KARACHI: The Sindh High Court (SHC) suspended an impugned notice for recovery of federal excise duty on a constitutional petition filed by M/s East West Insurance Co Ltd against the recovery notices under section 14 of the federal excise act in the tune of Rs. 544, 596, 972 issued by tax authorities.
While the hearing of petition, a two-member bench, headed by Justice Aqeel Ahmed Abbasi directed the tax authorities and deputy attorney general of Pakistan to file their respective comments on next date of hearing.
Earlier, counsel for the petitioner stated petitioner is engaged in the business of insurance, includes all kinds of general insurance business, reinsurance, counter insurance, and counter reinsurance and assurance business.
According to the petitioner, officials of the tax authorities issued a recovery notice under section 14 of the federal excise act, 2005 dated May 08, 2014 alleged that petitioner is liable to pay federal excise act on the amount of Rs. 544, 596, 972/ remitted/ payment of franchise fee/ technical fee/ royalty, under section 152 (1) of income tax ordinance, 2001 to the tax year 2012, 2013 at 10%.
Counsel argued that the notice is based on misreading of facts and the statement stated therein were not correct, he stated that petitioner filed reply however, instead of dropping the recovery notice respondents addressed to concern bank, for attachment of bank account of the petitioner, therefore, account of the petitioner has been freezed by the bank authorities.
Citing Chairman Federal Board of Revenue, Deputy Commissioner Inland Revenue Zone-II Regional Tax Office, Commissioner Inland Revenue Zone-II Regional Tax Office and Manger Summit Bank Ltd as respondent, petitioner pleaded the court may declare that act of the respondent is illegal, mala fide and arbitrary, petitioner also pleaded the court may set aside impugned recovery notices issued by tax authorities to the petitioner.
