9 of 182022-01-15

Sales Tax Act, 1990, as published 15 January 2022

This is the Sales Tax Act, 1990 as it stood on 15 January 2022. It runs to 238 pages and contains 112 sections, with 18 amendment footnotes.

What this document is

Published by the Federal Board of Revenue as part of the Sales Tax Act, 1990 collection. A consolidation of this kind folds every amendment made up to its cover date into the text, so it shows the law as it stood on 15 January 2022 rather than as originally enacted.

The date above was taken from the file name rather than a consolidation statement on the cover, so treat it as approximate.

The shape of this version

The operative text holds roughly 58,320 words across 112 sections.

What changed since the previous version

Against the version published 15 September 2021, this one has 1 new section.

New in this version

section 34, Default Surcharge

Which laws did the amending

Counting the footnotes by the instrument they name, the Finance Act accounts for the largest share with 1 references.

The source file


File name	`20226301162852921SalesTaxAct,1990withIndexupdatedupto15.01.2022.pdf`
Pages	238
Size	1.86 MB
Text extraction	markitdown
Extraction confidence	high
Position in this collection	10 of 18

SHA-256 of the source PDF:

6150ea394fd92983feeb4e2272c92d8cdc060736fac70edc0c15ac0212b28c01

Checking that value against the file you download confirms it is the same document these figures came from.

A note on these figures

Counts here are produced by software reading the PDF, not compiled by hand. The same method is applied to every document, which makes comparisons between versions meaningful, but a section with unusual formatting can be missed. Treat them as close measurements and the official document as the authority.

This is information, not legal or tax advice. Qanoon Digest is independent and not affiliated with the Federal Board of Revenue or the Government of Pakistan.

The full text of this version

All 112 sections as they appear in this document, reproduced from the source PDF. Amendment footnotes follow at the end.

1. Short title, extent and commencement

(1) This Act may be called the Sales Tax 5[…] Act, 1990.

(2) It extends to the whole of Pakistan. 6[(3) It shall come into force on such date as the Federal Government may, by notification in the official Gazette, appoint.]

2. Definitions

In this Act, unless there is anything repugnant in the subject or context,– 8[(1) “active taxpayer” means a registered person who does not fall in any of the following categories, namely:- 1 For Statements of Objects and Reasons see Gazette of Pakistan, dated the 30th March 1951, Pt. V. pp 36 and 37. 2 Substituted for the words “or consumption of goods” by the Finance Act, 1960. 3 Substituted for the words “or consumption of goods” by the Finance Act, 1960. 4 Chapter I to X substituted for Chapters I to XVI by the Finance Act, 1990. 5 Brackets and word “(Amendment)” omitted by the Finance Act, 1991. 6 Came into force by Notification No. S.R.O. 1100(I)/90, dated 28-10-1990 w.e.f. 1st November, 1990. 7 Section 2 Substituted by the Finance Act, 1996. 8 Clauses (1) and (1A) substituted for clause (1) by Finance Act, 2015.

(a) who is blacklisted or whose registration is suspended 9[***] in terms of section 21;

(b) fails to file the return under section 26 by the due date for two consecutive tax periods;

(c) who fails to file an Income Tax return under section 114 or statement under section 115, of the Income Tax Ordinance, 2001(XLIX of 2001), by the due date; and-

(d) who fails to file 10[quarterly] or an annual withholding tax statement under section 165 of the Income Tax Ordinance, 2001;

(1A) “Appellate Tribunal” means the Appellate Tribunal Inland Revenue established under section 130 of the Income Tax Ordinance, 2001 (XLIX of 2001);]

(2) “appropriate officer” means an 11[officer of Inland Revenue] authorised by the Board by notification in the official Gazette to perform certain functions under this Act; 12[(2A) “arrears”, in relation to a person, means, on any day, the sales tax due and payable by the person under this Act before that day but which has not yet been paid; ] 13[(3) “associates (associated persons)” means, -

(i) subject to sub-clause (ii), where two persons associate and the relationship between the two is such that one may reasonably be expected to act in accordance with the intentions of the other, or both persons may reasonably be expected to act in accordance with the intentions of a third person; 9 The words “or is blocked” omitted by Finance Act, 2020. 10 The word substituted by Finance Act, 2020. 11 Substituted for “Collector of Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 12 Clause (2A) substituted by Finance Act, 2008. Earlier it was inserted by Tax Laws (Amendments) Ordinance, 1999. Originally it was inserted by Finance Act, 1991. 13 Clause (3) substituted by Finance Act, 2008.

(ii) two persons shall not be associates solely by reason of the fact that one person is an employee of the other or both persons are employees of a third person;

(iii) without limiting the generality of sub-clause (i) and subject to sub-clause (iv), the following shall be treated as associates, namely: -

(a) an individual and a relative of the individual;

(b) members of an association of persons;

(c) a member of an association of persons and the association, where the member, either alone or together with an associate or associates under another application of this section, controls fifty per cent or more of the rights to income or capital of the association;

(d) a trust and any person who benefits or may benefit under the trust;

(e) a shareholder in a company and the company, where the shareholder, either alone or together with an associate or associates under another application of this section, controls either directly or through one or more interposed persons-

(i) fifty per cent or more of the voting power in the company;

(ii) fifty per cent or more of the rights to dividends; or

(iii) fifty per cent or more of the rights to capital; and

(f) two companies, where a person, either alone or together with an associate or associates under another application of this section, controls either directly or through one or more interposed persons -

(i) fifty per cent or more of the voting power in both companies;

(ii) fifty per cent or more of the rights to dividends in companies; or

(iii) fifty per cent or more of the rights to capital in both companies.

(iv) two persons shall not be associates under sub-clause

(a) or (b) of paragraph (iii) where the 14[Commissioner] is satisfied that neither person may reasonably be expected to act in accordance with the intentions of the other.

(v) In this clause, “relative” in relation to an individual, means-

(a) an ancestor, a descendant of any of the grandparents, or an adopted child, of the individual, or of a spouse of the individual; or

(b) a spouse of the individual or of any person specified in sub-clause (a).] 15[(3A) “association of persons” includes a firm, a Hindu undivided family, any artificial juridical person and anybody of persons formed under a foreign law, but does not include a company;] 16[(3AA) “banking company” means a banking company as defined in the Banking Companies Ordinance, 1962 (LVII of 1962) and includes anybody corporate which transacts the business of banking in Pakistan;] 17[(4) “Board” means the Federal Board of Revenue established under section 3 of the Federal Board of Revenue Act, 2007;] 14 Substituted for “Collector of Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 15 Clause (3A) inserted by Finance Act, 2008. 16 Clause (3A) re-numbered as (3AA). Earlier it was inserted by Finance Act, 2004. 17 Clause (4) substituted by Finance Act, 2008. Earlier it was substituted by Finance Act, 2007.

18[(4A) “Chief Commissioner” means a person appointed as the chief Commissioner Inland Revenue under section 30;] 19[(4AA) “Commissioner (Appeals)” means Commissioner of Inland Revenue (Appeals) appointed under section 30;] 20[(5) “Commissioner” means the Commissioner of Inland Revenue appointed under section 30;] 21[(5A) “common taxpayer identification number” means the registration number or any other number allocated to a registered person;] 22[(5AA) “company” means -

(a) a company as defined in the Companies Ordinance, 1984 (XL VII of 1984);

(b) a body corporate formed by or under any law in force in Pakistan;

(d) a body incorporated by or under the law of a country outside Pakistan relating to incorporation of companies;

(e) a trust, a co-operative society or a finance society or any other society established or constituted by or under any law for the time being in force; or

(f) a foreign association, whether incorporated or not, which the Board has, by general or special order, declared to be a 18 Clause (4A) inserted by Finance Act, 2010 w.e.f. June 5, 2010The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this amendment was made 19 New clause 4AA inserted by Finance Act, 2021. 20 Clause (5) inserted by Finance Act, 2010 w.e.f. June 5, 2010The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this amendment was made Through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 21 Clause (5A) inserted by Finance Act, 2006. Earlier clause (5A) was omitted by Finance Act, 2004. Earlier it was inserted by Tax Laws (Amendments) Ordinance, 1999. 22 Clause (5AA) inserted by Finance Act, 2008.

company for the purposes of the Income Tax Ordinance 2001 (XLIX of 2001); 23[(5AAA)] “computerized system” means any comprehensive information technology system to be used by the Board or any other office as may be notified by the Board, for carrying out the purposes of this Act;] 24[(5AB) “cottage industry” means a manufacturing concern, which fulfils each of following conditions, namely:-

(a) does not have an industrial gas or electricity connection;

(b) is located in a residential area;

(d) annual turnover from all supplies does not exceed 25[eight] million rupees;] 26[(5AC) “CREST” means the computerized program for analyzing and cross matching of sales tax returns, also referred to as COMPUTERISED RISK-BASED EVALUATION of SALES TAX;]

(6) “Customs Act” means the Customs Act, 1969 (IV of 1969), and where appropriate all rules and notifications made under that Act; 27[(6A) “defaulter” means a person and, in the case of company or firm, every director, or partner of the company, or as the case may be, of the firm, of which he is a director or partner or a proprietor and includes guarantors or successors, who fail to pay the arrears;] 28[(6B) “default surcharge” means the default surcharge levied under section 34;] 23 Clause (5AA) re-numbered as (5AAA) by Finance Act, 2008. Earlier it was inserted by Finance Act, 2006. 24 Clause (5AB) substituted by Finance Act, 2019. Word “eight” substituted by Finance (Supplementary) Act, 2022. 26 CREST 5AC inserted by Finance Act, 2013. 27 Clause (6A) inserted by Tax Laws (Amendments) Ordinance, 1999. 28 Clause (6B) substituted by Finance Act, 2008. Earlier it was inserted by Finance Act, 2005.

(7) “distributor” means a person appointed by a manufacturer, importer or any other person for a specified area to purchase goods from him for further supply and includes a person who in addition to being a distributor is also engaged in supply of goods as a wholesaler or a retailer;

(8) “document” includes any electronic data, computer programmes, computer tapes, computer disks, micro-films or any other medium for the storage of such data;

(9) “due date” in relation to the furnishing of a return 29[under section 26], 30[ 31[…] 32[….] means the 33[15th] day of the month following the end of the tax period, or such other date as the 34[Board] may, by notification in the official Gazette, specify 35[and different dates may be specified for furnishing of different parts or annexures of the return]; 36[(9A)] “e-intermediary” means a person appointed as e-intermediary under section 52A for filing of electronic returns and such other documents as may be prescribed by the Board from time to time, on behalf of a person registered under section 14;] 37[(9AA) ***]

(10) “establishment” means an undertaking, firm or company, whether incorporated or not, an association of persons or an individual;

(11) “exempt supply” means a supply which is exempt from tax under section 13; 38[(11A) “FBR Refund Settlement Company 39[10a] Limited” means the company with this name as incorporated under the 40[Companies Act, 2017 (XIX of 2017)], for the purpose of settlement of sales tax and income tax 29 The words and figure inserted by Finance Act, 1998. 30 The words and figure inserted by Tax Laws Amendment Ordinance, 2000, dated 24th May, 2000. 31 Comma and words etc. “, sub-section (6) of section 26A” omitted by Finance Act, 2004. 32 The expression “and section 26AA omitted by Finance, Act, 2016. 33 Substituted for “20th” by Finance Act, 1998 34 Substituted for “Federal Government” by Finance Act, 2008 35 Expression inserted through Finance Act, 2016. 36 Clause (9A) inserted by Finance Act, 2006. Earlier clause (9A) was omitted by Finance Act, 2004. Originally it was inserted by Tax Laws (Amendments) Ordinance, 2001. 37 Clause (9AA) omitted by Finance Act, 2004. Earlier it was inserted by Sales Tax (Amendment) Ordinance, 2001, dated February 7, 2001. 38 Existing clause re-numbered as clause (11B) and new clause (11A) inserted by Finance Supplementary (Second Amendment) Act, 2019 39 The word (Pvt) omitted by Finance Act, 2019. 40 Words substituted vide Finance Act, 2019

refund claims including payment by way of issuing refund bonds under section 67A’;] 41[10(11B) “firm” means the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all;]

(12) “goods” include every kind of movable property other than actionable claims, money, stocks, shares and securities; 42[“(12A) “green industry” in relation to the entry at serial number 150 of the Table-1 of the Sixth Schedule, means-

(a) a new industrial undertaking which is-

(i) setup on land which not previously been utilised for any commercial, industrial or manufacturing activity and is free from constraints imposed by any prior work;

(ii) built without demolishing revamping, renovating, upgrading, remodeling or modifying any existing structure, facility or plant;

(iii) not formed by the splitting up or reconstitution of an undertaking already in existence or by transfer of machinery, plant or building from an undertaking established in Pakistan prior to commencement of the new business and is not part of an expansion project;

(iv) using any process or technology that has not earlier been used in Pakistan and is so approved by the Engineering Development Board; and

(b) is approved by the Commissioner on an application made in the prescribed form and manner, accompanied by the prescribed 41 Clause (11A) inserted by Finance Act, 2008. 42 New clause 12A inserted through Tax Laws (Amendment) Act, 2020 dated 30-3-2020.

documents and, such other documents as may be required by the Commissioner: Provided that this definition shall be applicable from the 1st July, 2019 and onwards.”.]

(13) “importer” means any person who 43[ … ] imports any goods into Pakistan; 44[(14) “input tax”, in relation to a registered person, means -

(a) tax levied under this Act on supply of goods to the person;

(b) tax levied under this Act on the import of goods by the person;

(c) in relation to goods or services acquired by the person, tax levied under the Federal Excise Act, 2005 in sales tax mode as a duty of excise on the manufacture or production of the goods, or the rendering or providing of the services; 45[46 ]

(d) 47[…….] 48[Provincial Sales Tax levied on services rendered or provided to the person; and]

(e) levied under the Sales Tax Act, 1990 as adapted in the State of Azad Jammu and Kashmir, on the supply of goods received by the person;] 49[(14A) the expression “KIBOR” means Karachi Inter-Bank Offered Rate prevalent on the first day of each quarter of the financial year;] 50[(15) “Local Inland Revenue Office” means the office of Superintendent of Inland Revenue or such other office as the Board may, by notification in the official Gazette, specify;] 43 Word “lawfully” omitted by Finance Act, 2008 44 Clause (14) substituted by Finance Act, 2008. 45 Word “and” added at the end of clause through Finance, Act, 2016. 46 Word “and” omitted through Tax Laws (Amendment) Ordinance, 2016. 47 Expression omitted through Finance, Act, 2016. 48 Expression re-inserted through Tax Laws (Amendment) Ordinance, 2016 having affect from 01st day of July, 2016.. 49 Clause (14A) inserted by Finance Act, 2009. 50 Clause (15) substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this

(16) “manufacture” or “produce” includes -

(a) any process in which an article singly or in combination with other articles, materials, components, is either converted into another distinct article or product or is so changed, transformed or reshaped that it becomes capable of being put to use differently or distinctly and includes any process incidental or ancillary to the completion of a manufactured product;

(b) process of printing, publishing, lithography and engraving; and

(c) process and operations of assembling, mixing, cutting, diluting, bottling, packaging, repacking or preparation of goods in any other manner;

(17) “manufacturer” or “producer” means a person who engages, whether exclusively or not, in the production or manufacture of goods whether or not the raw material of which the goods are produced or manufactured are owned by him; and shall include -

(a) a person who by any process or operation assembles, mixes, cuts, dilutes, bottles, packages, repackages or prepares goods by any other manner;

(b) an assignee or trustee in bankruptcy, liquidator, executor, or curator or any manufacturer or producer and any person who disposes of his assets in any fiduciary capacity; and

(c) any person, firm or company which owns, holds, claims or uses any patent, proprietary, or other right to goods being manufactured, whether in his or its name, or on his or its behalf, as the case may be, whether or not such person, firm or company sells, distributes, consigns or otherwise disposes of the goods 51[:] amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 51 Substituted for the semi-colon by Finance Ordinance, 2000

52[Provided that for the purpose of refund under this Act, only such shall be treated as manufacturer-cum-exporter who owns or has his own manufacturing facility to manufacture or produce the goods exported or to be exported;] 53[(18) “Officer of Inland Revenue” means an officer appointed under section 30;] 54[(18A) “online market place” includes an electronic interface such as a market place, e-commerce platform, portal or similar means which facilitate sale of goods, including third party sale, in any of the following manner, namely:-

(a) by controlling the terms and conditions of the sale;

(b) authorizing the charge to the customers in respect of the payment for the supply; or

(19) “open market price” means the consideration in money which that supply or a similar supply would generally fetch in an open market; 55[(20) “output tax”, in relation to a registered person, means -

(a) tax levied under this Act on a supply of goods, made by the person;

(b) tax levied under the Federal Excise Act, 2005 in sales tax mode as a duty of excise on the manufacture or production of the goods, or the rendering or providing of the services, by the person; 56[(c) sales tax levied on the services rendered or provided by the person under Islamabad Capital Territory (Tax on Services) Ordinance, 2001 (XLII of 2001);] 52 Proviso inserted by Finance Ordinance, 2000. 53 Clause (18) substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 54 New clause 18A inserted by Finance Act, 2021. 55 Clause (20) substituted by Finance Act, 2008. Earlier it was inserted by Finance Act, 2007. 56 Clause (c) substituted by Finance Act, 2020.

57[(21) “person” means,-

(a) an individual;

(b) a company or association of persons incorporated, formed, organized or established in Pakistan or elsewhere;

(d) a Provincial Government;

(e) a local authority in Pakistan; or

(f) a foreign government, a political subdivision of a foreign government, or public international organization;]

(22) “prescribed” means prescribed by rules made under this Act; 58[(22A) “Provincial sales tax” means tax levied under, Provincial laws or laws relating to Islamabad Capital Territory, which are declared by the Federal Government, through notification in the official Gazette to be Provincial Sales Tax for the purpose of input tax;]

(23) “registered office” means the office or other place of business specified by the registered person in the application made by him for registration under this Act or through any subsequent application to the 59[Commissioner];

(24) “registration number” means the number allocated to the registered person for the purpose of this Act; 60[(25) “registered person” means a person who is registered or is liable to be registered under this Act: 57 Clause (21) substituted by Finance Act, 2008. 58 Clause (22A) inserted by Finance Act, 2008. 59 The word “Collector” was substituted for “Commissioner” by Finance (Amendment) ordinance, 2010 promulgated as Ordinance No. III of 2010 dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary part I at pages 229 to 259. 60 Clause (25) substituted by Finance Ordinance, 2002.

Provided that a person liable to be registered but not registered under this Act 61[…] shall not be entitled to any benefit available to a registered person under any of the provisions of this Act or the rules made thereunder;] 62[(26 ) ***]

(27) “retail price”, with reference to the Third Schedule, means the price fixed by the manufacturer 63[or importer, in case of imported goods] 64[…], inclusive of all 65[duties], charges and taxes (other than sales tax 66[…]) at which any particular brand or variety of any article should be sold to the general body of consumers or, if more than one such price is so fixed for the same brand or variety, the highest of such price 67[:]. 68[Provided that the Board may through a general order specify zones or areas for the purpose of determination of highest retail price for any brand or variety of goods.]

(28) “retailer” means a person 69[] supplying goods to general public for the purpose of consumption 70[:]. 71[Provided that any person, who combines the business of import and retail or manufacture or production with retail, shall notify and advertise wholesale prices and retail prices separately, and declare the address of retail outlets 72[].] 73[(28A) ***]

(29) “return” means any return required to be furnished under Chapter-V of this Act; 61 Words “shall remain liable to further tax under sub-section (1A) of section 3 and” omitted by Finance Act, 2004. 62 Clause (26) omitted by Finance Ordinance, 2002. 63 The expression inserted vide Finance Act, 2019. 64 Words “or the importer” omitted by Finance Act, 2005. Earlier these were inserted by Finance Act, 2003. 65 Words and comma inserted by Finance Act, 2007. 66 Words “and octroi” omitted by Finance Act, 1998. 67 The “semicolon” has been substituted by” colon” in Finance Act, 2014 68 Inserted by Finance Act 2014. 69 Words “not being a manufacturer or producer or an importer” omitted by Finance Act, 2003, after omission the commas become superfluous. Earlier commas and words were inserted by Finance Act, 1998. 70 Substituted for the semi-colon by Finance Act, 2003. 71 Proviso inserted by Finance Act, 2003. 72 The comma, words and figures “, and his total turnover per annum shall be taken into account for the purposes of registration under section 14” omitted by Finance Act, 2015. 73 Clause (28A) omitted by Finance Act, 2008. Earlier it was inserted by Finance Act, 1997.

74[(29A) “sales tax” means - -

(a) the tax, additional tax, or default surcharge levied under this Act;

(b) a fine, penalty or fee imposed or charged under this Act; and

(c) any other sum payable under the provisions of this Act or the rules made thereunder;] 75[(29AA) “sales tax account” means an account representing the double entry recording of sales tax transactions in the books of account;]

(30) “Schedule” means a Schedule appended to this Act;

(31) “similar supply”, in relation to the open market price of goods, means any other supply of goods which closely or substantially 76[resembles] the characteristics, quantity, components and materials of the aforementioned goods; 77[(31A) “special audit” means an audit conducted under section 32A;]

(32) “Special Judge” means the Special Judge appointed under Section 78[37C of the act until such appointment is made by the Special Judge appointed under section] 185 of the Customs Act; 79[(33) “supply” means a sale or other transfer of the right to dispose of goods as owner, including such sale or transfer under a hire purchase agreement, and also includes -

(a) putting to private, business or non-business use of goods produced or manufactured in the course of taxable activity for purposes other than those of making a taxable supply; 74 Clause (29A) inserted by Finance Act, 2008. 75 Clause (29A) renumbered as (29AA) by Finance Act, 2008. Earlier it was inserted by Finance Act, 2006. 76 Substituted for “resemble” by Finance Act, 2008. 77 Clause (31A) inserted by Finance Act, 1998. 78 Words etc. inserted by Finance Act, 2010 w.e.f. June 5, 2010. 79 Clause (33) substituted by Finance Act, 2008.

(b) auction or disposal of goods to satisfy a debt owed by a person; 80[***]

(c) possession of taxable goods held immediately before a person ceases to be a registered person 81[; and] 82[(d) in case of manufacture of goods belonging to another person, the transfer or delivery of such goods to the owner or to a person nominated by him:] Provided that the 83[Board, with the approval of the Federal Minister- in-charge,] may, by notification in the official Gazette, specify such other transactions which shall or shall not constitute supply;] 84[(33A) “supply chain” means the series of transactions between buyers and sellers from the stage of first purchase or import to the stage of final supply;] 85[(34)] tax”, unless the context requires otherwise, means sales tax;] 86[(35) “taxable activity”, means any economic activity carried on by a person whether or not for profit, and includes - -

(a) an activity carried on in the form of a business, trade or manufacture;

(b) an activity that involves the supply of goods, the rendering or providing of services, or both to another person;

(d) anything done or undertaken during the commencement or termination of the economic activity, 80 Word “and” omitted by Finance Act, 2015. 81 Semi-colon and word “and” substituted for colon by Finance Act, 2015. Semi-colon and word “and” substituted for colon by Finance Act, 2015. 82 Clause (d) added by Finance Act, 2015. 83 The words “Federal Government” substituted with the expression vide Finance Act, 2019. 84 Clause (33A) inserted by Finance Act, 2013. 85 Clause (34) substituted by Finance Act, 2008. 86 Clause (35) substituted by Finance Act, 2008.

but does not include -

(a) the activities of an employee providing services in that capacity to an employer;

(b) an activity carried on by an individual as a private recreational pursuit or hobby; and

(c) an activity carried on by a person other than an individual which, if carried on by an individual, would fall within sub- clause (b).]

(36) “tax fraction” means the amount worked out in accordance with the following formula: - a 100 + a (‘a’ is the rate of tax specified in section 3);

(37) “tax fraud” means knowingly, dishonestly or fraudulently and without any lawful excuse (burden of proof of which excuse shall be upon the accused) -

(i) doing of any act or causing to do any act; or

(ii) omitting to take any action or causing the omission to take any action, 87[including the making of taxable supplies without getting registration under this Act 88[[; or],] 89[(iii)] falsifying 90[or causing falsification 91[of] the sales tax invoices,] in contravention of duties or obligations imposed under this Act or rules or instructions issued thereunder with the intention of understating the tax 87 Words etc. inserted by Finance Act, 2004. 88 Substituted for comma by Finance Act, 2005 89 Sub-clause (iii) inserted by Finance Act, 2005. 90 Words inserted by Finance Act, 2007. 91 Word “of” inserted by Finance Act, 2021.

liability 92[or underpaying the tax liability for two consecutive tax periods] or overstating the entitlement to tax credit or tax refund to cause loss of tax; 93[(38) ***]

(39) “taxable goods” means all goods other than those which have been exempted under section 13;

(40) “tax invoice” means a document required to be issued under section 23;

(41) “taxable supply” means a supply of taxable goods made 94[…] 95[by an importer, manufacturer, wholesaler (including dealer), distributor or retailer] other than a supply of goods which is exempt under section 13 and includes a supply of goods chargeable to tax at the rate of zero per cent under section 4; 96[(42) ***]

(43) “tax period” means a period of one month or such other period as the 97[Board, with the approval of the Federal Minister-in-charge,] may 98[, ] by notification in the official Gazette, specify; 99[“(43A) 100[“Tier-1 retailer” means a retailer falling in any one or more of the following categories, namely:-]

(a) a retailer operating as a unit of a national or international chain of stores;

(b) a retailer operating in an air-conditioned shopping mall, plaza or centre, excluding kiosks;

(c) a retailer whose cumulative electricity bill during the immediately preceding twelve consecutive months exceeds Rupees 101[twelve] hundred thousand; 102[ ] 92 Words inserted by Finance Ordinance, 2000. 93 Clause (38) omitted by Finance Act, 2004. 94 The words “In Pakistan” omitted by Finance Act, 2003. 95 The words and commas inserted by Finance Act, 1998. 96 Clause (42) omitted by Finance Act, 1997. 97 97 The words “Federal Government” substituted with the expression vide Finance Act, 2019. 98 Substituted for semi-colon by Finance Act, 2008 99 Clause (43A) inserted through Finance Act, 2017 100 Expression substituted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020 substituted expression read as under: “Tier-1 retailers means” 101 Word “six” substituted by “twelve” though Tax Laws (Amendment) Act, 2020, dated 30-3-2020 102 The word “and” omitted vide Finance Act, 2019.

(d) a wholesaler-cum-retailer, engaged in bulk import and supply of consumer goods on wholesale basis to the retailers as well as on retail basis to the general body of the consumers”;] 103[ ] 104[(e) a retailer, whose shop measures one thousand square feet in area or more 105[or two thousand square feet in area or more in the case of retailer of furniture;] 106[] 107[(f) a retailer who has acquired point of sale for accepting payment through debit or credit cards from banking companies or any other digital payment service provider authorized by State Bank of Pakistan; 108[] 109[(g) a retailer whose deductible withholding tax under sections 236G or 236H of the Income Tax Ordinance, 2001(XLIX of 2001) during the immediately preceding twelve consecutive months has exceeded the threshold as may be specified by the Board through notification in the official Gazette; and 110[(h) any other person or class of persons as prescribed by the Board.] 111[(44) “time of supply”, in relation to,-

(a) a supply of goods, other than under hire purchase agreement, means the time at which the goods are delivered or made available to the recipient of the supply” 112[****];

(b) a supply of goods under a hire purchase agreement, means the time at which the agreement is entered into; and 103 The word “and” omitted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020. 104 Clause (e) inserted vide Finance Act, 2019. Words inserted by Finance Act, 2021. 106 Word “and” omitted by Finance Act, 2021. New clause (f) inserted by Finance Act, 2021. 108 Word “and” omitted by Finance (Supplementary) Act, 2022. 109 New clause (g) inserted by Finance (Supplementary) Act, 2022. Existing clause (f) re-numbered as clause (h) by Finance Act, 2021. 111 Clause (44) (44 A) and (44 AA) substituted for clause (44) by Finance Act, 2008. Words omitted by Finance Act, 2021.

(c) services, means the time at which the services are rendered or provided; 113[Provided that in respect of sub clause ( a) ,(b) or (c), where any part payment is received, -

(i) for the supply in a tax period, it shall be accounted for in the return for that tax period; and

(ii) in respect of exempt supply, it shall be accounted for in the return for the tax period during which the exemption is withdrawn from such supply ;]

(44A) “trust” means an obligation annexed to the ownership of property and arising out of the confidence reposed in and accepted by the owner, or declared and accepted by the owner for the benefit of another, or of another and the owner, and includes a unit trust; (44AA) “unit trust” means any trust under which beneficial interests are divided into units such that the entitlements of the beneficiaries to income or capital are determined by the number of units held;] 114[(45) ***]

(46) “value of supply” means:–

(a) in respect of a taxable supply, the consideration in money including all Federal and Provincial duties 115[and taxes, if any, which the supplier receives from the recipient for that supply but excluding the amount of tax: Provided that -

(i) in case the consideration for a supply is in kind or is partly in kind and partly in money, the value of the supply shall mean the open market price of the supply excluding the amount of tax; 116[ … ] 113 Proviso added by Finance Act, 2013. 114 Clause (45) omitted by Finance Act, 2004. 115 Words inserted by Finance Act, 1999. 116 Words “and” omitted by Finance Ordinance, 2001.

(ii) in case the supplier and recipient are associated persons and the supply is made for no consideration or for a consideration which is lower than the open market price, the value of supply shall mean the open market price of the supply excluding the amount of tax; 117[and] 118[(iii) in case a taxable supply is made to a consumer from general public on installment basis on a price inclusive of mark up or surcharge rendering it higher than open market price, the value of supply shall mean the open market price of the supply excluding the amount of tax.]

(b) in case of trade discounts, the discounted price excluding the amount of tax; provided the tax invoice shows the discounted price and the related tax and the discount allowed is in conformity with the normal business practices;

(c) in case where for any special nature of transaction it is difficult to ascertain the value of a supply, the open market price;

(d) in case of imported goods 119[excluding those as specified in the Third Schedule], the value determined under section 25 120[…] of the Customs Act, including the amount of customs- duties and central excise duty levied thereon; 121[…]

(e) in case where there is sufficient reason to believe that the value of a supply has not been correctly declared in the invoice, the value determined by the Valuation Committee comprising representatives of trade and the 122[Inland Revenue] constituted by the 123[Commissioner] 124[;] 125[ ] 117 Word inserted by Finance Ordinance, 2001. 118 Sub-clause (iii) inserted by Finance Ordinance, 2001. 119 The expression inserted vide Finance Act, 2019. 120 Words etc. “or 25B” omitted by Finance Act, 2004. 121 The word “and” omitted by Finance Supplementary (Amendment) Act, 1997. Earlier the same amendment was made by Sales Tax (Second Amendment) Ordinance, 1996, dated 2nd November, 1996; and again was made by the Sales Tax (Amendment) Ordinance, 1979. 122 Substituted for “Sales Tax Department” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) ordinance 2010 promulgated as Ordinance No. III of 2010 dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary part I at pages 229 to 259. 123 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) ordinance 2010 promulgated as Ordinance No. III of 2010 dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary part I at pages 229 to 259. 124 Word etc. “; and” substituted for “colon” by Finance Supplementary (Amendment) Act, 1997. Earlier it was substituted by Sales Tax (Second Amendment) Ordinance, 1996, dated 2nd November, 1996; and again was made by the Sales Tax (Amendment) Ordinance, 1979. 125 The word “and” omitted vide Finance Act, 2019.

126[(f) in case of manufacture of goods belonging to another person, the actual consideration received by the manufacturer for the value addition carried out in relation to such goods;] 127[(g)] in case of a taxable supply, with reference to retail tax, the price of taxable goods excluding the amount of retail tax, which a supplier will charge at the time of making taxable supply by him, or such other price as the Board may, by a notification in the official Gazette, specify.] 128[(h) in case of supply of electricity by an independent power producer 129[or WAPDA], the amount received on account of energy purchase price only; and the amount received on account of capacity purchase price, energy purchase price premium, excess bonus, supplemental charges etc. shall not be included in the value of supply; 130[***]

(i) in case of supply of electric power and gas by a distribution company, the total amount billed including price of electricity and natural gas, as the case may be, charges, rents, commissions and all duties and taxes local, provincial and federal but excluding the amount of late payment surcharge and the amount of sales tax; 1[and] 1[(j) in case of registered person who is engaged in purchasing used vehicles from general public on which sales tax had already been paid at the time of import or manufacturing, and which are, later on, sold in the open market after making certain value addition, value of supply will be the difference between sale and purchase price of the said vehicle on the basis of the valuation method prescribed by the Board.] 126 Sub clause (f) substituted by Finance Act, 2019. Earlier it was substituted by Sales Tax (Second Amendment) Ordinance, 1996, dated 2nd November, 1996; and again was made by the Sales Tax (Amendment) Ordinance, 1997. 127 Sub-Clause (g) inserted by Finance Act, 1997. 128 Clauses (h) and (i) added by Finance Act, 2019. 129 The words inserted by Finance Act, 2020, shall be deemed to have been inserted with effect from 1st July, 2019. The word “and” omitted by Finance Act, 2020, the word “and” and “new clause j” inserted by Finance Act, 2020.

