THE SINDH SALES TAX ON SERVICES ACT, 2011. SINDH ACT NO. XII OF 2011.

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PROVINCIAL ASSEMBLY OF SINDH

NOTIFICATION

KARACHI, THE 10TH JUNE, 2011

NO.PAS/Legis-B-19/2011-The Sindh Sales Tax on Services Bill, 2011 having been passed by the Provincial Assembly of Sindh on 6th June, 2011 and assented to by the Governor of Sindh on 10th June, 2011 is hereby published as an Act of the Legislature of Sindh.

THE SINDH SALES TAX ON SERVICES ACT, 2011.

SINDH ACT NO. XII OF 2011.

(As amended upto July, 2013)

AN

ACT

to provide for the levy of a tax on services provided, rendered, initiated, received or consumed in the Province of Sindh;

Preamble

WHEREAS in accordance with the Constitution of the Islamic Republic of Pakistan 1973 the imposition, administration, collection and enforcement of taxes on services is the prerogative of the provinces.

WHEREAS it is expedient to provide for the levy of a tax on services provided, rendered, initiated, received 1[, originated, executed] or consumed in the Province of Sindh and for all matters incidental and ancillary thereto or connected therewith.

Chapter I

PRELIMINARY

1. Short title, extent and commencement

(1) This Act may be called the Sindh Sales Tax on Services Act, 2011.

(2) It shall extend to the whole of the Province of Sindh.

(3) This Act shall come into force with effect from the first day of July, 2011.

2[2. Definitions. In this Act, unless there is anything repugnant in the subject or context-

(1) “accountant” means-

(i) a chartered accountant as defined in the Chartered Accountants Ordinance, 1961 (Ordinance No. X of 1961), and includes the Associate and Fellow members thereof;

1. Inserted vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

2. “Section 2”. substituted vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

(2)

(ii) a cost and management accountant as defined in the Cost and Management Accountants Act, 1966 (Act No. XIV of 1966), and includes the Associate and Fellow members thereof;

(iii) a firm or an association of chartered accountants or cost and management accounts; and

(iv) other accountants or association of accountants notified in this behalf by the Board;

(2) “advertisement” includes a notice, circular, label, wrapper, document, banner, hoarding, billboard, or any other audio or visual representation made or displayed by any means including print media, electronic media, telecommunication media, light, paint, colouration, sound, smoke or gas, or otherwise;

(3) “advertising agent” means a person engaged in providing any service connected with the making, preparation, display, demonstration or exhibition of advertisement in any manner and includes an advertising agency or media agent or advertising or media consultant, by whatever name called;

(4) “agent”, means a person who is authorized to act on behalf of another person (called ‘the principal’) to create a legal relationship with a third party, and includes a person specified as an agent under section 67;

(5) “airport ground service provider” and “airport service provider” mean and include any service provider, operator and airline providing or rendering ground or ramp services, including passenger and cargo handling services, to other airlines or to aircraft operators of scheduled or non-scheduled flights, and also include the handling agents authorized by the Civil Aviation Authority or other airport operators;

(6) “aircraft operator” means and includes any person who provides the services of transportation or carriage of passengers, goods, cargo, baggage or mail by aircraft;

(7) “airport operator” means and includes the Civil Aviation Authority and any other authority or organization or office managing or operating a customs airport, as notified under section 9 of the Customs Act, 1969 (Act No. IV of 1969);

(8) “Appellate Tribunal” means the Appellate Tribunal of the Sindh Revenue Board established under section 60;

(9) “architect” means and includes an architect or a town planner as defined in section 2 of the Pakistan Council of Architects and Town Planners Ordinance, 1983 (Ordinance IX of 1983), and also includes an association of persons or a commercial concern engaged in any manner, whether directly or indirectly, in the field of architecture or town planning;

(10) “arrears”, in relation to a person, means the tax due and payable by the person on a day under this Act, which has not been paid by that day in the prescribed manner;

(11) “Assistant Commissioner” means a person appointed as an Assistant Commissioner of the Sindh Revenue Board under section 34;

(12) “associates” or “associated persons” refers to –

(i) two persons, where the relationship between them is such that one may reasonably be expected to act in accordance with the intentions of the other, or both persons may reasonably be expected to act in accordance with the intentions of a third person;

(3)

Provided that two persons shall not be associates solely by reason of the fact that one person is an employee of the other or both persons are employees of a third person;

(ii) without prejudice to the generality of paragraph (i) and subject to paragraph (iii) of this clause, the following persons shall always be treated as associates, namely: –

(a) an individual and a relative of that individual;

(b) members of an association of persons;

(c) a member of an association of persons and the association, where the member, either alone or together with an associate or associates under another application of this clause, controls fifty per cent or more of the rights to income or capital of the association;

(d) a shareholder in a company and the company, where the shareholder, either alone or together with an associate or associates under another application of this clause, controls either directly or through one or more interposed persons–

(i) fifty per cent or more of the voting power in the company;

(ii) fifty per cent or more of the rights to dividends; or

(iii) fifty per cent or more of the rights to capital; and

(e) two companies, where a person, either alone or together with an associate or associates under another application of this clause, controls either directly or through one or more interposed persons –

(i) fifty per cent or more of the voting power in both companies;

(ii) fifty per cent or more of the rights to dividends in both companies; or

(iii) fifty per cent or more of the rights to capital in both companies; and

(iii) two persons shall not be associates under sub-paragraphs (a) or (b) of paragraph (ii) of this clause where the Commissioner SRB is satisfied that neither person may reasonably be expected to act in accordance with the intentions of the other;

Explanation: The expression “relative” in relation to an individual, means–

(a) an ancestor, a descendant of any of the grandparents, or an adopted child, of the individual, or of a spouse of the individual; or

(b) a spouse of the individual or of any person specified at (a) this explanation.

(13) “association of persons” includes a firm, any artificial juridical person and anybody of persons formed under a foreign law, but does not include a company;

(14) “authorized service station” means a service station or service center, authorized by a motor vehicle manufacturer, whether local or foreign, to carry out any service or repair or reconditioning or restoration or decoration of motor vehicles, classified under

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Chapter 87 of the Customs Act, 1969 (Act No. IV of 1969), manufactured by such manufacturer;

Explanation: The services by authorized service stations include -

(1) the services provided during the warranty period as well as after the expiry of the warranty period;

(2) the services provided even for the vehicles and machinery not manufactured by the manufacturer appointing or authorizing such service station; and

(3) the services provided against charges billed by way of reimbursement, whether from the manufacturer or insurance companies or leasing companies or other such persons;

(15) “automated teller machine” means an interactive automatic machine, whether owned or outsourced by banks and other financial institutions, designed to dispense cash, accept deposit of cash, transfer money between bank accounts and facilitate other financial transactions including payments of bills;

(16) “automated teller machine operations, maintenance, and management” means a service provided in relation to automated teller machines and includes site selection, contracting of location, acquisition, financing, installation, certification, connection, maintenance, transaction processing, cash forecasting, replenishment, reconciliation and value added services;

(17) “beauty parlour” or “beauty clinic” means a person or an establishment providing beauty treatment services including hair cutting, hair dyeing, hair dressing, face care, face treatment, cosmetic treatment, manicure, pedicure, make-up including bridal make-up, and counseling services on beauty care, face care or make-up or other such identical or similar services;

(18) “Board” means the Sindh Revenue Board established under section 3 of the Sindh Revenue Board Act, 2010 (Sindh Act No. XI of 2010);

(19) “business support service” means services provided in relation to business or commerce and includes evaluation of prospective buyers, telemarketing, call centre facilities, accounting and processing of transactions, processing of purchase orders and fulfillment services, information and tracking of delivery schedules, managing distribution and logistics, customer relationship management services, operational assistance for marketing, formulation of customer service and pricing policies, infrastructural support services and other transaction processing.

Explanation.– For the purposes of this clause, the expression “infrastructural support services” includes providing office alongwith utilities, lounge, reception with personnel to handle messages, secretarial services, telecommunication facilities, pantry and security;

(20) “cable TV operator” includes local loop holder and means a person who owns, controls, manages or runs any cable television system and is engaged in reception of broadcast pre-recorded or live signals from different channels for distribution to subscribers through a set of closed transmission path or wireless, and is liable to license as a cable TV operator under the Pakistan Electronic Media Regulatory Authority Ordinance, 2002 (Ordinance No. XIII of 2002);

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(21) “caterer”, by whatever name called, means a person who in ordinary course of business and in relation to events, functions, ceremonies, parties, get-together, occasions, etc., provides or supplies, either directly or indirectly, various services including food, edible preparations, beverages, entertainment, furniture or fixture, crockery or cutlery, pandal or shamiana, ornamental or decorative accessories or lighting for illumination;

(22) “club” includes a membership club and a proprietary club and means a person, a body of persons, an establishment, an organization or a place, the membership of which is restricted to a particular class of people or which is run on the basis of mutuality or otherwise and provides various services, facilities, utilities or advantages for an amount of fee, consideration, subscription or charges, including those for initial membership, whether or not it provides food or drinks or has any arrangement for boarding or lodging or games;

(23) “Commissioner” means a person appointed as a Commissioner of the Sindh Revenue Board under section 34;

(24) “Commissioner (Appeals)” means a person appointed as a Commissioner (Appeals) of the Sindh Revenue Board under section 34;

(25) “Commissionarte” means the office of the Commissioner or the Commissioner (Appeals) having jurisdiction specified under this Act and the rules made thereunder;

(26) “common taxpayer identification number” means the registration number or any other number or identification number allocated to a person for the purposes of this Act;

(27) “commodity broker” means a broker as defined in clause (b) of sub-rule (1) of rule 2 of the Commodity Exchange and Future Contracts Rules, 2005, made under section 33 of the Securities and Exchange Ordinance, 1969 (Ordinance No. XVII of 1969);

(28) “company” means -

(a) a company as defined in the Companies Ordinance, 1984 (Ordinance No. XLVII of 1984);

(b) a banking company and foreign banking company as defined in the Banking Companies Ordinance, 1962 (Ordinance No. LVII of 1962), and includes any body corporate which transacts the business of banking in Pakistan;

(c) a non-banking finance company (NBFC) and the notified entities as specified in section 282A of the Companies Ordinance, 1984 (Ordinance No. XLVII of 1984), read with the Non-Banking Finance Company (Establishment and Regulation) Rules, 2003;

(d) a body corporate formed by or under any law in force in Pakistan; (e) a modaraba company as defined in the Modaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980 (Ordinance No. XXXI of 1980);

(f) a financial institution as defined in the Financial Institutions (Recovery of Finances) Ordinance, 2001 (Ordinance No. XLVI OF 2001), including a microfinance institution licensed under the Microfinance Institutions Ordinance, 2001 (Ordinance No. LV of 2001) and a Islamic financial institution;

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(g) a body incorporated by or under the law of a country outside Pakistan relating to incorporation of companies;

(h) a trust, a co-operative society or a finance society or any other society established or constituted by or under any law for the time being in force; or

(i) a foreign association, whether incorporated or not, which the Board has, by general or special order, declared to be a company for the purposes of this Act.

