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the SRO. 283 is that the benefit of zero rating or reduced rate shall be admissible only if the goods are usable and are used in these specified sectors for trading and manufacturing purposes. According to the para (c ) (i) of SRO.283(I)/2011 dated 1st April, 2011, "Benefit of zero rating or reduced rate shall be admissible only if the goods covered in this notification are usable and are used in the aforesaid sectors for trading and manufacturing purposes. No other sector or industry shall be entitled to the benefit of this notification," it added. The examination of summary of domestic sales invoices monthly Sales Tax return of a manufacturer of polypropylene fibres and yarns revealed that the registered person made supplies of Rs 1.122 billion during the period from April 2011 to December 2013 @ 0 percent of 2 percent to three companies and unregistered persons. The supplies were made to companies who were not engaged in the textile sector (one of the five zero rated sectors). On the contrary, these companies were engaged in manufacturing of building materials, flexible bulk container, bags & packing materials respectively. The company misused the SRO.283(I)/2011 dated 1st April, 2011 and charged sales tax @0 percent or 2 percent instead of standard rate of 16 percent or 17 percent. Evidences were collected from FBR database as well as Google. LTU Karachi has issued statutory notices to the companies and after providing opportunity of being heard, an amount of Rs 139.429 million was imposed along with penalty of 100% in view of tax fraud in terms of section 2(37) of Sales Tax Act. This is for information of the Board and if found appropriate may be shared with other field formations for looking into the possibility of taking action against any such misuse by other registered persons, Rehmatullah Khan Wazir added.