2011 PLP (Trib (PTD)

Vide this appeal, the department has assailed the order of the learned Collector of Sales Tax(Appeals), Multan Order-in-Appeal No.74 of 2007 dated 31-3-2007.

2. Both the learned representatives appearing at the bar have been heard and record perused.

3. Facts in short are that the assessee-respondent is a registered person, having Sales Tax Registration No.04-90-6405-006-46, claimed adjustment of input tax amounting to Rs. 15,35,822 which pertains to the period 2004-2005. This claim was made on the strength of input invoices issued by the blacklisted supplier namely, Messrs Eurasia Import and Export, Karachi for the period August, September and October, 2004. On 6-11-2006, the Deputy Collector (Adjudication) issued a Show-Cause Notice bearing C.No.72/06/Adj/ST/DC/3065 to the registered person and raised various objections therein. Thereafter, on the basis of those objections/irregularities, the Deputy Collector Customs, Sales Tax (Adjudication), vide his Order-in-Original No.660 of 2006 dated 26-12-2006 initiated the court proceedings against the registered person and rejected the claim of refund amounting to Rs.15,35,822 besides penalty @ 3% equal to the principal amount was imposed in terms of section 33(2)(cc) of the Sales Tax Act, 1990. This treatment forced the appellant/registered person to file appeal before the learned Collector (Appeals), Multan, who by virtue of the order dated 31-3-2007, passed the Order-in-Appeal No.74 of 2007 and set aside the impugned order to decide the matter after scrutiny of the available record as well as the case-laws relied upon by the appellant/registered person. While doing so, it was observed by him as under: (11) Keeping in view the above mentioned facts, circumstances of the case, decisions of the superior Court, I am inclined to conclude that mere ground of blacklisting/non-supply of record or non traceability of the suppliers cannot be made the ground to declare the invoices issued by them as fake or forged unless the Adjudicating Authority had a concrete evidence regarding the status of the sales tax invoices issued and accepted. (12) I, therefore set aside the impugned order-in-original and accepted the appeal. This dispensation has compelled the department to come up in appeal before the learned Appellate Tribunal, Inland Revenue.

4. The learned D.R. appearing on behalf of the Revenue contended that the Collector (Appeals) has totally ignored the facts of the case and decided the case in favour of the assessee/registered person on the basis that at the time of sanctioning the refund, invoices of the blacklisted units were validated by the "STARR" system and refund was sanctioned after thorough verification and adhering to the provisions of section 73 of the Sales Tax Act, 1990. Further agitated that the refund is required to be processed within thirty days of the receipt of claim on the basis of the "STARR" verification only and thorough scrutiny is done at post refund audit stage as required under refund rules. Also contested that as soon as suspected activity came in the knowledge of the concerned Collectorate during the audit proceedings, the registration of the supplier was suspended which were ultimately declared to be blacklisted. On the other hand, the learned counsel for the respondent neglected the objections raised by the learned D.R. and supported the order of the Collector Sales Tax (Appeals) with the findings recorded therein.

5. We have given anxious thought to the averments advanced by the rival parties and perused the available record as well as the case-law submitted by the learned counsel for the respondent. After giving due consideration to the facts of the case .in its entirety, we are of the considered view that the contentions raised by learned D.R. have no substance therein. Before us the learned D.R. could not produce any further tangible or material evidence to rebut the findings of the learned Collector (Appeals), Multan. We have also noted that the Assistant Collector has initiated the proceedings against the assessee-respondent on the basis of whims, surmises and conjunctures and impugned the appellate order in further appeal before the learned Tribunal only to drag the assessee respondent into another chain of litigation. Conversely, the learned Collector (Appeals), Multan has rightly decided the case in favour of the appellant after thorough examination of the facts of the case and also respectfully following the case-law submitted before him during the Court proceedings. Since, the impugned order does not suffer from any factual or legal infirmity, therefore, we are constrained to uphold the order of the learned Collector (Appeals), Multan and this would result into dismissal of the departmental appeal.

6. As a result, the departmental appeal is dismissed being devoid of any merit. H.B.T./194/Tax(Trib.) Appeal dismissed.