(29) “computerized system” means any comprehensive information technology system used by the Board or any other office as may be notified by the Board, for carrying out the purposes of this Act;

(30) “courier services” includes the services provided or rendered by any person engaged in the transportation, carriage or delivery of time-sensitive documents, goods or articles, whether or not utilizing the services of a person, directly or indirectly, to collect, carry or deliver such documents, goods or articles;

(31) “customs agent” means a person licensed under section 207 of the Customs Act, 1969, and the rules made thereunder;

(32) “default surcharge” means the default surcharge levied under section 44;

(33) “defaulter” means a person or an association of persons and includes every member of such association, every director of such company and every partner of such firm and further includes guarantors or successors thereof, who fail to pay the arrears;

(34) “Deputy Commissioner” means a person appointed as a Deputy Commissioner of the Sindh Revenue Board under section 34;

(35) “document” includes, but is not limited to, any electronic data, computer programmes, computer tapes, computer disks, micro-films or any other medium or mode for the storage of such data;

(36) “due date”, in relation to the furnishing of a return or a statement or for payment of tax under the Act, means the 15th day of the month following the end of the tax period to which it relates, or such other date as the Board may, by notification in the official Gazette, specify;

(37) “economic activity” shall have the meaning given in section 4;

(38) “e-intermediary” means a person appointed as electronic-intermediary under section 71;

(39) “event management services” means a service provided in relation to planning, promotion, organizing or presentation of any arts, business, sports, marital functions, social functions or any other function or event, and includes any consultation or any ancillary service such as catering, decoration, photography, videography, sound recording, lighting & illumination, DJ, valet parking, etc., provided in this regard;

(40) “exempt service” means a service which is exempt from tax under section 10;

(41) “exhibition service” means the service provided or rendered in relation to an exhibition held -

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(a) to market; or

(b) to promote; or

(c) to advertise; or

(d) to showcase,

any product, goods or services intended for the growth in the business of the manufacturer, producer, importer, supplier, distributor or provider of such product, goods or services;

(42) “FBR” means the Federal Board of Revenue established under the Federal Board of Revenue Act, 2007 (Act No. IV 2007);

(43) “financial year” means a year commencing on the first day of July and ending on the thirtieth day of June in the following year;

(44) “firm” means the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all;

(45) “foreign exchange dealer” includes an exchange company or a foreign exchange company or a money changer authorized or licensed by the State Bank of Pakistan;

(46) “franchise” means an authority given by a franchiser, including an associate of the franchiser, under which the franchisee is contractually or otherwise granted any right to produce, manufacture, distribute sell or trade or otherwise deal in or do any other business activity in respect of goods or to provide services or to undertake any process identified with the franchiser against a consideration or fee, including technical fee, management fee, or royalty or such other fee or charges, irrespective of the fact whether or not a trademark, service mark, trade name, logo, brand name or any such representation or symbol, as the case may be, is involved:

(47) “freight forwarding agent” means a person who provides or renders or makes arrangement for his principals or client, the services, for fee or charges or commission or remuneration, for some or all of the services being provided by the shipping agents, clearing agents, stevedores, ship chandlers, port operators, terminal operators, surveyors, persons providing ship management services, warehousing services or container provision services or cover or guarantee in respect of imports or exports of goods, independently or in partnership or in arrangement with any such service provider or renderer;

(48) “goods” includes every kind of movable property other than actionable claims, money, stocks, shares and securities and does not include a service or services described under this Act;

(49) “Government” means the Government of Sindh; (50) “healthcare center, gyms or physical fitness center, etc.” includes a health club, gymnasium, reducing or slimming salon or clinic, or an establishment providing the facilities, utilities or advantages of sauna or steam bath, Turkish bath, solarium, spas, yoga, meditation, massage (excluding therapeutic massage under medical prescription or advice) or such other services;

(51) “hotel” includes motels and guesthouses and means a person, establishment, organization or place, by whatever name called, where rooms or suites are let out on rent,

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whether or not it has any arrangement for catering or function halls as a part of the hotel or provides any other services, facilities or utilities, but does not include a home or hostel which is exclusively used for the aged or invalid persons or students and is run by or under the control of such a charitable or educational institution as are exempt from the application of the Income Tax Ordinance, 2001 (Ordinance No. XLIX of 2001);

(52) “input tax”, in relation to a registered person, means,--

(a) tax levied under this Act on the services received by the person;

(b) tax levied under the Sales Tax Act, 1990, on the goods imported by the person;

(c) tax levied under the Sales Tax Act, 1990, on the goods or services received by the person; and

(d) Provincial sales tax or Islamabad Capital Territory sales tax levied on the services received by the person:

Provided that the Board may, by notification in the official Gazette, specify that any or all of the aforesaid tax shall not be treated as input tax for the purposes of this Act subject to such conditions and limitations as the Board may specify in the notification;

(53) “insurance” has the same meaning as defined in clause (xxvii) of section 2 of the Insurance Ordinance, 2000 (Ordinance No. XXXIX of 2000);

(54) “insurer” means a person as defined in clause (xxxi) of section 2 of the Insurance Ordinance, 2000 (Ordinance No. XXXIX of 2000);

(55) “inter-bank rate” means the Karachi Inter-Bank Offered Rate (KIBOR) prevalent on the first day of each quarter of the financial year;

(56) “legal practitioners and consultants” , by whatever name called, means a legal practitioner as defined in section 2 of the Legal Practitioners and Bar Councils Act, 1973 (Act No. XXXV of 1973), and includes a person engaged in providing of services in relation to advice, consultancy or assistance in any branch of law or providing representational services before any court, tribunal or other such judicial or quasi-judicial authority;

(57) “management consultant” means a person engaged, either directly or indirectly, in providing of services in connection with the management of any business, organization or institution in any manner and includes a person who renders advice, consultancy or technical assistance relating to conceptualizing, devising, development, modification, rectification, or upgradation of any working system of such business, organization or institution;

(58) “market research agency” means a person engaged, directly or indirectly, in providing of services relating to the study or survey, or both, of any situation in the market for any purpose other than personal, academic or educational requirements;

(59) “marriage hall and lawn”, by whatever name called, includes a hall or lawn or a banquet hall or a function hall or an exhibition hall or lawn, or any building, place, premises or marquee where parties, receptions, events or functions, more particularly relating to matrimonial ceremonies, are held, whether or not it has its own arrangement of

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event management or provision of food, beverages, crockeries, cutleries, furniture, fixtures, etc.;

(60) “officer of the SRB” means an officer of the Sindh Revenue Board appointed under section 34;

(61) “open market price” shall have the meaning given in section 6;

(62) “output tax”, in relation to a registered person, means the tax levied under this Act on the services provided or rendered by the person;

(63) “person” means –

(a) an individual;

(b) a company, an agency or an association of persons incorporated, formed, organized or established in Pakistan or elsewhere;

(c) the Federal Government;

(d) a Provincial Government;

(e) a Local Authority or Local Government in Pakistan; or

(f) a foreign Government, a political sub-division of a foreign Government, or a public international organization;

Explanation: The use of the word “he” in this Act shall be taken to refer to any or all of the persons mentioned in sub-clauses (a) to (f) above.

(64) “place of business in Sindh” means that a person -

(a) owns, rents, shares or in any other manner occupies a space in Sindh from where it carries on an economic activity whether wholly or partially; or

(b) carries on an economic activity through any other person such as an agent, associate, franchisee, branch, office, or otherwise in Sindh but not including a liaison office.

(65) “port operator” includes Karachi Port Trust, Port Qasim Authority or any other person or organization managing the operations of any customs port as declared under section 9 of the Customs Act, 1969 (Act No. IV of 1969);

(66) “prescribed” means prescribed by rules made under this Act;

(67) “PRAL” means the Pakistan Revenue Automation (Private) Limited;

(68) “provision of service” or “providing of service” includes the rendering, supply, initiation, origination, reception, consumption, termination or execution of service, whether in whole or part, including e-services where the context so requires;

(69) “public bonded warehouse” means a warehouse licensed under section 12 of the Customs Act, 1969;

(70) “registration number” means the number allocated to a registered person for the purpose of this Act;

(71) “registered person” means a person who is registered or is liable to be registered under this Act or any other person or class of persons notified by the Board in the official Gazette:

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Provided that a person liable to be registered but not registered under this Act shall not be entitled to any benefit available to a registered person under any of the provisions of this Act or the rules made thereunder;

(72) “reinsurance”, includes retrocession, and has the same meaning as defined in clauses (lii) and (lv) of section 2 of the Insurance Ordinance, 2000 (Ordinance No. XXXIX of 2000);

(73) “resident” means–

(a) an individual who, in a financial year, has -

(i) a place of business, whether whole or part thereof, in Sindh in any mode, style or manner; or

(ii) his permanent address, as listed in the individual’s national identity card, in Sindh; or

(iii) a permanent representative to act on his behalf or to provide service on his behalf in Sindh;

(b) an association of persons or a company which, in a financial year, has --

(i) its registered office is in Sindh; or

(ii) its place of business, whether whole or part thereof, in Sindh in any mode, style or manner; or

(iii) a permanent representative to act on its behalf or to provide service on its behalf in Sindh; or

(iv) the control or management of the association of persons or the company, whether whole or part thereof, situated in Sindh at any time during the financial year;

(74) “restaurant”, by whatever name called, includes a person, establishment, organization, place, cafe, coffee houses or ice cream parlors where food, beverages or other edible preparations are sold or served to the customers, including the customers availing of the take-away service or delivery service or room service or catering service, whether or not the restaurant provides any other services, facilities, utilities or advantages;

(75) “return” means a return required to be furnished under Chapter-VI of this Act;

(76) “rules” means the rules made under this Act;

(77) “Schedule” means a Schedule appended to this Act;

(78) “security agency” means a person engaged in the business of providing of services relating to security of any person or property, whether moveable or immovable, including the services of provision of security personnel, guard or vehicle;

(79) “service” or “services” means anything which is not goods or providing of which is not a supply of goods and shall include but not limited to the services listed in the First Schedule of this Act.

Explanation: A service shall remain and continue to be treated as service regardless whether or not the providing thereof involves any use, supply or consumption of any goods either as an essential or as an incidental aspect of such providing of service;

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(80) “shipping agent” means a person licensed as a shipping agent under the Customs Act, 1969 (Act No. IV of 1969), or the rules made thereunder, who provides or renders any service in relation to entrance or clearance of a conveyance at a customs port and a customs station, as defined in clauses (j) and (k) of section 2 of the Customs Act, 1969, and files import or export manifest and issues line or carrier bill of lading, for or on behalf of an airline or shipping line or any other conveyance, and includes non-vessel operating common carriers, slot carriers, charterers, international freight forwarders and consolidators, rendering services in relation to import and export of cargo, independently or as subsidiary of an airline, shipping line, slot carrier, charterer, and non-vessel operating common carrier;

(81) “ship chandler” means a person licensed as a ship chandler under the Customs Act, 1969 (Act No. IV of 1969) or the rules made thereunder;

(82) “ship management services” includes --

(a) supervision or negotiation for the maintenance, survey and repair of ship;

(b) engagement or providing of crew;

(c) receiving the hire and freight charges on behalf of the owner;

(d) negotiating contracts for bunker fuel and lubricating oils;

(e) arranging or negotiating arrangements for loading and unloading;

(f) payment, on behalf of the owners, of the expenses incurred in providing services or in relation to the management of the ship;

(g) entry of the ship on protection or indemnity association;

(h) providing or negotiating for victualing or storing of ship;

(i) dealing with insurance, salvage or other claims in relation to ship;

(j) arranging of insurance in relation to ship; and

(k) any other ship management service;

(83) “short-paid” means, where a registered person pays an amount of tax less than the tax due as indicated in the person’s return filed under section 30, the amount so involved and also includes the amount of tax due but not paid owing to miscalculation or incorrect or inadmissible input tax credit or adjustment or incorrect assessment of the tax due for a tax period;

(84) “similar service” means any other service which is the same as, or closely resembles, the other service in character, quality, quantity, functionality, materials, or reputation;

(85) “special audit” means an audit conducted under section 29;

(86) “Special Judge” means a Special Judge appointed under section 37;

(87) “sponsorship” includes naming an event after the sponsor, displaying the sponsor’s logo, trade name, brand name or product name, giving the sponsor exclusive or priority booking rights, sponsoring prizes or trophies for competition or game or sports; but does not include financial or other support in the form of donations and gifts, given by a donor,

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subject to the condition that the service provider is under no obligation to provide anything in return to such donor;

(88) “statement” means a statement prescribed under the rules or notifications made under this Act;

(89) “stevedore” includes a person engaged in handling and loading or unloading of cargo including containers, pallets and bulk cargo, from ships, vessels, steamers and country crafts in any manner and also includes a person who hires long shore, dock or harbor workers to load or unload ships, vessels, steamers and country crafts. A person providing or rendering any services related to or ancillary to the handling of or otherwise dealing with such or other cargo at a port or in any area or terminal at the port in any manner or style shall be included in the terminology “stevedores”;

(90) “stockbroker” means a broker as defined in clause (c) of sub-section (1) of section 2 of the Securities and Exchange Ordinance, 1969 (Ordinance No. XVII of 1969) providing services in relation to a Stock Exchange as defined in clause (xxiv) of sub-section (1) of section 2 of the Stock Exchange (Corporatization, Demutualization and Integration) Act, 2012 (Act No. XV of 2012) ;

(91) “surveyor” means a person engaged in the services of insurance survey, market survey, statistical survey, opinion poll survey and survey relating to risk assessment, loss or damage assessment or claim settlement but does not include the services conducted by the Federal or Provincial or Local Governments for its own purposes and by the recognized educational institutions for the purposes of education and academic research in such institutions;

(92) “tax” means -

(a) the tax, additional tax, or default surcharge levied under this Act;

(b) a fine, penalty or fee imposed or charged under this Act; and

(c) any other sum payable or recoverable under the provisions of this Act or the rules made thereunder;

(93) “tax consultant”, by whatever name called, includes a person engaged in providing of services of advice, consultancy or assistance in the matters of any federal, provincial or local government laws in relation to any tax, rate, cess or providing representational services before any court, tribunal or other such judicial or quasi judicial authority or the authority administering such tax laws.

