SALES TAX REFUND ON TAXABLE INPUT USED IN ZERO-RATED.pdf

8/14/2019 SALES TAX REFUND ON TAXABLE INPUT USED IN ZERO-RATED.pdf

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INDEX

1. Short Title, application and commencement.- .............................. .......................... ......................... 1

2. Definitions.- ........................... .......................... .......................... .......................... .......................... .2

3. Establishment of Fast Track Channel.- ............................. .......................... .......................... ............ 2

4. Filing of refund claim.- ............................. .......................... .......................... .......................... ......... 2

5. Scrutiny and processing of refund claim.-............................ .......................... .......................... ........ 2

6. Sanction and payment of refund claim.-.......... .......................... ............................ .......................... 3

7. Screening Channel.- ............................. .......................... .......................... .......................... ............. 3

SALES TAX REFUND ON TAXABLE INPUT USED IN

ZERO-RATED SUPPLY, RULES 2006

S.R.O. 330(I)/2006, Islamabad, the 4thApril , 2006.-

In exercise of the powers conferred by section 50 of the Sales Tax Act, 1990, read with

section 10 thereof, the Central Board of Revenue is pleased to make the following rules,

namely:-

SALES TAX REFUND ON TAXABLE INPUTS USED IN ZERO-RATED

SUPPLY, RULES, 2006

1. Short Title, application and commencement.-

(1) These rules may be called the Sales Tax Refund on Zero-Rated Supply, Rules,

2006.

(2) They shall apply to registered manufacturers who procure sales tax paid inputs

used in zero-rated supplies under section 4 of the Act, read with Notification No.S.R.O. 621(I)/2005, dated the 17

th June, 2005, and shall exclusively be

applicable to such inputs procured on or after the 6thJune, 2005.

(3) These shall come into force at once.


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2. Definitions.-

In these Rules, unless the subject or context otherwise requires,-

(a) Act means the Sales Tax Act, 1990;

(b) claimant means registered manufacturer engaged in the manufactureand supply of goods zero-rated under Notification No. S.R.O 621(I)/2005,

dated the 17thJune, 2005;

(c) sanctioning authority means Deputy Collector of sales tax or any other

officer of sales tax who holds full or partial charge of the Fast Track

Channel established under rule 3;

(d) system means the duly approved sales tax data base;

(e) table means the table annexed to these rules; and

(f) Zero-rated supply means the supply of goods which has been zero-rated

for sales tax purpose under Notification No. S.R.O. 621(I)/2005, dated the

17thJune, 2005.

3. Establishment of Fast Track Channel.-

There shall be established a Fast Track Channel in each Collectorate of Sales

Tax to receive, process and settle the refund claims relating to tax paid inputs

used in the manufacture of goods which stand zero-rated under Notification No.

S.R.O.621(I)/2005, dated the 17thJune, 2005.

4. Filing of refund claim.-

(1) Registered manufacturers engaged in the production of zero-rated goods shall

furnish data relating to the sales tax paid inputs, consumed in zero-rated

supplies, on soft as well as hard copy as per Table-I for imported inputs and; as

per Table II for locally purchased goods. The computer section shall receive the

data with acknowledgement and store it in the system immediately.

5. Scrutiny and processing of refund claim.-

(1) On receipt of a refund claim, each claim shall be assigned a claim number by the

computer section.

(2) Inputs directly imported and consumed in zero-rated goods by the claimant shall

be immediately validated.


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(3) Taxable purchases received by the claimant from public limited companies and

consumed in goods which are used in the zero-rated supplies by him, shall also

be validated for refund.

(4) The taxable inputs approved for refund shall be generated by the system.

(5) The auditor/senior auditor shall transmit the approved data to the sanctioning

authority along with the hard copy, after deductions, if any.

6. Sanction and payment of refund claim.-

(1) The sanctioning authority shall sanction, subject to the provisions of sub-section

(3) of section 10 of the Act, the validated amount, for which the refund payment

order (RPO) shall be generated by the system, and send the hard copy to Post-

Refund Section which shall complete the scrutiny within one month.

(2) The refund on construction material shall be processed on case to case basis.

(3) The Chief Accounts Officer (CAO) of the Collectorate shall issue the cheque for

the amount sanctioned in the RPO under sub-rule (1).

(4) After issuance of cheque, existing procedure shall be followed for the accountal

of the cheques with the State Bank of Pakistan scroll.

(5) The refund filed under these rules shall be sanctioned within seven days from

submission of refund claim under rule 4, subject to the provisions of sub-section

(4) of section 10 of Act.

7. Screening Channel.-

(1) Amount of input sales tax not validated by the system shall be sent by the

sanctioning authority to the screening channel along with a hard copy to be

processed manually.

(2) The screening channel auditor/senior auditor shall intimate the objections

generated by the system to the concerned refund claimants in the form of show

cause notice through courier.

(3) The sanctioning authority shall pass the orders as per merit of the case within

prescribed time on the admissibility or otherwise of the amount of input tax which

was not validated by the system.


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Table-I (Imported Inputs)

Tax Paid Inputs Zero-rated goods

Quantity Value Quantity consumedName of

Importer

Bill of

Entry

# &Date

Description

of goods No. Weight No. Weight Value

Description

of goods

Table-II (Locally Purchased Inputs)

Tax Paid Inputs Zero-rated goods

Quantity Value Quantity consumedName of

Supplier

Invoice

# &

Date

Description

of goods No. Weight No. Weight Value

Description

of goods

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SALES TAX REFUND ON TAXABLE INPUT USED IN ZERO-RATED.pdf