KARACHI: The Sindh High Court (SHC) has directed the tax department not to pass final order till next date of hearing on a constitutional petition filed by M/s SSGC LPG (Private) Limited against impugned show cause notice issued by the tax department and seeking exemption from withholding tax.
During the hearing of petition, a two-member bench, headed by Justice Aqeel Ahmed Abbasi directed the petitioner to submit response to the show cause notice and assist this court on maintainability of the instant petition on the next date of hearing. The court also issued notices to the tax authorities and deputy attorney general for February 2017.
Earlier, counsel for the petitioner stated that petitioner is engaged in the sourcing, processing, marketing, packaging and supply of liquefied petroleum gas (LPG) and provision of terminal and storage services and it has been issued a certificate by Oil and Gas Regulatory Authority (OGRA) and tax department has on in business of SRO 586 (1)/1991, in past issued exemption certificate to the petitioner from withholding tax on the supply of LPG under section 153 read with section 159 of the ordinance.
According to the petitioner, however, Additional Commissioner Inland Revenue Audit Range-B, Zone-III issued a notice under section 122 (9) read/with section 122 (5A) of the ordinance with a mala fide intention, whereby it has shown its intention to tax the income earned by the petitioner through supply of LPG under the final tax regime and not under the normal tax regime.
Citing secretary Ministry of Finance, additional commissioner Inland Revenue Audit Range-B, Zone-III, commissioner Inland Revenue Audit, Range B, Zone-III Large Taxpayer Unit as respondents, petitioner pleaded the court may declare that act of the petitioner is illegal, mala fide and arbitrary.
It also pleaded the court may set aside order of the impugned show cause notice and restrain them from taking any coercive action against the petitioner.