(94) “tax fraud” means knowingly, dishonestly or fraudulently and without any lawful excuse –

(a) doing of any act or causing to do any act; or

(b) omitting to take any action or causing the omission of any action, including providing of taxable services without being registered under this Act; or

(c) falsifying or causing falsification of tax invoices; or

(d) issuance of invoice or bill of taxable services without the provision of that taxable service; or

(e) failure to pay an amount of tax collected under section16, and failure to pay the amount of tax withheld under the provisions of the rules made under this Act, in contravention of the duties or obligations imposed under this Act or

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rules or instructions issued thereunder with the intention of understating the tax liability or underpaying the tax liability for two consecutive periods or more or overstating the entitlement of tax credit or tax refund to cause loss of tax revenue;

(95) “tax period” means a period of one month or such other period as the Board may, by notification in the official Gazette, specify;

(96) “taxable service” shall have the meaning given under section 3;

(97) “telecommunication service” shall have the meaning given in clause (v) of section 2 of the Pakistan Telecommunication (Re-organization) Act, 1996 (Act No. XVII of 1996), and includes the telecommunication system as defined in clause (u) thereof and further includes the wireless communication as defined in clause (1) of section 2 of the Wireless Telegraphy Act, 1933 (Act No. XVII of 1933) and also includes transfer, assignment or sharing of the right to use capacity for transmission, emission or reception of signals and provision of access to global or local information network;

(98) “terminal operator” includes Karachi International Container Terminal, Pakistan International Container Terminal and Qasim International Container Terminal or any on-dock or off-dock terminal or any other person doing similar activities and also includes the cargo or baggage shed operators licensed or appointed by the customs authorities at any customs port or customs airport or customs station;

(99) “value of a taxable service” shall have the meaning given under section 5;

3. Taxable Service.— (1) A taxable service is a service listed in the Second Schedule to this Act, which is provided:

(a) by a registered person from his registered office or place of business in Sindh;

(b) in the course of an economic activity, including in the commencement or termination of the activity.

Explanation: This sub-section deals with services provided by registered persons, regardless of whether those services are provided to resident persons or non-resident persons.

(2) A service that is not provided by a registered person shall be treated as a taxable service if the service is listed in the Second Schedule to this Act and:

(a) is provided to a resident person;

(b) by a non-resident person in the course of an economic activity, including in the commencement or termination of the activity.

Explanation: This sub-section deals with services provided by non-resident persons to resident persons 3[whether or not the said resident person is an end consumer of such services].

(3) For the purposes of sub-section (2), where a person has a registered office or place of business in Sindh and another outside Sindh, the registered office or place of business in Sindh and that outside Sindh shall be treated as separate legal persons.

(4) The Board may, with the approval of the Government and by notification in the official Gazette, prescribe rules for determining the conditions under which a particular service or class of services will be considered to have been provided by a person from his registered office or place of business in Sindh.

3 . Added vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

(14)

4. Economic activity.— (1) An economic activity means any activity carried on continuously or regularly by a person that involves or is intended to involve the provision of services to another person and includes—

(a) an activity carried on in the form of a business, including a profession, calling, trade, or undertaking of any kind, whether or not the activity is undertaken for profit;

(b) the supply of moveable property by way of lease, license or similar arrangement; and

(c) a one-off adventure or concern in the nature of a trade.

(2) Anything done or undertaken during the commencement or termination of an economic activity is part of the economic activity.

(3) An economic activity does not include—

(a) the activities of an employee providing services in that capacity to an employer; 4[or]

(b) a private recreational pursuit or hobby of an individual 5[.]

(c) 6[***]

(d) 7[***]

5. Value of a Taxable Service.— (1) The value of a taxable service is:

(a) the consideration in money including all Federal and Provincial duties and taxes, if any, which the person providing a service receives from the recipient of the service but excluding the amount of sales tax under this Act:

Provided that–

(i) in case the consideration for a service is in kind or is partly in kind and partly in money, the value of the service shall mean the open market price of the service as determined under section 6 excluding the amount of sales tax under this Act; and

(ii) in case the person provides the service and the recipient of the service are associated persons and the service is supplied for no consideration or for a consideration which is lower than the price at which the person provides the service to other persons who are not associated persons, the value of the service shall mean the price at which the service is provided to such other persons who are not associated persons excluding the amount of sales tax;

(iii) in case a person provides a service for no consideration or for a consideration is lower than the price at which such a service is provided by other persons, the value of the service shall mean the open market price for such a service;

4. Inserted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

5. Substituted for semi-colon vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No.II of 2012).

6. Omitted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

7. Omitted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

(15)

(b) in case of trade discounts, the discounted price excluding the amount of sales tax under this Act, provided the tax invoice shows the discounted price and the related tax and the discount allowed is in conformity with customary business practice;

(c) in case there is reason to believe that the value of a service has not been correctly declared in the invoice or for any special nature of transaction it is difficult to ascertain the value of a service, the open market price, as determined under section 6;

(d) notwithstanding any of the above, where the Board deems it necessary it may, by notification in the official Gazette, fix the value of any service or class of services and for that purpose fix different values for different classes or description of the same or similar types of services;

Provided that where the value at which the service is provided is higher than the value fixed by the Board, the value of the service shall, unless otherwise directed by the Board, be the value at which the service is provided.

6. Open market price.— (1) The open market price of a service is:

(a) the price the service would fetch in an open market transaction freely entered into between persons who are not associated persons; or

(b) if it is not possible to determine an amount under paragraph (a), the price a similar service would fetch in an open market transaction freely made between persons who are not associated persons, adjusted to take account of the differences between the similar service and the actual service, determined on the basis of the market conditions prevailing at the time and place at which the service is provided.

(2) If the open market price of a service cannot be determined under subsection (1), it may be determined using any method approved by the Board for calculating an objective approximation of the price the service would fetch in an open market transaction freely made between persons who are not associates.

7. Provision of services over a period of time.— (1) Where a service is provided over a period of time and payment for the same is made on a periodic basis, the service shall be treated as comprising two or more separate and distinct services each corresponding to the part of the service to which each separate part of the consideration relates.

Illustrations

The following examples illustrate the application of sub-section (1). These examples are not comprehensive and are meant for illustrative purposes only:

a) Where goods are leased for a two year period and payment is made on a semi-annual basis, the lease of goods for each six month period constitutes a separate service.

b) Where a bank provides a customer with a credit card and charges a quarterly fee for providing the credit card, the provision of the credit card for each quarter is a separate service.

(16)

c) Where an insurance company provides an insurance policy over a five year period and receives a premium on an annual basis, each premium relates to a separate service.

8[(2) This section shall not apply to the services for which payment is made on installment basis except where otherwise prescribed.]

8. Sub-section (2) substituted vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013)

(17)

Chapter-II

SCOPE OF TAX

8. Scope of tax.— (1) Subject to the provisions of this Act, there shall be charged, levied and collected a tax known as sales tax on the value of a taxable service at the rate specified in the Schedule in which the taxable service is listed.

(2) The 9[Board, with the approval of Government,] may, subject to such conditions and restrictions as it may impose, by notification in the official Gazette, declare that in respect of any taxable service provided by a registered person or a class of registered persons, the tax shall be charged, levied and collected at such higher or lower rate or rates as may be specified in the said notification for any given tax period.

9. Person liable to pay tax.— (1) Where a service is taxable by virtue of sub-section (1) of section 3, the liability to pay the tax shall be on the registered person providing the service.

(2) Where a service is taxable by virtue of sub-section (2) of section 3, the liability to pay the tax shall be on the person receiving the service.

(3) Notwithstanding anything contained in sub-sections (1) and (2), the 10[Board, with the approval of Government] may, by a notification in the official Gazette, specify the services or class of services in respect of which the liability to pay tax shall be on the person providing the taxable service, or the person receiving the taxable service or any other person.

(4) Nothing contained in sub-sections (1) and (2) shall prevent the collection of tax from a different person if that person is made separately or jointly or severally liable for this tax under section 18.

10. Exemptions.— (1) Notwithstanding the provisions of section 8, the Board, may, with the approval of the Government and subject to such conditions and restrictions as it may impose, by notification in the official Gazette:

(a) exempt any taxable service from the whole or any part of the tax chargeable under this Act;

(b) exempt any taxable service provided by a specific person or a class of persons from the whole or any part of the tax chargeable under this Act;

(c) exempt any recipient of services or class of such recipients, including international organizations and institutions, from the payment of the whole or any part of the tax payable under this Act; and

(d) exempt any person or class of persons from the whole or any part of the tax chargeable under this Act.

(2) The exemption under sub-section (1) may be allowed from any previous date specified in the notification issued under sub-section (1).

11. Power to amend Schedules.— The Board may, with the approval of the Provincial Assembly of Sindh, amend any Schedule to this Act in order to include or exclude any service

9. Substituted for the word “Government” vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

10. Substituted for the word “Government” vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

(18)

from the said Schedule 11[***].

12. Effect of change in the rate of tax.—If there is a change in the rate of tax, taxable services shall be charged to tax at such rate as is in force at the time the service is provided.

12[13. Special procedures and tax withholding provisions.- (1) Notwithstanding anything contained in this Act, the Board may, by notification in the official Gazette, prescribe special procedure for the payment of tax, valuation of taxable services, registration, record keeping, invoicing or billing requirements, returns and other related matters in respect of any service or class of services and subject to such limitations and conditions as may be specified in the notification.

(2) Notwithstanding anything contained in this Act, the Board may, by notification in the official Gazette, require any person or class of persons, whether registered or not, to withhold full or part of the tax charged from or invoiced to such person or class of persons on the provision of any taxable service or class of taxable services and to deposit the tax, so withheld, with the Government, within such time and in such manner as may be specified in the notification.]

14. Delegation of power to collect, administer and enforce sales tax on certain services.— (1) Notwithstanding anything contained in this Act, the Government may, by notification in the official Gazette, authorize the Federal Board of Revenue or any other Federal, provincial or other agency, department, organization or person to administer, collect and enforce the levy of sales tax on such taxable services as it may notify and in such mode and manner and for such period as it may prescribe and subject to such restrictions and conditions as it may impose.

(2) Notwithstanding anything contained in this Act, where the Government notifies any taxable services under sub-section (1) above, for the period specified therein, except for the provisions of Chapters I and II and sections 72, 74 and 78, the remaining provisions of this Act shall not be applicable to such taxable services.

(3) At the end of the period specified in sub-section (1) above, the tax on taxable services notified under sub-section (1) shall be administered, collected and enforced by the Board in the same mode and manner as all other taxable services and all provisions of this Act shall be applicable to them.

15. Adjustments.— The Board may, subject to such conditions and restrictions as it may prescribe and with the approval of the Government, allow registered persons to claim adjustments or deductions, including refunds arising as a result thereof, in respect of the sale tax paid on or in respect of any taxable services or class of taxable services provided by them.

11. The word “or to increase or decrease the rate of tax applicable to any taxable service” omitted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

12. Section 13 substituted vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013).

(19)

Chapter- III

PAYMENT AND COLLECTION OF TAX ON TAXABLE SERVICES

16. Collection of excess sales tax.— (1) Any person who has collected or collects any tax or charge, whether under misapprehension of any provision of this Act or otherwise, which was not

payable as tax or charge or which is in excess of the tax or charge actually payable and the incidence of which has been passed on to the person to whom the service is provided, shall pay the amount of tax or charge so collected to the Government.

(2) Any amount payable to the Government under sub-section (1) shall be deemed to be an arrear of tax or charge payable under this Act and shall be recoverable accordingly.

(3) The burden of proof that the incidence of tax or charge referred to in subsection (1) has been or has not been passed to the person to whom the service is provided shall be on the person collecting the tax or charge.

17. Time, manner and mode of payment.— (1) The tax in respect of a taxable service provided during a tax period shall be paid by a person at the time of filing the return in respect of that period under 13[Chapter-VI].