131[Provided] that, where the Board deems it necessary it may, by notification in the official Gazette, fix the value of any imported goods or taxable supplies or class of supplies and for that purpose fix different values for different classes or description of same type of imported goods or supplies: Provided further that where the value at which import or supply is made is higher than the value fixed by the Board, the value of goods shall, unless otherwise directed by the Board, be the value at which the import or supply is made;] 132[(46A) “whistleblower” means whistleblower as defined in section 72D of the Sales Tax Act, 1990;]

(47) “wholesaler” 133[includes a dealer and] means any person who carries on, whether regularly or otherwise, the business of buying and selling goods by wholesale or of supplying or distributing goods, directly or indirectly, by wholesale for cash or deferred payment or for commission or other valuable consideration or stores such goods belonging to others as an agent for the purpose of sale; and includes 134[a person supplying taxable goods to 135[a person 136[who deducts income tax at source under the Income Tax Ordinance, 2001 (XLIX of 2001)]] 137[…]; and

(48) “zero-rated supply” means a taxable supply which is charged to tax at the rate of zero per cent under section 4.] Chapter-II SCOPE AND PAYMENT OF TAX 131 Provisos substituted by Finance Act, 2006. 132 Clause (46A) added by Finance Act, 2015. 133 Words inserted by Finance Act, 1997. 134 The words, brackets and figures inserted by Finance Act, 1998. 135 Substituted for “person deducting advance tax under sub-section (4) of section 50 of the Income Tax, 1979 (XXXI of 1979)” by Finance Act, 2004. 136 Substituted for “whose income is not liable to tax under the Income Tax Ordinance, 2001 (XLIX of 2001) but has deducted income tax at source under section 153 of the said Ordinance” by Finance Act, 2006. 137 Comma and words “, and a person who in addition to making retail supplies is engaged in wholesale business” omitted by Finance Act, 2008.

3. Scope of tax

(1) Subject to the provisions of this Act, there shall be charged, levied and paid a tax known as sales tax at the rate of 138[seventeen] per cent of the value of-

(a) taxable supplies made 139[…] by a registered person in the course or furtherance of any 140[taxable activity] carried on by him; and

(b) goods imported into Pakistan, 141[irrespective of their final destination in territories of Pakistan]. 142[(1A) Subject to the provision of sub section (6) of section 8 or any notification issued thereunder, where taxable supplies are made to a person who has not obtained registration number, there shall be charged, levied and paid a further tax at the rate of 143[three] percent of the value In addition to the rate specified in sub sections (1), (1B), (2), (5), 144[(6) and section 4] provided that the Federal Govt. may, by notification in the official Gazette, specify the taxable supplies in respect of which the further tax shall not be charged, levied and paid.] 145[(1B) On the goods specified in the Tenth Schedule, in lieu of levying and collecting tax under sub-section (1), the tax shall be levied and collected, in the mode and manner specified therein-

(a) on the production capacity of plants, machinery, undertaking, establishments or installation producing 146[or] manufacturing such goods; or

(b) on fixed basis, from any person who is in a position to collect such tax due to the nature of the business, and different rates may be so prescribed for different regions or areas.] 138 Substituted for seventeen vide Finance Act, 2013 139 Words “ in Pakistan” omitted by Finance Act, 2003 140 Words substituted by Finance Act, 1996. 141 Words inserted through Finance Act, 2017 142 Sub section (1A) inserted by Finance Act, 2013. 143 For the word “two” the word “three” inserted by Finance Act, 2018. 144 The expression inserted through Finance Act, 2017 145 Clause (1B) substituted vide Finance Act, 2019. Word substituted by Finance Act, 2021.

147[(2) Notwithstanding the provisions of sub-section (1): -

(a) taxable supplies 148[and import of goods] specified in the Third Schedule shall be charged to tax at the rate of 1[seventeen] per cent of the retail price 149[or in case such supplies 150[or imports] are also specified in the Eighth Schedule, at the rates specified therein and the retail price thereof,] along with the amount of sales tax shall be legibly, prominently and indelibly printed or embossed by the manufacturer 151[, or the importer, in case of imported goods,] on each article, packet, container, package, cover or label, as the case may be; 152[:]153[ ] 154[Provided that the 155[Board], may, by notification in the official Gazette, exclude any taxable supply 156[or import] from the said Schedule or include any taxable supply 157[or import] therein; 158[…]

(aa) 159[goods specified in the Eighth schedule shall be charged to tax at such rates and subject to such conditions and limitations as specified therein; and] 160[(b) the 161[Federal Government] may, subject to such conditions and restrictions as it may impose, by notification in the official Gazette, declare that in respect of any taxable goods, the tax shall be charged, collected and paid in such manner and at such higher or lower rate or rates as may be specified in the said notification.]

(3) The liability to pay the tax shall be,- 147 Sub section (2) substituted by Finance Act, 2001 148 The expression inserted through Finance Act, 2019. 149 The expression inserted through Finance Act, 2017 150 The words “or imports” inserted vide Finance Act, 2019. 151 The expression inserted through Finance Act, 2019. 152 Substituted for “; and” by Finance Act, 2007. 153 The word ‘; and” omitted by Finance Act, 2014. 154 Proviso inserted by Finance Act, 2007. 155 Word “Board” substituted by Finance (Supplementary) Act, 2022. 156 The words “or imports” inserted through Finance Act, 2019. 157 The words “or imports” inserted through Finance Act, 2019. 158 Word “and” omitted by Finance Bill, 2014. 159 Inserted by Finance Act, 2014 160 Clause (b) substituted by Finance Act, 2015. 161 Words “Federal Government” substituted by Finance Act, 2018.

(a) in the case of supply of goods162[…], of the person making the supply, and

(b) in the case of goods imported into Pakistan, of the person importing the goods. 163[(3A) Notwithstanding anything contained in clause (a) of sub- section (3), the 164[Board, with the approval of the Federal Minister-in- charge,] may, by a notification in the official Gazette, specify the goods in respect of which the liability to pay tax shall be of the person receiving the supply.] 165[(3B) Notwithstanding anything contained in sub section (1) and (3), sales tax on the import and supply of the goods specified in the Ninth Schedule to this Act shall be charged, collected and paid at the rates, in the manner, at the time, and subject to the procedure and conditions as specified therein or as may be prescribed, and the liability to charge, collect and pay the tax shall be on the persons specified therein.] 166[(4) ***] 167[(5) The 168[Federal Government] may, in addition to the tax levied under sub-section (1) 169[…], 170[…] sub-section (2) and sub-section (4), levy and collect 171[“tax at such extra rate or amount”] not exceeding 172[seventeen] per cent of the value of such goods or class of goods and on such persons or class of persons, in such mode, manner and at time, and subject to such conditions and limitations as it may, by rules, prescribe.] 173[(6) The Federal Government or 174[the Board] may, in lieu of the tax under sub-section (1), by notification in the official Gazette, levy and 162 Words “in Pakistan” omitted by Finance Act, 2003. 163 Sub-section 3A inserted by Finance Act, 1998. 164 The expression inserted through Finance Act, 2019. 165 Inserted by Finance Act 2014 166 Sub section (4) omitted by Finance Act, 2008. 167 Sub section (5) inserted by Finance Act, 1999. 168 Words “Federal Government” substituted by Finance Act, 2018. 169 Word etc. “and (1 A)” omitted by finance Act, 2004. 170 Word etc. “clause (C) of” omitted by Finance Ordinance, 2002 171 Words substituted by Finance Act, 2013. 172 Rate substituted by Finance Act, 2013. 173 Sub section (6) inserted by Finance Ordinance 2001 174 Substituted for “Central Board of Revenue” by Finance Act, 2007

collect such amount of tax as it may deem fit on any supplies or class of supplies or on any goods or class of goods and may also specify the mode, manner or time of payment of such amount of tax. 175[(7) The tax shall be withheld 11[***] at the rate as specified in the Eleventh Schedule, by any person or class of persons 176[being purchaser of goods or services] as withholding agent for the purpose of depositing the same, in such manner and subject to such conditions or restrictions as the Board may prescribe in this behalf through a notification in the official Gazette 177[:] [Provided that in case of the online market place facilitating the sale of third party goods, the liability to withhold tax on taxable supplies of such party at the rates specified in column (4) against S. No. 8 of the Eleventh Schedule to the Sales Tax Act, 1990 shall be on the operator of such market place.] 178[(8) Notwithstanding anything contained in any law or notification made thereunder 179[, but subject to the provisions of clause (b) of sub- section (2)] in case of supply of natural gas to CNG stations, the Gas Transmission and Distribution Company shall charge sales tax from the CNG stations at the rate of seventeen per cent of the value of supply to the CNG consumers, as notified by the Board from time to time, but excluding the amount of tax, as provided in clause (46) of section 2. 180[(9) Notwithstanding anything contained in subsection (1), tax shall be charged from retailers 181[, other than those falling in Tier-1,] through their monthly electricity bills, at the rate of five percent where the monthly bill amount does not exceed rupees twenty thousand and at the rate of seven and half per cent where the monthly bill amount exceeds the aforesaid amount, 182[and the electricity supplier shall deposit the amount so collected directly without adjusting against his input tax]: 175 Sub-section (7) substituted by Finance Act, 2019. 176 The words omitted and the expression inserted by Finance Act, 2020. 177 Colon and proviso inserted by Tax Laws (Third Amendment) Ordinance, 2021. 178 Sub-section 8 Inserted by Finance Act, 2014. 179 Comma and words inserted by Finance Act, 2015. 180 Sub-section 9 inserted by Finance Act, 2014. 181 Commas and words inserted by Finance Act, 2019. 182 The expression substituted for the words “subject to the exclusions, procedure, restrictions and limitations as prescribed in Chapter II of the Sales Tax Special Procedure Rules, 2007” through Finance Act, 2019.

Provided that the tax under this sub-section shall be in addition to the tax payable on supply of electricity under sub section (1), (1A) and (5)183[:] 184[Provided further that the Commissioner of Inland Revenue having jurisdiction shall issue order to the electricity supplier regarding exclusion of a person who is either a Tier-1 retailer, or not a retailer.] 185[(9A) Notwithstanding anything contained in this Act, Tier-1 retailers shall pay sales tax at the rate as applicable to the goods sold under relevant provisions of this Act or a notification issued there under: 186[****] Provided further that from such date, and in such mode and manner, as prescribed by the Board, all Tier-1 retailers shall integrate their retail outlets with Board’s computerized system for real-time reporting of sales.] 187[(9AA) In respect of goods, specified in the Thirteenth Schedule, the minimum production for a month shall be determined on the basis of a single or more inputs as consumed in the production process as per criterion specified in the Thirteenth Schedule and if minimum production so determined exceeds the actual supplies for the month, such minimum production shall be treated as quantity supplied during the month and the liability to pay tax shall be discharged accordingly.] 188[(10) Notwithstanding anything contained in the Act, the Board through Notification in the official Gazette, may require any person or class of persons to integrate their invoice issuing machines with the Board’s Computerized System for real time reporting of sales in such mode and manner and from such date as may be prescribed.] 189[3A. ***] 183 For the full stop a “colon” is substituted through Finance Act, 2019. 184 The second proviso added vide Finance Act, 2019. 185 Sub-section (9A) substituted through Finance Act, 2019. First proviso omitted by Finance Act, 2021. New sub-section inserted by Finance Act, 2021. 188 New section 10 inserted by by Tax Laws (Third Amendment) Ordinance, 2021. 189 Section (3A) omitted by Finance Act, 2004.

190[3AA. ***] 191[3AAA. ***]

3B. Collection of excess sales tax etc

(1) Any person who has collected or collects any tax or charge, whether under misapprehension of any provision of this Act or otherwise, which was not payable as tax or charge or which is in excess of the tax or charge actually payable and the incidence of which has been passed on to the consumer, shall pay the amount of tax or charge so collected to the Federal Government. 193[(2) Notwithstanding anything contained in any law or judgement of a court, including the Supreme court and a High court, any amount payable to the Federal Government under sub-section (1) shall be deemed to be an arrear of tax or charge payable under this Act and shall be recoverable accordingly and any claim for refund in respect of such amount shall neither be admissible to the registered person nor payable to any court of law or to any person under direction of the court.]

(3) The burden of proof that the incidence of tax or charge referred to in sub-section (1) has been or has not been passed to the consumer shall be on the person collecting the tax or charge.]

4. Zero rating

Notwithstanding the provisions of section 3 194[except those of sub-section (1A)], 195[…] the following goods shall be charged to tax at the rate of zero per cent:– [(a) goods exported, or the goods specified in the Fifth Schedule;]

(b) supply of stores and provisions for consumption aboard a conveyance proceeding to a destination outside Pakistan as specified in section 24 of the Customs Act, 1969 (IV of 1969); 196[(c) such other goods, as the Federal Government may specify by notification in the official Gazette, whenever circumstances 190 Section (3AA) omitted by Finance Act, 2008. 191 Section (3AAA) omitted by Finance Act, 2002. 192 Old section (3A) renumbered as (3B) by Finance Act, 1996. 193 Sub-section (2) substituted by Finance Act, 2014. 194 The expression inserted through Finance Act, 2017 195 Words “a Supply of” omitted by Finance Act, 2004. 196 Clause (c) substituted through Finance Act, 2019.

exist to take immediate action for the purposes of national security, natural disaster, national food security in emergency situations and implementation of bilateral and multilateral agreements:”; and] 197[(d) omitted.]

5. Change in the rate of tax

If there is a change in the rate of tax-

(a) a taxable supply made 198[***] by a registered person shall be charged to tax at such rate as is in force at the time of supply;

(b) imported goods shall be charged to“tax at such rate as” is in force,-

(i) in case the goods are entered for home consumption, on the date on a 9[goods declaration] is presented under section 79 of the Customs Act, 1969 (IV of 1969);

(ii) in case the goods are cleared from warehouse, on the date on which a 199[goods declaration] for clearance of such goods is presented under section 104 of the Customs Act, 1969 (IV of 1969); Provided that where a 9[goods declaration] is presented in advance of the arrival of the conveyance by which the goods are imported, the tax shall be charged as is in force on the date on which the manifest of the conveyance is delivered: Provided further that if the tax is not paid within seven days of the of the 200[goods declaration] 201[under section 104 of the Customs Act,] the tax shall be charged at the rate as is in force on the date on which tax is actually paid.

6. Time and manner of payment

(1) The tax in respect of goods imported into Pakistan shall be charged and paid in the same manner 197 Clause (d) omitted by Finance Act, 2019. 198 Words “in Pakistan” omitted by Finance Act, 2003 199 Substituted for “bill of entry” by Finance Act, 2005 200 Substituted for “bill of entry” by Finance Act, 2005 201 Words, figure and comma inserted by the Finance Act, 1996.

and at the same time as if it were a duty of customs payable under the Customs Act, 1969 202[and the provisions of the said Act 203[including section 31A thereof], shall, so far as they relate to collection, payment and enforcement 204[including recovery] of tax under this Act on such goods where no specific provision exists in this Act, apply,]. 205[(1A) Notwithstanding anything contained in any other law for the time being in force, including but not limited to the Protection of Economic Reforms Act, 1992 (XII of 1992), and notwithstanding any decision or judgment of any forum, authority or court whether passed, before or after the promulgation of the Finance Act, 1998 (III of 1998), the provisions of section 31-A of the Customs Act, 1969 (IV of 1969), referred to in sub- section (1) shall be incorporated in and shall be deemed to have always been so incorporated in this Act and no person shall be entitled to any exemption from or adjustment of or refund of tax on account of the absence of such a provision in this Act, or in consequence of any decision or judgment of any forum, authority or court passed on that ground or on the basis of the doctrine of promissory estoppel or on account of any promise or commitment made or understanding given whether in writing or otherwise, by any government department or authority.]

(2) The tax in respect of taxable supplies made 206[***] during a tax period shall be paid by the registered person 207[by the date as prescribed in this respect] 208[:] 209[Provided that the Board may, by a notification in the Official Gazette, direct that the tax in respect of all or such classes of supplies (other than zero-rated supplies) of all or such taxable goods, as may be specified in the aforesaid notification, shall be charged, collected and paid in any other way, mode, manner or at time as may be specified therein.] 202 The Words inserted in place of “IV of 1969” by Finance Act, 1996 203 The words inserted by Finance Act, 1998. 204 Words “including recovery” inserted by Finance Act, 2015. 205 Sub Section (1A) inserted by Sales Tax (amendment) Ordinance, 2002 dated June 07, 2002 and shall be deemed to have always been so inserted. 206 Words “ in Pakistan” omitted by Finance Act, 2013 207 Words substituted through Finance, Act, 2016. 208 Substituted for full stop by Finance Act, 1997 209 Proviso inserted by Finance Act, 1997

210[(3) The tax due on taxable supplies 211[***] shall be paid by any of the following modes, namely:-

(i) through deposit in a bank designated by the Board; and

(ii) through such other mode and manner as may be specified by the Board.] 212[4. ***]

7. Determination of tax liability

(1) 213[Subject to the provisions of 214[section 8 and] 8B, for] the purpose of determining his tax liability in respect of taxable supplies made during a tax period, a registered person shall 215[, subject to the provisions of section 73,] be entitled to deduct input tax 216[paid 217[or payable 218[during the tax period for the purpose of taxable supplies made, or to be made, by him] from the output tax 219[excluding the amount of further tax under sub-section (1A) of section 3.] 220[ ] that is due from him in respect of that tax period and to make such other adjustments as are specified in Section 9 221[:] 222[Provided that where a registered person did not deduct input tax within the relevant period, he may claim such tax in the return for any of the six succeeding tax periods.]

(2) A registered person shall not be entitled to deduct input tax from output tax unless,-

(i) in case of a claim for input tax in respect of a taxable supply made 223[***], he holds a tax invoice 224[in his name and bearing his registration number] in respect of such supply 225[, 210 Sub Section III substituted by Finance Act, 1996. 211Words “made in Pakistan” omitted by Finance Act, 2003. 212 Sub Section 4 omitted by Finance Act, 1996. 213 Substituted for the word “ for by Finance Act, 2007 214 The word” section” substituted by the words and figure “section 8 and” in Finance Act 2014. 215 Comma and word etc, inserted by Finance Ordinance, 2001 216 Words inserted by Finance Act, 1996 217 Words inserted by Finance Act, 2004. 218 Words inserted by Finance Act, 1998. 219 Inserted by Finance Act 2014 220 Words etc “ excluding the amount of tax” omitted by Finance Act, 2004 221 Substituted for the full stop by Finance Act, 2003 222 Proviso substituted by Finance Act, 2008. 223 Words “in Pakistan” omitted by Finance Act, 2003. 224 Words inserted by Finance Act, 2003. 225 The expression substituted through Finance Act, 2019.

or in case of supply of electricity or gas, a bill bearing his registration number and the address where the connection is installed] 226[:] Provided that from the date to be notified by the Board in this respect, in addition to above, if the supplier has not declared such supply in his return or he has not paid amount of tax due as indicated in his return;

(ii) 227[in case of goods imported into Pakistan, he holds bill of entry or goods declaration in his name and showing his sales tax registration number, duly cleared by the customs under section 79 228[, section 81] or section 104 of the Customs Act, 1969 (IV of 1969);]

(iii) 229[in case of goods purchased in auction, he holds a treasury challan, 230[in his name and bearing his registration number,] showing payment of sales tax;] 231[(iv) ***] 232[(3) Notwithstanding anything in sub-sections (1) and (2), 233[Board, with the approval of the Federal Minister-in-charge,] may, by a special order, subject to such conditions, limitations or restrictions as may be specified therein allow a registered person to deduct input tax paid by him from the output tax determined or to be determined as due from him under this Act.] 234[(4) Notwithstanding anything contained in this Act or rules made there under, the 235[Federal Government] may, by notification in the official Gazette, subject to such conditions, limitations or restrictions as may be specified therein, allow a registered person or class of persons to deduct 226 A Colon substituted the semi colon & Proviso added through Finance, Act, 2016. 227 Clause (ii) substituted by Finance Act, 2003. 228 Expression “, section 81” inserted by Finance Act, 2015. 229 Clause (iii) inserted by Finance Ordinance, 2002 230 Comma and words inserted by Finance Act, 2004. 231 Clause (iv) omitted by Finance Act, 1997. 232 Sub Section (3) inserted by Finance Ordinance, 2002. 233 The expression substituted by Finance Act, 2019. 234 Sub Section (4) inserted by Finance Act, 2007. 235 Words “Federal Government” substituted by Finance Act, 2018.

such amount of input tax from the output tax as may be specified in the said notification.] 236[(5) Notwithstanding anything contained in this Act or the rules made thereunder, the Board, by notification in the official Gazette, may impose restrictions on wastage of material on which input tax has been claimed in respect of the goods or class of goods.]

7A. Levy and collection of tax on specified goods on value addition

238[(1) Notwithstanding anything contained in this Act or the rules made there under, the 10[Federal Government] may specify, by notification in the official Gazette, that sales tax chargeable on the supply of goods of such description or class shall, with such limitations or restrictions as may be prescribed, be levied and collected on the difference between the value of supply for which the goods are acquired and the value of supply for which the goods, either in the same state or on further manufacture, are supplied.] 239[(2) Notwithstanding anything contained in this Act or the rules made thereunder, in respect of the goods or class of goods specified in the Twelfth Schedule, the minimum value addition tax, against the value added by the registered person, shall be payable, at the rate and by the registered persons or class of registered persons, specified therein, subject to the conditions, limitations, restrictions and procedure specified therein: Provided that the Federal Government may, through a notification published in the official Gazette, amend any provision of the said Twelfth Schedule.] 236 New sub-section inserted by Finance Act, 2020. 237 Section (7A) inserted by Finance Act, 2003. 238 Renumbered by Finance Act, 2004 239 Sub-section (2) substituted vide Finance Act, 2019.

8. Tax credit not allowed

(1) Notwithstanding anything contained in this Act, a registered person shall not be entitled to reclaim or deduct input tax paid on - 241[(a) the goods 242[or services] used or to be used for any purpose other 243[***] for taxable supplies made or to be made by him;]

(b) any other goods or services which the 244[Federal Government] may, by a notification in the official Gazette, specify245[;246[]] 247[(c)] 248[] the goods under 249[sub-section] (5) of section 3 250[:] 251[(ca) the goods 252[or services] in respect of which sales tax has not been deposited in the Government treasury by the respective supplier;] 253[(caa) purchases, in respect of which a discrepancy is indicated by CREST or input tax of which is not verifiable in the supply chain;] 254[(d) fake invoices; 255[***]

(e) purchases made by such registered person, in case he fails to furnish the information required by the Board through a notification issued under sub-section (5) of section 26 [;] 256[(f) goods and services not related to the taxable supplies made by the registered person.] 240 Section (8) substituted by Finance Act, 1996. 241 Clause (a) substituted by Sales Tax (amendment) Ordinance, 2001 dated February 07, 2001. 242 Words inserted by Finance Act, 2008. 243 Words “for the manufacture of production of manufacture goods or,” omitted by Finance Act, 2007. 244 Words “Federal Government” substituted by Finance Act, 2018. 245 Substituted for full stop by Finance Act, 1999 246 Word “and” omitted by Finance Act, 2004. 247 Clause (c) inserted by Finance Act, 1999. 248 Word “on” omitted by Finance Act, 2004. 249 Substituted for subsection (1A) and Finance Act, 2004. 250 Substituted for the full stop by Finance Act, 2004. 251 Clause (ca) inserted by Finance Act, 2006. 252Words inserted by Finance Act, 2008. 253 Clause (caa) inserted by Finance Act, 2013 254 Clause (d) inserted by Finance Act, 2004. 255 The word “and “omitted by Finance Act 2014. 256 Inserted by Finance Act, 2014.

257[(g) goods and services acquired for personal or non-business consumption;] 258[(h) goods used in, or permanently attached to, immoveable property, such as building and construction materials, paints, electrical and sanitary fittings, pipes, wires and cables, but excluding 259[pre-fabricated buildings and] such goods acquired for sale or re-sale or for direct use in the production or manufacture of taxable goods; 260[***]] 261[(i) vehicles falling in Chapter 87 of the First Schedule to the Customs Act, 1969 (IV of 1969), parts of such vehicles, electrical and gas appliances, furniture furnishings, office equipment (excluding electronic cash registers), but excluding such goods acquired for sale or re-sale] 262[;] 263[(j) services in respect of which input tax adjustment is barred under the respective provincial sales tax law;

(k) import or purchase of agricultural machinery or equipment subject to sales tax at the rate of 7% under Eighth Schedule to this Act;

(l) from the date to be notified by the Board, such goods and services which, at the time of filing of return by the buyer, have not been declared by the supplier in his return 264[or he has not paid amount of tax due as indicated in his return; and 265[(m) the input goods 266[or services] attributable to supplies made to un-registered person, on pro-rata basis, for which sale invoices do not bear the NIC number or NTN as the case may be, of the recipient as stipulated in section 23.] 257 Inserted by Finance Act, 2014. 258 Inserted by Finance Act, 2014. 259 Words inserted by Finance Act, 2015. 260 Word “and” omitted by Finance Act, 2015. 261 Inserted by Finance Act, 2014. 262 Semi-colon substituted for full stop by Finance Act, 2015. 263 Clauses (j), (k) and (l) added by the Finance Act, 2015. 264 Expression added through Finance Act, 2016. 265 Clause (m) substituted through Finance Act, 2019. 266 The words inserted by Finance Act, 2020.

(2) If a registered person deals in taxable and non-taxable supplies, he can reclaim only such proportion of the input tax as is attributable to taxable supplies in such manner as may be specified by the Board.

(3) No person other than a registered person shall make any deduction or reclaim input tax in respect of taxable supplies made or to be made by him. 267[(4) ] 268[(5) Notwithstanding anything contained in any other law for the time being in force or any decision of any Court, for the purposes of this section, no input tax credit shall be allowed to the persons who paid fixed tax under any provisions of this Act as it existed at any time prior to the first day of December, 1998.] 269[(6) Notwithstanding anything contained in any other law for the time being in force or any provision of this Act, 270[Board, with the approval of the Federal Minister-in-charge,] may, by notification in the official Gazette, specify any goods or class of goods which a registered person cannot supply to any person who is not registered 271[] under this Act.] 272[(7) ***]

8A. Joint and several liability of registered persons in supply chain where tax unpaid

…………………………………………………………42 8B. Adjustable input tax. ………………………………………………… ……….43 9. Debit and credit note. ……………………………………………….. …..…..44 10. Refund of input tax. …………………………………………………. ……….45 11. Assessment of Tax and recovery of tax not levied or short levied or erronously refunded…………… ……………………………………. …..… .46 Where a registered person receiving a taxable supply from another registered person is in the knowledge or has reasonable grounds to suspect that some or all of the tax payable in respect of that supply or any previous or subsequent supply of the goods supplied would go unpaid 274[, of which the burden to prove shall be on the department] 267 Sub-Section (4) omitted by Finance Act, 1999. 268 Sub-section (5) inserted by Finance Act, 1999. 269 Sub-section (6) inserted by Sales Tax (Amendment) Ordinance, 2001 dated February 7, 2001. 270 The expression substituted by Finance Act, 2019. 271 Words “or enrolled” omitted by Finance Act, 2004. 272 Sub-section (7) omitted by Finance Act, 2004. Earlier it was inserted by Sales Tax (Amendment) Ordinance, 2001, dated February 7, 2001. 273 Section 8A inserted by Finance Act, 2006. 274 Expression added by Finance Act, 2015.

such person as well as the person making the taxable supply shall be jointly and severally liable for payment of such unpaid amount of tax 275[:]] 276[Provided that the Board may by notification in the official gazette, exempt any transaction or transactions from the provisions of this section.]

8B. Adjustable input tax

(1) Notwithstanding anything contained in this Act, in relation to a tax period, a registered person 278[other than public limited companies listed on Pakistan Stock Exchange] shall not be allowed to adjust input tax in excess of ninety per cent of the output tax for that tax period: 279[Provided that the restriction on the adjustment of input tax in excess of ninety percent of the output tax, shall not apply in case of fixed assets or Capital goods:] Provided further that the Board may by notification in the official Gazette, exclude any person or class of persons from the purview of sub- section (1).

(2) A registered person, subject to sub-section (1), may be allowed adjustment 280[or refund] of input tax not allowed under sub-section (1) subject to the following conditions, namely:-

(i) in the case of registered persons, whose accounts are subject to audit under the Companies Ordinance, 1984, upon furnishing a statement along with annual audited accounts, duly certified by the auditors, showing value additions less than the limit prescribed under sub-section (1) above; or

(ii) in case of other registered persons, subject to the conditions and restrictions as may be specified by the Board by notification in the official Gazette. 275 Substituted for full stop by Finance Act, 2007. 276 Proviso inserted by Finance Act, 2007. 277 Section 8B inserted by Finance Act, 2007. Words inserted by Finance Act, 2021. 279 Proviso substituted by Finance Act, 2011. 280 Words inserted by Finance Act, 2009.

(3) The adjustment or refund of input tax mentioned in sub- sections (2), if any, shall be made on yearly basis in the second month following the end of the financial year of the registered person.

(4) Notwithstanding anything contained in sub-sections (1) and (2), the Board may, by notification in the official Gazette, prescribe any other limit of input tax adjustment for any person or class of persons. 281[(4A) Notwithstanding anything contained in sub-sections (1), (2) and (3), input tax allowed in case of locally manufactured electric vehicles subject to reduced rate of tax under the Eighth Schedule shall be limited to the extent of amount of output tax and no refund or carry forward of excess input tax shall be allowed.]

(5) Any auditor found guilty of misconduct in furnishing the certificate mentioned in sub-section (2) shall be referred to the Council for disciplinary action under section 20D of Chartered Accountants, Ordinance, 1961 (X of 1961).] 282[(6) In case a Tier-1 retailer does not integrate his retail outlet in the manner as prescribed under sub-section (9A) of section 3, during a tax period or part thereof, the adjustable input tax for whole of that tax period shall be reduced by 283[60%.]

9. Debit and credit note

Where a registered person has issued a tax invoice in respect of a supply made by him and as a result of cancellation of supply or return of goods or a change in the nature of supply or change in the value of the supply or some such event the amount shown in the tax invoice or the return needs to be modified, the registered person may, subject to such conditions and limitations as the Board may impose, issue a debit or credit note and make corresponding adjustment against output tax in the return. 281 New sub-section (4A) inserted by Finance Act, 2020. 282 New sub-section (6) inserted through Finance Act, 2019. Expression substituted by Finance Act, 2021.

10. Refund of input tax

(1) If the input tax paid by a registered person on taxable purchases made during a tax period exceeds the output tax on account of zero rated local supplies or export made during that tax period, the excess amount of input tax shall be refunded to the registered person not later than forty-five days of filing of refund claim in such manner and subject to such conditions as the Board may, by notification in the official Gazette specify: 285[Provided that in case of excess input tax against supplies other than zero-rated or exports, such excess input tax may be carried forward to the next tax period, along with the input tax as is not adjustable in terms of sub-section (1) of section 8B, and shall be treated as input tax for that period and the Board may, subject to such conditions and restrictions as it may impose, by notification in the official Gazette, prescribe the procedure for refund of such excess input tax.] Provided further that the Board may, from such date and subject to such conditions and restrictions as it may impose, by notification in the official Gazette, direct that refund of input tax against exports shall be paid 286[at the fixed rates and in the manner as] notified in the such notification.

(2) If a registered person is liable to pay any tax, default surcharge or penalty payable under any law administered by the Board, the refund of input tax shall be made after adjustment of unpaid outstanding amount of tax or, as the case may, default surcharge and penalty.

(3) Where there is reason to believe that a person has claimed input tax credit or refund which was not admissible to him, the proceedings against him shall be completed within sixty days. For the purposes of enquiry or audit or investigation regarding admissibility of the refund claim, the period of sixty days may be extended up to one hundred and twenty days by an officer not below the rank of an Additional 287[Commissioner Inland Revenue] and the Board may, for reasons to be recorded in writing, extend the aforesaid period which shall in no case exceed nine months.] 284 Section 10 substituted by Finance Act, 2007. Earlier it was also substituted by Finance Act, 1998 and Finance Act, 1996 285 Proviso substituted by Finance Act, 2008. 286 The expression substituted through Finance Act, 2019. 287 Substituted for “Collector of Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

11. Assessment of Tax & Recovery of Tax not levied or short levied or erroneously refunded

(1) Where a person who is required to file a tax return fails to file the return for a tax period by the due date or pays an amount which, for some miscalculation is less than the amount of tax actually payable, an officer of Inland Revenue shall, after a notice to show cause to such person, make an order for assessment of tax, including imposition of penalty and default surcharge in accordance with sections 33 and 34: Provided that where a person required to file a tax return files the return after the due date and pays the amount of tax payable in accordance with the tax return along with default surcharge and penalty, the notice to show cause and the order of assessment shall abate.

(2) Where a person has not paid the tax due on supplies made by him or has made short payment or has claimed input tax credit or refund which is not admissible under this Act for reasons other than those specified in sub-section (1), an officer of Inland Revenue shall after a notice to show cause to such person, make an order for assessment of tax actually payable by that person or determine the amount of tax credit or tax refund which he has unlawfully claimed and shall impose a penalty and charge default surcharge in accordance with sections 33 and 34.

(3) Where by reason of some collusion or deliberate Act any tax or charge has not been levied or made or has been short levied or has been erroneously refunded, the person liable to pay any amount of tax or charge or the amount of fund erroneously made shall be served with the notice requiring him to show cause for payment of the amount specified in the notice.

(4) Where, by reason of any inadvertence, error or misconstruction any tax or charge has not been levied or made or has been short-levied or has been erroneously refunded, the person liable to the amount of tax or charge or the amount of refund erroneously made shall be served with a notice requiring him to show cause for payment of the amount specified in the notice; 288 Section 11 substituted by the Finance Act, 2012. Earlier it was substituted by Finance Act, 1996.

