2007 PLP (Trib (PTD)

SYED KAZIM RAZA SHAMSI (MEMBER JUDICIAL).

This appeal is directed against an order-in-original dated 2-10-2001 passed by Deputy Collector (Adjudication) Faisalabad whereby the claim of refund of Rs.72,500 was rejected and penalty of Rs.25,000 under section 33 was also imposed.

2. According, to the show-cause notice the claim of refund of Rs.72,500 was made by the appellant for the period of September, 1996 on the basis of invoices issued by Nusrat Textile Mills Limited Lahore which mill was declared as a take unit and invoices issued by it were also not adhered to. In reply to the show-cause notice it was denied that the invoices issued by Nusrat Textile Mills were fake and it was asserted that the fact of genuineness of Nusrat Textile Mills was confirmed from Aptma. The Deputy Collector vide impugned order while rejecting appellant's plea had placed reliance upon the letter of Central Board of Revenue dated 2-8-2000 and letter dated 30-1-2001 wherein the invoices issued by Nusrat Textile were directed not to be accepted. The appellant being aggrieved by the said order has assailed the same in the present appeal.

3. Arguments heard, record perused. The Deputy Collector while determining the inadmissibility of invoices has travelled beyond the scope of the show-cause notice issued to the appellants. In the show-cause notice the period for refund mentioned is for the months of September to November, 1996 but the Deputy Collector has relied upon an invoice dated 20-7-2001 for rejection of claim which was not the subject-matter of the show-cause notice. Furthermore the letter relied upon by the Deputy Collector for rejection of the refund do not contain any detail as to for which period the invoices issued by Messrs Nusrat Textile Mills should be ignored. It is evident from the record that Messrs Nusrat Textile Mills was registered person therefore the invoices issued by it should be considered genuine unless the said registered person commits irregularities in obeying the law. The letter dated 2-8-2000 shows that some record was requisitioned by Department from Messrs Nusrat Textile Mills which direction was not complied with on which basis it was observed that the mill. was involved in issuing fake invoices. Obviously this observation does not cover the invoices issued in the year 1996. Had the said mill was indulged in issuing fake invoices in 1996 then the matter should have been taken up in that relevant period as the invoices had to be .manifested in the monthly return to be submitted by the registered person. In these circumstances the order passed by Deputy Collector (Adjudication) is not sustainable in the eye of law.

4. For the foregoing reasons appeal is accepted and the impugned order is set aside. The demand raised by the Department in the show-cause notice as well as in the impugned order is set aside. The Deputy Collector (Refund) is directed to issue refund voucher to appellant/applicant without fail. Parties be informed through registered A/D or by UMS.

5. File by consigned after completion. C. M. A./103/Tax(Trib.) Appeal accepted.