(2) For the purposes of sub-section (1), a taxable service shall be considered to have been provided in the tax period during which:

(i) it was provided to the recipient;

(ii) an invoice for the value of the taxable service was sent to the recipient; or

(iii) consideration for the same was received;

whichever is earlier.

(3) Notwithstanding anything contained in sub-section (1), the Board may, by a notification in the official Gazette, direct that the tax in respect of all or such classes of taxable services, as may be specified in the aforesaid notification, shall be charged, collected and paid in any other way, mode, manner or time as may be specified therein.

(4) The tax due on taxable services shall be paid by any of the following

modes, namely:--

(a) through deposit in a bank designated by the Board; or

(b) through such other mode and manner as may be specified by the Board.

18. Joint and several liability of registered persons where tax unpaid.— Where a registered person receiving a taxable service from another registered person is in the knowledge of or has reasonable grounds to suspect that some or all of the tax payable in respect of that taxable service or any previous or subsequent taxable service provided would go unpaid, such person as well as the person providing the taxable service shall be jointly and severally liable for payment of such unpaid amount of tax.

13 . Substituted for the word and figure “Chapter IV” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

(20)

Provided that the Board may by notification in the official Gazette, exempt any transaction or transactions from the provisions of this section.

19. Sales of taxable activity or transfer of ownership.— In the case of sale or transfer of ownership of a business which provides taxable services to another person as an ongoing concern, any sales tax chargeable on taxable services or part thereof shall be accounted for and paid by the person to whom such sale is made or ownership is transferred.

20. Estate of deceased person.— The tax liability of a deceased registered person under this Act shall be the first charge on his estate in the hands of his successors.

21. Estate in bankruptcy.— (1) If a registered person is declared bankrupt, the tax liability under this Act shall pass on to the estate in bankruptcy if it continues to operate the business.

(2) If tax liability is incurred by an estate in bankruptcy, the tax is deemed to

be a current expenditure in the operations of the estate in bankruptcy and shall be paid before the claims preferred by other creditors are settled.

22. Liability for payment of tax in the case of private companies or business enterprises. Notwithstanding anything contained in the Companies Ordinance 1984 (No.XLVII of 1984), where any private company or business enterprise is wound up and any tax chargeable on the company or business enterprise, whether before, or in the course, or after its liquidation, in respect of any tax period cannot be recovered from the company or business enterprise, every person who was an owner of, or partner in, or director of, the company or business enterprise during the relevant period shall, jointly and severally with such persons be liable for the payment of such tax.

23. Assessment of Tax.— (1) Where on the basis of any information acquired during an audit, inquiry, inspection or otherwise, an officer of the SRB, not below the rank of Assistant Commissioner SRB is of the opinion that a registered person has not paid the tax due on taxable services provided by him or has made short payment, the officer shall make an assessment of sales tax actually payable by that person and shall impose a penalty and charge default surcharge in accordance with sections 43 and 44.

(2) No order under sub-section (1) shall be made by an officer of the SRB unless a notice to show cause is given to the person in default within five years from the end of the tax period to which the order relates specifying the grounds on which it is intended to proceed against him and the said officer shall take into consideration the representation made by such

person and provide him with an opportunity of being heard if the person so desires.

(3) Any order under sub-section (1) shall be made within one hundred and twenty days of issuance of the show cause notice or within such extended period as the officer of the SRB may, for reasons to be recorded in writing, fix provided that such extended period shall in no case exceed sixty days.

(4) In computing the period specified in sub-section (3), any period during which the proceedings are adjourned on account of a stay order or proceedings under section 65 or the time taken through adjournment by the person not exceeding thirty days shall be excluded.

(5) An order passed by an officer of the SRB under sub-section (1) may be further amended as may be necessary when on the basis of information acquired during an audit, inquiry, inspection or otherwise, the officer of the SRB is satisfied that:

(i) any sales tax has been under-assessed or assessed at too low a rate; or

(21)

(ii) any taxable service provided by the person has escaped assessment.

(6) The Commissioner SRB may amend, or further amend, any order passed under sub-sections (1) or (5), if he considers that the order is erroneous or prejudicial to the interest of sales tax.

(7) Sub-sections (2), (3) and (4) shall be applicable to any order passed under sub-sections (5) or (6).

(8) Notwithstanding anything contained in this Act, Board may prescribe thresholds, parameters, standards and basis for assessment of supply value and the assessment of tax.

(22)

Chapter-IV

REGISTRATION

24. Registration.— (1) Registration will be required for all persons who:

(a) are residents;

(b) provide any of the services listed in the Second Schedule from their registered office or place of business in Sindh; and

(c) ful ulfil any other criteria or requirements which the Board may prescribe under sub-section (2).

(2) Registration under this section will be regulated in such manner and subject to such conditions and restrictions and rules as the Board may, by notification in the official Gazette, prescribe.

(3) A person who receives a service, which is a taxable service by virtue of sub-section (2) of section 3, and is not a registered person shall be deemed to be a registered person for the purposes of the tax period in which such person:

(i) receives the service;

(ii) an invoice for the value of the service is sent to the person; or

(iii) consideration for the service is paid by the person;

whichever is earlier and all the provisions of this Act and rules made there under shall be applicable to such person for that particular tax period and any matters relating to, arising out of, or concerning that tax period as if that person had provided the service.

(4) The Board shall publish on its web site a list of persons registered under this Act.

(5) It shall not be reasonable for a person to believe that another person is registered under this Act if that other person is not on the list placed on the web site of the Board.

(6) It shall be reasonable for a person to believe that another person is registered under this Act if that other person is on the list placed on the web site of the Board.

24A. Voluntary Registration.— (1) A person who carries on an economic activity but is not required to be registered may apply for voluntary registration at any time.

(2) If a person who is not required to be registered applies for voluntary registration, the Board may register the person if the Board is satisfied that:

(a) the person is making, or will provide, services that are taxable services if the person were registered;

(b) the person has a place of business at which he carries on an economic activity;

(c) there are reasonable grounds to believe that the person will keep proper records and file regular returns as prescribed under this Act; and

(d) if the person has commenced carrying on an economic activity, the person has:

(i) kept proper records in relation to his economic activity; and

(23)

(ii) complied with his obligations under other taxation laws

14[24B.— Compulsory Registration.— (1) If an officer of the SRB is satisfied that a person is required to be registered under this Act and that the person has not applied for registration, the officer of the SRB shall, after such inquiry as he may deemed fit, register the person through an order to be issued in writing and such person shall be deemed to have registered from the date he became liable to registration.

(2) No person may be registered compulsorily without being given an advance notice and an opportunity of being heard.

25. Suspension of registration.— (1) Subject to sub-section (3),—

(a) the Board may suspend the registration of a person if it believes that the person—

(i) is not entitled to be registered; or

(ii) has failed to comply with its obligations under this Act; and

(b) the suspension of registration shall be effected by removing the name of the person from the list of registered persons published on the Board’s web site.

(2) The Board [or any officer of the SRB, authorized by the Board in this behalf, shall give notice to a registered person stating the reasons for the suspension and the remedial actions required to be taken by the person in such time as may be specified in the notice.

(3) In case the Board is not satisfied with the response of the person or the remedial actions taken by him or does not receive any response in the specified time, the Board may suspend that person’s registration.

(4) At any time within a period of sixty days of suspension, the Board may withdraw the suspension if it is satisfied with the remedial actions taken by the person.

(5) Where, after sixty days, the suspension has not been withdrawn, the Board may:

(a) institute proceedings against the person in respect of the alleged non-compliance under this Act;

(b) reinstate the person’s registration; or

(c) if neither of the actions in clauses (a) and (b) is done, cancel the person’s registration.

25A. De-registration.— (1) The Board or any officer of the SRB, authorized in this behalf, may subject to the rules, de-register a registered person or such class of registered persons not required to be registered under this Act.

(2) Where any person registered under this Act believes that he does not satisfy the requirements for registration in section 24, he may, in the manner and mode provided in the rules, make an application to the Board 15[or any officer of the SRB, authorized by the Board in this behalf,] to be de-registered. If upon receiving such an application, the Board 15[or any officer of the SRB, authorized by the Board in this behalf,] is satisfied that the person is not required to be registered under this Act and has fulfilled 16[the obligations for de-registration] under this Act it shall, subject to the rules, deregister such person.

14. Sub-section (1) of section 24B substituted vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

15. Inserted vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

16. Substituted for the words “any Obligation” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

(24)

(3) Where the Board receives an application under sub-section (2), it 17[shall] dispose of the same within a period of three months from the date of receipt of the application, or within such extended period, not exceeding sixty days, as the Board may, for reasons to be recorded in writing fix.

17. Substituted for the word “must” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

(25)

Chapter-V

BOOK KEEPING AND AUDIT PROCEEDINGS

26. Records.— (1) A registered person providing taxable services shall maintain and keep at his business premises or registered office in English or Urdu the following records of taxable services provided (including exempt services) by him or by his agent acting on his behalf in such form and manner as would permit ready ascertainment of his tax liability during a tax period-

(a) records of taxable services provided indicating:

(i) the description and type of service;

(ii) the value of the service;

(iii) the name and address of the person to whom the service was provided; and

(iv) any other information as may be specified by the Board.

(b) records of exempt services; and

(c) such other records as may be specified by the Board.

(2) Notwithstanding anything in any other law for the time being in force, the Board may require, by notification in the official Gazette, a registered person or class of registered persons to declare and use only as many number of business bank accounts as may be specified by the Board in such notification to make or receive payments on account of providing and receiving payment for services for the purpose of this Act or rules made there under and to make payment of due tax from such accounts only.

(3) The Board may, by notification in the official Gazette, specify that any class of persons registered under this Act 18[shall] use such electronic fiscal cash registers as are approved by the Board in the manner prescribed.

(4) The Board may, by notification in the official Gazette, prescribe the procedure or software for electronic maintenance of records, filing of sales tax returns and for any other matter or approve any software for electronic maintenance of records and filing of returns by a registered person or class of such persons under this Act.

(5) The registered persons, whose accounts are subject to audit under the Companies Ordinance, 1984, shall be required to submit a copy of the annual audited accounts, along with a certificate by the auditors certifying the payment of sales tax due and any deficiency in the sales tax paid by the registered person.

27. Retention and production of records and documents.— (1) A person, who is required to maintain any record or documents under this Act, shall retain the record and documents for a period of five years after the end of the tax period to which such record or documents relate or till the final decision in any proceedings including proceedings for assessment, appeal, revision, reference or petition, whichever is later.

(2) A person who is required to maintain any record or documents under this Act or any other law shall, as and when required by an officer of the SRB, not below the rank of

18 . Substituted for the word “should” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

(26)

Assistant Commissioner SRB, produce records or documents which are in his possession or control or in the possession or control of his agent; and where such records or documents have been stored as electronic data, he shall allow access to such officer and use of any machine on which such data is kept.

28. Audit Proceedings.— (1) An officer of the SRB, not below the rank of Assistant Commissioner SRB, may, on the basis of the return submitted by a registered person or the records obtained under sub-section (2) of section 27 conduct an audit of such person once in a year.

Provided that in case the Commissioner SRB has any information showing that such registered person is involved in tax fraud or evasion of tax, he may authorize an officer of the SRB, not below the rank of Assistant Commissioner SRB, to conduct an inquiry or investigation under section 48 which may or may not be in addition to any audit carried out for the same period.

(2) Where the officer of the SRB decides to conduct an audit under subsection (1), he shall issue a notice of audit to the person informing him of the audit proceedings and direct him to produce any records or documents which such officer may require for conducting the audit.

(3) The officer of the SRB shall conduct a preliminary audit and issue an audit observation pointing out the contraventions of the Act or rules, as the case may be, and the amount of tax evaded therein, on the basis of scrutiny of such records. The registered person may, within a period of 21 days of the receipt of the audit observation, submit his point of view in writing.

(4) If, within the period prescribed in sub-section (3), no reply is received or the reply furnished by the registered person is found unsatisfactory, the officer of the SRB shall issue an audit report specifying the amount of tax or charge that has not been levied or has been short levied or any other violation of any provision of Act or rules made there under.

(5) After completion of the audit under this section or any other provision of law, the officer of the SRB, not below the rank of Assistant Commissioner SRB, may pass an order in accordance with the provisions of section 23 or section 47, as the case may be, imposing the correct amount of tax, charging default surcharge and imposing a penalty.

