KARACHI: A division bench of Sindh High Court granted a stay in a constitutional petition filed by Tameer Microfinance Bank Limited against the recovery of Rs80.782 million as Federal Excise Duty (FED) on services. The bench comprising Justice Aqeel Ahmed Abbasi and Zafar Ahmed Rajput issued notices to the respondents for April 16, as well as Attorney General for Pakistan (AGP) under section 27-A of the CPC as the petitioners intend to challenge the application of Federal Excise Act on the case of petitioners after the 18th amendments.
The petitioner through his counsel submitted that the petitioners are being charged Federal Excise Duty on services although provinces, after 18th Amendments, have imposed sales tax on services; hence the same amounts to double taxation. He referred to notice under section 14 of the Federal Excise Act, 2005 read with section 7 of the Federal Excise Act, 2005 read with S.R.O. 550(I)/2006 of June 5, 2006 issued by the Deputy Commissioner Inland Revenue , Karachi, wherein an amount of Rs 80.782 million has been demanded from the petitioners.
The court also ordered that the petitioners may respond to the notice issued by respondents and attend the proceedings before the department concerned. However, the respondent shall refrain from any coercive action for the recovery of the impugned amount against till next hearing. The court added that if the petitioners did not proceed with the matter on the next date of hearing, the interim order passed may be recalled. The respondents in the petition are: Federation of Pakistan, Chief Commissioner, Inland Revenue, Large Taxpayers Unit, Karachi, and Deputy Commissioner, Inland Revenue, E&C, Unit-02, Range-A, Zone-II, Karachi.
