2002 PLP 2591 (PTD)

4. The complainant submitted that he never made any application in such form and manner as the. Board might have by notification in the Official Gazette, specified in accordance with section 18 of the Sales Tax Act, 1990 (Act).

5. He has further submitted that the certificate of Registration issued under the signature of Assistant Collector (Sales Tax), Registration and Information Division, Rawalpindi mentioned that he had been registered vide Registration No. 07‑01‑9999‑227‑55 on 26‑4‑2001 as wholesaler and retailer. It was mentioned in the certificate that it meant that he must: (i) Charges sales tax on all taxable supplies made during the course of taxable activity. (ii) File a return in the designated bank relating to a month on or before the 15th of the following month. (iii) File a Nil‑Return even if no taxable activity takes place during the current tax period. (iv) Abide by provisions of Sales Tax Act, 1990 and rules made thereunder.

6. The complainant contended that it amounted to compulsory registration under section 19 of the Act. According to him, it had no valid basis. He submitted that he was basically a retailer; that he was required to be registered under clause (ii) of subsection (1) of section 14 of the Act ‑if his value of supplies in any period during the last twelve months ending any tax period exceeds five million rupees and that the period of 12 months for registering his unit was to be counted backward from 26th.April, 2001 i.e. the date on which he was compulsorily registered. The complainant submitted that counting in such manner, the value of his supplies amounted to Rs.4,345,193 only. He submitted that the correct value of his supplies could be established by verification from record of income‑tax proceedings as required under the Rules. The complainant therefore, contended that the Registration order was arbitrary and oppressive falling under the definition of maladministration. Recommendation, therefore, was sought for Collector to invoke the proviso to section 19 to cancel such registration.

7. However, the contention of the complainant that under clause (ii) of subsection (1) of section 14, the value of his supplies is to be calculated by adding up the value of supplies for the last 12 months counted backward from the date of his compulsory registration is not correct.

8. The expression "value of supplies in any period during the last twelve months ending any tax period" connotes that the Collector in order to register a retailer under section 19 shall have to satisfy himself that value of retailer's supplies exceeds five million rupees in any of the 12 tax periods ending during the months in which compulsory registration of the retailer is intended and its preceding eleven months. In other words, he has to work back the value of supplies for periods of 12 months from each tax period ending during the last 12 months.

9. However; before adopting the foregoing view, an opportunity of being heard has been provided to the complainant as well as the respondent. Complainant's counsel concedes to the following view.

10. Since it is established that the liability of the complainant to be registered under section 19 of the Sales Tax Act, 1990 has not been determined as required under clause (ii) of subsection (1) of section 14 of the Act, it is recommended that the Collector or such other officer as may be authorized by him in this behalf, after such enquiry as required in accordance with observations in para.8 supra, may satisfy himself if the complainant was required to be registered. In case, he is satisfied that the complainant was not required to be registered, he may cancel the registration of the complainant by invoking his jurisdiction under proviso to section 19 of the Sales Tax Act, 1990.

11. Compliance may be reported within 30 days of the date of this order. C.M.A./M.A.K./402/FTO Order accordingly.