(6) Notwithstanding the penalties prescribed in section 43:

(a) if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with default surcharge voluntarily, whenever it comes to his notice, he shall, before receipt of notice of audit, file a revised return and shall deposit the amount short paid or amount of tax evaded along with default surcharge, in which case no penalty shall be recovered from him;

(b) if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with default surcharge during the audit, or at any time before issuance of show cause notice in lieu of the audit report, he shall file a revised return and shall deposit the evaded amount of tax, default surcharge under section 44, and twenty per cent of the penalty payable under section 43, in which case a show cause notice in lieu of the audit report will not be issued in the matter;

(c) if a registered person wishes to deposit the amount of tax short paid or amount of tax evaded along with default surcharge after issuance of show cause notice, he shall file a revised return and shall deposit the evaded amount of tax, default

(27)

surcharge under section 44, and fifty per cent of the penalty payable under section 43 and thereafter, the show cause notice, shall stand abated.

29. Special Audit by Chartered Accountants or Cost Accountants.— (1) The Board may, by notification in the official Gazette, appoint a Chartered Accountant as defined under Chartered Accountants Ordinance, 1961 (X of 1961) or a firm of Chartered Accountants or a Cost and Management Accountant within the meaning of the Cost and Management Accountants Act, 1966 (XIV of 1966) or a firm of Cost and Management Accountants, for conducting a special audit of the records of any registered person.

(2) Notwithstanding that the records of a registered person have been audited by an officer of the SRB appointed under section 34, the Board or a Commissioner SRB may direct an auditor appointed under sub-section (1) to audit the records of any registered person for the same period.

(3) An auditor appointed under sub-section (1), shall have the powers of an officer of the SRB under sections 19[27, 48, 51 and 52].

19. Substituted for the figures and word “19, 39 and 42” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

(28)

Chapter-VI

RETURNS

30. Return.— (1) Every registered person shall furnish, not later than the due date, a true and correct return in the prescribed form to a designated bank or any other office specified by the Board, indicating the tax due and paid during a tax period and such other information, as may be prescribed.

(2) Notwithstanding anything in sub-section (1), the Board may, by notification in the official Gazette, require any registered person or class of registered persons to submit returns on a quarterly basis.

(3) Notwithstanding anything in sub-section (1), the Board may, by notification in the official Gazette, require any registered person or class of registered persons to submit such returns, as may be prescribed, on an annual basis in addition to or instead of the monthly return or quarterly return.

(4) A return filed electronically on the web or any magnetic media or any other computer readable media as may be specified by the Board shall be deemed to be a return for the purpose of sub-sections (1), (2) or (3) and the Board may, by notification in the official Gazette, make rules for determining eligibility of the data of such returns and e-intermediaries who will digitize the data of such returns and transmit the same electronically under their digital signatures.

(5) If there is a change in the rate of tax during a tax period, a separate return in respect of each portion of tax period showing the application of different rates of tax shall be furnished.

(6) A registered person may file a revised return within one hundred and twenty days of filing a return under sub-sections (1), (2) or (3), as the case may be, to correct any omission or wrong declaration made therein and to deposit any amount of tax short paid.

31. Special Returns’— In addition to the return specified under section 30, the Assistant Commissioner SRB may require any person whether, registered or not, to furnish a return (whether on his own behalf or as an agent or trustee) in a prescribed form and such person shall furnish the return not later than the date specified in this regard.

32. Final Return.— If a person applies for de-registration in terms of section 20[ 25A], he shall before such de-registration, furnish a final return to the Commissioner SRB in the specified form in such manner and at such time as directed by the Commissioner SRB.

33. Return deemed to have been made.— A return purporting to be made on behalf of a person by his duly appointed representative or agent shall, for all purposes, be deemed to have been made by such person or under his authority unless proved to the contrary.

20 . Substituted for figure “25” vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

(29)

Chapter-VII

APPOINTMENT OF AUTHORITIES AND THEIR POWERS

34. Appointment of Authorities.— (1) For the purposes of this Act, the Board may, by notification in the official Gazette, appoint in relation to any area, any case or class of cases specified in the notification, any person to be-

(a) a Director of the Sindh Revenue Board;

(b) a Commissioner of the Sindh Revenue Board;

(c) a Commissioner (Appeals) of the Sindh Revenue Board;

(d) a Deputy Commissioner of the Sindh Revenue Board;

(e) an Assistant Commissioner of the Sindh Revenue Board; and

(f) an officer of the Sindh Revenue Board with any other designation.

(2) The Commissioner (Appeals) SRB and the Commissioner SRB shall be sub-ordinate to the Board and any other officer of the SRB so designated by the Board.

(3) The Deputy Commissioners SRB, Assistant Commissioners SRB shall be sub-ordinate to the Commissioner SRB and any other officer of the SRB so designated by the Board.

35. Powers— (1) An officer of the SRB appointed under section 34 shall exercise such powers and discharge such duties as are conferred or imposed upon him under this Act and rules made there under and he shall also be competent to exercise all powers and discharge all duties conferred upon any officer subordinate to him.

(2) Notwithstanding anything contained in this Act or the rules, the Board may, by general or special order, impose such limitations or conditions on the exercise of such powers and discharge of such duties as it deems fit.

36. Delegation of powers.— (1) The Board may, by notification in the official Gazette and subject to such limitations or conditions as may be specified therein, empower by name or

designation –

(a) any Deputy Commissioner SRB to exercise any of the powers of a Commissioner SRB under this Act; and

(b) any Assistant Commissioner SRB to exercise any of the powers of a Deputy Commissioner SRB under this Act; and

(c) any other officer of the SRB to exercise any of the powers of an Assistant Commissioner SRB under this Act.

(2) Unless the Board in any case otherwise directs, the Commissioner SRB may authorize an officer of the SRB subordinate to him to exercise within any specified area, any of the powers of the Commissioner SRB, or of any other officer of the SRB subordinate to the Commissioner SRB, under this Act.

(3) Board may delegate powers and functions of officer as additional duties to any officer of the SRB of the same rank or a step senior or junior in rank.

(30)

(4) An officer of the SRB to whom any powers are delegated under this section shall not further delegate such powers.

37. Special Judges.— (1) The Government may, by notification in the official Gazette, appoint as many Special Judges a person who is serving or has retired as District and Session Judge for a period of at least 5 years and, where it appoints more than one Special Judge, it shall specify in the notification the headquarters of each Special Judge and the territorial limits within which he shall exercise jurisdiction under this Act and the rules made there under.

(2) A person shall be appointed as a Special Judge, if he has served as Judge in BS 21 or above for at least a period of 7 Years and qualifies to be a Judge of High Court.

(3) If a Special Judge is, for any reasons, temporarily unable to perform his duties under this Act or the rules made there under, he may generally or specially authorize the Sessions Judge of the district to perform such duties of an urgent nature as he may deem proper and such Sessions Judge shall perform such duties.

38. Cognizance of offences by Special Judges.— (1) Notwithstanding anything contained in this Act, the rules made thereunder, or any other law for the time being in force, a Special Judge may, within the limits of his jurisdiction, take cognizance of any offence punishable by a Special Judge under this Act—

(a) upon a report in writing made by an officer of the SRB, not below the rank of Deputy Commissioner SRB with the approval of the Commissioner SRB, or by an officer especially authorized in this behalf by the Government;

(b) upon receiving a complaint or information of facts constituting such offence made or communicated by any person; or

(c) upon his knowledge acquired during any proceeding before him.

(2) Upon receipt of a report under clause (a) of sub-section (1), the Special Judge shall proceed with the trial of the accused.

(3) Upon receipt of a complaint or information under clause (b), or acquired in the manner referred to in clause (c) of sub-section (1), the Special Judge shall, before issuing a summon or warrant for appearance of the person complained against, hold a preliminary inquiry for the purpose of ascertaining the truth or falsehood of the complaint, or direct any Magistrate or any police officer to hold such inquiry and submit a report, and such Magistrate or officer, shall conduct such inquiry and make a report accordingly.

(4) If, after conducting such an inquiry or after considering the report of such Magistrate or officer, the Special Judge is of the opinion that –

(a) there is insufficient ground for proceeding, he may dismiss the complaint, or

(b) there is sufficient ground for proceeding, he may proceed against the person complained in accordance with law.

(5) A Special Judge or a Magistrate or an officer holding an inquiry under subsection (3) may hold such inquiry, as nearly as possible, in accordance with the provisions of section 202 of the Code of Criminal Procedure, 1898 (No. V of 1898).

39. Application of the Code of Criminal Procedure, 1898 (No. V of 1898).— (1) The provisions of the Code of Criminal Procedure, 1898 (No. V of 1898), so far as they are not inconsistent with the provisions of this Act, shall apply to all proceedings of the court of a Special Judge and such court shall be deemed to be a Court of Session for the purposes of the

(31)

said Code and the provisions of Chapter XXII-A of the Code, so far as applicable and with the necessary modifications, shall apply to the trial of cases by the Special Judge under this Act.

(2) For the purposes of sub-section (1), the Code of Criminal Procedure, 1898 (No. V of 1898), shall have effect as if an offence punishable under this Act were one of the offences referred to in sub-section (1) of section 337 of the Code.

40. Exclusive jurisdiction of Special Judge.— Notwithstanding anything contained in this Act, the rules made thereunder or in any other law for the time being in force no court, other than a Special Judge having jurisdiction, shall try an offence punishable by a Special

Judge under this Act.

41. Place of Sitting.— A Special Judge shall ordinarily hold sittings at his headquarters but,

keeping in view the general convenience of the parties or the witnesses, he may hold sittings at any other place.

42. Persons who may conduct prosecutions— (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1898 (No. V of 1898), an officer of the SRB, not below the rank of an 21[Assistant Commissioner] SRB shall be competent to conduct a prosecution

before a Special Judge for and on behalf of the Government.

(2) A prosecution conducted under this Act before the Special Judge may only be withdrawn on the directions of the Government.

21 . Substituted for the words “Deputy Commissioner” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013). .

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Chapter-VIII

OFFENCES AND PENALTIES

43. Offences and penalties.— Whoever commits any offence described in column (1) of the Table below shall, in addition to and not in derogation of any punishment to which he may be liable under any other law, be liable to the penalty mentioned against that offence in column (2) thereof. The sections referred to in column (3) are meant for illustrative purposes only and the corresponding offence described in column (1) may fall and be prosecuted under other

sections of this Act as well.

TABLE

Offences

Penalties

Section of the Act to which offence has reference

1. Any person who is required to apply for registration under this Act fails to make an application for registration before providing taxable services.

Such person shall be liable to pay a penalty of 10,000 rupees or five per cent of the amount of sales tax he would have been liable to pay had he been registered, whichever is higher.

In the case of noncompliance of compulsory registration, the minimum penalty shall be 100,000 rupees.

Provided that such person who is required to get himself registered under this Act, fails to get registered within ninety days of providing taxable services, he shall be further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to one year, or with fine which may extend to the amount of sales tax he would have been liable to pay had he been registered, or with both.

24

(33)

2. Where any person fails to furnish a return within the due date.

Such person shall be liable to pay a penalty of 5,000 rupees provided that if a return is not filed within fifteen days of the due date, a penalty of 100 rupees for each day of default shall be paid.

30

3. Where any person fails to deposit the amount of tax due or any part thereof in the time or manner laid down under this Act or the rules made there under.

(a) Such person shall be liable to pay a penalty of 10,000 rupees or five per cent of the total tax payable for that period, (if default is more than 3 days) whichever is higher.

(b) If the amount of tax due is not paid even after the expiry of a period of sixty days of issuance of the notice for such payment by an officer of the SRB, not below the rank of Assistant Commissioner SRB, the person shall, further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to three years, or with fine which may extend to the amount of unpaid tax, or with both.

(c) No penalty shall be payable if any miscalculation is made for the first time during a year

8, 17, and 66

4. Any person who fails to maintain records required under this Act or the rules made there under

Such person shall pay a penalty of 5,000 rupees or five per cent of the total tax payable for the tax period(s) for which he has failed to maintain the required record, whichever is higher.

26, 27 and 28

5. Where a registered person who, without any reasonable cause, in non compliance with the provisions of this Act fails to produce records

Where such a person is a company, it shall be liable to pay a penalty of 5000 rupees;

Where such person is not a

27 and 28

(34)

on receipt of a notice from the Board or any officer of the SRB directing him to produce such records.

company he shall be liable to pay a penalty of 1000 rupees.