Provided that, where a tax or charge has not been levied under this sub section the amount of tax shall be recovered as tax fraction of the value of supply. 289[(4A) Where any person, required to withhold sales tax under the provisions of this Act or the rules made thereunder, fails to withhold the tax or withholds the same but fails to deposit the same in the prescribed manner, an officer of Inland Revenue shall after a notice to such person to show cause, determine the amount in default].

(5) No order under this section shall be made by an officer of Inland Revenue unless a notice to show cause is given within five years, of the 290[end of the financial year in which the relevant date falls], to the person in default specifying the grounds on which it is intended to proceed against him and the officer of Sales Tax shall take into consideration the representation made by such person and provide him with an opportunity of being heard: Provided that order under this section shall be made within one hundred and twenty days of issuance of show cause notice or within such extended period as the Commissioner may, for reasons to be recorded in writing, fix provided that such extended period shall in no case exceed ninety days: Provided further that any period during which the proceedings are adjourned on account of a stay order or Alternative Dispute Resolution proceedings or the time taken through adjournment by the petitioner not exceeding sixty days shall be excluded from the computation of the period specified in the first proviso.

(6) Notwithstanding anything in sub-section (1), where a registered person fails to file a return, an officer of Inland Revenue, not below the rank of Assistant Commissioner, shall subject to such conditions as specified by the Federal Board of Revenue, determine the minimum tax liability of the registered person. 289 New sub-section 4A added through Finance Act, 2016. 290 Words substituted by Finance Act, 2021.

(7) For the purpose of this section, the expression “relevant date” means-

(a) the time of payment of tax or charge as provided under section 6; and

(b) in a case where tax or charge has been erroneously refunded, the date of its refund.]

11A. Short paid amounts recoverable without notice

…………. ……….48

Notwithstanding any of the provisions of this Act, where a registered person pays the amount of tax less than the tax due as indicated in his return, the short paid amount of tax along with default surcharge shall be recovered from such person by stopping removal of any goods from his business premises and through attachment of his business bank accounts, without giving him a show cause notice and without prejudice to any other action prescribed under section 48 of this Act or the rules made thereunder: Provided that no penalty under section 33 of this Act shall be imposed unless a show cause notice is given to such person.]

11B. Assessment giving effect to an order

……………………….. ……….48 11C. Power of tax authorities to modify orders, etc. …………….. ……….49 12. Omitted ………………………………………………………………….. ……….49

(1) Except where sub- section (2) applies, where, in consequence of, or to give effect to, any finding or direction in any order made under Chapter-VIII by the Commissioner (Appeals), Appellate Tribunal, High Court or Supreme Court an order of assessment of tax is to be issued to any registered person, the Commissioner or an officer of Inland Revenue empowered in this behalf shall issue the order within one year from the end of the financial year in which the order of the Commissioner (Appeals), Appellate Tribunal, High Court or Supreme Court, as the case may be, was served on the Commissioner or officer of Inland Revenue.

(2) Where, by an order made under Chapter-VIII by the Appellate Tribunal, High Court or Supreme Court, an order of assessment is remanded wholly or partly and the Commissioner or Commissioner (Appeals) or officer of Inland Revenue, as the case may be, is directed to pass a new order of assessment, the Commissioner or Commissioner (Appeals) or 291 Section 11A Substituted by Finance Act, 2006. Earlier it was inserted by Finance Ordinance, 2002. 292 New section 11B added by Finance Act, 2018.

officer of Inland Revenue, as the case may be, shall pass the new order within one year from the end of the financial year in which the Commissioner or Commissioner (Appeals) or officer of Inland Revenue, as the case may be, is served with the order: Provided that limitation under this sub-section shall not apply, if an appeal or reference has been preferred against the order passed by Appellate Tribunal or a High Court.]

11C. Power of tax authorities to modify orders, etc

(1) Where a question of law has been decided by a High Court or the Appellate Tribunal in the case of a registered person, on or after first day of July, 1990, the Commissioner or an officer of Inland Revenue may, notwithstanding that he has preferred an appeal against the decision of the High Court or made an application for reference against the order of the Appellate Tribunal, as the case may be, follow the said decision in the case of the said taxpayer in so far as it applies to said question of law arising in any assessment pending before the Commissioner or an officer of Inland Revenue, until the decision of the High Court or of the Appellate Tribunal is reversed or modified.

(2) In case the decision of High Court or the Appellate Tribunal, referred to in sub-section (1), is reversed or modified, the Commissioner or an officer of Inland Revenue may, notwithstanding the expiry of period of limitation prescribed for making any assessment or order, within a period of one year from the date of receipt of decision, modify the assessment or order in which the said decision was applied so that it conforms to the final decision.] 294[12. ***]

13. Exemption

………………………………………………………….. ……….49 Chapter-III …………………………………………………………………………. ……….52 REGISTRATION ………………………………………………………………. ………52

(1) Notwithstanding the provisions of section 3, supply of goods or import of goods specified in the Sixth Schedule shall, 293 New section 11C inserted by Finance Act, 2020. 294 Section 12 omitted by Finance Act, 1996. 295 Section 13 substituted by Finance Act, 1996.

subject to such conditions as may be specified by the 296[Federal Government], be exempt from tax under this Act 297[.] 298[***]

(2) Notwithstanding the provisions of sub-section (1) - 299[(a) the Federal Government may, whenever circumstances exist to take immediate action for the purposes of national security, natural disaster, national food security in emergency situations and implementation of bilateral and multilateral agreements, by notification in the official Gazette, exempt any supplies made or imports, of any goods or class of goods from the whole or any part of the tax chargeable under this Act, subject to the conditions and limitations specified therein;] 300[(b) ***]

(3) The exemption from tax chargeable under sub-section (2) may be allowed from any previous date specified in the notification issued under clause (a) 301[***].] 302[(4) ***] 303[(5) ***] 304[(6) The 305[Board] shall place before the National Assembly all notifications issued under this section in a financial year. 296 Substituted for “Board” by Sales Tax (Amendment) Ordinance, 1999, dated 13th August, 1999. 297 Substituted for colon by Tax Laws Amendment Ordinance, 2000, full Stop was substituted for colon by sales tax “(Amendment) Ordinance, 1999, dated 13th August, 1999. 298 Provisos omitted by Tax Laws Amendment Ordinance, 2000, dated 24th May, 2000. Earlier it was omitted by sales Tax (Amendment) Act, 1999 dated 30-03-1999. 299 Clause (a) substituted through Finance Act, 2019. 300 Clause (b) omitted by Finance Act, 2015. 301 Expression “or, as the case may be, order made under clause (b) of that sub-section” omitted by Finance Act, 2015. 302 Sub-section (4) omitted by Finance Act, 2006. 303 Sub-section (5) omitted by Sales Tax (Amendment) Ordinance, 2000. 304 Sub-section (6) and sub-section (7) added by Finance Act, 2015. 305 Substituted for the words “Federal Government” through Finance Act, 2017

(7) Any notification issued under sub-section (2), after 1st July, 2015 shall, if not earlier rescinded, stand rescinded on the expiry of the financial year in which it was issued 306[: Provided that all such notifications, except those earlier rescinded, shall be deemed to have been in force with effect from the 1st July, 2016 and shall continue to be in force till the 30th June, 2018, if not earlier rescinded: Provided further that all notifications issued on or after the first day of July, 2016 and placed before the National Assembly as required under sub-section (6) shall continue to be in force till thirtieth day of June, 2018, if not earlier rescinded by the Federal Government or the National Assembly.] 306 For the full stop a colon inserted and thereafter new provisos added through Finance Act, 2017

Chapter-III REGISTRATION

14. Registration

…………………………………………………………. ……….52

(1) Every person engaged in making taxable supplies in Pakistan, including zero-rated supplies, in the course or furtherance of any taxable activity carried on by him, falling in any of the following categories, if not already registered, is required to be registered under this Act, namely:-

(a) a manufacturer who is not running a cottage industry;

(b) a retailer who is liable to pay sales tax under the Act or rules made thereunder, excluding such retailer required to pay sales tax through his electricity bill under sub-section (9) of section 3;

(d) an exporter who intends to obtain sales tax refund against his zero-rated supplies;

(e) a wholesaler, dealer or distributor; and

(f) a person who is required, under any other Federal law or Provincial law, to be registered for the purpose of any duty or tax collected or paid as if it were a levy of sales tax to be collected under the Act.

(2) Persons not engaged in making of taxable supplies in Pakistan, if required to be registered for making imports or exports, or under any provisions of the Act, or any other Federal law, may apply for registration.

(3) The registration under this Act shall be regulated in such manner as the Board may, by notification in the official Gazette, prescribe.]

14A. Discontinuance of gas and electricity connections

……. ……….52

Notwithstanding anything contained in this Act or any other law for the time 307Section 14 substituted by Finance Act, 2015. 308 New section 14A inserted by Tax Laws (Third Amendment) Ordinance, 2021.

being in force, the Board shall have power through Sales Tax General Order to direct the gas and electricity distribution companies for discontinuing the gas and electricity connections of any person who fall in the following categories, namely:-

(a) Any person, including tier-1 retailers, who fail to register for sales tax purpose; or

(b) Notified tier-1 retailers registered but not integrated with the Board’s Computerized System. Provided that upon registration or integration, as the case may be, of the above said persons, the Board shall notify the restoration of their gas or electricity connection through Sales Tax General Order. ] 309[15. ***] 310[16. ***] 311[17. *** 18. *** 19. *** 20. ***]

21. De-registration, blacklisting and suspension of registration

(1) The Board or any officer, authorized in this behalf, may subject to the rules, de-register a registered person or such class of registered persons not required to be registered under this Act.

(2) Notwithstanding anything contained in this Act, in cases where the 313[Commissioner] is satisfied that a registered person is found to have 309Section 15 omitted by the Finance Act, 2014. 310 Section 16 omitted by Finance Act, 2003. 311 Sections 17 to 20 omitted by Finance Act, 2004. 312 Section 21 substituted by Finance Act, 2004. 313 Substituted “for collector” by Finance Act, 2010

issued fake invoices 314[…] or has 315[otherwise] committed tax fraud, he may blacklist such person or suspend his registration in accordance with such procedure as the Board may by notification in the official Gazette, prescribe.] 316[(3) During the period of suspension of registration, the invoices issued by such person shall not be entertained for the purposes of sales Tax refund or input tax credit, and once such person is black listed, the refund or input tax credit claimed against the invoices issued by him, whether prior or after such black listing, shall 317[…] be rejected through a self-speaking appealable order and after affording an opportunity of being heard to such person.] 318[(4) Notwithstanding anything contained in this Act, where the Board, the concerned Commissioner or any officer authorized by the Board in this behalf has reasons to believe that a registered person is engaged in issuing fake or flying invoices, claiming fraudulent input tax or refunds, does not physically exist or conduct actual business, or is committing any other fraudulent activity, the Board, concerned Commissioner or such Officer may after recording reasons in writing, block the refunds or input tax adjustments of such person and direct the concerned Commissioner having jurisdiction for further investigation and appropriate legal action.]

21A. Active taxpayers list

The Board shall have the power to maintain active taxpayers list in the manner as may be prescribed by rules and such rules may provide for the restrictions and limitations to be imposed on a person who ceases to be an active taxpayer.] Chapter-IV BOOK KEEPING AND INVOICING REQUIREMENTS 314 Comma and words “, evaded tax” omitted by Finance Act, 2005. 315 Word inserted by Finance Act, 2005. 316 Sub Section (3) inserted by Finance Act, 2011 317 Words and figure omitted by Finance Act, 2013. 318 Sub section (4) inserted by Finance Act, 2013. 319 Section 21A inserted by Finance Act, 2015.

22. Records. …………………………………………………………………. ……….55 23. Tax Invoices

…………………………………………………………. ……….57

(1) A registered person making taxable supplies shall maintain and keep at his business premises or registered office in English or Urdu language the following records of goods purchased 321[, imported] and supplied (including zero-rated and exempt supplies) made by him or by his agent acting on his behalf in such form and manner as would permit ready ascertainment of his tax liability during a tax period -

(a) records of supplies made shall indicate the description, quantity and value of goods, name and address of the person to whom supplies were made and the amount of the tax charged;

(b) records of goods purchased shall show the description, quantity and value of goods, name, address and registration number of the supplier and the amount of the tax on purchases; 322[(c) records of goods imported shall show the description, quantity and value of goods and the amount of tax paid on imports;] 323[(d)] records of zero-rated and exempt supplies; 324[(da) double entry sales tax accounts;] 325[(e)] invoices, credit notes, debit notes, bank statements, 326[banking instruments in terms of section 73,] inventory records, 327[utility bills, salary and labour bills, 328[cash book,] rental agreements, sale purchase agreements and lease agreements]; 329[…] 330[(ea) Record relating to Gate passes, inward or outward and transport receipts.] 320 Section 22 substituted by Finance Act, 1996. 321 The comma and words inserted by Finance Act, 2005. 322 Clause (c) inserted by Finance Act, 2005. 323 Existing clause (c) re-lettered as clause (d) by Finance Act, 2005. 324 Clause (da) inserted by Finance Act, 2006. 325 Existing clause (d) re-lettered as clause (e) by Finance Act, 2005. 326 The words, comma and figure inserted by Finance Act, 2004. 327 The commas and words inserted by Finance Act, 1999. Expression inserted by Finance Act, 2021. 329 The word “and” omitted by Finance Act, 2013. 330 Clause (ea) inserted by Finance Act, 2013.

331[(eb) Electronic version of records mentioned in clauses (a) to (ea) of this sub-section.] 332[(f)] such other records as may be specified by the Board: 333[Provided that the persons paying 334[…] retail tax shall keep such record as may be specified by the Board.] 335[(1A) Notwithstanding anything in any other law for the time being in force, the Board may require, by notification in the official Gazette, a registered person or class of registered persons to declare and use only as many number of business bank accounts as may be specified by the Board in such notification to make or receive payments on account of purchase and sale transactions for the purpose of this Act or rules made thereunder and to make payment of due tax from such accounts only.]

(2) The Board may, by notification in the official Gazette, specify for any class of taxable persons or any other person registered under this Act to keep such other records for the purposes of this Act. 336[(2A) The Board may, by notification in the Official Gazette, specify for any class of taxable persons registered under this Act to use such electronic fiscal cash registers as are approved by the Board in the manner as may be prescribed.] 337[(3) The Board may, by notification in the official gazette, prescribe the procedure or software for electronically maintenance of records, filing of sales tax returns or refunds and for any other matter or approve any software for electronic maintenance of records and filing of returns or refunds by a person or class of such persons.]] 338[(4) The registered persons, whose accounts are subject to audit under the Companies Ordinance, 1984 (XLVII of 1984), shall be required to New clause (eb) inserted by Finance Act, 2021. 332 Existing clause (e) re-lettered as clause (f) by Finance Act, 2005 333 Proviso substituted by the Finance Act, 1997. 334 The words “turnover tax or” omitted by Finance Act, 2005. 335 Sub-section (1A) inserted by Finance Act, 2007. 336 Sub-section (2A) inserted by Finance Act, 1999. 337 Sub Section (3) substituted by Finance Act, 2003. 338 Sub Section (4) inserted by Finance Act, 2007.

submit a copy of the annual audited accounts, along with a certificate by the auditors certifying the payment of due tax by the registered person.]

23. Tax Invoices

(1) A registered person making a taxable supply shall issue a serially numbered tax invoice at the time of supply of goods containing the following particulars339[, in Urdu or English language,] namely: -

(a) name, address and registration number of the supplier; [340(b) name, address and registration, number of the recipient and NIC or NTN of the unregistered person, as the case may be, excluding supplies made by a retailer where the transaction value inclusive of sales tax amount does not exceed rupees 341[one hundred] thousand, if sale is being made to an ordinary consumer. Explanation. - For the purpose of this clause, ordinary consumer means a person who is buying the goods for his own consumption and not for the purpose of re-sale or processing: Provided that the condition of NIC or NTN shall be effective from 1st August, 2019 342[:] 343[Provided further that the condition of NIC shall not apply in the case of payment through debit or credit card or digital mode;]

(d) description 344[including count, denier and construction in case of textile yarn and fabric,] and quantity of goods;

(e) value exclusive of tax; 339 The expression added through Finance Act, 2019. 340 Clause (b) substituted by Finance Act, 2019. 341 The words substituted by Finance Act, 2020. 342 Colon substituted by Finance (Supplementary) Act, 2022. 343 Proviso inserted by Finance (Supplementary) Act, 2022. 344 The expression added through Finance Act, 2019.

(f) amount of sales tax; and 345[(ff) ***]

(g) value inclusive of tax: Provided that the Board may, by notification in the official Gazette, specify such modified invoices 346[…] for different persons or classes of persons; Provided further that not more than one tax invoice shall be issued for a taxable supply347[.] 348[] 349[(2) No person other than a registered person or a person paying 350[ 351[***]]352[retail tax] shall issue an invoice under this section. 353[(3) A registered person making a taxable supply may, subject to such conditions, restrictions and limitations as the Board may, by notification in the official Gazette, specify, issue invoices to another registered person electronically and to the Board as well as to the 354[Commissioner], as may be specified.] 355[(4) The Board may, by notification in the Official Gazette, prescribe the manner and procedure for regulating the issuance and authentication of tax invoices.]

24. Retention of record and documents for six years

……….. ……….58 A person, who is required to maintain any record or documents under this Act, shall retain the record and documents for a period of 352[Six] years after the 345 Clause (ff) omitted by Finance Act, 2004. 346 Comma and words “, including replacement invoice,” omitted by Finance Act, 1997. 347 Full stop substituted by Finance (Supplementary) Act, 2022. 348 Proviso omitted by Finance (Supplementary) Act, 2022. 349 Sub Section (2) inserted by Finance Act, 1996. 350 Words “turnover tax or” omitted by Finance Act, 2004. 351 Words “or retailer tax” added by Finance Act, 1997. 352 Words inserted by Finance Act, 1997. 353 Sub section (3) inserted by Finance Act, 2005. 354 Substituted for “Collector” by Finance Act, 2010. 355 Sub Section (4) inserted by Finance Act, 2007. 356 Section (24) substituted by Finance Act, 1996. 357 Substituted for “Five” by Finance Act, 2010.

end of the tax period to which such record or documents relate 358[or till such further period the final decision in any proceedings including proceedings for assessment, appeal, revision, reference, petition and any proceedings before an alternative Dispute Resolution Committee is finalized].]

25. Access to record, documents, etc

……………………………… ……….59 360[(1) A person who is required to maintain any record or documents under this Act 361[or any other law] shall, as and when required by 5[Commissioner],produce record or documents which are in his possession or control or in the possession or control of his agent; and where such record or documents have been kept on electronic data, he shall allow access to [the officer of Inland Revenue authorized by the Commissioner] and use of any machine on which such data is kept.] 362[(2) The officer of Inland Revenue authorized by the Commissioner, on the basis of the record, obtained under sub-section (1), may, once in a year, conduct audit: 363[(2A) For the purpose of sub-section (2) of section 25, the Commissioner may conduct audit proceedings electronically through video links, or any other facility as prescribed by the Board.] Provided that in case the Commissioner has information or sufficient evidence showing that such registered person is involved in tax fraud or evasion of tax, he may authorize an officer of Inland Revenue, not below the rank of Assistant Commissioner, to conduct an inquiry or investigation under section 38: Provided further that nothing in this sub-section, shall bar the officer of Inland Revenue from conducting audit of the records of the registered person if the same were earlier audited by the office of the Auditor-General of Pakistan364[.] 358 Words and Commas inserted by Finance Act, 2010. 359 Section (25) substituted by Finance Act, 1995. 360 Numbered by Finance Act, 2003 361 Words inserted by Finance Act, 1999. 362 Substituted for “Such Officer of Sales tax” by Finance Act, 2010 363 New sub-section (2A) inserted by Finance Act, 2020. 364 Substituted for the colon through Finance Act, 2019.

365[omitted] 366[(3)] After completion of Audit under this section or any other provision of this Act, the officer of Inland Revenue may, after obtaining the registered person’s explanation on all the issues raised in the audit shall pass an order under section 11 367[***].] 368[(4) ***] 369[(4A) ***] 370[ (5) Notwithstanding the penalties prescribed in section 33, if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with 371[default surcharge] voluntarily, whenever it comes to his notice, before receipt of notice of audit, no penalty shall be recovered from him: Provided if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with [default surcharge] during the audit, or at any time before issuance of show cause notice 372[…] he may deposit the evaded amount of tax, 2[default surcharge] under section 34, and twenty five per cent of the penalty payable under section 33: Provided further that if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with 373[default surcharge] after issuance of show cause notice, he shall deposit the evaded amount of tax, 2[default surcharge] under section 34, and full amount of the penalty payable under section 33 and thereafter, the show cause notice, shall stand abated.] 374[Explanation.- For the purpose of sections 25, 38, 38A, 38B and 45A and for removal of doubt, it is declared that the powers of the Board, 365 Third proviso omitted by Finance Act, 2019. 366 Sub Section 3 substituted by Finance Act, 2010. 367 Words, figures and comma “or section 36, as the case may be” omitted by Finance Act, 2015. 368 Sub Section 4 omitted by Finance Act, 2010. 369 Sub Section (4A) expired. 370 Sub Section (5) inserted By Finance Act, 2003. 371 Substituted for “Additional Tax” by Finance Act, 2005. 372 Words in lieu of Audit report omitted by Finance Act, 2010. 373 Substituted for the words “additional tax” by Finance Act, 2005. 374 Explanation added by Finance Act, 2013.

Commissioner or officer of Inland Revenue under these sections are independent of the powers of the Board under section 72B and nothing contained in section 72B restricts the powers of the Board, Commissioner or Officer of Inland revenue to have access to premises, stocks, accounts, records, etc. under these sections or to conduct audit under these sections.]

25A. Drawing of samples

……………………………………………….. ……….61 25AA. Transaction between Associates ………………………………… ……….61 Chapter-V ………………………………………………………………………….. ………61 RETURNS ………………………………………………………………………… ……….61 26. Return. ……………………………………………………………………. ……….62 26A. Omitted ………………………………………………………………….. ……….64 Where an authorized officer of 376[Inland Revenue] considers it necessary to take a sample of any goods or raw materials, for the purpose of determining their liability to sales tax or for the purpose of establishing their value or for any other reason, he may remove a minimum quantity of goods or raw materials sufficient to enable a proper examination or analysis to be made. At the time of taking the sample the person in possession of the goods shall be informed and given the opportunity to sign the representative samples, so drawn, and take a corresponding sample for his record. Any sample taken under this section shall be taken against a proper receipt a copy each of which shall be kept in the record by the registered person and the 377[Large Taxpayers Unit or Regional Tax Office, as the case may be].]

25AA. Transactions between Associates

6[(1)] The Commissioner or an office of Inland Revenue may, in respect of any transaction between persons who are associates, determine the transfer price of taxable supplies between the persons as is necessary to reflect the fair market value of supplies in an arm’s length transaction.] 379[(2) The Board may, by notification in official gazette, prescribe rules for carrying out the purpose of sub-section (1).] Chapter-V RETURNS 375 Section 25A inserted by Finance Act, 1999. 376 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extra Ordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009 published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 377 Substituted for “Collectorate” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extra Ordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009 published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 378 Section (25AA) by Finance Act, 2010 w.e.f. june5, 2010, the same amendment was made by Finance (Amendment) Ordinance 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extra Ordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009 published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 379 Existing sub-section renumbered as sub-section (1) and new sub-section (2) inserted by Finance Act, 2021.

26. *** Return

(1) Every registered person 382[…] shall furnish not later than the due date a true 383[, complete] and correct return in the prescribed form to a designated bank 384[or any other office] specified by the Board, indicating the purchases and the supplies made during a tax period, the tax due and paid and such other information, as may be prescribed 385[;] 386[Provided that the Board may, by notification in the official Gazette, require any person or class of persons to submit return on quarterly basis: Provided further that the Board may, by notification in the official Gazette, require any person or class of persons to submit such return as may be prescribed annually in addition to the monthly return or quarterly return: Provided also that the return filed electronically on the web or any magnetic media or any other computer readable media as may be specified by the Board shall also be deemed to be a return for the purpose of sub- section (1) and the Board may, by notification in the official Gazette, make rules for determining eligibility of the data of such returns and e- intermediaries who will digitize the data of such returns and transmit the same electronically under their digital signatures.] 387[…]

(2) 388[….] omitted 389[(3) A registered person may, subject to approval of the 390[Commissioner Inland Revenue] having jurisdiction, file a revised return within 391[one hundred and twenty] days of the filing of return under sub- section (1) or, as the case may be, sub-section (2), 392[ or under clause (a) or 380 Section 26 substituted by Finance Act, 1996 381 Word “monthly” omitted by Finance Act, 2006. 382 Words “making taxable supplies” omitted by Finance Act, 1999. 383 Comma and word inserted by Finance Act, 2020. 384 Words inserted by Finance Act, 2006. 385 In the proposed amendment “a full stop is substituted for a colon” while colon is already appearing. 386 Proviso inserted by Finance Act, 2006. 387 Proviso omitted by Finance Act, 2006 388 Sub-section (2) omitted through Finance Act, 2016. 389 Sub section (3) substituted by Finance Act, 2006. 390 Substituted for collector of Sales tax by Finance Act, 2010 391 Substituted for “ninety” by Finance Act, 2008. 392 Words inserted by Finance Act, 2011.

clause (b) of section 27], to correct any omission or wrong declaration made therein393[:] 394[Provided that the approval under this sub-section shall not be required if revised return is filed within sixty days of filing of return and either the tax payable therein is more than the amount paid or the refund claimed therein is less than the amount as claimed, under the return sought to be revised.] 395[(4) Notwithstanding the penalties prescribed in section 33, if a registered person wishes to file revised return voluntarily along with deposit of the amount of tax short paid or amount of tax evaded along with 396[default surcharge], whenever it comes to his notice, before receipt of notice of audit, no penalty shall be recovered from him: Provided that in case the registered person wishes to deposit the amount of tax as pointed out by the officer of 397[Inland Revenue] during the audit, or at any time before issuance of the show cause notice 398[…], he may deposit the evaded amount of tax, [default surcharge] under section (34), and twenty five percent of the penalty payable under section 33 along with the levied return: Provided further that in case the registered person wishes to deposit the amount after issuance of show cause notice, he shall deposit the evaded amount of sales tax 399[…],400[default surcharge] under section 34, and full amount of leviable penalty under section 33 along with the revised return and thereafter, the show cause notice, shall stands abated.] 401[(5) The Board may, by notification in the official Gazette, require any person or class of persons, for any goods of such description or class, to furnish such summary or details or particulars pertaining to the imports, purchases and supplies during any tax period or periods, in such format as may be specified.] 393 Substituted for the full stop through Finance Act, 2019. 394 New proviso added through Finance Act, 2019. 395 Subsection (4) inserted by Finance Act, 2003. 396 Substituted for “Additional Tax” by Finance Act, 2005. 397 Substituted for “Sales tax” by Finance Act, 2010. 398 Words “in lieu of the audit report” omitted by Finance Act, 2010. 399 Words “etc alongwith the amount of further tax as per provision of sub section (1A) of section 3, if applicable omitted by Finance Act, 2004. 400 Substituted for words “additional tax” by Finance Act, 2005. 401 Sub section (5) inserted by Finance Act, 2004.

402[26A. ***] 403[26AA. ***] 404[26AB. Extension of time for furnishing returns. (1) A registered person required to furnish a return under section 26 may apply, in writing, to the Commissioner for an extension of time to furnish the return.

(2) An application under sub-section (1) shall be made by the due date for furnishing the return in terms of section 2(9) for the period to which the application relates.

(3) Where an application has been made under sub-section (1) and the Commissioner is satisfied that the applicant is unable to furnish the return to which the application relates by the due date because of-

(a) absence from Pakistan;

(b) sickness or other misadventure; or

(c) any other reasonable cause, the Commissioner may, by order in writing, grant the applicant an extension of time for furnishing the return.

(4) An extension of time under sub-section (3) shall not exceed fifteen days from the due date for furnishing the return, unless there are exceptional circumstances justifying a longer extension of time: Provided that where the Commissioner has not granted extension for furnishing the return under sub-sections (3) or (4), the Chief Commissioner may on an application made by the registered person for extension or further extension, as the case may be, grant extension or further extension for a period not exceeding fifteen days, unless there are exceptional circumstances justifying a longer extension of time. 402 Section 26 A omitted by Finance Act, 2004. 403 Section 26AA omitted by Finance Act, 2008. New section 26AB inserted by Finance Act, 2021.

(5) An extension or further extension of time granted under sub- sections (3) or (4), as the case may be, shall not, for the purpose of charge of default surcharge under section 34, change the due date for payment of sales tax under section 6.]

27. Special Returns

In addition to the return specified under section 26 -

(a) a person registered 406[ 407[ ] under this Act] shall furnish special return within such date and in such form indicating information such as quantity manufactured or produced, purchases made, goods supplied or payment of arrears made, etc, for such period as the Board may, by a notification in official gazette, specify; and

(b) the 408[commissioner] may require any person whether, registered or not, to furnish a return (whether on his own behalf or as an agent or trustee) in a prescribed form and such person shall furnish the return not later than the date specified in this regard.]

28. Final Return

If a person applies for de-registration in terms of section 21, he shall before such de-registration, furnish a final return to the 410[commissioner] in the specified form in such manner and at such time as directed by the 411[commissioner]].

29. Return deemed to have been made

A return purporting to be made on behalf of a person 412[by his duly appointed representative] shall, for all purposes, be deemed to have been made by such person or under his authority unless proved to the contrary. Chapter-VI 405 Section 27 substituted by the Finance Ordinance, 2000. 406 Substituted for words and figure “under section 14” by sales tax (Amendments) Ordinance, 2000, dated September 05, 2000. 407 Words “or enrolled” omitted by Finance Act, 2004. 408 Substituted for “Collector” by Finance Act, 2010 409 Section 28 substituted by Finance Act, 1996. 410 Substituted for “Collector” by Finance Act, 2010 411 Substituted for “Collector” by Finance Act, 2010 412 Words inserted by Finance Act, 1996.

APPOINTMENT OF 413[OFFICERS OF SALES TAX] & THEIR POWERS

30. Appointment of Authorities

(1) For the purposes of this Act, the Board may, appoint in relation to any area, person or class of persons, any person to be -

(a) a chief commissioner of Inland Revenue;

(b) a commissioner of Inland Revenue ;

(d) an Additional commissioner of Inland Revenue ;

(e) a Deputy commissioner of Inland Revenue; 415[(ea) District Taxation Officer Inland Revenue;]

(f) an Assistant commissioner of Inland Revenue; 416[(fa) Assistant Director Audit Inland Revenue;]

(g) an Inland Revenue Officer;

(h) a Superintendent Inland Revenue;

(i) an Inland Revenue Auditor Officer 417[…]; 418[(ia) an inspector Inland Revenue; and] (j)an officer of Inland Revenue with any other designation. 413 Any reference to the “Sales Tax Officer” shall be construe as reference to an “Officer of “Inland Revenue” by virtue of section 72 of the Sales Tax Act, 1990. 414 Section 30 substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, Published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at Pages 229 to 259. Earlier it was substituted by Finance Act, 1996. 415 Clause (ea) inserted through Finance Act, 2017 416 Clause (fa) inserted through Finance Act, 2017 417 Word “and” omitted by Finance Act, 2011. 418 Clause “(ia)” inserted by Finance Act, 2011

(2) The Chief Commissioner Inland Revenue and Commissioner Inland Revenue (Appeals) shall be sub-ordinate to the Board and Commissioner Inland Revenue shall be sub-ordinate to the Chief Commissioner Inland Revenue. 419[(2A) The Chief Commissioners Inland Revenue shall perform their functions in respect of such persons or classes of persons or such areas as the Board may direct. 5(2B) The Commissioners Inland Revenue shall perform their functions in respect of such persons or classes of persons or such areas as the Chief Commissioner, to whom they are sub-ordinate, may direct.]

(3) Additional Commissioner Inland Revenue, Deputy Commissioners Inland Revenue 420[, District Taxation Officer Inland Revenue], Assistant Commissioner Inland Revenue 6[, Assistant Director Audit Inland Revenue], Superintendent Inland Revenue, Inland Revenue Audit Officer, Inland Revenue Officer 421[, Inspector Inland Revenue], and officer of Inland Revenue with any other designation shall be sub-ordinate to the Commissioner Inland Revenue and shall perform their functions in respect of such persons or classes of persons or such areas as the Commissioners, to whom they are sub ordinate, may direct.

(4) Deputy Commissioner Inland Revenue 422[, District Taxation Officer Inland Revenue], Assistant Commissioner Inland Revenue 1[, Assistant Director Audit Inland Revenue], Superintendent Inland Revenue, Inland Revenue Audit Officer, Inland revenue Officer, 423[Inspector Inland Revenue Officer] an officer of Inland Revenue with any other designation shall be sub-ordinate to the Additional Commissioner Inland Revenue.]

30A. Directorate General (Intelligence and Investigation), Inland Revenue

(1) The Directorate General (Intelligence and Investigation) Inland Revenue shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant 419 Sub-sections (2A) & (2B) inserted through Finance Act, 2017 420 Expressions inserted through Finance Act, 2017 421 Comma and words inserted by Finance Act, 2011. 422 Expression inserted through Finance Act, 2017 423 Comma and words inserted by Finance Act, 2011. 424 Section 30A substituted by Finance Act, 2018.

Directors and such other officers as the Board may, by notification in the official Gazette, 425[appoint].

(2) The Board may, by notification in the official Gazette,-

(a) specify the functions and jurisdiction of the Directorate General and its officers; and

(b) confer the powers of authorities specified in section 30 upon the Directorate General and its officers.]

