KARACHI: Mekotax Private Limited, KAM International, Umer Garments, J.B Corporation, S.M Traders and Asacotex moved the Sindh High Court (SHC) challenging non-adjustment/dis-allowance of input tax on packing material from 1st of July 2016 vide SRO 491 (1) 2016.
Counsel for the petitioners submitted in constitutional petition that they are, inter alia, engaged in the business of processing, manufacturing, packing and marketing of various textile products and all along it has richly contributed to the exchequer of this country by way of payment of indirect taxes.
Counsel argued that petitioners are being aggrieved from non-adjustment/dis-allowance of input tax on packing material w.e.f 1st of July 2016 vide SRO 491 (1)/2016 where condition X of adjustment of sales tax being paid on packing material as input tax under the Sales Tax Act-1990.
He said the petitioner further challenged the misapplication of section 08 of the act-1990 by respondents who informed the petitioners that they are not entitled to input adjustment on packing material and proviso under condition X of notification 491 (1)/ 2016 is bad in law, unconstitutional, without jurisdiction, illegal, void ab-initio and has no legal effect.
Citing Secretary, Ministry of Finance, Chairman Federal Board of Revenue, Chief Sales Tax Law and Procedure FBR, Chief Commissioner RTO and Chief Executive Pakistan Revenue Automation Pvt Ltd as respondents, petitioners pleaded with the court to declare above-mentioned SRO illegal, unlawful, insofar as it relates to the dis-allowance of input tax on packing material and direct officials of the tax department to allow input tax adjustment.