Provided that where such person fails to produce the record within 60 days of receipt of a notice, he shall be liable to pay the penalty prescribed for the offence in sub-section (4) above.

6. Any person who knowingly or fraudulently,—

(a) submits a false or forged document to any officer of the SRB; or

(b) destroys, alters, mutilates or falsifies the records; or

(c) makes a false statement, false declaration, false representation, false personification, or gives any false information 22[; or

(d) fails to pay, recover or deposit the actual amount of tax, or claims inadmissible tax credit or adjustment or deduction or refund.]

Such person shall be liable to pay a penalty of 25,000 rupees or one hundred percent of the tax payable for the tax period(s) to which the offence relates, whichever is higher.

Such person shall, further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to five years, or with fine which may extend to an amount equal to the tax payable for the tax period(s) to which the offence relates, or with both.

23[2(94)] and General

7. Where any person who denies or obstructs the access of an authorized officer to the business premises, registered office or to any other place where records are kept, or otherwise refuses access to accounts or records

Such person shall be liable to pay a penalty of 25,000 rupees or one hundred per cent of the tax payable for the tax period(s) to which the offence relates, whichever is higher.

Such persons shall, further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to five years, or with a fine which may extend to an amount equal to the tax payable for the tax period(s) to which the offence relates, or with both.

27, 28 and 51

8. Where any person commits, causes to commit or attempts to commit tax fraud, or abets or connives in the commission of tax fraud of 25,000 rupees or more.

Such person shall be liable to pay a penalty of up to 500,000 rupees, but not less than 25,000 rupees, or one hundred per cent of the tax

24[2(94)]

22. Full stop at the end replaced by a semicolon and the word “or” and item (d) added vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012)

23. Substituted for the figure “2(41)” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013)..

24. Substituted for the figure “2(41)” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013)..

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payable for the tax period(s) to which the offence relates.

Such person shall, further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to five years, or with fine which may extend to an amount equal to the tax payable for the tax period(s) to which the offence relates, or with both.

9. Where any person violates any embargo placed on removal of goods in connection with recovery of tax.

Such person shall be liable to pay a penalty of 25,000 rupees or ten per cent of the amount of the tax sought to be recovered, whichever is higher.

Such person shall, further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to one year, or with fine which may extend to amount equal to the amount of tax sought to be recovered, or with both.

66

10. Where any person who obstructs any officer of the SRB in the performance of his official duties under this Act or the rules made thereunder.

Such person shall be liable to pay a penalty of 25,000 rupees or one hundred per cent of the tax payable for the tax period(s) to which the offence relates, whichever is higher.

Provided that such a person shall be further liable upon conviction by a Special Judge to imprisonment for a term which may extend to one year or with fine not exceeding 50,000 rupees or with both.

35

11. Where any person who fails to fulfill any of the conditions, limitations or restrictions prescribed in a notification issued under any of the provisions of this Act.

Such person shall be liable to pay a penalty of 5000 rupees or three per cent of the tax payable for the tax period(s) to which the offence relates, whichever is higher

13 and General

12. Where any person who contravenes any provision of this Act or the rules made thereunder for which no penalty has, specifically, been provided in this section.

Such person shall be liable to pay a penalty of 10,000 rupees or three per cent of the tax payable for the tax period(s) to which the offence relates, whichever is higher.

General

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13. Where any person repeats an offence for which a penalty is provided under this Act.

Such person shall be liable to pay twice the amount of penalty provided under the Act for the said offence.

General

14. Where any person –

(a) knowingly and without lawful authority gains access to or attempts to gain access to the computerized system; or

(b) unauthorisedly uses or discloses or publishes or otherwise disseminates information obtained from the computerized system; or

(c) falsifies any record or information stored in the computerized system; or

(d) knowingly or dishonestly damages or impairs the computerized system; or

(e) knowingly or dishonestly damages or impairs any duplicate tape or disc or other medium on which any information obtained from the computerized system is kept or stored; or

(f) unauthorisedly uses unique user identifier of any other registered user to authenticate a transmission of information to the computerized system; or

(g) fails to comply with or contravenes any of the conditions prescribed for security of unique user identifier.

Such person shall pay a penalty of 25,000 rupees or one hundred per cent of the amount equal to the loss caused to sales tax revenue.

Such person shall, further be liable, upon conviction by the Special Judge, to imprisonment for a term which may extend to one year, or with fine which may extend to an amount equal to the loss caused to sales tax revenue, or with both.

73

15. Where any person fails to provide the document or record or information or data or refuses to allow the officer of the SRB to take extracts from or make copies of the document or record or information or data or fails to appear before an officer of SRB or fails to answer any question put to him.

Such person shall be liable to pay penalty of 100,000 rupees.

Such person shall, further be liable, upon conviction by a Special Judge, to imprisonment for a term which may extend to one year or fine which may extend to 100,000 rupees or with both.

52

(37)

44. Default Surcharge.— (1) Notwithstanding the provisions of section 23, if a registered person does not pay the tax due or any part thereof, whether willfully or otherwise, in time or in the manner specified under this Act, rules or notifications issued there under, he shall, in addition to the tax due and any penalty under section 43, pay default surcharge at the rate mentioned below:—

(a) the person liable to pay any amount of tax or charge, shall pay default surcharge at the rate of Inter-Bank Rate plus three per cent per annum of the amount of tax due; and

(b) in case, the default is on account of tax fraud, the person who has committed tax fraud shall pay default surcharge at the rate of two per cent per month, of the amount of tax evaded, till such time the entire liability including the amount of default surcharge is paid.

(2) For the purpose of calculation of default surcharge, the period of default shall be reckoned from the sixteenth day of a month (following the due date of the tax period to which the default relates) to the day preceding the date on which the tax due is actually paid.

Explanation— For the purpose of this section tax due does not include the amount of penalty.

45. Exemption from penalty and default surcharge.— The Board may, with the approval of the Government and by a notification in the official Gazette, exempt any registered person or class of registered persons from payment of the whole or any part of the penalty and default surcharge imposed under sections 25[43 and 44] subject to such conditions and limitations as may be specified in such notification or, as the case may be, special order.

46. Compounding of offences. — Notwithstanding anything contained in any other provision of this Act, where any person has committed any offence warranting prosecution under this Act, the Government may, either before or after the institution of any proceedings for the prosecution of such offence, terminate the proceedings if such person pays the amount of tax due along with such default surcharge and penalty as is determined under the provisions of this Act.

47. Recovery of tax not levied or short-levied.— (1) Where by reason of some inadvertence, error or miscalculation 26[***] any tax or charge has not been levied or has been short-levied, the person liable to pay any amount of tax or charge shall be served with a notice, within five years of the relevant date, requiring him to show cause for payment of the amount specified in the notice.

27[(1A) Where by reason of some collusion, abetment, deliberate attempt, mis-statement, fraud, forgery, false or fake documents-

(a) Any tax or charge has not been paid or is, short paid, assessed or collected, the person liable to pay such tax shall be served with a notice within five years of such tax period, requiring him to show cause for non-payment of such tax;

(b) Any amount of tax is refunded which is not due, the person obtaining such refund shall be served with a notice within five years of the receipt of such refund to show cause for such refund.]

(2) The officer of the SRB empowered in this behalf shall, after considering the objections of the person served with a notice to show cause under sub-section (1) 28[or (1A)],

25. Substituted for “34 and 35” vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

26. The words “on the part of an officer of the SRB” deleted vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

27. Sub-section (1A) inserted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

28. Inserted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

(38)

determine the amount of tax or charge payable by him and such person shall pay the amount so determined.

(3) Any order under sub-section (2) shall be made within one hundred and twenty days of issuance of the notice to show cause or within such extended period as the officer of the SRB may, for reasons to be recorded in writing, fix, provided that such extended period shall in no case exceed sixty days.

(4) In computing the period specified in sub-section (3), any period during which the proceedings are adjourned on account of a stay order or proceedings under section 65 or the time taken through adjournment by the petitioner not exceeding thirty days shall be excluded.

(5) For the purpose of this section, the expression “relevant date” means the time of payment of tax or charge as provided under section 17.

48. Power to summon persons to give evidence and produce documents in inquiries under the Act.— (1) Any officer of the SRB shall have the power to summon any person whose attendance he considers necessary either to tender evidence or to produce documents or any other thing in any audit, inquiry or investigation, which such officer is making for any of the purposes of this Act.

(2) Any person summoned under sub-section (1) shall be bound to attend either in person or by an authorised agent, as the officer of the SRB may direct.

(3) Notwithstanding anything in sub-section (1) and (2), a person who is exempted from personal appearance in a court under sections 132 and 133 of the Code of Civil Procedure (No.V of 1908), shall not be required to appear in person.

(4) Any inquiry or investigation before an officer of the SRB shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 of the Pakistan Penal Code (No. XLV of 1860).

49. Power to arrest and prosecute.— (1) An officer of the SRB, not below the rank of a Commissioner SRB, or any other officer of equal rank authorised by the Board in this behalf, who on the basis of material evidence has reasonable cause to believe that any person has committed a tax fraud or any offence warranting prosecution under this Act, may cause arrest of such person.

(2) All arrests made under this Act shall be carried out in accordance with the

relevant provisions of the Code of Criminal Procedure, 1898 (No.V of 1898).

(3) Where the person suspected of tax fraud or any offence warranting prosecution under this Act is a company, every director or officer of that company whom the officer of the SRB has reason to believe is personally responsible for actions of the company contributing the tax fraud or any offence warranting prosecution under this Act shall be liable to arrest;

Provided that any arrest under this sub-section shall not absolve the company from the liabilities of payment of tax, default surcharge and any penalty imposed under this Act.

50. Procedure to be followed on arrest of a person.— (1) When an officer of the SRB arrests a person under section 49, he shall immediately intimate the fact of the arrest of that person to the Special Judge who may direct such officer to produce that person at such time and place and on such date as the Special Judge considers expedient and the officer shall act accordingly.

(39)

(2) Notwithstanding anything contained in sub-section (1), any person arrested under this Act shall be produced before the Special Judge or, if there is no Special Judge within a reasonable distance, to the nearest Magistrate within twenty-four hours of such arrest, excluding the time necessary for the journey from the place of arrest to the court of the Special Judge or, as the case may be, of the Magistrate.

(3) When any person is produced under sub-section (2) before the Special Judge, the Special Judge may, on the request of such person, after perusing the record, if any and after giving the prosecution an opportunity of being heard, admit him to bail on his executing a bond, with or without sureties, or refuse to admit him to bail and direct his detention at such place as he deems fit:

Provided that nothing herein contained shall preclude the Special Judge from cancelling the bail of any such person at a subsequent stage if, for any reason, he considers such cancellation necessary, but before passing such order he shall afford such person an opportunity of being heard, unless for reasons to be recorded he considers that the affording of such opportunity shall defeat the purpose of this Act.

(4) When such person is produced under sub-section (2) before a Magistrate, such Magistrate may, after authorising his detention in such custody at such place and for such period as he considers necessary or proper for facilitating his earliest production before the Special Judge, direct his production before the Special Judge on a date and time to be fixed by him or direct such person to be forthwith taken to, and produced before, the Special Judge and he shall be so taken.

(5) Nothing in sub-section (3) or sub-section (4) shall preclude the Special Judge or the Magistrate from remanding any such person to the custody of the officer of the SRB holding an inquiry against that person if such officer makes a request in writing to that effect, and the Special Judge or the Magistrate, after perusing the record, if any, and hearing such person, is of the opinion that for the completion of inquiry or investigation it is necessary to make such order:

Provided that in no case shall the period of such custody exceed fourteen days.

(6) When any person is arrested under this Act, the arresting officer of the SRB shall record the fact of arrest and other relevant particulars in the register specified in sub-section (10) and shall immediately proceed to inquire into the charge against such person and if he completes the inquiry within twenty-four hours of his arrest, excluding the time necessary for journey as aforesaid, he may, after producing such person before the Special Judge or the Magistrate, make a request for his further detention in his custody.

(7) While holding an inquiry under sub-section (6), the officer of the SRB shall exercise the same powers as are exercisable by an officer in charge of a police station under the Code of Criminal Procedure, 1898 (No. V of 1898), but such officer shall exercise such powers subject to the foregoing provisions of this section while holding an inquiry under this Act.

(8) If the officer of the SRB, after holding an inquiry as aforesaid, is of the opinion that there is no sufficient evidence or reasonable ground for suspicion against such person, he shall release him on his executing a bond, with or without sureties, and shall direct such person to appear, as and when required, before the Special Judge, and make a report to the Special Judge for the discharge of such person and shall make a full report of the case to his immediate superior.