30B. Directorate General … Internal Audit

The Directorate General 2[…] Internal Audit shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and such other officers as the Board, may by notification in the official Gazette, appoint.

30C. Directorate General of Training and Research

-The Directorate General of Training and Research shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and such other officers as the Board, may by notification in the official Gazette, appoint. 429[30CA.Directorate General of Digital Invoicing and Analysis.– The Directorate General of Digital Invoicing and Analysis shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and such other officers as the Board may, by notification in the official Gazette, appoint.]

30D. Directorate General of Valuation

-The Directorate General of Valuation 5[…] shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and such other officers as the Board, may by notification in the official Gazette, appoint. 425 Substituted for the word “post” through Finance Act, 2019. 426 Section 30B inserted by Finance Act, 2005. 427 Words “of inspection and” omitted by Finance Act, 2007. 428 Section 30C inserted by Finance Act, 2005. 429 New section 30CA inserted by Finance (Supplementary) Act, 2022. 430 Section 30D inserted by Finance Act, 2005. 431 Words “and Post Clearance Audit” omitted by Finance Act, 2007.

30DD. Directorate of Post Clearance Audit

The Directorate of Post clearance Audit shall consist of a Director and as many Additional Directors, Deputy Directors, Assistant Directors and such other officers as the Board may, by notification in the official Gazette, appoint.]

30DDD. Directorate General of Input Output Co-efficient Organization

The Directorate General of Input Output Coefficient Organization (IOCO)-Inland Revenue shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors, Assistant Directors and such other officers as the Board may, by notification in the official Gazette, appoint.]

30E. Powers and Functions of Directorate, etc

The Board may, by notification in the official Gazette, specify the functions, jurisdiction and powers of the Directorates General as specified in the preceding sections and their officers by notification in the official Gazette.]

31. Powers

An officer of 435[Inland Revenue] appointed under section 30 shall exercise such powers and discharge such duties as are conferred or imposed on him under this Act; and he shall also be competent to exercise all powers and discharge all duties conferred or imposed upon any officer subordinate to him: Provided that, notwithstanding anything contained in this Act or the rules, the Board may, by general or special order, impose such limitations or conditions on the exercise of such powers and discharge of such duties as it deems fit.

32. Delegation of powers

437[(1) The Board or the Chief Commissioner, with the approval of the Board, may, by an order and subject to such limitations or conditions as may be specified therein, empower by name or designation - 432 Section 30DD inserted by Finance Act, 2007. 433 New section 30DDD added through Finance Act, 2016. 434 Section 30E inserted by Finance Act, 2005. 435 Substituted for “sales tax” by Finance Act, 2010 w.e.f June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No.III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 436 Section 32 substituted by Finance Act, 1996. 437 Sub Section (1) substituted by Finance Act, 2010 w.e.f. June 5, 2010. Earlier clause (a) to (d) substituted by Finance (2) omitted by the Finance Act, 2010

[(a) any Additional Commissioner Inland Revenue or Deputy Commissioner Inland Revenue to exercise any of the powers of a Commissioner Inland Revenue under this Act; and

(b) any Deputy Commissioner Inland Revenue or Assistant Commissioner Inland Revenue to exercise any of the powers of an Additional Commissioner Inland Revenue under this Act;

(c) any Assistant Commissioner Inland Revenue to exercise any of the powers of a Deputy Commissioner Inland Revenue under this Act; and

(d) any other officer of Inland Revenue to exercise any of the powers of an Assistant Commissioner Inland Revenue under this Act.] 438[(2) ***]

(3) The officer to whom any powers are delegated under this section shall not further delegate such powers.] 439[32A. 440[Audit by Special Audit Panels]. 441[(1) The Board may appoint as many special audit panels as may be necessary, comprising two or more members from the following, -

(a) an officer or officers of Inland Revenue;

(b) a firm of chartered accountants as defined under the Chartered Accountants Ordinance, 1961 (X of 1961);

(c) a firm of cost and management accountants as defined under the Cost and Management Accountants Act, 1966 (XIV of 1966); or

(d) any other person as directed by the Board, 438 Sub Section (2) omitted by the Finance Act, 2010. 439 Section 32A inserted by Finance Act, 1998. 440 Substituted for the words “Special Audit by Chartered Accountants or Cost Accountants” by Finance Act, 2015 441 Substituted for sub-section (1) by Finance Act, 2015

to conduct audit of a registered person or persons, including audit of refund claims and forensic audit and the scope of such audit shall be determined by the Board or the Commissioner Inland Revenue on a case-to-case basis. In addition, the Board may, where it considers appropriate, also get such audit conducted jointly with similar audits being conducted by provincial administrations of sales tax on services.]

(2) Notwithstanding that records of a registered person have been audited by an officer appointed under section 30, the Board or a 442[Commissioner] may direct 443[special audit panel] appointed under sub- section (1) to audit the records of any registered person.

(3) 444[Every member of special audit panel] appointed under sub- section (1), shall have the powers of an officer of 445[Inland Revenue] under sections 25, 37 and 38. 446[(4) Each special audit panel shall be headed by a chairman who shall be an officer of Inland Revenue.

(5) If any one member of the special audit panel, other than the chairman, is absent from conducting an audit, the proceedings of the audit may continue and the audit conducted by the special audit panel shall not be invalid or be called in question merely on the ground of such absence.

(6) The Board may prescribe rules in respect of constitution, procedure and working of special audit panel.] 447[32AA. ***] 442 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010 dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary part I at pages 229 to 259. 443 Substituted for the words “an auditor” by Finance Act, 2015 444 Substituted for the words “An Auditor” by Finance Act, 2015 445 Substituted for “sales tax” by Finance Act, 2010 w.e.f. June 5, 2010.The same was made by Finance (Amendment) Ordinance, 2010, promulgated as ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part-I at Pages 229 to 259. 446 Sub-sections (4), (5) and (6) inserted by Finance Act, 2015. 447 Section 32 AA omitted by Finance Act, 2008, earlier it was inserted by Tax Laws Amendment Ordinance, 2000, dated may 24, 2000.

Chapter-VII

OFFENCES AND PENALTIES

33. Offences and penalties

449[…] Whoever commits any offence described in column (1) of the Table below shall, in addition to and not in derogation of any punishment to which he may be liable under any other law, be liable to the penalty mentioned against that offence in column

(2) thereof: -

TABLE

Provided that in case a person files a return within 451[ten] days of the due date, he shall pay a penalty of 452[two] hundred rupees for each day of default. involved, whichever is higher.

material nature in the registration of taxable activity.

448 Section 33 substituted by Finance Act, 2005. 449 Bracket and figure “one” omitted by Finance Act, 2008. 450 Substituted for the word “five” by Finance Act, 2019.. 451 Substituted for the word “fifteen” by Finance Act, 2015. 452 Substituted for the word “one” by Finance Act, 2019.

Any person who fails to Such person shall pay a penalty of 3, 6, 7 and 48 defaulter shall pay a penalty of five default:

miscalculation is made for the first time during a year:

Provided further that if the amount of tax due is not paid even after the expiry of a period of sixty days of 454[Inland Revenue, not below the conviction by a Special Judge, to may extend to three years, or with fine which may extend to amount involved, or with both. due is paid.

453 Substituted for the word “fifteen” by Finance Act, 2015. 454 Substituted for “Sales tax”, not below the rank of Assistant Collector of sales tax” by Finance Act, 2010

registered within sixty days of the commencement of taxable activity, conviction by a Special Judge, to may extend to three years, or with amount equal to the amount of tax involved, or with both.

under. first notice;

second notice; and

third notice.

section (5) of section 26. 11. Any person who, - Such person shall pay a penalty of 2(37) and General

hundred per cent of the amount of tax involved, whichever is higher. He shall, further be liable, upon 456[Inland revenue]; or conviction by a Special Judge, to

involved, or with both.

forged or false.

Any person who denies Such person shall pay a penalty of 25, 38 , 458[38A present the same when

455 Any reference to “officer of Sales Tax” shall be construed as reference to an ‘officer of Inland Revenue” by virtue of Section 72A of the Sales Tax Act, 1990. 456 Substituted for the words “Sales Tax” by the Finance Act, 2010 458 Substituted for “or 38A” by Finance Act, 2009

required under section 25, 38 457[38A or 40B]. involved, or with both. involved, or with both. 15. Any person who Such person shall pay a penalty of 31 and General official duties. Act. 17. Any person who fails Such person shall pay a penalty of 71 and General

457 Substituted for “or 38A” by Finance Act, 2009

provisions of this Act. Such officer of 460[Inland Revenue] act. thereunder] for which section. this Act 50A.] twenty-five thousand rupees or one

459 Words “Sales Tax” substituted for Inland Revenue by Finance (Amended) Ordinance, 2010.

460 Substituted for “Sales Tax” by Finance Act, 2010

461 Words added through Finance Act, 2016. 462 Serial No. 20 omitted by Finance Act, 2008.

463 Serial No. 21 and 22 inserted by Finance Act, 2006.

(b) unauthorizedly otherwise disseminates information the computerized system; or

information computerized system; or

dishonestly computerized system; or

dishonestly or disc or other information the computerized or stored; or

to authenticate a transmission of information computerized system; or

(g) fails to comply contravenes conditions identifier.

barcodes, or without tax stamps,

464 S.No. 23 and entries relating thereto in columns (1), (2) and (3) inserted through Finance Act, 2017 465 Expression omitted by by Finance (Supplementary) Act, 2022.

barcodes, permanent seizure of the vehicle used for transportation of [specified goods]; and

[specified goods] without or with such sale be sealed for a period not exceeding fifteen days. 466[“24. Any person, who is Such person shall pay a penalty of sub-section (9A) of

466 New serial numbers “24”, “25”, “26” and “27” inserted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020. 467 Paragraph under serial number 24 inserted by Finance (Supplementary) Act, 2022.

computerized system, fails to get under the Act, and if under law.

472[25A A person required Such person shall be liable to pay: Sub-section (9A) stipulated under sub- rupees for second default registered under the after fifteen days of order for first default; after fifteen days of order thereunder. after fifteen days of order for third default:

468 The word substituted by Finance Act, 2020. 469 The word substituted by Finance Act, 2020. 470 Expression substituted by Tax Laws (Third Amendment) Ordinance, 2021. 471 Expression omitted by Tax Laws (Third Amendment) Ordinance, 2021. 472 New serial number inserted by Tax Laws (Third Amendment) Ordinance, 2021.

473[Notwithstanding above, person shall be liable to be sealed by an officer of Inland Revenue in

the manner prescribed.]

Provided 474[***] that if the retailer integrates his business with the Board’s Computerized System Commissioner.

Any person, being a Such person shall pay a penalty of sub-section (27) of (a) of sub-section payment of fine which shall not be less than twenty percent of the total retail price of such goods.

Further, such goods shall also be liable to confiscation. However, the adjudication authority, after such payment of fine which shall not be less than twenty percent of value,

473 Expression substituted by Finance (Supplementary) Act, 2022. 474 Word “further” omitted by Finance (Supplementary) Act, 2022.

falling in Third Schedule, of such goods.

56AB] so in the manner as required under the law

476[33A. section 51, the Board shall prescribe rules for initiating criminal proceedings against any authority mentioned in sections 30 to 30DDD, including any officer or official subordinate to the aforesaid authority, who wilfully and deliberately commits or omits an act which results in undue benefit or advantage to the authority or the officer or official or to any other person.

(2) Where proceedings under sub-section (1) have been initiated against the authority or officer or official, the Board shall simultaneously intimate the relevant Government agency to initiate criminal proceedings against the person referred to in sub-section (1).

(3) The proceedings under this section shall be without prejudice to any other liability that the authority or officer or official or the person may incur under any other law for the time being in force.]

34. Default Surcharge

(1) Notwithstanding the provisions of section 11, if a registered person does not pay the tax due or any part thereof, whether wilfully or otherwise, in time or in the manner specified under this Act, rules or notifications issued thereunder or claims a tax credit, refund or

475 New serial number 28 added by Finance Act, 2020. 476 New section 33A added by Finance Act, 2019. 477 Section 34 substituted by Finance Act, 2005. Earlier it was also substituted by Finance Act, 1996.

makes an adjustment which is not admissible to him, or incorrectly applies the rate of zero per cent to supplies made by him, he shall, in addition to the tax due, pay default surcharge at the rate mentioned below:-

(a) 478[…] the person liable to pay any amount of tax or charge or the amount of refund erroneously made, shall pay default surcharge at the rate of 479[twelve per cent per annum], of the amount of tax due or the amount of refund erroneously made; 480[and] 481[(b) ***]

(c) in case, the default is on account of tax fraud, the person who has committed tax fraud shall pay default surcharge at the rate of two per cent per month, of the amount of tax evaded or the amount of refund fraudulently claimed, till such time the entire liability including the amount of default surcharge is paid.

(2) For the purpose of calculation of default surcharge, -

(a) in the case of inadmissible input tax credit or refund, the period of default shall be reckoned from the date of adjustment of such credit or, as the case may be, refund is received; and

(b) in the case of non-payment of tax or part thereof, the period of default shall be reckoned from the 16th day of a month (following the due date of the tax period to which the default relates) to the day preceding the date on which the tax due is actually paid. Explanation.- For the purpose of this section tax due does not include the amount of penalty. 478 Words and comma “for the first six months of default,” omitted by Finance Act, 2008. 479 Words twelve substituted by Finance Act, 2018. 480 Word inserted by Finance Act, 2008. 481 Clause (b) omitted by Finance Act, 2008.

34A. Exemption from penalty and default surcharge

The Federal Government may, by a notification in the official Gazette, or the 484[Board] by a special order published in Gazette for reasons to be recorded in writing, exempt any person or class of persons from payment of the whole or part of the penalty and 485[default surcharge] imposed under sections 33 and 34 subject to such conditions and limitations as may be specified in such notification or, as the case may be, special order.] 486[35. ***] 487[35A. ***] 488[36. ***]

37. Power to summon persons to give evidence and produce documents in inquiries under the Act

(1) Any officer of 489[Inland Revenue] shall have powers to summon any person whose attendance he considers necessary either to tender evidence or to produce documents or any other thing in any inquiry which such officer is making for any of the purposes of this Act.

(2) Any person summoned under sub-section (1) shall be bound to attend either in person or by an authorised agent, as the officer of 4[Inland Revenue] may direct; Provided that a person who is exempted from personal appearance in a court under section 132 and 133 of the Code of Civil Procedure (Act V of 1908), shall not be required to appear in person. 482 Section 34A substituted by Finance Ordinance 2001. Earlier it was inserted by Sales Tax (Amendment) Act, 1999 which comes into force from the first day of December, 1998. Earlier the same was amendment was made by Sales Tax (Second Amendment) Ordinance, 1988, dated 01-12-1998. 483 Substituted for “additional tax” by Finance Act, 2005 484 Substituted for “Central Board of revenue” by Finance Act, 2007 485 Substituted for “additional tax” by Finance Act, 2005 486 Section 35 omitted by Finance Act, 1996. 487 Section 35A omitted by Finance Act, 1996. Earlier it was inserted by Finance Act, 1992. 488 Section 36 omitted by Finance Act, 2012. Earlier it was substituted by Finance Act, 1996. Before this it was substituted by the Finance Act, 1994. 489 Substituted for “sales tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009 published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

(3) Any inquiry before an officer of 490[Inland Revenue] shall be deemed to be a judicial proceeding within the meaning of section 193 and 491[228] of the Pakistan Penal Code (Act XLV of 1860).

37A. Power to arrest and prosecute

(1) An officer of 493[Inland Revenue not below the rank of an Assistant Commissioner of Inland Revenue] or any other officer of equal rank authorised by the 494[Board] in this behalf, who on the basis of material evidence has reason to believe that any person has committed a tax fraud 495[or any offence warranting prosecution under this Act] 496[…], 497[may cause arrest of such person.]

(2) All arrests made under this Act shall be carried out in accordance with the relevant provisions of the Code of Criminal Procedure, 1898 (Act V of 1898). 498[(3) ***]

(4) Notwithstanding anything contained in sub-section (1) to subsection (3) or any other provision of this Act, where any person has committed a tax fraud 499[or any offence warranting prosecution under this Act], the 500[Commissioner] may, either before or after the institution of any proceedings for recovery of tax, compound the offence if such person pays the amount of tax due along with such 501[default surcharge] and penalty as is determined under the provisions of this Act.

(5) Where the person suspected of tax fraud 502[or any offence warranting prosecution under this Act] is a company, every director or 490 Substituted for “sales tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009 published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 491 Substituted for the figure “223” by Finance Act, 1994 492 Section 37A substituted by Finance Act, 1996. 493 Substituted for “sales tax”, not below the rank of an Assistant Collector of Sales tax by Finance Act, 2010 w.e.f June 5, 2010, the same amendment was made by Finance (amendment) Ordinance, 2010, promulgated as Ordinance No.III of 2010, dated February 6, 2010, published in the Official Gazette of Pakistan Extraordinary part I at pages 23 to 53. 494 Substituted for “Central Board of Revenue” by Finance Act, 2007 495 Words inserted by Finance Act, 2007. 496 Words “in respect of a supply or supplies made by him” omitted by Finance Act, 2007. 497 Substituted for the words “may arrest such person” by Finance Act, 2003 498 Sub-section (3) omitted by Finance Act, 2005. 499 Words inserted by Finance Act, 2007. 500 Substituted for “Collector” by Finance Act, 2010 w.e.f. june5, 2010, the same amendment was made by Finance (Amendment) Ordinance 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extra Ordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009 published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 501 Substituted for “additional tax” by Finance Act, 2005 502 Words inserted by Finance Act, 2007.

officer of that company whom the authorised officer has reason to believe is personally responsible for actions of the company contributing the tax fraud 503[or any offence warranting prosecution under this Act] shall be liable to arrest; provided that any arrest under this sub-section shall not absolve the company from the liabilities of payment of tax, 504[default surcharge] and penalty imposed under this Act.]

37B. Procedure to be followed on arrest of a person

(1) When 506[an officer of Inland Revenue] authorized in this behalf arrests a person under Section 37A, he shall immediately intimate the fact of the arrest of that person to the Special Judge who may direct such Officer to produce that person at considers such time and place and on such date as the Special Judge considers expedient and such Officer shall act accordingly.

(2) Notwithstanding anything contained in the sub-section (1), any person arrested under this Act shall be produced before the Special Judge or, if there is no Special Judge within a reasonable distance, to the nearest Judicial Magistrate, within twenty-four hours of such arrest, excluding the time necessary for the journey from the place of arrest to the Court of the Special Judge or, as the case may be, of such Magistrate.

(3) When any person is produced under sub-section (2) before the Special Judge, he may, on the request of such person, after perusing the record, if any and after giving the prosecution an opportunity of being heard, admit him to bail on his executing a bond, with or without sureties, or refuse to admit him to bail and direct his detention at such place as he deems fit: Provided that nothing herein contained shall preclude the Special Judge from cancelling the bail of any such person at a subsequent stage if, for any reason, he considers such cancellation necessary, but before passing such order he shall afford such person an opportunity of being heard, unless for reasons to be recorded he considered that the affording of such opportunity shall defeat the purposes of this Act.

(4) When such person is produced under sub-section (2) before a Judicial Magistrate, such Magistrate may, after authorising his detention in 503 Words inserted by Finance Act, 2007. 504 Substituted for “additional tax” by Finance Act, 2005 505 Section 37B inserted by Finance Act, 1995. 506 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019.

such custody at such place and for such period as he considers necessary or proper for facilitating his earliest production before the Special Judge, direct his production before the Special Judge on a date and time to be fixed by him or direct such person to be forthwith taken to, and produced before, the Special Judge and he shall be so taken.

(5) Nothing in sub-section (3) or sub-section (4) shall preclude the Special Judge or the Judicial Magistrate from remanding any such person to the custody of 507[an officer of Inland Revenue] holding inquiry against that person if such officer makes a request in writing to that effect, and the Special Judge or the Judicial Magistrate, after perusing the record, if any, and hearing such person, is of the opinion that for the completion of inquiry or investigation it is necessary to make such order: Provided that in no case the period of such custody shall exceed fourteen days.

(6) When any person is arrested under this Act, 508[an officer of Inland Revenue] shall record the fact of arrest and other relevant particulars in the register specified in sub-section (10) and shall immediately proceed to inquire into the charge against such person and if he completes the inquiry within twenty-four hours of his arrest, excluding the time necessary for journey as aforesaid, he may, after producing such person before the Special Judge or the nearest Judicial Magistrate, make a request for his further detention in his custody.

(7) While holding an inquiry under sub-section (6), 509[an officer of Inland Revenue] shall exercise the same powers as are exercisable by an officer in charge of a police station under the Code of Criminal Procedure, 1898 (Act V of 1898), but such officer shall exercise such powers subject to the foregoing provisions of this section while holding an inquiry under this Act.

(8) If 510[an officer of Inland Revenue], after holding an inquiry as aforesaid, is of the opinion that there is no sufficient evidence or reasonable ground for suspicion against such person, he shall release him on his 507 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019. 508 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019. 509 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019. 510 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019.

executing a bond, with or without sureties, and shall direct such person to appear, as and when required, before the Special Judge, and make a report to the Special Judge for the discharge of such person and shall make a full report of the case to his immediate superior.

(9) The Special Judge to whom a report has been made under sub- section, (8) may, after the perusal of record of the inquiry, and hearing the prosecution, agree with such report and discharge the accused or, if he is of the opinion that there is sufficient ground for proceedings against such person, proceed with his trial and direct the prosecution to produce evidence.

(10) 511[An officer of Inland Revenue] empowered to hold inquiry under this section shall maintain a register to be called “Register of Arrests and Detentions” in the prescribed form in which he shall enter the name and other particulars of every person arrested under this Act, together with the time and date of arrest, the details of the information received, the details of things, goods or documents, recovered from his custody, the name of the witnesses and the explanation, if any, given by him and the manner in which the inquiry has been conducted from day to day; and, such register or authenticated copies of its aforesaid entries shall be produced before the Special Judge, whenever such Officer is so directed by him.

(11) After completing the inquiry, 512[an officer of Inland Revenue] shall, as early as possible, submit to Special Judge a complaint in the same form and manner in which the officer incharge of a police station submits a report, before a court.

(12) Magistrate of the first class may record any statement or confession during inquiry under this Act, in accordance with the provisions of Section 164 of the Code of Criminal Procedure, 1898 (Act V of 1898).

(13) Without prejudice to the foregoing provisions of this section, 513[Board, with the approval of the Federal Minister-in-charge,] may, by notification in the official Gazette, authorize any other officer working under the 514[Board] to exercise the powers and perform the functions of 511 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019. 512 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019. 513 The expression substituted for the words “Federal Government” through Finance Act, 2019. 514 Substituted for “Central Board of Revenue” by Finance Act, 2007

515[an officer of Inland Revenue] under this section, subject to such conditions, if any, that it may deem fit to impose.]

37C. Special Judges

(1) The Federal Government may by notification in the official Gazette, appoint as many Special Judges as it considers necessary and, where it appoints more than one Special Judge, it shall specify in the notification the headquarter of each Special Judge and the territorial limits within which he shall exercise jurisdiction under this Act.

(2) No person shall be appointed as a Special Judge unless he is or has been a Sessions Judge.]

37D. Cognizance of Offences by Special Judges

(1) Notwithstanding anything contained in this Act or any other law for the time being in force, a Special Judge may, within the limits of his jurisdiction, take cognizance of any offence punishable under this Act:

(a) Upon a report in writing made by an officer of Inland Revenue or by any other officer especially authorized in this behalf by the Federal Government; or

(b) Upon receiving a complaint or information of facts constituting such offence made or communicated by any person; or

(c) Upon his own knowledge acquired during any proceeding before him under this act or under any other law for the time being in force.

(2) Upon the receipt of report under clause (a) of sub-section (1), the Special Judge shall proceed with trial of the accused.

(3) Upon the receipt of a complaint or information under clause (b), or acquired in the manner referred to in clause (c) of sub-section (1), the Special Judge may, before issuing a summon or warrant for appearance of the person complained against, hold a preliminary inquiry for the purpose of ascertaining the truth or falsehood of the complaint, or direct any 515 Substituted for the words “the Sales Tax Officer” through Finance Act, 2019. 516 Section 37C inserted by Finance Ac, 2010 earlier a different section 37C was omitted by Finance Act, 2005 which was inserted by Finance Act, 1997. 517 Section 37D to 371 inserted by Finance Act, 2010.

magistrate or any officer of Inland Revenue or any police officer to hold such inquiry and submit a report, and such Magistrate or officer shall conduct such inquiry and make report accordingly.

(4) If, after conducting such inquiry or after considering the report of such Magistrate or officer, the Special Judge is of the opinion that- -

(a) there is no sufficient ground for proceeding, he may dismiss the complaint, or

(b) there is sufficient ground for proceeding, he may proceed against the person complained against in accordance with law.

(5) A special Judge or a Magistrate or an officer holding inquiry under sub-section (3) may hold such inquiry, as early as possible, in accordance with the provision of section 202 of the Code of Criminal Procedure, 1898 (Act V of 1898).

37E. Special Judge, etc. to have exclusive jurisdiction

Notwithstanding anything contained in this Act or in any other law for the time being in force,-

(a) no court other than the Special Judge having jurisdiction, shall try an offence punishable under this Act;

(b) no other court or officer, except in the manner and to the extent specifically provided for in this Act, shall exercise any power, or perform any function under this Act;

(c) no court, other than the High Court, shall entertain, hear or decide any application, petition or appeal under chapters XXXI and XXXII of the Code of Criminal Procedure, 1898 (Act V of 1898), against or in respect of any order or direction made under this Act; and

(d) no court, other than the Special Judge or the High Court, shall entertain any application or petition or pass any order or give any direction under chapters XXXVII, XXXIX, XLIV or XLV of the aforesaid Code.]

37F. Provisions of Code of Criminal Procedure, 1898, to apply

(1) The provision of the Code of Criminal procedure, 1898 (Act V of 1898), so far as they are not inconsistent with the provisions of this Act, shall apply to the proceedings of the court of a Special Judge and such court shall be deemed to be a court of Sessions for the purpose of the said Code and the provisions of Chapter XXIIA of the foresaid Code, so far as applicable and with the necessary modifications, shall apply to the trial of cases by the Special Judge under this Act.

(2) For the purposes of sub-section (1), the Code of Criminal Procedure, 1898 (Act V of 1898), shall have effect as if an offence punishable under this Act were one of the offences referred to in sub-section

(1) of section 337 of the said Code.

37G. Transfer of cases

(1) Where more than one Special Judge are appointed within the territorial jurisdiction of a High Court, the High Court, and where not more than one Special Judge is so appointed, the Federal Government, may by order in writing direct the transfer, at any stage of the trial, of any case from the court of one Special Judge to the Court of another Special Judge for disposal, whenever it appears to the High Court or, as the case may be, the Federal Government, that such transfer may promote the ends of justice or tend to the general convenience of the parties or witnesses.

(2) In respect of a case transferred to a Special Judge under sub- section (1), such Special Judge shall not by reason of the said transfer, be bound to recall and rehear any witness whose evidence has been recorded in the case before the transfer and may act upon the evidence already recorded or produced before the court which tried the case before the transfer.]

37H. Place of Sittings

A Special Judge shall ordinarily hold sittings at his headquarters but, keeping in view the general convenience of the parties or the witnesses, he may hold sittings at any other place.

37I. Appeal to the High Court

(1) Any person, including the Federal Government, the Board, the Commissioner or Director of Intelligence and Investigation or any other officer authorized in this behalf

by the Board, aggrieved by any order passed or decision made by a Special Judge under this Act or under the Code of Criminal Procedure, 1898 (Act V of 1898), may, subject to the provisions of Chapters XXXI and XXXII of the said Code, within Sixty days from the date of the order or decision, prefer an appeal to the High Court.

(2) Except as otherwise provided in sub-section (1), the provisions of the Limitation Act, 1908 (IX of 1908), shall apply to an appeal preferred under sub-section (1).] 518[38. Authorised officers to have access to premises, stocks, accounts and records - (1) Any officer authorised in this behalf by the Board 519[or the Commissioner 520[***]] shall have free access 521[including real-time electronic access] to business or manufacturing premises, registered office or any other place where any stocks, business records or documents required under this Act are kept or maintained belonging to any registered person or a person liable for registration or whose business activities are covered under this Act or who may be required for any inquiry or investigation in any tax fraud committed by him or his agent or any other person; and such officer may, at any time, inspect the goods, stocks, records, data, documents, correspondence, accounts and statements, utility bills, bank statements, information regarding nature and sources of funds or assets with which his business is financed, and any other records or documents, including those which are required under any of the Federal, Provincial or local laws maintained in any form or mode and may take into his custody such records, statements, diskettes, documents or any part thereof, in original or copies thereof in such form as the authorised officer may deem fit against a signed receipt.

(2) The registered person, his agent or any other person specified in sub-section (1) shall be bound to answer any question or furnish such information or explanation as may be asked by the authorised officer.

(3) The department of’ direct and indirect taxes or any other Government department, local bodies, autonomous bodies, corporations or 518 Section 38 Substituted by Finance Act, 1996. 519 Words inserted by Finance Act, 2010 w.e.f. June 5, 2010. 520 The words “or the Collector” were omitted by Finance Act, 2009. 521 Words inserted by Finance Act, 2020.

such other institutions shall supply requisite information and render necessary assistance to the authorised officer in the course of inquiry or investigation under this section.] 522[(4) For the purpose of sub-section (1), the Board may make rules relating to electronic real-time access for audit or a survey of persons liable to tax.]

38A. Power to call for information

The 524[Commissioner] may, by notice in writing, require any person, including a banking company, to furnish such information or such statement in connection with any investigation or inquiry in cases of tax fraud, as may be specified in such notice 525[:]] 526[Provided that the 527[Commissioner] may require any regulatory authority to provide information concerning the licenses and authorizations issued by it.]

38B. Obligation to produce documents and provide information

(1) Notwithstanding anything contained in this Act or any other law for the time being in force, any person required to maintain the record under the Act, on demand by an officer, not below the rank of 529[an Assistant] 530[Commissioner Inland Revenue] , by notice in writing, as and when specified in the notice, shall,-

(a) produce for examination, such documents or records which the officer of 531[Inland Revenue] considers necessary or relevant to the audit, inquiry or investigation under the Act;

(b) allow the officer of 532[Inland Revenue] to take extracts from or copies of such documents or records; and 522 New sub-section (4) inserted by Finance Act, 2020. 523 Section 38A inserted by Finance Act, 2004. 524 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 525 Substituted for full stop by Finance Act, 2007 526 Proviso inserted by Finance Act, 2007. 527 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010 528 Section 38B inserted by Finance Act, 2006. 529 Substituted for “a Deputy” by Finance Act, 2011 530 Substituted for “Collector of Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 531 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extra Ordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009 published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 532 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010

(c) appear before the officer of 533[Inland Revenue] and answer any question put to him concerning the documents and records relating to the audit or inquiry or investigation referred to in clause (a) above.

(2) An officer of 534[Inland Revenue] conducting an audit, inquiry or, as the case may be, an investigation under the Act, may require in writing any person, department, company or organization to furnish such information as is held by that person, department, company or organization, which, in the opinion of the officer of 535[Inland Revenue], is relevant to such audit, inquiry or investigation.

(3) The Board may require, in writing, any person, department, company or organization, as the case may be, to provide any information or data held by that person, department, company or organization, which, in the opinion of the Board, is required for purposes of formulation of policy or administering the Customs, Sales Tax, Federal Excise or Income Tax.

(4) Every person, department, company or organization shall furnish the information requisitioned by the Board or the officer of Sales Tax under sub-section (2) or (3), within the time specified in the notice issued by the Board or, as the case may be, the officer of 536[Inland Revenue].] 537[39. ***]

40. Searches under warrant

(1) Where any officer of 539[Inland Revenue] has reason to believe that any documents or things which in his opinion, may be useful for, or relevant to, any proceedings under this Act 533 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 534 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 535 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 536 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 537 Section 39 omitted by Finance act, 1996. 538 Section 40 substituted by Finance Act, 2004. 539 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010

are kept in any place, he may after obtaining a warrant from the magistrate, enter that place and cause a search to be made at any time.

(2) The search made 540[in his presence] under sub-section (1) shall be carried out in accordance with the relevant provisions of the Code of Criminal Procedure, 1898 (V of 1898).] 541[40A. ***]

40B. Posting of Inland Revenue Officer

Subject to such conditions and restrictions, as deemed fit to impose, the 543[Board], 544[omitted..] may post Officer of 6[Inland Revenue] to the premises of registered person or class of such persons to monitor production, sale of taxable goods and the stock position 545[.] 546[omitted..]

40C. Monitoring or Tracking by Electronic or other means

(1) Subject to such conditions, restrictions, and procedures, as it may being fit to impose or specified, the Board may, by notification in the official Gazette, specify any registered person or class of registered persons or any good or class of goods in respect of which monitoring or tracking of production, sales, clearances, stocks or any other related activity may be implemented through electronic or other means as may be prescribed

(2) From such date as may be prescribed by the Board, no taxable goods shall be removed or sold by the manufacturer or any other person without affixing tax stamp, bandrole stickers, labels, 548[barcodes,] etc. in any such form, style and manner as may be prescribed by the Board in this behalf.] 549[(3) Such tax stamps, banderols, stickers, labels, barcodes etc., shall be acquired by the registered person referred to in sub-section (2) from a licensee appointed by the Board for the purpose, against price approved by 540 The word and comma, inserted by the Finance Act, 2005 541 Section 40A omitted by Finance Act, 2006. 542 Section 40B inserted by Finance Act, 2003. 543 Substituted for “Central Board of revenue” by Finance Act, 2007 544 Words “or Chief Commissioner” omitted by Finance Act, 2018. 545 Colon omitted and full stop inserted by Finance Act, 2018. 546 Proviso and explanation omitted by Finance Act, 2018. 547 Section 40C inserted by Finance Act, 2013. 548 Word and comma inserted by Finance Act, 2015 549 Sub-section (3) added by Finance Act, 2015.

the Board, which shall include the cost of equipment installed by such licensee in the premises of the said registered person.]

