OFFICE OF THE ASSISSTANT COMMISSIONER AUDIT UNIT-04, ZONE-II,

REGIONAL TAX OFFICE, LAHORE

PH# 042-9999111
C. No.699 Dated: 24-12-2024
M/S Ahad Corporation,
21-Wahdat Road,
Lahore.
Appeals under Section 45-B of the Sales Tax Act, 1990 against this order can be filed
within thirty days of receipt of this Assessment Order before the Commissioner Inland Revenue
(Appeals), Lahore and may be delivered at the said address by hand or through registered post to
reach the learned appellate authority within the stipulated time.
An appeal against this order should be accompanied by the prescribed appeal fee and
must be accompanied, inter alia, by:
a) an attested copy of this Assessment Order bearing court fee stamp as prescribed under
Schedule-1 item 6 of the Court Fee Act, 1870 and
b) an extra copy of the written appeal should simultaneously be sent to this office for
information and record.
ASSESSMENT ORDER U/S 11E OF THE SALES TAX ACT, 1990
Sales tax audit of M/S Ahad Corporation, 21-Wahdat Road, Lahore having sales tax
registration No.09876543210 (hereinafter referred to as “the registered person”) for the tax
periods from July 2016 to June 2017 was selected under section 25 of the Sales Tax Act, 1990
(hereinafter referred to as “the Act”) by the Commissioner Inland Revenue, Zone-II, RTO,
Lahore. Accordingly, the registered person was requested vide letter C. No. 198/01 dated
03.10.2024 to provide record of sales tax to be maintained under section 22 of the Act to conduct
the sales tax audit for the tax periods from July 2016 to June 2017. On the basis of record
provided by the registered person, sales tax audit of the registered person had been conducted
under section 25 of the Act for the tax periods from July 2016 to June 2017 and it was found that
the registered person made taxable supply of Rs.2990/- in June 2017 on which sales tax
chargeable was Rs.508/- and after input tax adjustment under section 7 and 8B, the tax liability
of the registered person came out to be Rs.51/- which was not paid by the registered person.
Thus the non/short payment by the registered person of sales tax amounting to Rs.51/-
contravened the provisions of sections 3, 6, 7, 8B and 26 of the Act.
2. Hence, a show cause notice vide C. No. 695 dated 01.12.2024 was issued under section
11E of the Act to the registered person wherein he was required to pay sales tax amounting to
Rs.51/- in terms of section 3 read with 8B of the Act along with penalty amounting to
Rs.10,000/- under serial number 5 of the Table of the Section 33 of the Act for non/short
payment of due sales tax and default surcharge (to be calculated at the time of deposit) under
section 34(1)(a) of the Act.
3. Hearing in the instant case was fixed on 15.12.2024 at 11.00 a.m. in the office of the
undersigned, situated at 5th Floor, Tax House, Regional Tax Office, Syed Mouj Darya Road,
Lahore. It was also stated in the said show cause notice that in case nothing was heard from
registered person or nobody appeared on the scheduled hearing, the case would be decided on
merit as per facts available on record.
4. On the date of hearing i.e. 15.12.2024, Mr. XYZ, Advocate appeared on behalf of the
registered person and submitted written reply vide letter No. 623 dated 15.12.2024 wherein it
was stated that the registered person adjusted hundred percent of the output tax liability against
the carry forward input tax of the whole year since it is adjustable/refundable on yearly basis,
therefore the registered person did not deposit the sales tax payable on the supplies for the tax
period June 2017. The above said representative of the registered person reiterated the same
arguments in the personal hearing.
5. I have gone through the record of the case, written and verbal submissions of the
registered person and have come to the conclusion that the arguments advanced by the registered
person in support of non/short payment of sales tax are not valid as per provisions of the law. As
per the provisions of section 8B(1) of the Act, a registered person shall not be allowed to adjust
input tax in excess of ninety per cent of the output tax for that tax period and the adjustment or
refund shall be made on yearly basis in the second month following the end of the financial year
of the registered person. Hence, it was the responsibility of the registered person to only adjust
ninety percent of output tax which amounts to Rs.457/- adjustable against Rs.508/- for the tax
period June 2017 and make payment of sales tax amounting to Rs.51/- but the registered person
has not deposited the mentioned sales tax amount against the supplies. Therefore, the charges
levelled in the show cause notice stand established.
6. I, therefore, assess under section 11E of the Sales Tax Act, 1990 that sales tax amounting
to Rs.51/- (Rupees fifty one) is payable by the registered person along with the default surcharge
of Rs.45.58/- (calculated till 24-12-2024) under section 34 (1) (a) of the Act. Moreover, penalty
amounting to Rs.10,000/- under serial number 5 of the Table of the Section 33 ibid for non/short
payment of due sales tax is also imposed on the registered person.
7. This order consists of (02) pages and each page bears my seal and signatures.

(Zubda Hameed)
Assistant Commissioner IR
C. No. 856/01 Dated: 24.12.2024
Copy forwarded to:
The Commissioner, Inland Revenue, Zone II, Regional Tax Office, Lahore.
Office copy.