(9) The Special Judge to whom a report has been made under sub-section (8) may, after the perusal of record of the inquiry, and hearing the prosecution, agree with such report and

(40)

discharge the accused or, if he is of the opinion that there is sufficient ground for proceedings against such person, proceed with his trial and direct the prosecution to produce evidence.

(10) The officer of the SRB holding an inquiry under this section shall maintain a register to be called the “Register of Arrests and Detentions” in the prescribed form in which he shall enter the name and other particulars of every person arrested under this Act, together with the time and date of arrest, the details of the information received, the details of things, goods or documents, recovered from his custody, the name of the witnesses and the explanation, if any, given by him and the manner in which the inquiry

has been conducted from day to day; and, such register or authenticated copies of its aforesaid entries shall be produced before the Special Judge, whenever such officer is so directed by him.

(11) After completing the inquiry, the officer of the SRB shall, as early as possible, submit to the Special Judge a complaint in the same form and manner in which the officer in charge of a police station submits a report, before a court.

(12) Any Magistrate of the first class may record any statement or confession during inquiry under this Act, in accordance with the provisions of section 164 of the Code of Criminal Procedure, 1898 (No. V of 1898).

51. Authorised officers to have access to premises, stocks, accounts and records.— (1) Any officer authorised in this behalf by the Board shall have free access to the business premises, registered office or any other place where any stocks, business records or documents required under this Act are kept or maintained by any registered person or a person liable for registration or whose business activities are covered under this Act or who may be required for any inquiry or investigation in any tax fraud committed by him or his agent or any other person; and such officer may, at any time, inspect the goods, stocks, records, data, documents, correspondence, accounts, statements, utility bills, bank statements, information regarding nature and sources of funds or assets with which his business is financed, and any other records or documents, including those which are required under any of the Federal, Provincial or local laws maintained in any form or mode and may take into his custody such records, statements, diskettes, documents or any part thereof, in original or copies thereof in such form as the authorised officer may deem fit against a signed receipt.

(2) The registered person, his agent or any other person specified in subsection (1) shall be bound to answer any question or furnish such information or explanation as may be asked by the authorised officer.

(3) All other Government departments, local bodies, autonomous bodies, corporations or such other institutions shall supply requisite information and render necessary assistance to the authorised officer in the course of inquiry or investigation under this section.

52. Obligation to produce documents and provide information.— (1) Notwithstanding anything contained in this Act or any other law for the time being in force, any person required to maintain any record under the Act, shall, on demand by an officer of the SRB, not below the rank of a 29[Assistant Commissioner] SRB, by notice in writing, as and when specified in the notice–

(a) produce for examination, such documents or records which the officer of the SRB considers necessary or relevant to the audit, inquiry or investigation under the Act;

29 . Substituted for the words “Deputy Commissioner” vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).

(41)

(b) allow the officer of the SRB to take extracts from or make copies of such documents or records; and

(c) appear before the officer of the SRB and answer any question put to him concerning the documents and records relating to the audit, investigation, or inquiry referred to in clause (a) above.

(2) An officer of the SRB conducting an audit, inquiry or, as the case may be, an investigation under the Act, may require in writing any person, department, company or organization to furnish such information as is held by that person, department, company or organization, which, in the opinion of the officer of the SRB, is relevant to such audit, inquiry or investigation.

(3) The Board may require, in writing, any person, department, company or organization, as the case may be, to provide any information or data held by that person, department, company or organization, which, in the opinion of the Board, is required for purposes of formulation of policy or administering or implementing this Act.

(4) Every person, department, company or organization shall furnish the information requisitioned by the Board or the officer of the SRB under subsection (2) or (3), within the time specified in the notice issued by the Board or, as the case may be, the officer of the SRB.

53. Searches under warrant.— (1) Where any officer of the SRB has reason to believe that any documents or things which in his opinion, may be useful for, or relevant to, any proceedings under this Act are kept in any place, he may after obtaining a warrant from the Magistrate, enter that place and cause a search to be made at any time.

(2) The search made under sub-section (1) shall be carried out in accordance with the relevant provisions of the Code of Criminal Procedure, 1898 (No. V of 1898).

54. Posting of an officer of the SRB to business premises.— (1) Subject to such conditions and restrictions, as it deems fit to impose, the Board may post an officer of the SRB to the premises of a registered person or class of such persons to monitor the provision of services by such registered person or persons.

(2) Notwithstanding anything contained in sub-section (1), if a Commissioner SRB, on the basis of material evidence, has reasonable cause to believe that a registered person is involved in evasion of sales tax or tax fraud, he may, by recording the reason in writing, post an officer of the SRB to the premises of such registered person to monitor provision of services by such person.

55. Revision by the Commissioner SRB.— (1) The Commissioner SRB may, of his own motion or on an application made in writing by a registered person for revision, call for and examine the record of any proceeding under this Act in which an order has been passed by an officer of the SRB other than the Commissioner (Appeals) SRB.

(2) If after examining the record under sub-section (1), the Commissioner SRB is not satisfied with the legality or propriety of any order passed by an officer of the SRB, the Commissioner SRB may make such revision to the order as he may think fit.

(3) No order imposing or enhancing any penalty or fine requiring payment of a greater amount of sales tax than the originally levied amount shall be passed unless the person affected by such order has been given an opportunity of showing cause and of being heard.

(4) The Commissioner SRB shall not revise any order under sub-section (2) if:

(42)

(i) an appeal under section 57 is pending or the matter has been referred to resolution under section 65.

(ii) where an appeal against the order lies under section 57, the time within which such appeal may be made has not expired or the person has not waived his right of appeal;

(iii) in the case of an application made by a person, the application has not been made within ninety days of the date on which on which such order was served on the person, unless the Commissioner SRB is satisfied that the person was prevented by sufficient cause from making the application within the time allowed;

(iv) in the case where the Commissioner SRB has on his own motion called for and examined an order passed by a sub-ordinate officer, more than five years have lapsed from the date of the original order.

(5) No application for revision of an assessment shall be made under subsection (1) unless the amount of tax due under the assessment that is not in dispute has been paid by the taxpayer.

56. Revision by the Board.— (1) The Board may, of its own motion, call for and examine the record of any departmental proceedings under this Act or the rules made there under for the purpose of satisfying itself as to the legality or propriety of any decision or order passed therein by an officer of the SRB other than the Commissioner (Appeals) SRB.

(2) If after examining the record under sub-section (1), the Board is not satisfied with the legality or propriety of any decision or order passed by an officer of the SRB, it may pass such order as it may think fit.

(3) No order imposing or enhancing any penalty or fine requiring payment of a greater amount of sales tax than the originally levied amount shall be passed unless the person affected by such order has been given an opportunity of showing cause and of being heard.

(4) No proceeding under this section shall be initiated in a case where an appeal under section 57 is pending or the matter has been referred to resolution under section 65.

(5) No order shall be made under this section after the expiry of five years from the date of the original decision or order of the sub-ordinate officer referred to in sub-section (1).

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Chapter-IX

APPEALS

57. Appeals.— (1) Any person, other than the Board or any of its officers, aggrieved by any decision or order passed under sections 30[22, 23, 24B, 43, 44, 47, 68 or 76] by an officer of the SRB may, within thirty days of the date of receipt of such decision or order, prefer an appeal to the Commissioner (Appeals) SRB.

(2) An appeal under sub-section (1) shall–

(a) be in the prescribed form;

(b) be verified in the prescribed manner;

(c) state precisely the grounds upon which the appeal is made;

(d) be accompanied by the fee specified in sub-section (3); and

(e) be lodged with the Commissioner (Appeals) SRB within the time set out in sub-section (4).

(3) The prescribed fee shall be –

(i) where the appellant is a company, one thousand rupees; or

(ii) where the appellant is not a company, two hundred rupees.

(4) An appeal shall be preferred to the Commissioner (Appeals) SRB within thirty days of the following:-

(a) where the appeal relates to any assessment or penalty including default surcharge, the date of service of the notice of demand relating to the said assessment or penalty including default surcharge, as the case may be; and

(b) in any other case, the date on which the order to be appealed against is served.

(5) The Commissioner (Appeals) SRB may, upon application in writing by the appellant, admit an appeal after the expiration of the period specified in sub-section (4) if the Commissioner (Appeals) SRB is satisfied that the appellant was prevented by sufficient cause from lodging the appeal within that period.

58. Procedure in appeal.— (1) The Commissioner (Appeals) SRB shall give notice of the day fixed for the hearing of the appeal to the appellant and to the officer of the SRB against whose order the appeal has been made.

(2) The Commissioner (Appeals) SRB may adjourn the hearing of the appeal from time to time.

(3) The Commissioner (Appeals) SRB may, before the hearing of an appeal, allow an appellant to file any new ground of appeal not specified in the grounds of appeal already filed by

30. Substituted for “13, 18, 19 or 38” vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

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the appellant where the Commissioner (Appeals) SRB is satisfied that the omission of the ground from the form of the appeal was not willful or unreasonable.

(4) The Commissioner (Appeals) may stay the recovery of any sales tax due by virtue of the decision or order being appealed against and any such order made by the Commissioner (Appeals) shall remain operative for no more than fifteen days during which period a notice shall be issued to the respondent and after hearing the parties, the order staying recovery may be confirmed, varied or vacated as the Commissioner (Appeals) deems fit but the stay order so confirmed or varied shall remain operative for no more than sixty days, including any period for which the recovery may have been stayed prior to the confirmation or variation of the stay order.

(5) The Commissioner (Appeals) SRB may, before disposing of an appeal call for such particulars as the Commissioner (Appeals) SRB may require respecting the matters arising in the appeal or cause further inquiry to be made by the officer of the SRB.

59. Decision in appeal.— (1) In disposing of an appeal lodged under section 57, the Commissioner (Appeals) SRB may pass such order as he thinks fit, confirming, varying, altering, setting aside or annulling the decision or order appealed against.

(2) In deciding an appeal, the Commissioner (Appeals) SRB may make such further inquiry as may be necessary provided that he shall not remand the case for denovo consideration.

(3) The Commissioner (Appeals) SRB shall not increase the amount of any tax payable by the appellant unless the appellant has been given an opportunity of showing cause against such increase.

(4) As soon as practicable after deciding an appeal, the Commissioner (Appeals) SRB shall serve his order on the appellant and the officer of the SRB who made the order appealed against.

(5) An order passed by the Commissioner (Appeals) SRB under sub-section (3) shall be passed not later than one hundred and twenty days from the date of filing of appeal or within such extended period, not exceeding sixty days, as the Commissioner (Appeals) SRB may, for reasons to be recorded in writing fix.

(6) In computing the aforesaid time period, any period during which the proceedings are adjourned on account of a stay order or proceedings under section 65 or the time taken through adjournment by the appellant not exceeding thirty days shall be excluded.

(7) Where the Commissioner (Appeals) SRB has not made an order under sub-section (1) before the expiration of four months from the end of the month in which the appeal was lodged, the relief sought by the appellant in the appeal shall be treated as having been given and all the provisions of this Act shall have effect accordingly.

(8) For the purposes of sub-section (7), any period during which the hearing of an appeal is adjourned on the request of the appellant shall be excluded in the computation of the period of four months.

60. Appointment of the Appellate Tribunal.— (1) There shall be established an Appellate Tribunal to exercise the functions conferred on such Tribunal by this Act or the rules made thereunder.

(2) The Appellate Tribunal shall consist of a Chairperson and such other judicial and accountant members as are appointed by the Government having regard to the needs of the Tribunal.

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(3) A person may be appointed as a Judicial Member of the Appellate Tribunal if the person –

(a) is qualified to be a Judge of High Court and has remained a Judge of the District court for at least 5 years,

(b) is below the age of sixty-five years.

(4) A person may be appointed as an Accountant Member of the Appellate Tribunal if the person is an officer of the SRB/ FBR equivalent in rank to that of:

(a) a Commissioner (Appeals) SRB/ FBR having at least three years experience as Commissioner SRB; or

(b) a Commissioner SRB/FBR having at least five years experience as Commissioner SRB; and

(c) is below the age of sixty-five years;

(5) Notwithstanding anything contained in sub-section (4), the Government may, for three years from the day this Act comes into effect, appoint any person who has worked for a minimum of three years:

(i) in the Federal Board of Revenue or Provincial Excise and Taxation Department in the rank not below the Bs.20 for 5 years in aggregate, or

(ii) as Collector of Sales Tax (Appeals) under sub-section (b) of section 30 of the Sales Tax Act 1990,for 3years with service of at least 5 years in Bs. 20, as an Accountant Member of the Appellate Tribunal.