40D. Provisions relating to goods supplied from tax-exempt areas

……97

(1) The conveyance carrying goods supplied from the tax exempt areas, shall be accompanied by such documents in respect of the goods carried as may be prescribed under rules.

(2) The Regional Tax Office having jurisdiction may establish check-posts on the routes originating from tax-exempt areas for the purpose of examining the goods carried and the documents related thereto, An officer not below the rank of Inspector, Inland Revenue, as authorized by the Commissioner, Inland Revenue, and assigned to such check-posts, may stop vehicle on such routes as coming from tax-exempt areas and examine documents for ascertaining their validity and conformity to the goods carried.

(3) In the absence of the prescribed documents or any discrepancy in such documents, the goods so carried shall be seized along with the vehicle carrying the goods by the officer as aforesaid under proper acknowledgment.

(4) The notices to the owner of the goods and the vehicle to show cause against imposition of penalty shall be issued within fifteen days of the seizure as aforesaid.

(5) For the purposes of this section, the expression “tax-exempt areas” means Azad Jammu and Kashmir, Gilgit-Baltistan, 551[Border Sustenance Markets and] Tribal Areas as defined in Article 246 of the Constitution of the Islamic Republic of Pakistan and such other areas as may be prescribed.”;]

40E. Licensing of brand name

……………………………………………………..97

(1) Manufacturers of the specified goods shall be required to obtain brand licence for each brand or 550 New Section “40D” inserted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020. Expression inserted by Finance Act, 2021. New section 40E inserted by Finance Act, 2021.

stock keeping unit (SKU) in such manner as may be prescribed by the Board.

(2) Any specified brand and SKU found to be sold without obtaining a licence from the Board shall be deemed counterfeit goods and liable to outright confiscation and destruction in the prescribed manner and such destruction and confiscation shall be without prejudice to any other penal action which may be taken under this Act.] 553[41. *** 42. ***] Chapter-VIII 554[APPEALS] 555[43. *** 44. ***] 556[45. ***]

45A. Power of the Board and Commissioner to call for records

(1) The Board may, of its own motion 560[, or otherwise] call for and examine the record of any departmental proceedings under this Act or the rules made there under for the purpose of satisfying itself as to the 553 Sections 41 and 42 omitted by Finance Act, 1996 554 Heading of chapter Adjudication substituted for cases by finance act 1996 555 Sections 43 and 44 omitted by Finance Act, 1996 556 Section 45 omitted by Finance Act, 2010 557 Section 45A added by Finance Act, 1993. 558 Substituted for “Collector and Collector (Adjudication)” by Finance Act, 2005. Earlier these were substituted for “and Collector” by Finance Act, 2003. 559Substituted for “Collector” by Finance Act, 2010 w.e.f. June 05, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extra Ordinary Part I at pages 229 to 259. 560 Words inserted by Finance Act, 2015.

legality or propriety of any decision or order passed therein by an Officer of 561[Inland Revenue], it may pass such order as it may think fit: Provided that no order imposing or enhancing any penalty or fine requiring payment of a greater amount of [Sales Tax] than the originally levied shall be passed unless the person affected by such order has been given an opportunity of showing cause and of being heard.

(2) No proceeding under 562[this section] shall be initiated in a case where an appeal under Section 563[45B] or Section 46 is pending.

(3) No order shall be made under this Section after the expiry of 564[five] years from the date of original decision or order of the sub-ordinate officer referred to in sub-section (1). 565[(4) The 566[Commissioner] may, suo moto, call for and examine the record of any proceeding under this Act or the rules made thereunder for the purpose of satisfying himself as to the legality or propriety of any decision or order passed by an officer of 567[Inland Revenue] subordinate to him, and pass such order as he may deem fit.]]

45B. Appeals

569[(1) Any person, other than the Sales Tax Department, aggrieved by any decision or order passed under sections 10, 11, 25, 36, or 66, by an officer of Inland Revenue may, within thirty days of the date of receipt of such decision or order, prefer appeal to the Commissioner Inland Revenue (Appeals): Provided that an appeal preferred after the expiry of thirty days may be admitted by the Commissioner Inland Revenue (Appeals) if he is satisfied that the appellant has sufficient cause for not preferring the appeal within the specified period 570[.] 561 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 562 Substituted for “sub-section (1)” by Finance Act, 2008 563 Substituted for the figure “45” by Finance Ordinance, 2002 564 Substituted for “three” by Finance Ordinance, 2000 565 Sub-section (4) substituted by Finance Act, 2005 566 Substituted for the word “Collector” by Finance Act, 2010 567 Substituted for the words “Sales Tax” by Finance, Act, 2010 568 Section 45B inserted by Finance Ordinance, 2002 569Subsection (1) Substituted by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 570 For the colon a full stop substituted and second proviso omitted by Finance Act, 2020.

9[****]

(d) be accompanied by the prescribed fee specified in sub-section (1B); and the time set out in sub-section (1).

[(1B)

(a) in the case of an appeal against an assessment- thousand rupees; or thousand and five hundred rupees; and rupees; or thousand rupees.]

572[573[(1C) Where in a particular case, the Commissioner (Appeals) is of the opinion recovery of tax levied under this act, shall cause undue hardship to the taxpayer, he, after affording opportunity of being heard to the commissioner or officer of Inland revenue against whose orders appeal has been made, may stay the recovery of such tax for a period not exceeding

(2) The 574[Commissioner Inland Revenue] (Appeals) may, after giving both parties to the appeal an opportunity of being heard, pass such

572 Existing sub-section (1A) re-numbered as (1C) by Finance Act, 2020. 573Inserted through Finance Act, 2013 574 Substituted for “Collector of Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated

order as he thinks fit, confirming, varying, altering, setting aside or annulling the decision or order appealed against 575[:] 576[Provided that such order shall be passed not later than 577[one hundred and twenty] days from the date of filing of appeal or within such extended period as the 578[Commissioner] (Appeals) may, for reasons to be recorded in writing fix: Provided further that such extended period shall, in no case, exceed 579[sixty] days 580[:]] 581[Provided further that any period during which the proceedings are adjourned on account of a stay order or Alternative Dispute Resolution proceedings or the time taken through adjournment by the petitioner not exceeding thirty days shall be excluded from the computation of aforesaid periods.]

(3) In deciding an appeal, the 1[Commissioner of Inland Revenue] (Appeals) may make such further inquiry as may be necessary provided that he shall not remand the case for de novo consideration. 582[(4) ***] 583[(5) The Commissioner (Appeals) shall not admit any documentary material or evidence which was not produced before the Officer Inland Revenue unless the Commissioner (Appeals) is satisfied that the appellant was prevented by sufficient cause from producing such material or evidence before the Officer Inland Revenue.] as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 575 Colon inserted through Finance, Act, 2005 576 Two provisos inserted by Finance Act, 2005 577 Substituted for “ninety” by Finance Act, 2008. 578 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 05, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan 579 Substituted for “one hundred and twenty” by Finance Act, 2009, earlier it was substituted for “ninety” by Finance Act, 2008. 580 Substituted for full stop by Finance Act, 2009 581 Proviso inserted by Finance Act, 2009 582Sub-section (4) omitted y Finance Act, 2006. 583 New sub-section (5) inserted by Finance Act, 2020.

46. Appeals to Appellate Tribunal

584[(1) Any person including an officer of 585[Inland Revenue] (not below the rank of an 586[Additional Commissioner], aggrieved by any order passed by- -

(a) the 587[Commissioner Inland Revenue] (Appeals) under section 45B,

(b) the 588[Commissioner Inland Revenue] through adjudication or under any of the provisions of this Act or rules made thereunder,

(c) the Board under section 45A, may, within sixty days of the receipt of such decision or order, prefer appeal to the Appellate Tribunal.] 589[(2) The Appellate Tribunal may admit, hear and dispose of the appeal as per procedure laid down in sections 590[131 and 132 of the Income tax Ordinance, 2001(XLIX of 2001, and rules made thereunder.] 591[(2A) All appeals and proceedings under this Act pending before the customs, Excise and Sales Tax Appellate Tribunal Constituted under section 194 of the customs Act 1969(IV of 1969) shall stand transferred to the Appellate Tribunal constituted under section 130 of the Income Tax Ordinance 2001 (XLIX of 2001) with effect from 28th Day of October , 2009.] 592[(3) ***

(4) ***

(5) *** 584 Sub Section (1) substituted by Finance Act, 2008. Earlier it was substituted by the Finance ordinance 2002. 585 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 05, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan. 586 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 05, 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010 published in the Gazette of Pakistan. 587 Substituted for “Collector of Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 588 Substituted for “Collector of Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 589 Sub-Section (2) substituted by Finance Act, 2009. 590 Substituted for “194A, 194B and 194C of the customs Act, 1969 (IV of 1969)” by Finance Act, 2010. 591 Sub Section (2A) inserted by Finance Act w.e.f. June 5, 2010. 592 Sub-sections (3), (4), (5), (6), (7), (8) and (9) omitted by Finance Act, 2009.

(6) ***

(7) ***

(8) ***

(9) ***]

47. Reference to the High Court

(1) Within ninety days of the communication of the order of the Appellate Tribunal under sub-section (594[2]) of section 46, the aggrieved person or any officer of 595[Inland Revenue] not below the rank of an 596[an Additional [Commissioner], authorized by the 597[Commissioner] may prefer an application in the prescribed form along with a statement of the case to the High Court, stating any question of law arising out of such order.

(2) The statement to the High Court referred to in sub-section (1), shall set out the facts, the determination of the Appellate Tribunal and the question of law, which arises out of its order.

(3) Where, on an application made under sub-section (1), the High Court is satisfied that a question of law arises out of the order referred to in sub-section (1), may proceed to hear the case.

(4) A reference to the High Court under this section shall be head by a bench of not less than two judges of the High Court and, in respect of the reference, the provisions of section 98 of the Code of Civil Procedure, 1908 (Act V of 1908) shall apply, so far as may be, notwithstanding anything contained in any other law for the time being in force.

(5) The High Court upon hearing a reference under this section shall decide the question of law raised by the reference and deliver judgment thereon specifying the grounds on which such judgment is based and the order of the Tribunal shall stand modified accordingly. The Court shall send a copy of the judgment under the seal of the Court to the Appellate Tribunal. 593 Section 47 substituted by Finance Act, 2005. Earlier it was substituted by Finance Act, 1997 594 Substituted for “5” by Finance Act, 2010 w.e.f. June 05, 2010 595 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010 596Substituted for “Deputy Collector” by Finance Act, 2006 597 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010

(6) The cost of any reference to the High Court shall be in the discretion of the Court.

(7) Notwithstanding that a reference has been made to the High Court, the tax shall be payable in accordance with the order of the Appellate Tribunal: Provided that, if the amount of tax is reduced as a result of the judgment in the reference by the High Court, and amount of tax found refundable by the High Court, the High Court may on application 598[by an Additional 599[Commissioner] authorized] by the 2[Commissioner] within thirty days of the receipt of the judgment of the High Court that he intends to seek leave to appeal to the Supreme Court, make an order authorizing the Collector to postpone the refund until the disposal of the appeal by the Supreme Court.

(8) Where recovery of tax has been stayed by the High Court by an order, such order shall cease to have effect on the expiration of a period of six months following the day on which it is made unless the reference is decided, or such order is withdrawn, by the High Court earlier.

(9) Section 5 of the Limitation Act, 1908 (IX of 1908), shall apply to an application made to the High Court under sub-section (1).

(10) An application under sub-section (1) by a person other than the 1[Additional 2[Commissioner] authorized by the] 2[Commissioner] shall be accompanied by a fee of one hundred rupees.] 600[(11) Notwithstanding anything contained in any provision of this Act, where any reference or appeal was filed with the approval of 601[Commissioner] by the officer of lower rank than the 2[Commissioner], and the reference or appeal is pending before an appellate forum or the Court, such reference or appeal shall always be deemed to have been so filed by the 2[Commissioner]. 598 Words inserted by Finance Act, 2006. 599 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010 600 Sub section (11) inserted by Finance Act, 2006. 601 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010

602[“47A. Alternative dispute resolution.- (1) Notwithstanding any other provision of this Act, or the rules made thereunder, an aggrieved person in connection with any dispute pertaining to-

(a) the liability of tax against the aggrieved person, or admissibility of refunds, as the case may be;

(b) the extent of waiver of default surcharge and penalty; or

(c) any other specific relief required to resolve the dispute, may apply to the Board for the appointment of a committee for the resolution of any hardship or dispute mentioned in detail in the application, which is under litigation in any court of law or an Appellate Authority, except where criminal proceedings have been initiated or where interpretation of question of law having effect on identical cases is involved having effect on other cases.

(2) The Board may, after examination of the application of an aggrieved person, appoint a committee, within sixty days of receipt of such application in the Board, comprising, -

(a) Chief Commissioner Inland Revenue having jurisdiction over the case; and

(b) two persons from a panel notified by the Board comprising of chartered accountants, cost and management accountants, advocates, having minimum of ten years’ experience in the field of taxation and reputable businessmen.

(3) The Board shall communicate the order of appointment of committee to the court of law or the appellate authority where the dispute is pending and the Commissioner.

(4) The Committee appointed under sub-section (2) shall examine the issue and may, if it deemed necessary, conduct inquiry, seek expert opinion, direct any officer of the Inland Revenue or any other person to conduct an audit and shall decide the dispute through consensus, within one hundred and twenty days of its appointment. 602 Section 47A substituted by Finance Act, 2020.

(5) The Committee may, in case of hardship, stay recovery of tax payable in respect of dispute pending before it for a period not exceeding one hundred and twenty days in aggregate or till the decision of the Committee or its dissolution, whichever is earlier.

(6) The decision of the committee under sub-section (4) shall be binding on the Commissioner when the aggrieved person, being satisfied with the decision, has withdrawn the appeal pending before any appellate authority or the court of law and has communicated the order of withdrawal to the Commissioner: Provided that if the order of withdrawal is not communicated to the Commissioner within sixty days of the service of decision of the committee upon the aggrieved person, the decision of the committee shall not be binding on the Commissioner.

(7) If the Committee fails to decide within the period of one hundred and twenty days under sub-section (4), the Board shall dissolve the committee by an order in writing and the matter shall be decided by the court of law or the appellate authority where the dispute is pending.

(8) The Board shall communicate the order of dissolution to the court of law or the Appellate Authority and the Commissioner.

(9) The aggrieved person, on receipt of the order of dissolution, shall communicate it to the court of law or the appellate authority, where the dispute is pending.

(10) The aggrieved person may make the payment of sales tax and other taxes as decided by the committee under sub-section (4) and all decisions and orders made or passed shall stand modified to that extent.

(11) The Board may prescribe the amount to be paid as remuneration for the services of the members of the Committee, other than the member appointed under clause (i) of sub-section (2).

(12) The Board may, by notification in the official Gazette, make rules for carrying out the purposes of this section.]

Chapter-IX RECOVERY OF ARREARS

48. Recovery of arrears of tax

………………………………………. ……..107 Chapter-X ………………………………………………………………………….. ……..109 MISCELLANEOUS …………………………………………………………… ……..109 -(1) 603[Subject to sub-section (1A), where] any amount of tax 604[…] is due from any person, the officer of 605[Inland Revenue] may:-

(a) deduct the amount from any money owing to person from whom such amount is recoverable and which may be at the disposal or in the control of such officer or any officer of Income Tax, Customs or Central Excise Department;

(b) require by a notice in writing any person who holds or may subsequently hold any money for or on account of the person from whom tax may be recoverable to pay to such officer the amount specified in the notice;

(c) stop removal of any goods from the business premises of such person till such time the amount of tax is paid or recovered in full; 606[(ca) require by a notice in writing any person to stop clearance of imported goods or manufactured goods or attach bank accounts;]

(d) seal the business premises till such time the amount of tax is paid or- recovered in full;

(e) attach and sell or sell without attachment any movable or immovable property of the registered person from whom tax is due 607[; and] 603 Words etc. “levied, penalty imposed or demand raised under any bond or other instrument executed under this Act” omitted by Finance Ordinance, 2002. 604 Substituted for “where” by Finance Act, 2007 605 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 606 Clause (ca) inserted by Finance Act, 1999. 607 Semi-colon and the word “’ and” at the end of clause (e) and thereafter clause (f) inserted by Finance Act, 1997. Earlier it was omitted by Finance Act, 1996. Originally it was inserted by Finance Act, 1994.

(f) 608[…] recover such amount by attachment and sale of any moveable or- immovable property of the guarantor, person, company, bank or financial institution, where a guarantor or any other person, company, bank or financial institution fails to make payment under such guarantee, bond or instrument 609[:] Provided that the Commissioner Inland Revenue or any officer of Inland Revenue shall not issue notice under this section or the rules made thereunder for recovery of any tax due from a taxpayer if the said taxpayer has filed an appeal under section 45B in respect of the order under which the tax sought to be recovered has become payable and the appeal has not been decided by the Commissioner (Appeals), subject to the condition that 610[ten] per cent of the amount of tax due has been paid by the taxpayer.] 611[(1A) If any arrears of tax, default surcharge, penalty or any other amount which is adjudged or payable by any person and which cannot be recovered in the manner prescribed above, the Board or any officer authorized by the Board, may, write off the arrears in the manner as may be prescribed by the Board.]

(2) For the purpose of recovery of tax, penalty or any other demand raised under this Act, the officer of 612[Inland Revenue] shall have the same powers which under the Code of Civil Procedure 1908 (V of 1908), a Civil Court has for the purpose of recovery of an amount due under a decree. 613[(3) The provision of sub-sections (1) and (2) shall mutatis mutandis apply regarding assistance in collection and recovery of taxes in pursuance of a request from a foreign jurisdiction under a tax treaty, bilateral or a multilateral convention, and inter-governmental agreement or similar agreement or mechanism.] 608 Word “may” omitted by Finance Act, 2007. 609 For the full stop a colon substituted and thereafter proviso added through Finance Act, 2017 610 Word ten substituted by Finance Act, 2018. 611 Sub-section (1A) inserted by Finance Act, 2007. 612 Substituted for “Sales Tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. New sub-section inserted by Finance Act, 2021.

Chapter-X MISCELLANEOUS

49. Sales of taxable activity or transfer of ownership

……… ……..109 49A. Liquidators. …………………………………………………………….. ……..109 50. Power to make rules. ………………………………………………… ……..110 50A. Computerized system. ………………………………………………. ……..111 50B. Electronic scrutiny and intimation……………………………….112 51. Bar of suits, prosecution and other legal proceedings. ….. ……..112 52. Appearance by authorised representative. …………………… ……..112 52A. e-intermediaries to be appointed. ……………………………….. ……..113 53. Estate of deceased person. ………………………………………… ……..114 54. Estate in bankruptcy. ………………………………………………… ……..114 55. Removal of difficulties. ……………………………………………. ……..114 56. Service of order, decisions, etc. …………………………………. ……..114 56A. Agreement for the exchange of information…………………….116 56AB. Real time access to information and databases………………….117 56B. Disclosure of information by a public servant ………….. ……. ….118 56C. Prize schemes to promote tax culture………………………….. 118 57. Rectification of Mistake ……………………………………………. ……..119 58. Liability for payment of tax in the case of private companies or business enterprises ………………………………………………….. ……..119 58A. Representatives. ………………………………………………………. ……..120 58B. Liability and obligations of representatives. ………………… ……..122 59. Tax paid on stocks acquired before registration …………… ……..123 60. Powers to deliver certain goods without payment of tax .. ……..124 61. Repayment of tax in certain cases. ……………………………… ……..124 61A. Repayment of tax to persons registered in Azad Jammu and Kashmir. …………………………………………………………………. ……..124 -(1) In case of termination of taxable activity or part thereof or its sale or transfer of ownership to a non-registered person, the possession of taxable goods or part thereof by the registered person shall be deemed to be a taxable supply and the registered person shall be required to account for and pay the tax on the taxable goods held by him: Provided that if the tax payable by such registered person remains unpaid, the amount of unpaid tax shall be the first charge on the assets of the business and shall be payable by the transferee of business. 615[(2) In the case of sale or transfer of ownership of a taxable activity or part thereof to another registered person as an ongoing concern, the taxable goods or part thereof shall be transferred to the new owner through a zero-rated invoice and the sales tax chargeable thereon shall be accounted for and paid by the registered person to whom such taxable activity or part thereof is transferred.]

49A. Liquidators

(1) Every person (hereinafter referred to as a “liquidator”) who is -

(a) a liquidator of a company;

(b) a receiver appointed by a Court or appointed out of Court;

(d) a mortgagee in possession; shall, within fourteen days of being appointed or taking possession of an asset in Pakistan, whichever occurs first, give written notice thereof to the 614 Section 49 Substituted by Finance Act, 1996 615 Sub-section (2) substituted through Finance Act, 2016. 616 Section 49A inserted by Finance Act, 2004.

617[Commissioner]. (2) The 4[commissioner] shall, within three months of being notified under sub-section (1), notify the liquidator, in writing, of the amount which appears to the 1[Commissioner] to be sufficient to provide for any sales tax which is or will become payable by the person whose assets are in the possession of the liquidator.

(3) A liquidator shall not, without leave of the 1[Commissioner]. Part with any asset held as liquidator until the liquidator has been notified under sub-section (2).

(4) A liquidator: -

(a) shall set aside, out of the proceeds of sale of any asset by the liquidator, the amount notified by the 1[Commissioner] under sub-section (2), or such amount as is subsequently agreed to by the 1[Commissioner]: and

(b) shall be liable to the extent of the amount set aside for the Sales tax liability of the person who owned the asset.

(5) A liquidator shall be personally liable to the extent of any amount required to be set-aside under sub-section (4) for the tax referred to in sub-section (2) if, and to the extent that, the liquidator fails to comply with the requirements of this section.

(6) Where the proceeds of sale of any asset are less than the amount notified by the 618[Commissioner] under sub-section (2), the application of sub-sections (4) and (5) shall be limited to the proceeds of sale.

(7) This section shall have effect notwithstanding anything contained in any other law for the time being in force.]

50. Power to make rules

619[(1)] The Board may, by notification in the official Gazette, make rules for carrying out the purposes of this Act 617 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 618 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 619 Brackets and figure inserted by Finance Act, 2008.

620[, including rules for charging fee for processing of return, claims and other documents and for preparation of copies thereof.] 621[(2) All rules made under sub-section (1) or any other provisions of this Act, shall be collected, arranged and published along with general orders and departmental instructions and rulings, if any, at appropriate intervals and sold to the public at reasonable price 622[or may be placed regularly on the official website maintained by the Board.]

50A. Computerized system

(1) The Board may prescribe the use of computerized system for carrying out the purposes of this Act, including the receipt of applications for registration, returns and such other declarations or information required to be provided under this Act and the rules made thereunder, from such date and for such registered persons or class of persons as the Board may, by notification in the official Gazette, specify.

(2) The Board may make rules for regulating the conduct and transaction of business in relation to the submission of returns or other information to the Board by the persons required to transmit or receive any information through the computerized system, including 624[matters such as grant of] authorization, suspension and cancellation of authorization and for security of the information transmitted or received through the computerized system.] 625[(3) Unless otherwise proved, the information received in the computerized system from or on behalf of any registered person shall, for all official and legal purposes, be deemed to have been furnished by and received from such registered person.

(4) The business information gathered through computerized system shall be confidential to be used only for official and legal purposes and no unauthorized person shall claim for any access to such information.] 620 Comma and words inserted by Finance Act, 1994 621 Sub-section (2) inserted by Finance Act, 2008. Words inserted by Finance Act, 2021. 623 Section 50A inserted by Finance Act, 2006. 624 Substituted for “their” by Finance Act, 2007 625 Sub-section (3) and (4) inserted by Finance Act, 2007.

50B. Electronic scrutiny and intimation

(1) The Board may implement a computerized system for the purpose of automated scrutiny, analysis and cross-matching of returns and other available data relating to registered persons and to electronically send intimations to such registered persons about any issue detected by the system.

(2) The intimation sent by the computerized system under sub- section (1) shall be in the nature of an advice or advance notice, aimed at allowing the registered person to clarify the issue, rectify any mistake or take other corrective action before any legal or penal action is initiated.

(3) The computerized system shall be so implemented so as to keep record of the issues detected, intimations sent, responses received and actions taken, and to present such information to the officer of Inland Revenue and to the Board in the prescribed manner.

(4) The Board may prescribe procedures and specifications for the smooth and efficient operation of the computerised system.]

51. Bar of suits, prosecution and other legal proceedings

(1) No suit shall be brought in any Civil Court to set aside or modify any order passed, any assessment made, any tax levied, any penalty imposed or collection of any tax made under this Act.

(2) No suit, prosecution or other legal proceeding shall lie against the Federal Government or against any public servant in respect of any order passed in good faith under this Act. 627[(3) Notwithstanding anything in any other law for the time being in force, no investigation or inquiry shall be undertaken or initiated by any governmental agency against any officer or official for anything done in his official capacity under this Act, rules, instructions or direction made or issued thereunder without the prior approval of the Board.]

52. Appearance by authorised representative

A registered person required to appear before the Appellate Tribunal or an officer of 628[Inland Revenue] in connection with any proceedings under this Act may, 626 Section 50B inserted by Finance Act 2014 627 Sub section (3) inserted by Finance Act, 2004. 628 Substituted for “Sales Tax Act” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance

in writing, authorise any person629[having such qualification as may be prescribed] to represent him or appear on his behalf.

52A. e-intermediaries to be appointed

(1) Subject to such conditions, limitations and restrictions, the Board may, by a notification in the official Gazette, appoint a person to electronically file return under Chapter V and such other documents electronically, as may be prescribed from time to time, on behalf of a person registered under section 14.

(2) A person registered under section 14 may authorize an e- intermediary to electronically file return or any other documents, as specified in sub-section (1).

(3) The return or such other documents filed by an e-intermediary on behalf of a registered person shall be deemed to have been filed by that registered person.

(4) Where this Act requires anything to be done by the registered person and if such thing is done by an e-intermediary authorized by the registered person under sub-section (2), unless the contrary is proved, shall be deemed to have been done with the knowledge and consent of such registered person so that in any proceedings under this Act, the registered person shall be liable as if the thing has been done by him.

(5) Where an e-intermediary, authorized by a registered person under sub-section (2) to act on his behalf, knowingly or wilfully submits a false or incorrect information or document or declaration with an intent to avoid payment of tax due or any part thereof or claiming a tax credit or a refund that is not due to the registered person, such e-intermediary shall be jointly and severally responsible for recovery of the amount of tax short paid or the amount refunded in excess as a result of such incorrect or false information or document or declaration, without prejudice to any other action that may be taken against him under the relevant provisions of the law. No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 629 Words inserted by Sales Tax (Amendment) Ordinance, 2000, dated September 5, 2000 630 Section 52A inserted by Finance Act, 2006.

(6) The Board may, by notification in the official Gazette, prescribe rules for the conduct and transaction of business of e- intermediaries, including their appointment, suspension and cancellation of appointment, subject to such conditions as specified therein.]

53. Estate of deceased person

The tax liability of a deceased registered person under the Act shall be the first charge on his estate in the hands of his successors.

54. Estate in bankruptcy

(1) If a registered person is declared bankrupt, the tax liability under this Act shall pass on to the estate in bankruptcy if it continues to operate the business.

(2) If tax liability is incurred by an estate in bankruptcy, the tax is deemed to be a current expenditure in the operations of the estate in bankruptcy and shall be paid before the claims preferred by other creditors are settled.

55. Removal of difficulties

If any difficulty arises in giving effect to the provisions of this Act or the rules made or notifications issued there under, the Board may through a general order or otherwise, issue instructions or directions, not inconsistent with the provisions of this Act, for such actions to be taken by an officer of Inland Revenue or any other person as it considers necessary or expedient for the purpose of removing the difficulty.]

56. Service of orders; decisions etc

(1) subject to this Act , any notice, order or requisition required to be served on a resident individual, other than in a representative capacity for the purposes of this Act shall be treated as properly served on the individual if -

(a) personally served on the individual or, in the case of an individual under a legal disability or a non-residents individual the representative of the individual;

(b) sent by register post or courier service specified in clause (b) of sub-section (2) or to the individual’s usual or last known address in Pakistan; 633[..] 631 Substituted vide Finance Ordinance, 2001 632 Section 56 substituted vide Finance Act, 2010 633 The words “or” omitted through Finance Act, 2017

(c) served on the individual in the manner prescribed for service of a summons under the code of civil procedure, 1908(Act V of 1908) 634[; or

(d) sent electronically through email or to the e-folder maintained for the purpose of e-filing of sales tax-cum-Federal excise returns by the 635[registered person].]

(2) Subject to this Act, any notice order or requisition required to be served on any person, other than a resident individual to whom sub- section (1)applies, for the purposes of this Act, shall be treated as properly served on person if -

(a) personally served on the representative of the person;

(b) sent by registered post or courier service to the person’s registered office or address for service of notices under this Act, in Pakistan or where the person does not have such office or address, the notice is sent by registered [Post to any office or place of business of the person in Pakistan; 636[..]

(c) served on the Person in the manner prescribed for service of a summons under the code of civil procedure, 1908(Act V of 1908) 637[; or

(d) sent electronically through email or to the e-folder maintained for the purpose of e-filing of sales tax-cum-Federal excise returns by the 3[registered person].]

(3) Where an association of persons is dissolved, any notice, order or requisition required to be served under this Act, on the association or a member of the association may be served on any person who was the 634 Semi colon substituted for the full stop and new clause (d) inserted through Finance Act, 2017 635 The words substituted by Finance Act, 2020. 636 The words “or” omitted through Finance Act, 2017 637 Semi colon substituted for the full stop and new clause (d) inserted through Finance Act, 2017

principal officer or a member of the association immediately before such dissolution.

(4) Where, business stands discontinued, any notice, order or requisition required to be served under this Act, on the person discontinuing the business may be served on the person personally or on any individual who was the person’s representative at the time of discontinuance.

(5) The validity of service of a notice under this Act shall not be called into question after the notice has been complied with in any manner.]

56A. Agreement for the exchange of information or assistance in recovery of taxes

(1) The Federal Government may enter into bilateral or multilateral agreements with provincial governments or with governments of foreign countries for the exchange of information, including electronic exchange of information, with respect to sales tax imposed under this Act or any other law of Pakistan and under the corresponding laws of such countries and may, by notification in the official Gazette, make such provisions as may be necessary for implementing such agreements. 640[(1A) Notwithstanding anything contained in this Act, the Board shall have power to share data or information including real time data videos, images received under the provisions of this Act with any other Ministry or Division of the Federal Government or Provincial Government, subject to such limitations and conditions an may be specified by the Board.]

(2) The provisions of section 107 of the Income Tax Ordinance, 2001 (XLIX of 2001) shall, mutatis mutandis, apply to the provisions of this section. 641[(3) The Federal Government may enter into bilateral or multilateral convention, and inter-governmental agreement or similar agreement or mechanism for assistance in the recovery of taxes.] 638 Sections 56A, 56B and 56C added by Finance Act, 2015 Words inserted by Finance Act, 2021. New sub-section (1A) inserted by Finance Act, 2021. New sub-section (3) inserted by Finance Act, 2021.

56AB. Real-time access to information and databases

(1) Notwithstanding anything contained in any law for the time being in force, including but not limited to the National Database and Registration Authority Ordinance, 2000 (Ordinance VIII of 2000), and the Emigration Ordinance, 1979 (Ordinance XVIII of 1979), arrangements shall be made to provide real-time access of information and database to the Board in the prescribed form and manner by-

(a) the National Database and Registration Authority with respect to information pertaining to National Identity Card (NIC), Pakistan Origin Card, Overseas Identity Card, Alien Registration Card, and other particulars contained in the Citizen Database;

(b) the Federal Investigation Agency and the Bureau of Emigration and Overseas Employment with respect to details of international travel;

(c) the Islamabad Capital Territory and Provincial and local land record and development authorities with respect to record-of-rights including digitized edition of record-of- rights, periodic record, record of mutations and report of acquisition of rights;

(d) the Islamabad Capital Territory and Provincial Excise and Taxation Departments with respect to information regarding registration of vehicles, transfer of ownership and other associated record;

(e) all electricity suppliers and gas transmission and distribution companies with respect to particulars of a consumer, the units consumed and the amount of bill charged or paid: Provided that where the connection is shared or is used by a person other than the owner, the name and NIC of the owner and the user shall also be furnished: Provided further that all electricity suppliers and gas transmission and distribution companies shall make arrangements by the 1st day of January, 2021 for allowing consumers to update the ratio of sharing of a 642 New section 56AB inserted by Finance Act, 2020.

connection or the particulars of users, as the case may be; and

(f) any other agency, authority, institution or organization, notified by the Board.

(2) The Board shall make arrangements for laying the infrastructure for real-time access to information and database under sub-section (1) and aligning it with its own database in the manner as may be prescribed.

(3) Until real-time access to information and database is made available under sub-section (1), such information and data shall be provided periodically in such form and manner as may be prescribed.

(4) Subject to section 56B, all information received under this section shall be used only for tax purposes and kept confidential.] 643[56B. Disclosure of information by a public servant.─ (1) Any information acquired under any provision of this Act shall be confidential and no public servant shall disclose any such information, except as provided under section 216 of the Income Tax Ordinance, 2001 (XLIX of 2001).

