1996 PLP 1468 (SCMR)
CENTRAL BOARD OF REVENUE and others‑‑‑Petitioners Versus Messrs CHAMPION CLOCK COMPANY‑‑‑Respondent
| Citation | 1996 PLP 1468 (SCMR) |
| Forum / Court | Supreme Court of Pakistan |
| Bench Members | Saiduzzaman Siddiqui and Fazal Ilahi Khan, JJ |
| Parties | CENTRAL BOARD OF REVENUE and others‑‑‑Petitioners Versus Messrs CHAMPION CLOCK COMPANY‑‑‑Respondent |
Q1: What are the key laws and sections cited in 1996 PLP 1468 (SCMR)?
This judgment primarily cites: statutory provisions as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 1996 PLP 1468 (SCMR)?
The case was heard and decided by the Supreme Court of Pakistan bench comprising: Saiduzzaman Siddiqui and Fazal Ilahi Khan, JJ.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 1996 PLP 1468 (SCMR) (CENTRAL BOARD OF REVENUE and others‑‑‑Petitioners Versus Messrs CHAMPION CLOCK COMPANY‑‑‑Respondent). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Representation
- Imtiaz Khan, Advocate‑on‑Record for Petitioners. Rafiq Ahmed Bajwa, Senior Advocate Supreme Court for Respondent.
- Imtiaz Khan, Advocate-on-Record for Petitioners. Rafiq Ahmed Bajwa, Senior Advocate Supreme Court for Respondent.
Headnotes / Summary
(On appeal from the judgment of Lahore High Court, Lahore, dated 4th May, 1991 passed in Writ Petition No.28 of 1987). (a) Sales Tax Act (III of 1951)‑‑‑ ‑‑‑‑S. 3(4)(iv)‑‑‑Constitution of Pakistan (1973), . Art. 185(3)‑‑‑Exemption from sales tax‑‑‑Extent‑‑‑Leave to appeal was granted to consider whether exemption from sales tax made available to clocks would equally be available to manufacture of cases/bodies in which clocks are housed. (b) Sales Tax Act (III of 1951)‑‑‑ ‑‑‑‑S. 3(4)(iv)‑‑‑Exemption of wall clocks from payment of sales tax‑‑ Bodies/cases of wall clock manufactured by assessee‑‑‑Exemption from sales tax‑‑‑Extent‑‑‑Bodies of wall clock manufactured by assessee fall within definition of "partly manufactured goods", therefore, just for the reason that they were assimilated into the end product e.g. wall clocks, it would not get them out of levy of sales tax ‑‑‑Wfiere, however, partly manufactured goods lead to production of different manufactured goods, tax would be charged only on the end product for sales tax could not be charged at . two stages of same manufacturing process‑‑‑Where cases/bodies of wall clock manufactured by assessee were not incorporated, in the end product (wall clock) or were sold by them same would be subject to payment of sales tax‑‑‑High Court having recorded categorical finding that bodies/cases of wall clock manufactured by assessee were not sold by them separately but were used only in the end product (wall clock) manufactured by them, sales tax could only be charged on the end product (wall clocks)‑‑‑Wall clocks manufactured by assessee having been admittedly 'exempted from payment of sales tax, High Court had rightly found in the facts and circumstances of case that no sales tax could be recovered on the bodies/cases of wall clock separately so long as exemption was in the field‑‑ Judgment of High Court was affirmed in circumstances.
Judgment & Decree
SAIDUZZAMAN SIDDIQUI, J.
1 Leave was granted to the case to consider whether the exemption from sales tax availed to clocks would equally be available to manufacture of the cases/bodies in which the clocks are housed.
2. Respondent company in the above appeal manufactures wall clocks. In the process of manufacture of wall clock they also produce bodies/cases of wall clocks. Wall clocks manufactured in Pakistan were' exempted from payment of sales tax thereon, vide S.R.O. No.666(I)/81, dated 25-6-1981 as amended by S.R.O. No.563(I)/82, dated 14-6-1982. The respondent-company vide their letter, dated 1st September, 1986 sought clarification from C.B.R. whether the plastic bodies/cases of wall clock manufactured by them for being used in the manufacture of clocks are exempted from payment of sales tax. The Central Board of Revenue (C.B.R.) vide their letter, dated 17th December, 1986 clarified that clock bodies/cases were subject to levy tax under section 3(4)(iv) of the Act. 3., The bodies/cases of . wall clock manufactured by the respondent undoubtedly fall within the definition of "partly manufactured goods" and therefore, just for the reason that they are assimilated into the end product e.g., wall clocks, it would not get them out of the levy of sales tax. However, if the partly manufactured goods leads to the production of a different manufactured goods, the tax is to be charged only on the end product, as sales tax cannot be charged at two stages of the same manufacturing process. The learned counsel for appellant does not dispute that if the bodies/cases manufactured by the respondent are finally incorporated in the end product wall clock, then the amount of sales tax recovered on the bodies/cases has to be refunded as the end product is exempted from payment of sales tax.
4. We are, therefore, of the view that if the cases/bodies of the wall clock manufactured by the respondent are not incorporated in the end product (wall clock) or it, is sold by them it will be subject to payment of sales tax.
5. In the instant case, however, the High Court has recorded a categorical finding that the bodies/cases of the wall clock manufactured by the respondent are not sold by them separately and they are used only in the end product wall e clock manufactured by them. In view of this categorical finding, the sales tax can only be charged on the end product, namely the wall clocks. As it is not disputed before us that the wall clocks manufactured by the respondent is exempted from payment of sales tax, the High Court rightly held in the facts and circumstances of this case, that no sales tax can be recovered on the bodies/cases of wall clock separately so long as the two notifications referred to above hold the field. No case for interference is made out. The appeal is dismissed but we will make no order as to costs. A.A./E-171/S Appeal dismissed