| Case ID |
379914d4-b7d3-4288-9da5-4ddf667a667c |
| Body |
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| Case Number |
Sales Tax Reference Application No.76 of 2009 |
| Decision Date |
Feb 02, 2010 |
| Hearing Date |
Nov 19, 2009 |
| Decision |
The Sindh High Court ruled against the applicant, Messrs Telecard Ltd., in their Sales Tax Reference Application. The court found that the applicant, acting merely as a sales agent for the Pakistan Telecommunication Company Limited (PTCL), could not claim a refund of sales tax and excise duty charged on pay-phone cards. The court emphasized that the burden of indirect taxes is borne by the end consumers, and since the applicant was only an intermediary, they were not entitled to a refund. The ruling was based on the interpretation of the Sales Tax Act, 1990, particularly sections 3(B) and 66, which clarify the roles and responsibilities regarding the collection and payment of taxes. The court reiterated that taxes collected on behalf of the government cannot be reclaimed by those who merely facilitate the sale of goods or services without providing them directly. |
| Summary |
In the case of Sales Tax Reference Application No.76 of 2009, the Sindh High Court examined the role of Messrs Telecard Ltd. in the sale of pay-phone cards and their claim for a refund of sales tax and excise duty. The court noted that the applicant acted solely as a sales agent for PTCL, which meant they were not the actual service provider and thus could not claim a refund on taxes that had already been passed on to consumers. This decision reaffirms the distinction between direct and indirect taxes, clarifying that the burden of indirect taxes, such as sales tax, ultimately falls on the end consumers. The ruling also highlighted the importance of understanding the legal responsibilities of intermediaries in tax collection processes. This case emphasizes the legal interpretations surrounding the Sales Tax Act, 1990, and the Central Excise Act, 1944, as they relate to the refund claims of businesses acting as agents rather than direct service providers. |
| Court |
Sindh High Court
|
| Entities Involved |
Pakistan Telecommunication Company Limited,
TELECARD LTD.,
COLLECTOR SALES TAX AND CENTRAL EXCISE (ENFORCEMENT), KARACHI
|
| Judges |
MUSHIR ALAM,
AQEEL AHMED ABBASI
|
| Lawyers |
Ayyaz Shoukat for Applicant,
Siddiq Mirza and Mian Khan Malik, D.A.G. for Respondent No. 1
|
| Petitioners |
Messrs TELECARD LTD. Through Deputy General Manager Finance, Karachi
|
| Respondents |
another,
COLLECTOR SALES TAX AND CENTRAL EXCISE (ENFORCEMENT), KARACHI
|
| Citations |
2010 SLD 140,
(2010) 101 TAX 306,
2010 PTD 967,
2010 PTCL 1014
|
| Other Citations |
Fecto Belarous Tractor Ltd. v. Government of Pakistan PLD 2005 SC 605
|
| Laws Involved |
Sales Tax Act, 1990,
Central Excise Act, 1944
|
| Sections |
66,
3(B),
47,
3(D)
|