(2) Notwithstanding anything contained in sub-section (1) and the Freedom of Information Ordinance, 2002 (XCVI of 2002), any information received or supplied in pursuance of bilateral or multilateral agreements with government of foreign countries for exchange of information under section 56A shall be confidential.]

56C. Prize schemes to promote tax culture

1[(1)] The Board may prescribe prize schemes to encourage the general public to make purchases only from registered persons issuing tax invoices.] 644[(2) The Board may prescribe procedure for “mystery shopping” in respect of invoices issued by tier-1 retailers integrated with FBR online 643 Section 56B substituted through Finance Act, 2016. 644 Existing sub-section renumbered as sub-section (1) and new sub-section (2) inserted by Finance Act, 2021.

system randomly and in case of any discrepancy, all the relevant provisions of this Act shall apply accordingly.]

57. Rectification of Mistake

(1) The officer of Inland Revenue, Commissioner, the Commissioner (Appeals) or the Appellate Tribunal may, by an order in writing, amend any order passed by him to rectify any mistake apparent from the record on his or its own motion or any mistake brought to his or its notice by a taxpayer or, in the case of the Commissioner (Appeals) or the Appellate Tribunal, the Commissioner.

(2) No order under sub section (1) which has the effect of increasing an assessment, reducing a refund or otherwise applying adversely to the taxpayer shall be made unless the taxpayer has been given a reasonable opportunity of being heard.

(3) Where a mistake apparent on the record is brought to the notice of the officer of Inland Revenue, Commissioner or Commissioner (Appeals), as the case may be, and no order has been made under sub section (1), before the expiration of the Financial year next following the date on which the mistake was brought to their notice, the mistake shall be treated as rectified and all the provisions of this Act shall have effect accordingly.

(4) No order under sub-section (1) shall be made after five years from the date of the order sought to be rectified.]

58. Liability for payment of tax in case of private companies or business enterprises

(1) Notwithstanding anything contained in the Companies Act, 2017 (XIX of 2017), where any private company or business enterprise is wound up and any tax chargeable on the company or business enterprise, whether before, or in the course, or after its liquidation, in respect of any tax period cannot be recovered from the company or business enterprise, every person who was an owner of, or partner in, or director of, or a shareholder, owning not less than ten per cent of the paid- up capital, in the company or business enterprise, as the case may be, during the relevant period shall jointly and severally with such persons, be liable for the payment of such tax. 645 Section 57 is substituted by Finance Act, 2013. 646 Section 58 substituted by Finance Act, 2019.

(2) Any director or partner who pays tax under sub-section (1) shall be entitled to recover the tax paid from the company or a share of the tax from any other director or partner, as the case may be.

(3) A shareholder who pays tax under sub-section (1) shall be entitled to recover the tax paid from the company or from any other shareholder, owning not less than ten percent of the paid up capital, in proportion to the shares owned by that other shareholder.”; and

(4) The provisions of this Act shall apply to any amount due under this section as if it were tax due under an order for assessment made under this Act.]

58A. Representatives

(1) For the purpose of this Act and subject to sub-sections (2) and (3), the expression “representative” in respect of a registered person, means: -

(a) where the person is an individual under a legal disability, the guardian or manager who receives or is entitled to receive income on behalf, or for the benefit of the individual;

(b) where the person is a company (other than a trust, a Provincial Government, or local authority in Pakistan), a director or a manager or secretary or agent or accountant or any similar officer of the company;

(c) where the person is a trust declared by a duly executed instrument in writing whether testamentary or otherwise, any trustee of the trust;

(d) where the person is a Provincial Government, or local authority in Pakistan, any individual responsible for accounting for the receipt and payment of money or funds on behalf of the Provincial Government or local authority;

(e) where the person is an association of persons, a director or a manager or secretary or agent or accountant or any similar 647 Section 58A and 58B inserted by Finance Act, 2008

officer of the association or, in the case of a firm, any partner in the firm;

(f) where the person is the Federal Government, any individual responsible for accounting for the receipt and payment of moneys or funds on behalf of the Federal Government; or

(g) where the person is a public international organization, or a foreign government or political sub-division of a foreign government, any individual responsible for accounting for the receipt and payment of moneys or funds in Pakistan on behalf of the organization, government, or political subdivision of the government.

(2) Where the Court of Wards, the Administrator General, the Official Trustee, or any receiver or manager appointed by, or under, any order of a Court receives or is entitled to receive income on behalf, or for the benefit of any person, such Court of Wards, Administrator General, Official Trustee, receiver, or manager shall be the representative of the person for the purposes of this Act.

(3) 648[subject to sub-section (4), where a person is a non-resident person, the representative of the said person for the purpose of this Act, for a financial year in which the relevant tax period falls, shall be any person in Pakistan]: - -

(a) who is employed by, or on behalf of, the non-resident person;

(b) who has any business connection with the non-resident person;

(d) who holds, or controls the receipt or disposal of any money belonging to the non-resident person;

(e) who is the trustee of the non-resident person; or 648 The expression substituted by and Explanation added by Finance Act, 2020.

(f) who is declared by the 649[Commissioner] by an order in writing to be the representative of the non-resident person. 1[Explanation.- For the purposes of this sub-section, non-resident person shall have the same meaning assigned thereto under the Income Tax Ordinance, 2001 (XLIX of 2001).]

(4) No person shall be declared as the representative of a non- resident person unless the person has been given an opportunity by the 1[Commissioner] of being heard.]

58B. Liability and obligations of representatives

(1) Every representative of a person shall be responsible for performing any duties or obligations imposed by or under this Act on the person, including the payment of tax.

(2) Subject to section 58 and sub-section (5) of this section, any tax that, by virtue of sub-section (1), is payable by a representative of a registered person shall be recoverable from the representative only to the extent of any assets of the registered person that are in the possession or under the control of the representative.

(3) Every representative of a registered person who pays any tax owing by the registered person shall be entitled to recover the amount so paid from the registered person or to retain the amount so paid out of any moneys of the registered person that are in the representative’s possession or under the representative’s control.

(4) Any representative, or any person who apprehends that he may be assessed as a representative, may retain out of any money payable by him to the person on whose behalf he is liable to pay tax (hereinafter in this section referred to as the “principal”), a sum equal to his estimated liability under this Act, and in the event of disagreement between the principal and 649 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

such a representative or a person as to the amount to be so retained, such representative or person may obtain from the 650[Commissioner] a certificate stating the amount to be so retained pending final determination of the tax liability, and the certificate so obtained shall be his authority for retaining that amount.

(5) Every representative shall be personally liable for the payment of any tax due by the representative in a representative capacity if, while the amount remains unpaid, the representative: -

(a) alienates, charges or disposes of any moneys received or accrued in respect of which the tax is payable; or

(b) disposes of or parts with any moneys or funds belonging to the person that is in the possession of the representative or which comes to the representative after the tax is payable, if such tax could legally have been paid from or out of such moneys or funds.

(6) Nothing in this section shall relieve any person from performing any duties imposed by or under this Act on the person which the representative of the person has failed to perform.]

59. Tax paid on stocks acquired before registration

The tax 652[. . .] paid on goods purchased by a person who is subsequently required to be registered under section 14 due to new liabilities or levies or gets voluntary registration under 653[this Act or the rules made thereunder], shall be treated as input tax, provided that such goods were purchased by him from a registered person against an invoice issued under section 23 during a period of thirty days before making an application for registration and constitute his verifiable unsold stock on the date of compulsory registration or on the date of application for registration or for voluntary registration: Provided that where a person imports goods, the tax paid by him thereon during a period of ninety days before making an application for registration shall be treated as an input tax subject to the condition that he 650 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010 651Section 59 inserted by Finance Act, 1999. Earlier it was omitted by Finance Act, 1997. Earlier it was substituted through Finance Act, 1996. 652 Commas and words “, other than the turnover tax” omitted by Finance Act, 2004. 653 Substituted for “section 18” by Finance Act, 2004

holds the bill of entry relating to such goods and also that these are verifiable unsold or un-consumed stocks on the date of compulsory registration or on the date of application for registration or for voluntary registration.]

60. Powers to deliver certain goods without payment of tax

Subject to such conditions, limitations or restrictions as it thinks fit to impose, 655[Federal Government] may authorise the 656[import] of goods or class of goods, without payment of the whole or any part of the tax payable thereon to the following persons, namely: -

(i) registered importers importing such goods temporarily with a view to subsequent exportation; 657[(ii) registered manufacturer-cum-exporters who import raw materials and intermediary products for further manufacture of goods meant for export;] 658[(iii) ***]

61. Repayment of tax in certain cases

Subject to such conditions, limitations or restrictions as it thinks fit to impose, the Board may authorise the repayment in whole or in part of the tax paid on 659[…] any goods of such class or description as it may determine, which have been used in the production, manufacture, processing, repair or refitting in Pakistan of goods of such class or description as it may determine.

61A. Repayment of tax to persons registered in Azad Jammu and Kashmir

Subject to such conditions, limitations or restrictions as it may deem fit to impose, the Board may authorize the repayment in whole or in part of the input tax paid on any goods acquired in or imported into Pakistan by the persons registered in Azad Jammu and Kashmir as are engaged in making of zero-rated supplies.]

62. Drawback allowable on re-export

…………………………… ……..124 63. Drawback on goods taken into use between importation and re- exportation. …………………………………………………………….. ……..125 64. Power to declare what goods are identifiable and to prohibit drawback in case of specified foreign territory …………….. ……..125

Exemption of tax not levied or short levied as a result of general practice …………………………………………………………………… ……..125 66. Refund to be claimed within one year. ……………………….. ……..126 67. Delayed Refund. ……………………………………………………… ……..127 67A. Payment of refund through sales tax refund bonds.. ……… ……..128 68. Liability of the registered person for the acts of his agent. ……..129 69. Issuance of duplicate of sales tax documents. ……………… ……..130 70. Computation of limitation period. ………………………………. ……..130 71. Special procedure. ……………………………………………………. ……..130 72. Officers of Sales Tax to follow Board’s orders, etc. ……… ……..130 72A. Reference to the authorities …………………………………… …………131 72B. Selection of audit by the Board ………………………………. …………131 72C. Reward to Inland Revenue Officers and Officials …….. …………131 72D. Reward to whistleblowers ……………………………………… …………132 73. Certain transactions not admissible. …………………………… ……..133 74. Condonation of time-limit. ………………………………………… ……..134 74A. Validation. ………………………………………………………………. ……..135 75. Application of the provisions of Act IV of 1969 to Sales Tax….135 76. Fee and service charges. …………………………………………… ……..136 SCHEDULES ………………………………………………………………… …………136 THE FIRST SCHEDULE (omitted)…. …………………………………. ……..136 THE SECOND SCHEDULE (omitted) …………………………………. ……..136 THE THIRD SCHEDULE …………………………………………………… ……..136 THE FOURTH SCHEDULE (omitted) …………………………………. ……..140 THE FIFTH SCHEDULE ……………………………………………………. ……..140 THE SIXTH SCHEDULE …………………………………………………… ……..145 THE SEVENTH SCHEDULE (omitted) ……………………………. …………216 THE EIGHT SCHEDULE ……………………………………………….. …………216 THE NINTH SCHEDULE ………………………………………………. …………226 THE TENTH SCHEDULE ………………………………………………. …………228 THE ELEVENTH SCHEDULE ……………………………………….. …………231 THE TWELFTH SCHEDULE…………………………………………………..234 THE THIRTEENTH SCHEDULE ……………………………………. …………236

The 1[Act No. III of 1951 as Amended by Act VII of 1990] An Act to consolidate and amend the law relating to the levy of a tax on the sale 2[, importation, exportation, production, manufacture or consumption] of goods WHEREAS it is expedient to consolidate and amend the law relating to the levy of a tax on the sale 3[, importation, exportation, Production, manufacture or consumption] of goods; It is hereby enacted as follows:- 4[Chapter-I PRELIMINARY When any goods which have been imported into Pakistan and on which tax has been paid on 654 Section 60 Substituted by Finance Act, 1998. 655 Words substituted by Finance Act, 2018. 656 Substituted for “delivery” by Finance Act, 1999 657 Clause (ii) substituted by the Finance Act, 1999. 658 Clause (iii) omitted by Finance Act, 1999. 659 Words “the importation of” omitted by Finance Ordinance, 2002 660 Section 61A inserted by Finance Act, 2008.

importation are re-exported outside Pakistan and such goods as are capable of being identified, seven-eighth of such tax shall, except as otherwise hereinafter provided, be repaid as drawback, and the provisions of Customs Act, 1969 (IV of 1969), relating to drawback of customs duties shall, so far as may be apply to such tax, as they apply for the purposes of that Act: Provided that no such drawback shall be repaid unless the re-export is made within a period of two years from the date of importation as shown in the records of the Custom House: Provided further that the Board may, on sufficient cause being shown, in any case extend the said period by a further period of one year.

63. Drawback on goods taken into use between importation and re-exportation

Notwithstanding anything contained in section 62, the repayment of sales tax as drawback in respect of goods which have been taken into use between importation and re-exportation shall be subject to such orders, conditions or limitations as may be passed or imposed by the Board in each case,-

(a) modifying the amount of tax which shall be repaid as drawback on any such goods or class of goods; or

(b) prohibiting the repayment of tax as drawback on any such goods or class of such goods; or

(c) varying the condition for the grant of drawback on any such goods or class of such goods by restricting the period after importation within which the goods must be re-exported.

64. Power to declare what goods are identifiable and to prohibit drawback in case of specified foreign territory

The Federal Government may, from time to time, by notification in the official Gazette, prohibit the payment of drawback upon the exportation of goods or any specified goods or class of goods to any specified foreign port or territory.

65. Exemption of tax not levied or short levied as a result of general practice

Notwithstanding anything contained in this Act, if in

respect of any supply the 661[Federal Government] is satisfied that inadvertently and as a general practice: -

(a) tax has not been charged in any area on any supply which was otherwise taxable, or according to the said practice the amount charged was less than the amount that should have actually been charged;

(b) the registered person did not recover any tax prior to the date it was discovered that the supply was liable to tax; and

(c) the registered person started paying the tax from the date when it was found that the supply was chargeable to tax; It may, by a notification in the official Gazette, direct that the tax not levied or short levied as a result of that inadvertent practice, shall not be required to be paid for the period prior to the discovery of such inadvertent practice.

66. Refund to be claimed within one year

No refund of tax claimed to have been paid or over paid through inadvertence, error or misconstruction 662[or refund on account of input adjustment not claimed within the relevant tax period, ] shall be allowed, unless the claim is made within one year of the date of payment 663[:] 664[Provided that in a case where a registered person did not deduct input tax within the relevant tax period, the 665[Commissioner] may, after satisfying himself that input tax adjustment is due and admissible, allow the registered person to take such adjustment in the tax period as specified by the 4[Commissioner]:] 661 Words substituted by Finance Act, 2018. 662 Words inserted by Finance Act, 1998. 663 Substituted for the full-stop by Finance Ordinance, 2001 664 Proviso inserted by Finance Ordinance, 2002. 665 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

666[ Provided 667[further] that in a case where the refund has become due on account of any decision or judgement of any officer of 668[Inland Revenue] or court or the Tribunal, the period of one year shall be reckoned from the date of judgement or decision of such officer, court or Tribunal669[:]] Provided further that the application or claim filed under this section shall be disposed of within a period not exceeding ninety days from the date of filing of such application or claim.] 670[Provided also that no refund shall be admissible under this section if incidence of tax has been passed directly or indirectly to the consumer.]

67. Delayed Refund

Where a refund due under section 10 is not made within 672[the time specified in section 10 from the date] of filling of 673[refund claim], there shall be paid to the claimant in addition to the amount of refund due to him, a further sum equal to 674[KIBOR] per annum of the amount of refund due, from the date following the expiry of [the time specified 675[as aforesaid], to the day preceding the day of payment of refund: Provided that where there is reason to believe that a person has claimed the refund which is not admissible to him, the provision regarding the payment of such additional amount shall not apply till the investigation of the claim is completed and the claim is either accepted or rejected 7[:] 676[Provided further that where a refund due in the consequence of any order passed under section 66 is not made within forty five days of date 666 Proviso inserted by Finance Ordinance, 2001. 667 Word inserted by Finance Ordinance, 2002. 668 Substituted for “sales tax” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 669 Substituted for full stop by Finance Act, 2005 670 Proviso inserted by Finance Act, 2011. 671 Section 67 substituted by Finance Act, 1996. 672 Substituted for “thirty days” by Finance Act, 1997 673 Substituted for “return” by Finance Act, 2007 674 Substituted for “Six percent” by Finance Act, 2009, earlier the word “six” was substituted for “fourteen” by the Finance Act, 2004, before that it was substituted for “ten” by Finance Supplementary (Amendment) Act, 1997. Which came into force on March 28, 1997, prior to this it was substituted by Sales Tax (Second Amendment) Ordinance 1996, dated 2nd November, 1996. 675 Substituted for the words and figures “in section 10 from the date” by Finance Act, 2007. Colon substituted for full stop and new proviso inserted by Finance Act, 2021.

of such order, there shall be paid to the claimant in addition to the amount of the refund due to him, a further sum equal to KIBOR per annum of the amount of refund, due from the date of the refund order.]

67A. Payment of refund through sales tax refund bonds

(1) Notwithstanding anything contained in section 67, the sales tax refunds payable under this Act may also be paid through sales tax refund bonds to be issued by FBR Refund Settlement Company 678[ ] Limited, in book-entry form through an establishment licensed by the Securities and Exchange Commission of Pakistan as a central depository under the Securities Act, 2015, (111 of 2015), in lieu of payment to be made through issuance of cheques or bank debit advice.

(2) The Board shall issue a promissory note to FBR Refund Settlement Company 679[ ] Limited, hereinafter referred to as the company, incorporating the details of refund claimants and the amount of refund determined as payable to each for issuance of sales tax refund bonds, hereinafter referred to as the bonds, of the same amount. 677 New section 67A inserted by Finance Supplementary (Second Amendment) Act, 2019 678 The word “private” omitted by Finance Act, 2019. 679 The word “private” omitted by Finance Act, 2019.

(3) The bonds shall be issued in values in multiples of one hundred thousand rupees.

(4) The bonds so issued shall have a maturity period of three years and shall bear annual simple profit at ten per cent.

(5) The bonds shall be traded freely in the country’s secondary markets.

(6) The bonds shall be approved security for calculating the statutory liquidity reserve.

(7) The bonds shall be accepted by the banks as collateral.

(8) There shall be no compulsory deduction of Zakat against the bonds and Sahib-e-Nisab may pay Zakat voluntarily according to Shariah.

(9) After period of maturity, the company shall return the promissory note to the Board and the Board shall make the payment of amount due under the bonds, along with profit due, to the bond holders.

(10) The bonds shall be redeemable in the manner as in the preceding sub-section before maturity only at the option of the Board along with simple profit payable at the time of redemption in the light of general or specific policy to be formulated by the Board.

(11) The refund under sub-section (1) shall be paid in the aforesaid manner to the claimants who opt for payment in such manner.

(12) The 680[Board, with the approval of the Federal Minister-in- charge,] may notify procedure to regulate the issuance, redemption and other matters relating to the bonds, as may be required.]

68. Liability of the registered person for the acts of his agent

When any person is expressly or impliedly authorised by a registered person 680 The expression substituted for the words “Federal Government” by Finance Act, 2019.

to be his agent for all or any of the purposes of this Act, the registered person shall be responsible for the act done by his agent.

69. Issuance of duplicate of sales tax documents

An officer of 682[Inland Revenue not below the rank of Assistant Commissioner] may, on payment of one hundred rupees, issue an attested duplicate of any sales tax document as is available with the department or has been filed under this Act or rules made thereunder to a relevant registered person applying for the same.]

70. Computation of limitation period

In computing the period of limitation prescribed for any appeal or application under this Act, the day on which the order complained of was served and, if the concerned person was not furnished with a copy of the order, the time requisite for obtaining a copy of such order shall be excluded.

71. Special procedure

684[(1)] 685[The Board] may, by notification in the official Gazette, prescribe special procedure for scope and payment of tax, registration, book keeping and invoicing requirements and returns, etc. in respect of such supplies as may be specified therein.] 686[(2) ***] 687[(3) Notwithstanding anything contained in this Act or any other law for the time being in force or any decision of any court, the trade enrolment Certificate Schemes immediately in force before the commencement of the Finance Act, 1999, shall be deemed to be validly made under this Act.]

72. Officers of Sales Tax to follow Board’s orders, etc

All officers of 9[Inland Revenue] and other persons employed in the execution of this Act shall observe and follow the orders, instructions and directions of the Board: 681 Section 69 substituted by the Finance Act, 2008. 682 Substituted for the words “Sales Tax not below the rank of Assistant Collector” by the Finance Act, 2010 683 Section 71 inserted by Finance supplementary (Amendment) Act, 1997, which came into force on March 28, 1997. Earlier the same amendment was made by Sales Tax (Second Amendment) Ordinance, 1996 and by Sales Tax (Amendment) Ordinance, 1997. 684 Section 71 re-numbered as sub-section (1) by Finance Act, 1999 685 The expression “Notwithstanding anything contained in this Act, the Federal Government” substituted through Finance Act, 2019. 686 Sub-section (2) omitted by Sales Tax (Amendment) Ordinance, 1999, dated 13th August, 1999. Earlier inserted by Finance Act, 1999. 687 Sub-section (3) inserted by Finance Act, 1999. 688Sub-section (3) inserted by Finance Act, 1999. 689 Section 72 inserted by Finance Act, 1998. 9 Substitued for the Words “Sales Tax” by Finance Act, 2010.

Provided that no such orders, instructions or directions shall be given so as to interfere with the discretion of [officers of 6[Inland Revenue] in the exercise of their quasi-judicial functions.]

72A. Reference to the authorities

Any reference to the Collector, Additional Collector, Deputy Collector, Assistant Collector, Superintendent, Senior Auditor and an officer of Sales Tax wherever occur in this Act and rules, notifications, clarifications general orders or order made or issued there under, shall be construed as reference to the Commissioner Inland Revenue, Additional Commissioner Inland Revenue,” Deputy Commissioner Inland Revenue, Assistant Commissioner Inland Revenue, Superintendent Inland Revenue, Inland Revenue Audit Officer and an officer of Inland Revenue, respectively.]

72B. Selection of audit by the Board

(1) The Board may select persons or classes of persons for audit of tax affairs through computer ballot which may be random or parametric as the Board may deem fit. 692[(1A) Notwithstanding anything contained in this Act or any other law, for the time being in force, the Board shall keep the selection parameters confidential.]

(2) Audit of tax affairs of persons selected under sub-section (1) shall be conducted as per procedure given in section 25 and all the provisions of this Act shall apply accordingly.

(3) For the removal of doubt, it is hereby declared that the Board shall be deemed always to have had, the power to select any persons or classes of persons for audit of tax affairs under this section.]

72C. Reward to Inland Revenue Officers and Officials

(1) In cases involving concealment or evasion of sales tax and other taxes, cash 690 Substituted for “sales” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 691 Section 72A inserted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 692 New sub-section (1A) added through Finance Act, 2019. 693Section 72C substituted by Finance Act, 2013.

reward shall be sanctioned to the officers and officials of Inland Revenue for their meritorious conduct in such cases and to the informer providing credible information leading to such detection, as may be prescribed by the Board, only after realization of part or whole of a taxes involve in such cases.

(2) The Board may, by notification in the official Gazette, prescribed the procedure in this behalf and specify the apportionment of reward sanctioned under this section for individual performance or to collective welfare of the officers and officials of Inland Revenue.]

72D. Reward to whistleblowers

(1) The Board may sanction reward to whistleblowers in cases of concealment or evasion of tax, tax fraud, corruption or misconduct providing credible information leading to such detection of evasion of tax fraud.

(2) The Board may, by notification in the official Gazette, prescribe the procedure in this behalf and also specify the apportionment of reward sanctioned under this section for whistleblowers.

(3) The claim for reward by the whistleblower shall be rejected, if-

(a) the information provided is of no value;

(b) the Board already had the information;

(d) no collection of taxes is made from the information provided from which the Board can pay the reward.

(4) For the purpose of this section, “whistleblower” means a person who reports concealment or evasion of sales tax and tax fraud leading to detection or collection of taxes, fraud, corruption or misconduct, to the competent authority having power to take action against the person or a sales tax authority committing fraud, corruption, misconduct, or involved in concealment or evasion of taxes.] 694 Section 72D added by Finance Act, 2015.

73. Certain transactions not admissible

(1) Notwithstanding anything contained in this Act or any other law for the time being in force, payment of the amount for a transaction exceeding value of fifty thousand rupees, excluding payment against a utility bill, shall be made by a crossed cheque drawn on a bank or by crossed bank draft or crossed pay order or any other crossed banking instrument showing transfer of the amount of the sales tax invoice in favour of the supplier from the business bank account of the buyer 696[:] 697[Provided that online transfer of payment from the business account of buyer to the business account of supplier as well as payments through credit card shall be treated as transactions through the banking channel, subject to the condition that such transactions are verifiable from the bank statements of the respective buyer and the supplier.] 698[Provided further that adjustments made by a registered person in respect of amounts payable and receivable to and from the same party shall be treated as payments satisfying the provisions of this sub-section subject to following conditions, namely:-

(a) sales tax has been charged and paid by both parties under the relevant provisions of this Act and rules prescribed thereunder, wherever applicable; and

(b) the registered person has sought prior approval of the Commissioner before making such adjustments.]

(2) The buyer shall not be entitled to claim input tax credit, adjustment or deduction, or refund, repayment or draw-back or zero-rating of tax under this Act if payment for the amount is made otherwise than in the manner prescribed in sub-section (1), provided that payment in case of a transaction on credit is so transferred within one hundred and eighty days of issuance of the tax invoice.

(3) The amount transferred in terms of this section shall be deposited in the business bank account of the supplier, otherwise the 695 Section 73 substituted by Finance Act, 2004. Earlier it was substituted by Finance Act, 2003, which was inserted by Tax Laws (Amendments) Ordinance, 1999. 696Substituted for full stop by Finance Act, 2005 697 Proviso inserted by Finance Act, 2005. New proviso inserted by Finance Act, 2021.

supplier shall not be entitled to claim input tax credit, adjustment or deduction, or refund, repayment or draw-back or zero-rating of tax under this Act. Explanation- For the purpose of this section, the term “business bank account” shall mean a bank account utilized by the registered person for business transactions, declared to the 699[Commissioner] in whose jurisdiction he is registered 700[through Form STR-1 or change of particulars in registration database.]] 701[“(4) A registered 702[person] shall not be entitled to deduct input tax (credit adjustment or deduction of input tax) which is attributable to such taxable supplies exceeding, in aggregate, one hundred million rupees in financial year or ten million rupees in a tax period as are made to certain person who is not a registered person under this Act: Provided that the aforesaid shall not apply to supplies made to.-

(a) Federal / provincial / local Government departments, authorities, etc. not engaged in making of taxable supplies;

(b) Foreign Missions, diplomats and privileged persons; 703[***]

(c) all other persons not engaged in supply of taxable goods; 4[and] 704(d) persons or classes of person, specified by the Board through notification in the official Gazette subject to such conditions and restrictions as may be specified therein.]

74. Condonation of time-limit

Where any time or period has been specified under any of the provisions of the Act or rules made there 699 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010, the same amendment was made by Finance Amendment) Ordinance, 2010, promulgated as Ordinance no. III of 2010, the same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the official Gazette of Pakistan Extraordinary Part I at pages 23 to 53 and this amendment was made through Finance (amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 700 Words inserted by Finance Act, 2013. 701 New sub-section “(4)” inserted through Tax Laws (Amendment) Act, 2020. 702 Word substituted by Finance Act, 2020. 703 Word “and” omitted and the word “and” inserted by Finance Act, 2020. 704 New clause (d) inserted by Finance Act, 2020. 705 Section 74 added by the Finance Ordinance, 2002.

under within which any application is to be made or any act or thing is to be done, the 706[Board] may, in any case or class of cases, permit such application to be made or such act or thing to be done within such time or period as it may consider appropriate [:] Provided that the Board may, by notification in the official Gazette, and subject to such limitations or conditions as may be specified therein, empower any [Commissioner] to exercise the powers under this section in any case or class of cases. Explanation.- For the purpose of this section, the expression “any act or thing is to be done” includes any act or thing to be done by the registered person or by the authorities specified in section 30 of this Act.]

74A. Validation

708[(1) All notifications and orders issued and notified in exercise of the powers conferred upon the Federal Government, before the commencement of Finance Act, 709[2018] shall be deemed to have been validly issued and notified in exercise of those powers.] 710[(2) Notwithstanding any omission, irregularity or deficiency in the establishment of or conferment of powers and functions on the Directorate General (Intelligence and Investigation), Inland Revenue and authorities specified in section 30A, all orders passed, notices issued and actions taken, before commencement of the Finance Act, 2018, in exercise or purported exercise of the powers and functions of the officers of Inland Revenue under this Act by the Director General (Intelligence and Investigation), Inland Revenue or the authorities specified in section 30A shall be deemed to have been validly passed, issued and taken under this Act.]

75. Application of the provisions of Act IV of 1969 to Sales Tax

The Federal Government may, by notification in the official Gazette, declare that any of the provision of the Customs Act, 1969 (IV of 1969), relating to the levy of, and exemption from, customs duties, draw-back of duty, warehousing, confiscation, and procedure relating to offences and appeals shall, with such modifications and alterations as it may consider 706 Substituted for the words “Central Board of Revenue” by Finance Act, 2007. 707 Section 74A inserted through Finance Act, 2017 708 Existing provision numbered as sub-section (1) by Finance Act, 2018. 709 Figure substituted by Finance Act, 2018. 710 New sub-section (2) added by Finance Act, 2018.

necessary or desirable to adapt them to the circumstances, be applicable in regard to like matters in respect of the tax imposed by section 3.]

76. Fee and service charges

3[(1)] The 712[“Board with approval of the Federal Minister-in-charge”] may, by notification in the official Gazette, subject to such conditions, limitations or restrictions as it may deem fit to impose, levy fee and service charges for valuation, in respect of any other service or control mechanism provided by any formation under the control of the Board, including ventures of public-private partnership, at such rates as may be specified in the notification.] 713[(2) The Board may authorize and prescribe the manner in which fee and service charges collected under sub-section (1) shall be expended.] *************** SCHEDULES The FIRST SCHEDULE 714[] The SECOND SCHEDULE 715[] 716[The THIRD SCHEDULE See 717[clause (a)] of sub-section (2) of section 3] 711 New section 76 added through Finance Act, 2019. 712Words “Federal Government” substituted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020. Existing sub-section renumbered as sub-section (1) and new sub-section (2) inserted by Finance Act, 2021. 714 The first schedule omitted by Finance Supplementary (Amendment) Act, 1997, with effect from March 28, 1997. 715 The Second Schedule omitted by Finance Supplementary (Amendment) Act, 1997, with effect from March 28, 1997. 716 The Third Schedule Substituted by Finance Act, 1998, earlier it was inserted by Finance Act, 1996. 717 Substituted for the words, brackets and letter “clause (c)” by Finance Ordinance, 2002

1969 (IV of 1969) juices beverages. 719[ 6 33.03 and 33.04.] 721[12 09.02 723[17 paper names and trade marks 725[19. 718 Substituted for the figure “21.05” through Finance Act, 2017 719 Serial No.6 and entries relating thereto substituted by Finance Act, 2005, earlier these were inserted by Sales Tax (Amendment) Ordinance, 2002, dated March 21, 2002. 720 Serial No.7 to 11 and entries relating thereto added by Finance Act, 2005 721 Serial No.12 to 13 and entries relating thereto omitted by Finance Act, 2008 722 Serial No.14 to 16 and entries relating thereto added by Finance Act, 2005 723 Serial No.17 and entries relating thereto added by Finance Act, 2005 724 Serial No.18 to 21 and entries relating thereto added by Finance Act, 2006 725 Serial No.19 to 20 and entries relating thereto omitted by Finance Act, 2008

1969 (IV of 1969) 5[22. 729[38. conditioners, electric bulbs, tube-lights, and telephone sets.

726 Serial Nos. 23 to 31, 34 and 35 entries relating thereto omitted by Notification No. S.R.O. 895(I)/2013, dated 4th October, 2013. 727 Serial Nos. 22 and 36 and entries relating thereto omitted Notification No. S.R.O. 681(I)/2013, dated 26th July, 2013. 728 New Serial number added through Finance Act, 2016 729 Serial numbers 38 up to 49 and entries relating thereto added through Finance Act, 2019.

1969 (IV of 1969) 39. heaters. for household use. colours, varnishes, gums, thinners, blacks, cellulose lacquers and polishes sold in retail packing 42. fluids, transmission fluid, and other vehicular fluids sold in retail packing. automotive manufacturers or assemblers those sold to automotive assemblers with brand name

Serial Description Heading Nos. of the First No. Schedule to the Customs Act, 1969 (IV of 1969)

(1) (2) (3) manufacturers or assemblers 730[50. [] omitted with effect Respective heading] from the 1st day of December, 2021 The FOURTH SCHEDULE 731[] 732[The FIFTH SCHEDULE [See section 4] Serial Description No.

(1) (2) 733[1. ***] 2. Supply to diplomats, diplomatic missions, privileged persons and privileged organizations which are covered under various Acts, Orders, Rules, Regulations and Agreements passed by the Parliament or issued or agreed by the Government of Pakistan.] 734[3. ***]omitted 735[4. ***]] 730Serial number 50 omitted by Finance (Supplementary) Act, 2022 w.e.f 1st day of December, 2021. 731 Fourth Schedule omitted by Finance Act, 1998. 732 Fifth Schedule added by Finance Act, 1996. S. Nos. 1 and 6 and entries relating thereto omitted by Finance Act, 2021. 734Serial number 3 and entries relating thereto in column (2) omitted by Finance (Supplementary) Act, 2022. 735Serial No. 4 and entry relating thereto omitted by Finance Act, 2012

Serial Description No.

(1) (2) 736[5. Supplies of raw materials 737[, components and goods for further] manufacture of goods in the Export Processing Zones.] 2[6. *****] 738[6A. ***]omitted 739[7. Supplies made to exporters under the Duty and Tax Remission Rules, 2001 subject to the observance of procedures, restrictions and conditions prescribed therein.] 740[8. Imports or supplies made to Gawadar Special Economic Zone, excluding vehicles falling under heading 87.02 of the Pakistan Customs Tariff, subject to such conditions, limitations and restrictions as the 741[Board] may impose. ] [9. ***]omitted 742[10. ******] 6[11. ****] 12. The following goods and the raw materials, packing materials, sub-components, components, sub-assemblies and assemblies imported or purchased locally for the manufacture of the said goods, subject to the conditions, limitations and restrictions as 743[prescribed by the Board]:– 744[(i) to (ix) [……]] 745[(x) … 736 Serial No. 5 added by the Finance Act, 1997. 737 Substituted for the words “and components for” by the Sales Tax (Amendment) Ordinance, 1999 738 Serial number(s) 6A and 9 and entries relating thereto in column (2) omitted by Finance (Supplementary) Act, 2022. 739Serial No. 7 added by Finance Ordinance, 2001 740 Serial No. 8 and entries relating thereto inserted by Finance Act, 2004 741Substituted f Revenue” by Finance Act, 2007 S. Nos. 10 and 11 and entries relating thereto omitted by Finance Act, 2021. 743 Substituted for the word “specified in Chapter XIV of the Sales Tax Special Procedure Rules, 2007” through Finance Act, 2019. 744 Serial numbers (i) to (ix) omitted through Finance Act, 2016. 745 Clauses (x) to (xvi) omitted by Finance Act, 2015

Serial Description No.

(1) (2)

(xi) …

(xii) …

(xiii) …

(xiv) …

(xv) …

(xi) …]

(xvii) 746[Preparations suitable for infants, put up for retail sale 747[not exceeding rupees five hundred per two hundred grams] (PCT Heading 1901.1000)

(xviii) 748[…..]

(xix) 749[***] omitted.

(xx) 750[Colors in sets (PCT heading 3213.1000).

(xxi) Writing, drawing and marking inks (PCT heading. 3215.9010 and 3215.9090)

(xxii) Erasers (PCT heading 4016.9210 and 4016.9290)

(xxiii) Exercise books (PCT heading 4820.2000)

(xxiv) Pencil sharpeners (PCT heading 8214.1000)

(xxv) Geometry boxes (PCT heading 9017.2000)

(xxvi) Pens, ball pens, markers and porous tipped pens (PCT heading 96.08) 746 Expression substituted through Finance Act, 2017 747 Words added by Finance (Supplementary) Act, 2022. 748 Serial number (xviii) omitted through Finance Act, 2016. 749 Clause (xix) omitted by Finance (Supplementary) Act, 2022. 750 New clauses (xx) to (xxvii) inserted by Finance Act, 2018.

Serial Description No.

(xxvii) Pencils including color pencils (PCT heading 96.09)”.] 751[13. Supplies of raw materials, components and goods for further manufacture of goods in the Gwadar Free Zone and export Pakistan, tax shall be charged on the value assessed on the Goods Declaration for import 14 Supplies of locally manufactured plant and machinery of the following specifications, to manufacturers in the Gwadar Free Zone, subject to the conditions, restrictions and procedure given below, namely:- production of goods by that manufacturer. machinery specified in clause (i). gear, meant or adapted for use in conjunction with machinery specified in clause (i).

(iv) parts of machinery as specified in clauses (i), (ii) and (iii), identifiable for use in or with such machinery. Conditions, restrictions and procedures:-

(a) the supplier of the machinery is registered under the Act; number; manufacturer located in the Gwadar Free Zone and

751 New serial numbers 13 and 14 inserted by Finance Act, 2020 shall have effect from the 1st June, 2020.

No.

(1) (2) holds a certificate from the Gwadar Port Authority to that effect;

(d) the purchaser submits an indemnity bond in proper Commissioner, not be sold, transferred or otherwise moved out of the Gwadar Free Zone before a period of five years from the date of entry into the Zone;

(e) if the machinery is brought to tariff area of Pakistan outside Gwadar Free Zone, sales tax shall be charged on the value assessed on the Goods Declaration for import; and

(f) breach of any of the conditions specified herein shall attract legal action under the relevant provisions of the Act, besides recovery of the amount of sales tax along with default surcharge and penalties involved.] Fat filled milk 753[***] (PCT heading 1901.9090). 17. 754[19. Drugs registered under the Drugs Act, 1976 (XXXI of 1976), or medicaments as classified under chapter 30 of the First Schedule to the Customs Act, 1969 (IV of 1969) except PCT heading 3005.0000.

752 Serial numbers 15 and 18 omitted by Finance (Supplementary) Act, 2022. 753 Expression omitted by Tax Laws (Third Amendment) Ordinance, 2021. 754 New serial numbers 19 and 20 inserted by Finance (Supplementary) Act, 2022.

755[The SIXTH SCHEDULE [See section 13(1)]

Table-1 (Imports or Supplies)

757[4. 0702.0000, 763[***], from Afghanistan] including

755Sixth Schedule substituted by Finance Act, 2005. Earlier it was substituted by Finance Act, 1998. Originally it was inserted by Finance Act, 1996. 756 Serial number(s) 1,2,3,11 and 12 omitted by Finance (Supplementary) Act, 2022. 757 S. Nos. 4 to10 and entries relating thereto omitted by Finance Act, 2006 758 Words inserted by Finance (Supplementary) Act, 2022. 759 The words inserted by the Finance Act, 2009. 762The figure and comma “0701.9000,” omitted by the Finance Act, 2009 763 The figure and comma “0703.1000,” omitted by the Finance Act,2009

760[or] 0708.9000, 0709.1000, 0709.2000, 0709.3000, 0709.4000, 0709.5100, 764[0709.5910, 0709.5990], 0709.6000, 0709.7000, 0709.9000, 0710.1000, 0710.2100, 0710.2200, 0710.2900, 0710.3000, 0710.4000, 0710.8000, 0710.9000, 0712.2000, 0712.3100, 0712.3200, 0712.3300, 0712.3900 and 0712.9000 765[0713.2010, 0713.2020, 0713.2090], 0713.3100, 0713.3200, 0713.3300, 0713.3910, 0713.3920, 0713.3990, 0713.4010, 0713.4020, 0713.5000, 0713.9010, 0713.9020 and 0713.9090

760Substituted for the comma by the Finance Act, 2008 761The words “or package” omitted by the Finance Act, 2008. 764 Substituted for the figure and comma “0709.5200, 0709.5900” by the Finance Act,2007 765Substituted for the figure and comma “0713.2000” by the Finance Act, 2009

766[15. 0804.5020, 0804.5030, 0805.1000, 0805.2910, 0805.2100, 0805.2200, 0805.2990, 0805.4000, 0805.5000, 0805.9000, 0806.1000, 0806.2000, 0807.1100, 0807.1900, 0807.2000, 0808.3000, 0808.4000, 0809.1000, 0809.2000, 0809.3000, 0809.4000, 0810.1000, 0810.2000, 0810.4000, 0810.5000, 0810.6000, 0810.9010, 0810.9090, 0811.1000, 0811.2000, 0811.9000, 0813.1000, 0813.2000, 0813.3000, 0813.4010, 0813.4020 and 0813.4090] brand names and trademarks. 769[09.10] names and trademarks.

766 Serial number 15 substituted by Finance (Supplementary) Act, 2022. 767 Substituted for PCT heading “0904.2010” by the Finance Act, 2012 768 Substituted for PCT heading “0904.2020” by the Finance Act, 2012 769 Substituted for the figure “0910.1000” through Finance Act, 2017

in retail packing bearing brand names and trademarks. flour 771[20. 773[24.

3[29. books.

770 Serial number 19 substituted by Finance (Supplementary) Act, 2022. 771 Serial number 20 omitted by Finance (Supplementary) Act, 2022. 772 Serial number(s) 21and 23 omitted by Finance (Supplementary) Act, 2022. 773 Serial numbers 22,24,26, 27, 29 and 29C omitted by Finance Act, 2021. 774 S. No. 25 and the entries relating thereto omitted by the Finance Act, 2013 775 Serial No. 28 and entries relating thereto omitted by Finance Act, 2015 776 S. Nos. 29A and 29B omitted by the Finance Act, 2011 777 S. No. 30 omitted by the Finance Act, 2011 778Substituted for the words and figures “4901.9910 and respective headings of 85.24” by the Finance Act, 2007

8523.2990, 779[8523.4910], 780[8523.4920], 781[8523.4190] […], […], 8523.4190, 8523.5910, 8523.5990, 8523.8010, 8523.8020 and 8523.8090] shares, stocks and bonds. 784[34. 7108.2090] 789[39. 779 Substituted for PCT heading “8523.4010” by Finance Act, 2012 780 Substituted for PCT heading “8523.4030” by Finance Act, 2012 781 Substituted for PCT heading “8523.4090” by Finance Act, 2012 782 Serial number 32 substituted by Finance (Supplementary) Act, 2022. 783 Substituted for the figure “4907.0000” by Finance Act, 2017 784 S. Nos. 34 & 35 omitted by the Finance Act, 2011 785 Serial number 36 omitted through Finance Act, 2019. 786 Serial number 37 omitted through Finance Act, 2019. 787 Substituted for the figure “7108.2000” by Finance Act, 2017 788 The word and figures added by the Finance Act, 2007 789 S. No. 39 and entries relating thereto omitted by Finance Act, 2015 790 S. No. 40 omitted by the Finance Act, 2006 791 S. Nos. 41 to 44 omitted by the Finance Act, 2011

Intra-Ocular lenses and Glucose testing equipment. 794[46. and personal effects including vehicles and also the goods for donation to projects established in Pakistan imported by any of the rulers of Gulf Sheikhdoms

(1) of the First Schedule to the 1969) for their personal use and for donation to welfare projects established in Pakistan subject to the similar conditions as are envisaged for the purposes of

792 The word “imported” omitted by the Finance Act, 2007 793 Substituted for the figures “9201.3900” by the Finance Act, 2007 794 Serial number 46 omitted by Finance (Supplementary) Act, 2022.

duty on such goods under the said Act. under grants-in-aid for which a Government of Pakistan before the 30th June, 1996, provided provision for exemption of tax agreement.

795 Substituted for the words “Central Board of Revenue” by Finance Act, 2007 796 Serial number(s) 49 to 57 and 58 omitted by Finance (Supplementary) Act, 2022. 797 Serial No. 56 and entries relating thereto omitted by Finance Act, 2015

99.24 800[, 99.25 798[,] and powder, blood tubing (balloons, catheters, wires and are envisaged for the purpose of duty on these goods under the

798 Substituted for the word “and” by the Finance Act, 2008 799 The comma and words inserted by the Finance Act 2014 800 Substituted for the word and figures “and 99.25” by the Finance Act, 2008 801 The comma and figure inserted by the Finance Act 2014

1969). 802[60. 67. 68. 73A. ***]

802 Serial number(s) 61, 61 and 63 omitted by Finance (Supplementary) Act, 2022. 803 S. No. 62 omitted by the Finance Act, 2011 804 S. Nos. 64 to 70 omitted by the Finance Act, 2011 805 Serial number(s) 71, 72, 81, 84 and 92 omitted by Finance (Supplementary) Act, 2022. 806 Serial numbers 73 to 80, 82, 83 and 85 omitted by Finance Act, 2021.

inks 4016.9290 8713.9000 mathematical calculating instruments (geometry box) porous tipped pens] 811[Gwadar] Export processing Zone’s investors and to Export Processing Zone 3[Gwadar] for infrastructure

807 Serial numbers 85, 91 and 93 omittted by Finance Act, 2021. 808 Serial number 95 and entries relating thereto is omitted through Finance Act, 2019. 809 The expression substituted by Finance Act, 2017 810 Serial number 99 omitted by Finance (Supplementary) Act, 2022. 811 Spellings of “Gawadar” corrected as “Gwadar” by Finance Act, 2017

812[100 and operation of 3[Gwadar] Port and development of Free Zone for 3[Gwadar] Port as imported Pakistan (Private) Limited (ii) Gwadar International Terminal Bunker Oils bought and sold to aforesaid operating companies] having Concession Agreement Authority, for a period of forty year, subject to the following namely,-

812 New serial numbers 100A & 100B added through Finance Act, 2016. 813 The expression inserted through Finance Act, 2017 814 The expression inserted by Finance Act, 2020 shall have effect from the 1st June, 2020.

(A). Conditions and procedure for imports.-

(i) This exemption shall China Overseas Ports Holding Company its operating companies, their contractors and sub- contractors which hold the Concession Agreement;

(ii) Ministry of Ports and Shipping shall certify in the prescribed manner and format as per Annex- I that the imported materials and equipments are bonafide requirement operation of 815[Gwadar] Port and development of Free Zone for 1[Gwadar] Port. The authorized officer of that Ministry shall furnish all relevant Pakistan Customs against password obtained under Customs Act, 1969 (IV of

815 Spellings of “Gawadar” corrected as “Gwadar” by Finance Act, 2017

computerized Computerized System on daily basis, whereas entry of the data obtained from which have not yet been condition shall not apply to ship bunker oils; and S.R.O. 115(I)/2008, dated disposed of without prior approval of the FBR and

816 The expression inserted and words substituted by Finance Act, 2020 shall have effect from the 1st June, 2020.

residual value], provided not apply to ship bunker oils.

supply.-

(i) This exemption shall be admissible only to operating contractors and sub- Agreement; exemption on goods which are otherwise

817[Gwadar] Port and development of Free Zone for 1[Gwadar] Port from the sales tax registered persons only; exempt supply, particulars required under section 23 of the aforesaid Act, shall for each supply registered person to the operating company mentioning thereon that the said invoice is being issued under this notification;

(iv) a monthly statement summarizing all the supplies made in the month against the operating prepared in triplicate by the registered

817 Spellings of “Gawadar” corrected as “Gwadar” by Finance Act, 2017

exempt supplies and the authorized registered person. the said signed monthly statement shall be got verified by the registered person authorized to receive the supplies operating company, confirming that supplies mentioned in the monthly statement have been duly received;

(v) after verification from the operating company, original copy of the monthly registered person, operating company and the triplicate registered person to Sales Tax having

twentieth day of the month following the made; and

(vi) the registered person the aforesaid record when required to do so. 1[100B] within the Gwadar Free Zone, subject to the condition that the sales and supplies outside the Gwadar Free Zone and into the subjected to sales tax.

818 New S.No. 100C and entries relating thereto inserted through Finance Act, 2017

Pakistan (Private) Limited (ii) Gwadar International Terminal Limited, for a period of twenty- development and operations of PCT heading 9917 (3)] either for exclusive use within the limits of Gwadar Free Zone, conditions that such machinery, investors of Gwadar Free Zone, under the Customs Act, 1969 made thereunder shall, mutatis mutandis, apply provided that if any of such goods is taken out

819 New serial number 100D inserted by Finance Act, 2020 shall have effect from the 1st June, 2020.

of the Zone for purpose other than the export, the tax on the importer.] 820[101. 821[102. salt bearing brand names and trademarks whether or not sold in retail packing.

820 Serial number 101 omitted by Finance Act, 2021. 821 Serial number(s) 102, 104 and 105 omitted by Finance (Supplementary) Act, 2022. 822 Serial number 103 omitted by Finance Act, 2021. 823 Serial numbers 106 and 108 omitted by Finance Act, 2021.

824 Serial number(s) 109 and 110 omitted by Finance (Supplementary) Act, 2022. 825 Serial No. 111, expression “White crystalline sugar” omitted through Finance Act, 2016.

Dilatations Catheters (Balloons) 4. PTCA Guide Wire 5. PTCA Guiding Catheters 6. Inflation Devices/Priority Packs Technology (OCT) System 8. OCT Catheters (IVUS) (FFR/IFR) System 11. IVUS/FFR/IFR Catheters and wires (Straight and Angled) 13. Drug Coated Angioplasty Balloon Micro Coils 15. Thrombectomy Device Catheters

826 New sub-serial No(s) 7 to.25 under entry A of S.No. 112 and entries relating thereto added by Finance Supplementary (Amendment) Act, 2018.

Serial Description Heading Nos. of the No First Schedule to the

(1) (2) (3) 17. Covered Stents (Coronary/Peripheral) 18. Vessel Closure Devices 19. Embolic Protection Devices 20. Renal Stents 21. Vena-cava Filters 22. Coronary and Peripheral Snares 23. Atherectomy Devices 24. IABP Consoles & Catheters 25. Intracardiac Echocardiography Machine & Catheters] B. ANGIOGRAPHY PRODUCTS 1. Angiography Catheters 2. Sheaths 3. Guide Wires 4. Contrast Lines 5. Pressure Lines 6. Mannifolds 7. 827[Wrist Bands for Radial Vessel Closure] C. CONTRAST MEDIA FOR ANGIOGRAPHY/ANG IOPLASTY 827 New sub-serial No. 7 under entry B of S.No. 112 and entries relating thereto added by Finance Supplementary (Amendment) Act, 2018.

Serial Description Heading Nos. of the No First Schedule to the

(1) (2) (3) 1. Angiography Accessories 2. ASD Closure Devices 3. ASD Delivery Systems 4. VSD Closure Devices 5. VSD Delivery System 6. Guide Wires 7. Sizing Balloons 8. Sizing Plates 9. PDA Closure Devices 10. PDA Delivery System D. TEMPORARY PACEMAKERS (with leads, connectors and accessories) E. PERMANENT PACEMAKER. (with leads, connectors and accessories) F. HEART FAILURE DEVICES (with leads, connectors and accessories) G. IMPLANTABLE CARDIOVERTES (with leads, connectors and accessories)

PHYSIOLOGY PRODUCTS

Electrophysiology catheters 2. Electrophysiology cables 3. Electrophysiology connectors 4. 828[Excimer Laser System with Accessories Balloons, Dilator Sheaths (Rotation & Manual) System and Accessories and Accessory Kit Device and Accessories 9. Ablation catheters System Accessories]

I. LEAR CARDIOLOGY PRODUCTS

Radioactive isotopes

828 New sub-serial No(s) 4 to 11 under entry H of S.No. 112 and entries relating thereto added by Finance Supplementary (Amendment) Act, 2018.

MAA, DTPA etc.)

PRODUCTS

Oxygenators 2. Cannulas 3. Prosthetic Heart Valves 4. Luminal shunts for heart surgery appliances Heart Pump PHP Console and Catheters 7. Tandem Heart / Tandem Lung and Accessories 8. Ventricular Assist Device System

(a) Heart Mate-II

(b) Heart Mate-III

Shunts Instruments

829 New sub-serial No(s) 6 to 12 under entry J of S.No. 112 and entries relating thereto added by Finance Supplementary (Amendment) Act, 2018.

for AF (Surgical) 12. Heart Lung Machines]

K. EQUIPMENT

Machine 2. Echocardiography Machines 3. ETT Machines Studies 5. 830[Left Ventricular Assist Device / System (LVAD) and Catheters 6. MitraClipTranscatheter Mitral Valve System 7. MitraClip Guide Catheter, Clip and Delivery System (PFO) Closure Device (LAA) Occluder (TAVI/TAVR) Stents 12. Aortic Stent Grafts

830 New sub-serial No(s) 5 to 18 under entry K of S.No. 112 and entries relating thereto added by Finance Supplementary (Amendment) Act, 2018.

Coil thoracic EVAR/ extension Monitor (ICM) 16. Carotid Stents 17. Vascular Clips 18. MRI Compatible Cardiac Anesthesia Machine with Accessories]

L. PERIPHERAL INTERVENTIONS EQUIPMENT

(including rotating homeostatic Stents”].

831 Words “Drug Eluting Peripheral Stents” under entry L of S.No. 112 added by Finance Supplementary (Amendment) Act, 2018.

832[113. 835[…….] omitted namely:-

HIV Kits 4C Es Trionyx 5C Cell control Lnormal sera Pregnancy test DNA SSP DRB Generic IC (control) retic C Control estimation Ferritin kit HEV (Hepatitis E virus) ID-DA Cell Urine Analysis Strips Albumin beg Cratinin sysi Ring

832 Serial number(s) 113, 114, 116, and 117 omitted by Finance (Supplementary) Act, 2022. Serial number 115 omitted by Finance Act, 2021. 834 S.No. 118 omitted by Finance Supplementary (Second Amendment) Act, 2019 835 Serial No. 119, expression “Tubular day..” omitted through Finance Act, 2016.

Serial Description Heading Nos. of the No First Schedule to the

(1) (2) (3) Detektiion cups ISE Standard Alkaline phosphatase (Alb) Bilirubin kit HDL Cholesterol Ck creatinin kinase (mb) Ck nac Glulcose kit Ammonia Modular Lac Ldh kit (lactate dehydrogenase kit) Urea uv kit Ua plus Tina quant Crp control Aslo tin Proteins Lipids HDL/LDL cholesterol Protein kit U Control Sera Pac Control HCV UIBC (Unsaturated iron binding capacity) U/CSF Inorganic Phosphorus kit Kit amplicon kit (for PCR) Ige

Lc hsv Oligo NA/K/CL Hcy Standard [or calibrated] Hla B27 Liss Coombs Typhoid kit HCV amp Urine test strips Strips for sugar test Blood glucose test strips separator for collection of platelets Elisa or Eclia kit PCR kits blot test). I.C.T. (Immunochromatographi c kit) reagent aluminium foil with set. 836[123. Serial numbers 123 to 125 omitted by Finance Act, 2021.

***] 839[130. Department of Plant Protection namely:-

Terpenic derivative

837 Serial number(s) 126, 127 and 129 omitted by Finance (Supplementary) Act, 2022. Serial number 128 omitted by Finance Act, 2021. 839 Serial number(s) 130 to 132 omitted by Finance (Supplementary) Act, 2022. 840 The words “ingredients for pesticides” and the figure “2903.3040” omitted by Finance Act, 2017 841 The words “Cadusafos Technical Material” and figure “2903.6900” omitted by Finance Act, 2017

diol) - Polyvinyl Alcohol Propanol - Methyglycol Acetate cyclo-hexanones petroleum Xylene (1,2 & 1,3 & ethyle benzene)

842 The words “ingredients for pesticides” and the figure “2918.9010” omitted by Finance Act, 2017 843 The words “ingredients for pesticides” and the figure “2919.0010” omitted by Finance Act, 2017 844 The words “other ingredients for pesticides” and the figure “2919.0090” omitted by Finance Act, 2017

cyclopropane carboxylate phenoxybenzyl (S)-2-(4, chloro phenyl)-3 mehtyl butyrate cyclopropane carboxalate Bifenthrin Technical Material- Technical Material- Bromoxynil Technical Material Technical Material

845 The words “Tiethanolamine and its salts” and the figure “2922.1300” omitted by Finance Act, 2017 846 The words “ingredients for pesticides” and the figure “2924.2930” omitted by Finance Act, 2017

thiosulfourropane disodium thiosulphate propane compounds Technical Material - Dimethysulfoxid carbamate Material Diazinon Technical Material Material

ylcarbamate. -Dicopper chloride trihydroxide 847[2939.8010] Ingredients for pesticides Technical Material 849[White spirit 2710.1240 850[134. 851[“137 Paper weighing 60 g/m2 852[, art 4802.5510 2[,4810.1990,

847 Substituted for the figure “2939.9910” by Finance Act, 2017 848 Substituted for the figure “3824.9099” by Finance Act, 2017 849 New entries inserted by Finance Act, 2021. 850 Serial number(s) 134 to 136 omitted by Finance (Supplementary) Act, 2022. 851 New S.No(s) 137 to 149 and entries relating thereto inserted through Finance Act, 2018. 852 Words and expression inserted by Finance Act, 2021.

Nashiran-e-Quran as per quota determined by IOCO kinds) (ii) Hearing assessment equipment;

(a) Audiometers

(b) Tympanometer

(d) Oto Acoustic Omission by fertilizer manufacturers for use as feed stock including dumpers and special purpose motor vehicles, if not manufactured locally, imported CSCECL) for the construction Company (M/s CCCC) for the

853 Serial number(s) 138 to 142 omitted by Finance (Supplementary) Act, 2022.

conditions: under this serial number shall only be available above;

(ii) that the equipment and serial number shall only projects; bond, in the prescribed set out in Annex-A, at the time of import to the consignment basis; certify in the prescribed set out in Annex-B that the imported equipment

machinery are bona fide - Multan Section (392.0 Peshawar Motorway or for the construction of Karakorum II - Thakot to Havellian Section (118.057 km) as the case may be; imported goods through the authorized officer of Act, 1969 (IV of 1969). Customs stations where Computerized System is Automation or any other

person authorized by the Collector in this behalf shall enter the requisite on daily basis, whereas customs stations which made on weekly basis;

(vi) that the equipment and construction machinery, serial number, shall not be re-exported, sold or FBR the same shall be prescribed by the FBR;

of the FBR in terms of same shall be subject to time of import; construction machinery, surrendered at any time payment of any sales tax , for further disposal as the FBR; para (iii) above by the fulfillment of conditions stipulated at para (vi) or

(vii) or (viii) above, as the case may be; and

(x) that violation of any of

rate of sales tax leviable on the date of clearance of goods in addition to provisions of the law. Internationale Zusammenarbeit) GIZ manufactured, for construction Section) subject to fulfilment of and restrictions as are specified under S. No. 145 of this table, provided that total incidence of taxes in respect of construction

854 Serial number 146 omitted by Finance (Supplementary) Act, 2022.

for the project shall not exceed taxes availed before 30th June, 2018 under the provisions of the Customs Act, 1969, the Federal thereunder;

(b) imports of plant, machinery, inputs by the industries located in the tribal areas, as defined in Republic of Pakistan,- as made till 30th June, 2023, to which the provisions of the Act applied had Article 247 of the

855 Serial number 149 and 150 omitted by Finance (Supplementary) Act, 2022. 856 New serial numbers 151, 152 and 153 and entries relating thereto in column (2) and (3) inserted through Finance Act, 2019.

Act, 2018 (XXXVII of 2018): Provided that, in case of cheque for the amount of sales tax payable under the Sales Tax Act, 1990, and the same shall be presentation of a consumption or installation certificate, as the goods imported as issued by the Commissioner Inland Revenue having jurisdiction: Provided further that if plant, transferred or supplied outside value from the day of assent to the consumers in tribal areas, and to

areas which were set and started cooking oil industries the conditions that the importer quota from Ministry of National and Coordination.

859[155. 860[156. Electric Vehicles:- semi-trailers (Electric Prime Movers) Rickshaw

Serial number 153 omitted by Finance Act, 2021. 858 New serial numbers 154 to 156 inserted by Finance Act, 2020. 859 Serial number 155 omitted by Finance (Supplementary) Act, 2022. 860 Serial number 156 substituted by Finance (Supplementary) Act, 2022.

Loader following electric vehicles (4 2026:

(i) Small cars/SUVs with 50 Kwh battery or below; and below

861 New serial numbers 157 to 162 inserted by Finance Act, 2021. 862 Serial number 158 omitted by Finance (Supplementary) Act, 2022. 863 Expression substituted by Tax Laws (Third Amendment) Ordinance, 2021. 864 Expression substituted by Tax Laws (Third Amendment) Ordinance, 2021.

for consumption of these items enterprises limitations and restrictions.

865[Annex-I [See serial No. 100A & 100B] Header Information NTN/FTN of Importer Approval No.

(1) (2) Details of materials and equipments (to be filled in by the Goods imported (Collectorate of authorized officer of the Ministry of Ports and Shipping) import) ) x H S c o d e D e s c ri pti o n S p e c s C u st o m s d ut y r at e ( a p pli c a bl e R at e o f s al e s t a W H T Q u a ntit y U O M Q it y u a nt i m p o rt e d C oll e ct o r at e C R N/ M a c h N o. D at e o f C R N/ M a c h N o.

(3) (4) (5) (6) (7) (8) (9) (10) (11) (12 (13) (14 ) ) Header Information NTN/FTN of Importer Approval No.

(1) (2) Details of materials and equipments (to be Goods imported (Collectorate of filled in by the authorized officer of the import) Ministry of Ports and Shipping) H S c o d e D e s cri pti o n S p e c s C u st o m s d ut y r at e ( a p pli c a bl e) R at e o f s al e s t a x W H T Q u a ntit y U O M Q u a ntit y i m p o rt e d C oll e ct o r at e C R N/ M N o a . c h D at e o f C R N/ M a c h N o.

(3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) NOTE 1.- Before certifying, the authorized officer of the Ministry of Ports and Shipping shall ensure that the goods are genuine and bona fide requirement for construction and operation of Gwadar Port and development of Free Zone for Gwadar Port. Signature________________________ Designation ________________________ NOTE 2.- In case of clearance through Pakistan Customs Computerized System, the above information shall be furnished online against a specific 865 Annexure-I inserted through Finance Act, 2016.

user I.D. and password obtained under section 155D of the Customs Act, 1969 (IV of 1969).

866[Annex-A [See condition 145(iii)] INDEMNITY BOND (On appropriately stamped non-judicial paper) THIS DEED OF INDEMNITY is made on the _________ date of BETWEEN Messrs_ having registered office at _________(hereinafter called “the importers” which means and includes their successors, administrators, executors and assignees) of the one part, AND the President of Pakistan through the Collector of Customs _________ (hereinafter called the “Collector of Customs”), of the other part. WHEREAS the Federal Government, by its decision contained in serial number 145 or serial number 148 of this table, as the case may be, and subject to the conditions given in the said serial number 145 or serial number 148 of this table, as the case may be, has been pleased to direct that such equipment and construction machinery, as are not manufactured locally, shall be exempt from the whole of sales tax leviable thereon, in accordance with the said serial number 145 or serial number 148 of this table, as the case may be, if imported for :-

(i) construction of Sukkur - Multan Section (392.0 km) of Karachi - Peshawar Motorway or

(ii) for the construction of Karakorum Highway (KKH) Phase-II - Thakot to Havellian Section (118.057 km). AND WHEREAS M/S.____________ having registered office at __________ (hereinafter called the importers) have imported the equipment and/or construction machinery mentioned in the said serial number 145 or serial number 148 for purposes of construction of above mentioned project(s) in accordance with the conditions given in the said serial number 145 or serial number 148 of this table, as the case may be; NOW, THEREFORE, in consideration of the release of the equipment and/or construction machinery without recovery of leviable sales tax, the importers bind themselves to pay on demand to the Government of Pakistan the sum of Rs. __________ being the sales tax and charges leviable on the machinery, if the importers fail to fulfill the condition (vi) or (vii) or (viii) 866 New Annexures A, B, C & D inserted by Finance Act, 2018.

of the said serial number 145 or serial number 148 of this table, as the case may be. The importers further agree and bind themselves that the amount covered by this Bond shall be recovered as arrears of sales tax under section 202 of the Customs Act, 1969. This Bond shall become void when the Collector of Customs is satisfied that the importers have fulfilled all the conditions of the said serial number 145 or serial number 148 of this table, as the case may be. Signed by importers on this ____________________ day of 201. Managing Director (Name and permanent address) Collector of Customs (On behalf of President) Witness_________________________________________ (signature, name, designation and full address) Witness_____________________________________________________ (signature, name, designation and full address) Note: The bond shall be written on appropriate non-judicial stamp paper and shall be witnessed by a Government servant in BPS 17 or above, an Oath Commissioner, a Notary Public or an officer of a Schedule Bank. Annex-B [See condition 145 (iv) and (v)] NTN or FTN of Importer Approval No. (I) (II) Details of input goods (to be filled by the authorized officer of the Regulatory Authority) to be imported Description Quantity/UOM L/C No. IGM No. Remarks, if and or bank Date & any. specifications. contract Index No. No. and B/L.

(1) (2) (3) (4) (5) CERTIFICATE BY THE AUTHORIZED OFFICER OF REGULATORY AUTHORITY:

It is hereby certified that the description, quantity and other details mentioned above are true and correct. Goods imported are in commensuration with the project requirement and are bona fide requirement of the project. It is further certified that the above items shall not be used for any other purpose except for the project. Signature: ________________________ Name & Designation: ________________________ Official Stamp: ________________________ Date: ________________________ Note: -For the purposes of this serial number 145, the expression “not manufactured locally” shall mean the goods which are not listed in the locally manufactured items in the Customs General Order issued by the Federal Board of Revenue from time to time. Annex-C [See condition 146(b)] INDEMNITY BOND (On appropriately stamp non-judicial paper attested by a Government servant in BPS 17 or above, an Oath Commissioner, a Notary Public or an officer of a Scheduled Bank) THIS DEED OF INDEMNITY is made on the _________ date of BETWEEN Messrs_ having registered office at _________ (hereinafter called “the importers” which means and includes their successors, administrators, executors and assignees) of the one part, AND the President of the Islamic Republic of Pakistan through the Collector of Customs _________ (hereinafter called the “Collector of Customs”), of the other part. WHEREAS the Federal Government, by its decision contained in serial number 146 and subject to the conditions given in the said serial number 146, has been pleased to direct that such equipment shall be exempt from the whole of sales tax leviable thereon, in accordance with the said serial number 146, if imported for Lahore Orange Line Metro Train Project.

AND WHEREAS M/S., the importers have imported the equipment mentioned in the said serial number 146 for the above mentioned project in accordance with the conditions given in the said serial number 146; NOW, THEREFORE, in consideration of the release of the equipment without recovery of leviable sales tax, the importers bind themselves to pay on demand to the Government of Pakistan the sum of Rs. __________ being the sales tax and charges leviable on the equipment, if the importers fail to fulfill the condition (f) or (g) or (h) of the said serial number 146, as the case may be. The importers further agree and bind themselves that the amount covered by this Indemnity Bond shall be recovered as arrears of sales tax under section 202 of the Customs Act, 1969. This Bond shall stand revoked automatically when the Collector of Customs is satisfied that the importers have fulfilled all the conditions of the said serial number 146. Signed by importers on this ______________ day of 201. Managing Director or person next in hierarchy duly authorized by MD (Name and permanent address) Collector of Customs (On behalf of President) Witness(1)_______________________________ (signature, name, designation and full address) Witness(2)__________________________________________ (signature, name, designation and full address) Annex-D [See conditions 146 (c) and (e)]

Details of equipment (to be filled by the authorized officer of the Regulatory Authority) to be imported No. and B/L.

CERTIFICATE BY THE AUTHORIZED OFFICER OF REGULATORY AUTHORITY:

Table-2 (Local Supplies only)

First Schedule to the cottage industry.] adjustment is not available under a notification issued 1990. restaurants, food chains and sweet shops falling in the category of Tier-1 retailers. served in messes run on the

867 Serial number(s) 1, 2 and 4 omitted by Finance (Supplementary) Act, 2022. 868 S. No. 3 substituted by the Finance Act, 2007 869 Substituted by the Finance Act, 2014 870 S. No. 5 omitted by the Finance Act, 2011 871 Serial number 7 substituted by Finance (Supplementary) Act, 2022.

First Schedule to the workers. manufacture.

873[12. 877[17. ***]

872 S. No. 11 inserted by the Finance Act, 2009 873 S. No. 12 omitted by the Finance Act, 2013 874 S. Nos. 13 to 16 added by the Finance Act, 2014 875 S. No. 13 & 14 omitted by the Finance Act, 2015 876 Serial number(s) 9, 15 and 16 omitted by Finance (Supplementary) Act, 2022. 877 S. Nos. 17 to 20 and 24, 25 omitted by Finance Act, 2021.

First Schedule to the 3[21. seed meal and canola seed meal 878[22. silos till 30.06.2026 and 2009.9000 or containing added sugar or packing under a brand name sold in retail packing under a brand name

878 Serial number(s) 22, 23 and 33 omitted by Finance (Supplementary) Act, 2022. 879 New serial numbers 26 to 39 inserted by Finance Act, 2021.

retail packing under a brand name retail packing under a brand name in retail packing under a brand name retail packing under a brand name powdered, excluding that sold in retail packing under a brand name and 1604.2090] poultry meat excluding those sold in retail packing under a brand name excluding those sold in retail packaging under a brand name

880 Serial number 38 omitted by Finance (Supplementary) Act, 2022. 881 Serial number(s) 40 to 51 inserted by Finance (Supplementary) Act, 2022.

0602.4000, 0602.9010 and 0602.9090 wheat and meslin flour 0708.1000, 0708.2000, 0708.9000, 0709.1000, 0709.2000, 0709.3000, 0709.4000, 0709.5100, 0709.5910, 0709.5990, 0709.6000, 0709.7000, 0709.9000, 0710.1000, 0710.2100, 0710.2200, 0710.2900, 0710.3000, 0710.4000, 0710.8000, 0710.9000, 0712.2000, 0712.3100, 0712.3200, 0712.3300, 0712.3900 and 0712.9000

fertilizer)

50 Locally manufactured laptops, 8471.3010 and computers, notebooks 8471.3020 whether or not incorporating multimedia kit and personal computers 51 Newspaper Respective headings] Notes:– 1. For the purpose of this Schedule, for entries against which classification of headings or sub-headings has been specified, exemption shall be admissible on the basis of description of goods as mentioned in column 2 of the Schedule Pakistan Customs Tariff classification of headings is provided for ease of reference and commodity classification purposes only. 2. For the purposes of determining classification of any goods, the general rules for interpretation of the First Schedule to the Customs Act, 1969 (IV of 1969) and Explanatory Notes to the Harmonized Commodity Description and Coding System (relevant version) as amended from time to time shall be considered authentic source of interpretation. 3. For the purposes of exemption of sales tax under serial numbers 46, 47, 49, 50, 51, 52, 53, 56, 57, 59, 60 and 62 of this Schedule, the definitions, restrictions, limitations, conditions and procedures and all the provisions of Chapter 99 of the First Schedule to the Customs Act, 1969 (IV of 1969), for the purposes of applying zero-rate of customs duty shall, mutatis mutandis, apply and shall be deemed and construed to be part of this Schedule. ——— 882[TABLE-3 The plant, machinery, equipment and apparatus, including capital goods, specified in column (2) of the Annexure below, falling under the HS Codes specified in column (3) of that Annexure, shall be exempt from the 882Inserted by Finance Act, 2014

whole of Sales tax, subject to the following conditions, besides the conditions specified in column (4) of the Annexure, namely:-

(i) The imported goods as are not listed in the locally manufactured items, notified through a Customs General Order issued by the Board from time to time or, as the case may be, certified as such by the Engineering Development Board.

(ii) except for S. No. 9, 14, 883[14A and 15] of the Annexure, the Chief Executive, or the person next in hierarchy duly authorized by the Chief Executive or Head of the importing company shall certify in the prescribed manner and format as per Annex-A that the imported items are the company’s bona fide requirement. He shall furnish all relevant information online to Pakistan Customs Computerized System against a specific user ID and password obtained under section 155D of the Customs Act, 1969. In already computerized Collectorates or Customs stations where the Pakistan Customs Computerized System is not operational, the Project Director or any other person authorized by the Collector in this behalf shall enter the requisite information in the Pakistan Customs Computerized System on daily basis, whereas entry of the data obtained from the customs stations which have not yet been computerized shall be made on weekly basis; and

(iii) in case of partial shipments of machinery and equipment for setting up a plant, the importer shall, at the time of arrival of first partial shipment, furnish complete details of the machinery, equipment and components required for the complete plant, duly supported by the contract, layout plan and drawings: Explanation.- For the purpose of Table-3, capital goods mean any plant, machinery, equipment, spares and accessories, classified in Chapters 84, 85 or any other chapter of the Pakistan Customs Tariff, required for- 883 The figure and words inserted through Finance Act, 2017

(a) the manufacture or production of any goods and includes refractory bricks and materials required for setting up a furnace, catalysts, machine tools, packaging machinery generating sets and equipment, instruments for testing, control and the like; or

(b) used in mining, agriculture, fisheries, animal husbandry, industry. 884[ANNEXURE

***] omitted

884 Inserted by Finance Act, 2014. 885 Serial number(s) 1 to 9 and 11 omitted by Finance (Supplementary) Act, 2022. 886 Serial number 10 omitted by Finance Act, 2015.

the prescribed manner and setting up of hotels, power infrastructure related projects located in an area of 30 km authorized officer of the Ministry shall furnish all Gwadar.

System against a specific 155D of the Customs Act, 1969. 2. The goods shall not be sold or otherwise disposed of without prior approval of the FBR and payment taxes leviable at the time of import.

. 15A

887 Serial number(s) 13 to 15B and 17 omitted by Finance (Supplementary) Act, 2022. 888 S.No. 16 and entries relating thereto omitted by Finance Act, 2015

determined by IOCO Manufacturing 8471.7090 IC the items listed under Chapter 87 of the Pakistan Customs installation in that zone by zone enterprises, on one time basis as prescribed in the SEZ restriction as a Federal Board of Revenue may impose from time to time. 889[20 . assembly/ manufacturing of heading admissible on one time

889 New serial number 20 inserted by Finance Act, 2020.

manufacturing facility of expansion in the existing electric vehicles specific plant and machinery, duly Engineering (EDB).] [21

891[Table-4

The goods specified in column (2) of the Annexure below falling under the PCT codes specified in column (3) of the said Annexure, when supplied within the limits of the Border Sustenance Markets, established in cooperation with Iran and Afghanistan, shall be exempted from the whole of the sales tax, subject to the following conditions, namely:-

Sustenance Markets established in cooperation with Iran and Afghanistan; availed, are brought outside the limits of such markets, sales higher; Customs Authorities subject to furnishing of bank guarantee equal to the amount of sales tax involved and the same shall jurisdiction;

890 Serial number 21omitted by Finance (Supplementary) Act, 2022. 891 Table-4 added by Finance Act, 2021.

(iv) The said exemption shall only be available to a person upon furnishing proof of having a functional business premises located within limits of the Border Sustenance Markets; and

(v) Breach of any of the conditions specified herein shall attract relevant legal provisions of this Act, besides recovery of the amount of sales tax alongwith default surcharge and penalties involved. Annexure the First Schedule to the Customs Act, 1969 (IV of 1969) chilled 0713.9090 Wilczek or Vigna angularis)

vaahdzeia subterrea equina, Vicia faba var. minor) Tree Flowers) (Cloves) (Nutmeg) (Coriander) of Cumins) Cumins) of Anise, Badian, Caraway, Fennel etc) Badian, Caraway, Fennel etc)

1003.9000 broken and paper board exceeding 1 % (milk and cream) exceeding 1 % but not exceeding 6 % (milk and cream) 10% (Milk and Cream) exceeding 10 % (Milk and Cream) vegetables 0705.2900 the genus Pimenta 0807.1900

whether or not ground or in the form extraction of soya bean oil. miners and hand tools nes machines used by the food industry

(Ginger) preparations for washing the skin, in the form of liquid or cream and put containing soap porcelain or china articles of porcelain or china purposes (excl. glass having a linear c 70.10 or 70.18) plated with precious metal

delivery tricycles), not motorised inners (others)

892[Annex-A

Header Information no. Details of Input goods (to be filled by the chief Goods imported (Collectorate i

CERTIFICATE. It is certified that the description and quantity mentioned above are commensurate with the project requirement and that the same are not manufactured locally. It is further certified that the above items shall not be used for any other purpose.

Signature of Chief Executive, or The person next in hierarchy duly Authorized by the Chief Executive

Name ______________________ N.I.C. No. __________________________________

892 Inserted by Finance Act, 2014

NOTE:- In case of clearance through Pakistan Customs Computerized System, the above information shall be furnished online against a specific user I.D. and password obtained under section 155D of the Customs Act, 1969. Explanation.-

Chief Executive means.-

or limited company or multinational organization; or

893[Annex-B

Header Information Details of Input goods (to be filled by the Goods imported (Collectorate of )

CERTIFICATE Before certifying the above-authorized officer of the Regulatory Authority shall ensure that the goods are genuine and bona fide requirement of the project and that the same are not manufactured locally.

NOTE:- In case of clearance through Pakistan Customs Computerized System, the above information shall be furnished on line against a specific

893 Inserted by the Finance Act, 2014

user I.D. and password obtained under section 155D of the Customs Act, 1969. ———–

The SEVENTH SCHEDULE 894[***]

895[The EIGHTH SCHEDULE [See clause (aa) of sub-section (2) of section 3]

Table-1

Schedule to the Customs Act, 1969 (IV ***]

894 The seventh schedule omitted by the Finance Act, 1997 895 The eighth schedule inserted by the Finance Act, 2014 896 Serial numbers 1 and 5 omitted by Finance Act, 2021. 897 Serial number 2 omitted by Finance Act, 2020. 898 S. No. 3 and entries relating thereto omitted by Finance Act, 2015 899 Serial number(s) 4 and 6 to 12 omitted by Finance (Supplementary) Act, 2022.

Schedule to the Customs Act, 1969 (IV 901[18. clothing or footwear

and 8701.9320] 28 ***] omitted 2[33. 900 Serial number(s) 13 to 17, 20, 26 to 30 and 34 omitted by Finance (Supplementary) Act, 2022. 901 Serial number 18 and entries relating thereto is omitted through Finance Act, 2019. 902 Serial number 19 omitted by Finance Act, 2021. 903 Serial number 21 and entries relating thereto is omitted through Finance Act, 2019. 904 Serial number 22 omitted by Finance Act, 2021. 905 Figures substituted through Finance Act, 2018. 906 For the figure “10” the figure “5” substituted through Finance Act, 2016. 907 Serial number 31 omitted through Finance Act, 2016. 908 Serial number 32 and entries relating thereto is omitted through Finance Act, 2019.

Schedule to the Customs Act, 1969 (IV to 42]. 43. Natural gas Respective 910[5%] If supplied to fertilizer stock in manufacturing of fertilizer 44. Phosphoric acid 2809.2010 5% If imported by fertilizer manufacturing of DAP per metric tonne or 17% ad valorem, whichever is higher & 49 . heading

909 S.No(s) 33 & 35 to 42 omitted by Finance Act, 2018. 910 For the figure “10” the figure “5” substituted through Finance Act, 2018. 911 Serial number(s) 45 and 46 omitted by Finance (Supplementary) Act, 2022 912 S.No(s) 48 & 49 omitted by Finance Act, 2018. 913 S.No(s) 50 to 51 omitted by Finance Act, 2021.

Schedule to the Customs Act, 1969 (IV equipment.”; projector instruments and cinema

accessories Speakers Surround Speakers board Distribution System

metal profiles

Schedule to the Customs Act, 1969 (IV 56. Potassium Chlorate Respective 17% Import and supply 915[90] per kilogram shall not to organizations under the control of Ministry of Defence Production. 57. Rock phosphate Respective 10% If imported by fertilizer in the manufacturing of fertilizers. imported LPG.”.] . . 66. Supplies as made Respective 920[12%] if supplied goods are Board’s computerized

914 Serial number(s) 54, 55, 59 and 61 to 64 omitted by Finance (Supplementary) Act, 2022 915 The figure substituted by Finance Act, 2021. 916 The figure substituted by Finance Act, 2021. 917 S.No. 58 added by Finance Supplementary (Amendment) Act, 2018. 918 Serial number 60 “Fat filled Milk” omitted by Tax Laws (Third Amendment) Ordinance, 2021. 919 Serial numbers 65 and 67 omitted by Finance Act, 2021. 920 The figure substituted by Finance (Supplementary) Act, 2022

Schedule to the Customs Act, 1969 (IV subject to the condition addition during the last six months”; and 921[66 A vehicles Prime Movers) Buses Rickshaw Loader Trucks Motorcycle

921 Serial number(s) 66A, 66B and 68, 69 omitted by Finance (Supplementary) Act, 2022 922 Serial number 70 substituted by Finance (Supplementary) Act, 2022

923[7 30th June, 2026: SUVs with 50 Kwh and commercial battery or below manufactured or assembled motorcars of cylinder capacity upto 924[850cc] [73

to 2500 cc FATA/PATA to the taxable areas

923 New serial numbers 71 to 74 inserted by Finance Act, 2021. 924 Expression substituted by Finance (Supplementary) Act, 2022. 925 Serial number 73 substituted by Finance (Supplementary) Act, 2022

926 Import of electric 8703.8090 12.5% [75 vehicle in CBU conditions 927 ***] omitted [76 928 personal computers 8471.3020 5% If imported in CBU [77 and Laptop and condition] computers, 8471.3010 notebooks whether or not incorporating multimedia kit 929[Table-2 ***] Annex-A Header Information NTN/FTN of Importer Regulatory authority no. Name of Regulatory authority

(1) ( 2 ) (3) Details of Input goods (to be filled by the chief Goods imported (Collectorate executive of the importing company) of import) H S C o d e D e s cri pti o n S p e c s C D u u s t y t o m r - at e ( a p pli c a bl e) S al e s T a x r at e ( a p pli c a bl e) W H T Q u a ntit y U O M Q u a ntit y i m p ort e d C oll e ct or at e C R N/ M a c h N o. D at e of C R N/ M a c h. N o.

(4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) CERTIFICATE. It is certified that the description and quantity mentioned above are commensurate with the project requirement and that the same are not manufactured locally. It is further certified that the above items shall not be used for any other purpose. Signature of Chief Executive, or the person next in hierarchy duly authorized by the Chief Executive Name ______________________ 926 Serial number 75 substituted by Finance (Supplementary) Act, 2022. 927 Serial number 76 omitted by Finance (Supplementary) Act, 2022 928 New serial number 77 inserted by Finance (Supplementary) Act, 2022 929 Table -2 omitted by Finance (Supplementary) Act, 2022.

N.I.C. No. __________________________________

NOTE:– In case of clearance through Pakistan Customs Computerized System, the above information shall be furnished online against a specific user I.D. and password obtained under section 155D of the Customs Act, 1969.

Explanation.-

Chief Executive means.-

or limited company or multinational organization; or

––––––– Annex-B

Header Information Details of Input goods (to be filled by the Goods imported authorized officer of the Regulatory (Collectorate of import) Authority) (12 )

CERTIFICATE. Before certifying the above-authorized officer of the Regulatory Authority shall ensure that the goods are genuine and bona fide requirement of the project and that the same are not manufactured locally. Designation ________________________

930[The NINTH SCHEDULE [See sub-section (3B) of section 3] 931[Table-I Sales Tax on supply (payable at the time of supply by CMOs): S. No. Description / Specification of Sales tax on supply Goods (payable at the time of supply by CMOs)

(1) (2) (3) 1. Subscriber Identification Rs. 250 Module (SIM) Cards 932[Provided that the provisions of Table-I shall not be applicable from 1st July, 2020 onwards. Explanation.- For removal of doubt, it is clarified that the above amendment in law shall not prejudicially affect, the Board’s stance or position in pending cases on the issue of chargeability of sales tax on SIM cards before any court of law.] 930 The Ninth Schedule added by the Finance Act, 2015 931 Table-I, Table-II and conditions substituted by Finance Act, 2020. 932 Proviso and Explanation to Table-1 inserted by Finance Act, 2021.

Table-II Cellular mobile phones in CKD/CBU form: S. Description / Sales tax on Sales tax on Sales tax on supply No. Specification of CBUs at the import in of locally under column (4) or satellite phones to be charged on the basis of import value per set, or against each category:- - phones) 30 (smart phones) but not exceeding US$ but not exceeding US$ 933[17% valorem]

933 Expression substituted by Finance (Supplementary) Act, 2022 934 Expression substituted by Finance (Supplementary) Act, 2022 935 Expression substituted by Finance (Supplementary) Act, 2022

LIABILITY, PROCEDURE AND CONDITIONS [(i) The liability to pay the tax on the goods specified in this Schedule shall be-

(a) in case of the goods specified in Table-I, of the Cellular Mobile Operator (CMO);

(b) in case of goods specified in columns (3) and (4) of Table-II, of the importer; and

(ii) The time of payment of tax due under this Schedule shall be the same as specified in section 6;

(iii) The tax paid under this Schedule shall not be deductible against the output tax payable by the purchaser or importer of the goods specified in this Schedule;

(iv) The input tax paid on the input goods attributable to the goods specified in this Schedule shall not be deductible for the tax payable under this Schedule; and

(v) The Board may prescribe further mode and manner of payment of tax due under this Schedule.] 936[The TENTH SCHEDULE [See sub-section (1B) of section 3] 937[(1)]The tax on bricks, falling in PCT heading 938[6901.0000], shall be paid on fixed basis, 939[ ] at the rates specified in Table below:- 936 The new Tenth Schedule, the Eleventh Schedule and the Twelfth Schedule added through Finance Act, 2019. 937 Existing paragraph renumbered as paragraph (1) by Finance Act, 2020. 938 PCT heading “6901.1000” substituted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020 939 Expression “on monthly return,” Omitted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020

TABLE S. Region or area Tax No. payable per month

(1) (2) (3) 1. Lahore, Rawalpindi and Islamabad Rs. 12,500 districts 2. Attock, Chakwal, Jehlum, Mandi Rs. 10,000 Bahauddin, Sargodha, Gujrat, Sialkot, Narowal, Gujranwala, Hafizabad, Sheikhupura, Kasur, Nankana Sahib, Chiniot, Faisalabad, Jhang, Toba Tek Singh, Okara and Sahiwal districts 3. Khushab, Mianwali, Bhakar, Layyah, Rs. 7,500 Muzaffarghar, Dera Ghazi Khan, Rajanpur, Multan, Lodhran, Khanewal, Vehari, Bahawalpur, Pakpattan, Bahawalnagar, Rahim Yar Khan districts; and Sindh, Khyber- Pakhtunkhwa and Baluchistan provinces

940[(2) Tax on cement or concrete blocks falling in PCT heading 6810.1100, shall be charged on fixed basis as per the following Table, namely:- TABLE S. No. Item Tax

(1) (2) (3) 1. Paver Rs. 2 per sq.ft 2. Hollow block Rs. 3 per piece (volume less than 1 cubic feet) 3. Solid block Rs. 3 per piece (volume less than 1 cubic feet) 4. Kerb Stone Rs. 5 per piece (volume less than 1 cubic feet) 5. Kerb stone Rs. 10 per piece] (volume greater than 1 cubic feet) Note: No input tax adjustment shall be allowed against the tax paid under this Schedule.] 940 New paragraph (2) and its Table along with Note inserted by Finance Act, 2020.

941[The ELEVENTH SCHEDULE [See sub-section (7) of section 3]

TABLE The rates for withholding or deduction by the withholding agents 942[are specified as below provided that withholding of tax under this Schedule shall not be applicable to the goods and supplies specified vide clauses (i) to (viii) after the Table]

S. Withholding agent Supplier Rate or extent of deduction 1. (a) Federal and provincial 943[Active 1/5th of Sales Tax as shown on public sector organizations

(b) Companies as defined in 2001 (XLIX of 2001) 2. (a) Federal and provincial 2[Active 1/10th of Sales Tax as shown 2001 (XLIX of 2001) 3. Federal and provincial 2[persons Whole of the tax involved or 4. Companies as defined in the 2[persons 5% of gross value of supplies Taxpayers] 5. Registered persons as Person Whole of sales tax applicable services

941 Eleventh Schedule inserted by Finance Act, 2019. 942 The expression substituted by Finance Act, 2020. 943 Words substituted by Finance Act, 2020.

S. Withholding agent Supplier Rate or extent of deduction 2[persons Active Taxpayers] 944[7 Registered persons Persons 75% of the sales tax (PCT Headings: 7801.1000, 7801.9100, 7801.9900, 7802.0000, 78.03, 7804.1100, 7804.1900, 7804.2000, 78.05, 7806.0010, 7806.0020, 7806.0090) batteries under (PCT Headings: 8548.1010, 8548.1090)

944 New serial numbers 7 and 8 inserted by Finance Act, 2021.

Online market place Persons 2% of gross value of other than supplies: active Provided that the taxpayers provisions of this entry shall be effective from the date as notified by the Board.]

(i) Electrical energy;

(ii) Natural Gas;

(iii) Petroleum Products as supplied by petroleum production and exploration companies, oil refineries, oil marketing companies and dealers of motor spirit and high speed diesel;

(iv) Vegetable ghee and cooking oil;

(v) Telecommunication services;

(vi) Goods specified in the Third Schedule to the Sales Tax Act, 1990;

(vii) Supplies made by importers who paid value addition tax on such goods at the time of import;

(viii) Supplies made by an Active Taxpayer as defined in the Sales Tax Act, 1990 to another registered persons with exception of advertisement services; and 945[(ix) Supply of sand, stone, gravel/crush and clay to low cost housing schemes sponsored or approved by Naya Pakistan Housing and Development Authority.] 945 New clause (ix) inserted by Finance Act, 2020.

946[The TWELFTH SCHEDULE [See sub-section (2) of section 7A] TABLE S. No. Goods or class of PCT Rate goods Heading

(1) (2) (3) (4) 1. All imported goods Respective 3% ad subject to exclusions Heading valorem as in conditions and procedure given after the Table Procedure and conditions:-

(1) The sales tax on account of minimum value addition as payable under this Schedule (hereinafter referred to as value addition tax), shall be levied and collected at import stage from the importers on all taxable goods as are chargeable to tax under section 3 of the Act or any notification issued thereunder at the rate specified in the Table in addition to the tax chargeable under section 3 of the Act or a notification issued thereunder:

(2) The value addition tax under this Schedule shall not be charged on,- 947[(i) Raw materials and intermediary goods imported by a manufacturer for in-house consumption;]

(ii) The petroleum products falling in Chapter 27 of Pakistan Customs Tariff as imported by a licensed Oil Marketing Company for sale in the country; 946 Twelfth Schedule inserted by Finance Act, 2019. 947 Clause (i) substituted by Finance Act, 2020.

(iii) Registered service providers importing goods for their in- house business use for furtherance of their taxable activity and not intended for further supply;

(iv) Cellular mobile phones or satellite phones;

(v) LNG / RLNG;

(vi) Second hand and worn clothing or footwear (PCT Heading 6309.000);

(vii) Gold, in un-worked condition; 948[***]

(viii) Silver, in un-worked condition;

(ix) 949[The goods as specified in the Third Schedule on which tax is paid on retail price basis.950[;and 951[(x) plant, machinery and equipment falling in Chapters 84 and 85 of the First Schedule to the Customs Act, 1969 (IV of 1969), as are imported by a manufacturer for in-house installation or use. 952[(xi) Electric vehicles (4 wheelers) CKD kits for small cars/SUVs, with 50 kwh battery or below and LCVs with 150 kwh battery of below till 30th June, 2026;

(xii) Electric vehicles (4 wheelers) small cars/SUVs, with 50 kwh battery or below and LCVs with 150 kwh battery of below in CBU condition till 30th June, 2026”;

(xiii) Electric vehicles (2-3 wheelers and heavy commercial vehicles) in CBU condition till 30th June, 2025; and

(xiv) motor cars of cylinder capacity upto 850cc]

(3) The value addition tax paid at import stage shall form part of input tax, and the importer shall deduct the same from the output tax due for the tax period, subject to limitations and restrictions under the Act, for determining his net liability. The excess of input 948 The word “and” omitted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020 949 Clause (ix) inserted vide SRO 1321(I)/2019 dated 08th November, 2019. 950 The word “and” inserted by Tax Laws (Amendment) Act, 2020, dated 30-3-2020. Clause “(x)” inserted by Tax Laws (Amendment) Act, 2020, dated 30-3-2020 952 New clauses inserted by Finance Act, 2021.

tax over output tax shall be carried forwarded to the next tax period as provided in section 10 of the Act. 953[“(4) The refund of excess input tax over output tax, which is attributable to tax paid under this Schedule, shall not be refunded to a registered person in any case, except that as used for making of zero-rated supplies.”]

(5) The registered person, if also dealing in goods other than imported goods, shall be entitled to file refund claim of excess carried forward input tax for a period as provided in section 10 or in a notification issued there under by the Board after deducting the amount attributable to the tax paid at import stage i.e. sum of amounts paid during the claim period and brought forward to claim period. Such deducted amount may be carried forward to subsequent tax period.] 954[THIRTEENTH SCHEDULE” (Minimum Production) [See sub-section (9AA) of section 3] Minimum production of steel products.- The minimum production for steel products shall be determined as per criterion specified against each in the Table below: Table S. Product Production criteria No.

(1) (2) (3) 1. Steel billets and ingots One metric ton per 700 kwh of electricity consumed 953 Clause (4) substituted through Tax Laws (Amendment) Act, 2020, dated 30-3-2020 the substituted clause read as under: “(4) In no case, the refund of excess input tax over output tax, which is attributable to tax paid at import stage, shall be refunded to a registered person.” 954 New Thirteenth Schedule inserted by Finance Act, 2021.

steel

Procedure and conditions:-

(i) both actual and minimum production and the local supplies shall be declared in the monthly return. In case, the minimum minimum production: Provided that in case, in a subsequent month, the registered person shall be entitled to get adjustment of excess tax on account of excess of minimum production over actual supplies: Provided further that in a full year, as per financial year of the company or registered person, or period starting from July to June of next year, in other cases, the tax actually paid shall not be less than the liability determined on the basis of minimum production for that year and in case of excess payment no refund shall be admissible: liability against minimum production, or actual supplies, whichever is higher, shall be deposited on monthly basis on proportionate basis depending upon the time required to break the vessel;

(ii) the payment of tax on ship plates in aforesaid manner does not absolve ship breakers of any tax liability in respect of items other than ship plates obtained by ship-breaking;

(iii) the melters and re-rollers employing self-generated power consumption. Such meter shall be duly locked in room with keys in the custody of a nominee of the Commissioner Inland

Revenue having jurisdiction. The officers Inland Revenue having jurisdiction shall have full access to such meter;

(iv) the minimum production of industrial units employing both distributed power and self-generated power shall be determined on the basis of total electricity consumption.] ********* PCPPI-4310(19) FBR-19-09-2019-2000.

Amendment notes

Footnotes printed in the source document. Text quoted after the words was as under is the previous wording and is no longer in force.

3AA. Omitted ………………………………………………………………….. ..……..34 3AAA. Omitted ………………………………………………………………….. …..…..34 3B. Collection of excess sales tax etc. ………………………………. ..……..34 4. Zero rating. ……………………………………………………………… ..……..34 5. Change in the rate of tax. ………………………………………….. ..……..35 6. Time and manner of payment. …………………………………… …..…..35 7. Determination of tax liability. ……………………………………. ……….37 7A. Levy and collection of tax on specified goods on value addition….39 8. Tax credit not allowed. …………………………………………….. ……….40
1. Omitted ………………………………………………………………….. ……….53
1. Omitted ………………………………………………………………….. ..……..53
1. Omitted ………………………………………………………………….. ..……..53
1. Omitted ………………………………………………………………….. …..…..53
1. Omitted ………………………………………………………………….. ..……..53
1. Omitted ………………………………………………………………….. …………53 21. De-registration, blacklisting and suspension of registration….. …53 21A. Active taxpayers list …………………………………………………. ………54 Chapter-IV ………………………………………………………………………… ……….54 BOOK KEEPING AND INVOICING REQUIREMENTS ……… ……….54
26AA. Omitted …………………………………………………………………… ……….64 26AB. Extension of time for furnishing returns ……………………… ……….64 27. Special Returns. ………………………………………………………. ……….65 28. Final Return. …………………………………………………………… ……….65 29. Return deemed to have been made. ……………………………. ……….65 Chapter-VI ………………………………………………………………………… ……….65 APPOINTMENT OF OFFICER OF SALES TAX & THEIR POWERS..66 30. Appointment of Authorities ………………………………………. ……….66 30A. Directorate General, (Intelligence and Investigation) Inland Revenue…………….. ………………………………………………. …….….67 30B. Directorate General Internal Audit. ……………………………. ……….68 30C. Directorate General of Training and Research. ……………. ……….68 30CA. Directorate General of Digital Invoicing and Analysis ……….68 30D. Directorate General of Valuation. ………………………………. ………68 30DD. Directorate of Post Clearance Audit . …………………………. ………69 30DDD. Directorate General of Input Output Co-efficient Organization..69 30E. Powers and Functions of Directorate etc. ……………………. ………69 31. Powers. …………………………………………………………………… ………69 32. Delegation of powers ……………………………………………….. ………69 32A. Audit by Special Audit Panels ………………………………….. ………70
32AA. Omitted. ………………………………………………………………….. ………71 Chapter-VII ……………………………………………………………………….. ………72 OFFENCES AND PENALTIES …………………………………………… ………72 33. Offences and penalties. …………………………………………….. ………72 33A. Proceedings against authority and persons ………………….. ………83 34. Default Surcharge. …………………………………………………… ………83 34A. Exemption from penalty and default surcharge. …………… ………85
1. Omitted. …………………………………………………………………. ………85
35A. Omitted. …………………………………………………………………. ………85
1. Omitted. …………………………………………………………………. ………85 37. Power to summon persons to give evidence and produce documents in inquiries under the Act. …………………………………………. ………85 37A. Power to arrest and prosecute ……………………………………. ………86 37B. Procedure to be followed on arrest of a person. ……………. ………87 37C. Special Judges …………………………………………………………. ………90 37D. Cognizance of Offences by Special Judges …………………. ………90 37E. Special Judge, etc. to have exclusive Jurisdiction ………… ………91 37F. Provisions of Code of Criminal Procedure, 1898, to apply……… 92 37G. Transfer of cases ……………………………………………………… ………92 37H. Place of Sittings ………………………………………………………. ………92 37I. Appeal to the High Court ………………………………………….. ………92 38. Authorised officers to have access to premises, stocks, accounts and records ……………………………………………………………………. ………93 38A. Power to call for information. ……………………………………. ………94 38B. Obligation to produce documents and provide information…….. 94
1. Omitted ………………………………………………………………….. ………95 40. Searches under warrant …………………………………………….. ………95 40A. Omitted. …………………………………………………………………. ………96 40B. Posting of Inland Revenue Officer. ……………………………. ………96 40C. Monitoring of Tracking by Electronic or other means…………………. 96
1. Omitted… ………………………………………………………………. ………98
1. Omitted. …………………………………………………………………. ………98 Chapter-VIII ………………………………………………………………………. ………98 APPEALS …………………………………………………………………………. ………98
1. Omitted. …………………………………………………………………. ………98
1. Omitted. …………………………………………………………………. ………98
1. Omitted. …………………………………………………………………. ………98 45A. Power of the Board and Commissioner to call for records……… 98 45B. Appeals. …………………………………………………………………. ………99 46. Appeals to Appellate Tribunal. ………………………………….. …..…102 47. Reference to the High Court. …………………………………….. ……..103 47A. Alternative dispute resolution. …………………………………… ……..105 Chapter-IX ………………………………………………………………………… ……..107 RECOVERY OF ARREARS ………………………………………………. ……..107