(6) The Government shall appoint a member of the Appellate Tribunal as Chairperson of the Tribunal and, except in special circumstances, the person appointed should be a judicial member.

31[(6A) Notwithstanding anything contained in this section or in sections 61 and 62 and till such time that an Appellate Tribunal is established under this Act, the appeals under section 61 shall be heard and decided and the functions of the Appellate Tribunal shall be exercised by a bench comprising of at least two Members, as defined in clause (h) of section 2 of the Sindh Revenue Board Act, 2010 (Sindh Act No. XI of 2010). In case of difference of opinion between the two Members deciding the appeal, the case shall be decided by the Chairman of the Board, acting as the referee Member of the bench.]

(7) The powers and functions of the Appellate Tribunal shall be exercised and discharged by Benches constituted from members of the Tribunal by the Chairperson of the Tribunal.

(8) Subject to sub-section (7), a Bench shall consist of not less than two members of the Appellate Tribunal and shall be constituted so as to contain an equal number of judicial and accountant members, or so that the number of members of one class does not exceed the number of members of the other class by more than one.

(9) The Government may, by notification in the official Gazette, direct that all or any of the powers of the Appellate Tribunal shall be exercised by:

(i) any one member; or

31. “Sub-section (6A)” inserted vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013).

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(ii) more members than one, jointly or severally.

(10) Notwithstanding anything contained in sub-sections (7) and (8), the Chairperson may constitute as many Benches consisting of a single member as he may deem necessary to hear such cases or class of cases as the Government may by order in writing, specify.

(11) The Chairperson or other member of the Appellate Tribunal authorized, in this behalf by the Chairperson may, sitting singly, dispose of any case where the amount of tax or penalty involved does not exceed five million rupees.

(12) Subject to sub-section (10), if the members of a Bench differ in opinion on any point, the point shall be decided according to the opinion of the majority.

(13) If the members of a Bench are equally divided on a point, they shall state the point on which they differ and the case shall be referred by the Chairperson for hearing on that point to one or more other members of the Appellate Tribunal, and the point shall be decided according to the opinion of the majority of the members of the Tribunal who have heard the case including those who first heard it.

(14) If there are an equal number of members on the Appellate Tribunal, the Government may appoint an additional member for the purpose of deciding the case on which there is a difference of opinion.

(15) Subject to this Act, the Appellate Tribunal shall have the power to regulate its own procedure, and the procedure of Benches of the Tribunal in all matters arising out of the discharge of its functions including the places at which the Benches shall hold their sittings.

61. Appeal to the Appellate Tribunal.— (1) Where the taxpayer or the officer of the SRB objects to any order passed by the Commissioner (Appeals) SRB, including an order under sub-section (4) of Section 58, the taxpayer or officer may appeal to the Appellate Tribunal against such order.

(2) An appeal under sub-section (1) shall be-

(a) in the prescribed form;

(b) verified in the prescribed manner;

(c) accompanied, except in case of an appeal preferred by an officer of the SRB, by the fee specified in sub section (3); and

(d) preferred to the Appellate Tribunal within sixty days of the date of service of order of the Commissioner (Appeals) SRB on the taxpayer or the officer of the SRB, as the case may be.

(3) The prescribed fee shall be two thousand rupees.

(4) The Appellate Tribunal may, upon application in writing, admit an appeal after the expiration of the period specified in clause (d) of sub-section (2) if it is satisfied that the person appealing was prevented by sufficient cause from filing the appeal within that period.

62. Disposal of appeals by the Appellate Tribunal.— (1) The Appellate Tribunal may, before disposing of an appeal, call for such particulars as it may require in respect of the matters arising on the appeal or cause further inquiry to be made by the officer of the SRB.

(2) The Appellate Tribunal shall afford an opportunity of being heard to the parties to the appeal and, in case of default by any of the parties on the date of hearing, the Tribunal may,

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if it deems fit, dismiss the appeal in default, or may proceed ex parte to decide the appeal on the basis of the available record.

(3) The Appellate Tribunal shall decide the appeal within six months of its filing.

(4) The Appellate Tribunal may stay the recovery of any sales tax due by virtue of the decision or order being appealed against and any such order made by the Appellate shall remain operative for no more than thirty days during which period a notice shall be issued to the respondent and after hearing the parties, the order staying recovery may be confirmed, varied or vacated as the Appellate Tribunal deems fit but the stay order so confirmed or varied shall remain operative for no more than ninety days, including any period for which the recovery may have been stayed prior to the confirmation or variation of the stay order.

(5) In deciding the appeal, the Appellate Tribunal may, without prejudice to the powers specified in sub-section (2), make an order to –

(a) affirm, modify or annul the order being appealed against; or

(b) remand the case to the officer of the SRB or the Commissioner (Appeals) SRB for making such inquiry or taking such action as the Tribunal may direct.

(6) The Appellate Tribunal shall not increase the amount of any tax payable, penalty or default surcharge unless the taxpayer has been given a reasonable opportunity of showing cause against such increase.

(7) The Appellate Tribunal shall communicate its order to the taxpayer and the concerned officer of the SRB.

(8) Save as provided in section 63, the decision of the Appellate Tribunal on an appeal shall be final.

63. Reference to the High Court.— (1) Within sixty days of the communication of the order of the Appellate Tribunal under section 62, the aggrieved person or any officer of the SRB not below the rank of a Deputy Commissioner SRB, authorized by the Commissioner SRB may prefer an application in the prescribed form along with a statement of the case to the High Court, stating any question of law arising out of such order.

(2) The statement to the High Court referred to in sub-section (1), shall set out the facts, the determination of the Appellate Tribunal and the question of law, which arises out of its order.

(3) Where, on an application made under sub-section (1), the High Court is satisfied that a question of law arises out of the order referred to in subsection (1), it may proceed to hear the case.

(4) A reference to the High Court under this section shall be heard by a bench of two judges of the High Court and, in respect of the reference, the provisions of section 98 of the Code of Civil Procedure 1908 (Act V of 1908), shall apply, so far as may be, notwithstanding anything contained in any other law for the time being in force.

(5) The High Court upon hearing a reference under this section shall decide the question of law raised by the reference and deliver a judgment thereon specifying the grounds on which the judgment is based and the order of the Tribunal shall stand modified accordingly. The Court shall send a copy of the judgment under the seal of the Court to the Appellate Tribunal.

(6) The cost of any reference to the High Court shall be in the discretion of the Court.

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(7) Notwithstanding that a reference has been made to the High Court, the tax shall be payable in accordance with the order of the Appellate Tribunal.

Provided that, if the amount of tax is reduced as a result of the judgment in the reference, and amount of tax found refundable by the High Court, the High Court may on application by a Deputy Commissioner SRB authorized by the Commissioner SRB within thirty days of the receipt of the judgment of the High Court that he intends to seek leave to appeal to the Supreme Court, make an order authorizing the postponement of the refund until the disposal of the appeal by the Supreme Court.

(8) Where recovery of tax has been stayed by the High Court by an order, such order shall cease to have effect on the expiration of a period of six months following the day on which it is made unless the reference is decided, or such order is withdrawn by the High Court before the expiry of six months.

(9) Section 5 of the Limitation Act, 1908 (IX of 1908), shall apply to an application made to the High Court under sub-section (1).

(10) An application under sub-section (1) by a person other than the Deputy Commissioner SRB authorized by the Commissioner SRB shall be accompanied by a fee of one hundred rupees.

(11) Notwithstanding anything contained in any provision of this Act, where any reference or appeal was filed with the approval of the Commissioner SRB by an officer of lower rank than the Commissioner SRB, and the reference or appeal is pending before an appellate forum or the Court, such reference or appeal shall always be deemed to have been so filed by the Commissioner SRB.

64. Deposit of sales tax demand while appeal is pending.— Where in any appeal, the decision or order appealed against relates to any sales tax demanded under this Act, the person who has filed the appeal shall, pending the appeal, deposit the admitted amount of sales tax based on the return filed under section 30 or as may be determined by the Commissioner (Appeals) SRB or the Appellate Tribunal where such return has not been filed.

65. Alternate Dispute Resolution.— (1) Notwithstanding any other provisions of this Act, or the rules made there under, any registered person aggrieved in connection with any dispute pertaining to:–

(a) the liability of sales tax against the registered person;

(b) the extent of waiver of default surcharge and penalty;

(c) relaxation of any procedural or technical irregularities and condonation of any prescribed time limitation; and

(d) any other specific relief required to resolve the dispute, may apply to the Board for the appointment of a committee for the resolution of any dispute mentioned in detail in the application.

(2) Notwithstanding anything contained in sub-section (1), the Board shall not accept an application under sub-section (1) where criminal proceedings have been initiated or where, the Board is of the opinion that the interpretation of a question of law having a larger impact on revenue or on a number of similar cases is involved.

(3) The Board may, after examination of the application of a registered person, appoint a committee within thirty days of receipt of such application, consisting of an officer of

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the SRB not below the rank of a Deputy Commissioner SRB and a second person from the notified panel consisting of chartered or cost accountants, advocates, representatives of trade bodies or associations, retired officers of the rank of not less than BS-20, retired judges, or any other reputable taxpayers, for the resolution of the dispute.

(4) The committee constituted under sub-section (3) shall examine the issue and may, if it deems fit, conduct an inquiry, seek expert opinions, direct any officer of the SRB or any other person to conduct an audit and shall make recommendations to the Board within ninety days of its constitution in respect of the dispute. If the committee fails to make recommendations within the said period the Board shall dissolve the committee and constitute a new committee which shall decide the matter within a further

period of ninety days. If after the expiry of that period the dispute is not resolved the matter shall be taken up by the appropriate forum provided under this Act for decision.

(5) The Board may, on the recommendation of the committee, pass such order, as it may deem appropriate within forty-five days of the receipt of the recommendations of the committee.

(6) The registered person may make payment of sales tax as determined by the Board in its order under sub-section (5), and such order of the Board shall be submitted before the forum, tribunal or the Court where the matter is subjudice for consideration of orders as deemed appropriate.

65A. Government may appoint Ombudsmen or may assign duties and functions of ombudsmen to any officer retired or serving not below the rank of BS-21 officer to act as an ombudsmen with regard to the redressal of grievances of the tax payers or the registered persons for inordinate delays, maladministration within the field offices of Sindh revenue Board for delays, ineptitude or for misconduct, and may advise the Board to adopt corrective measures for implementation of such advice. Government may frame rules in consultation with the SRB for implementation of the provisions.

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Chapter-X

RECOVERY OF ARREARS

66. Recovery of arrears of tax.— (1) Subject to sub-section (2), where any amount of tax is due from any person, the officer of the SRB may:-

(a) deduct the amount from any money owing to the person from whom such amount is recoverable and which may be at the disposal or in the control of such officer or any officer of the SRB;

(b) require by a notice in writing any person who holds or may subsequently hold any money for or on account of the person from whom tax may be recoverable to pay to such officer the amount specified in the notice;

(c) require by a notice in writing any bank to attach that person’s bank accounts;

(d) seal the persons business premises till such time as the amount of tax is paid or recovered in full;

(e) attach and sell or sell without attachment any movable or immovable property of the person from whom tax is due; and

(f) recover such amount by attachment and sale of any moveable or immovable property of the guarantor, person, company, bank or financial institution where a guarantor or any other person, company, bank or financial institution fails to make payment under such guarantee, bond or instrument.

(2) If any arrears of tax, default surcharge, penalty or any other amount which is payable by any person cannot be recovered in the manner prescribed above, the Board or any officer authorized by the Board, may, write off the arrears or amount in the manner as may be prescribed by the Board.

(3) For the purpose of recovery of tax, penalty or any other demand raised under this Act, the officer of the SRB shall have the same powers which under the Code of Civil Procedure 1908 (V of 1908) a Civil Court has for the purpose of recovery of an amount due under a decree.

(4) Provision of Land Revenue Act, 1967 would mutatis mutandis apply for the recovery of the arrears of the taxable amount to any person under this Act.

(5) The Deputy Commissioner and the Assistant commissioner, Sindh Revenue Board shall have and exercise the powers of the Collector and Assistant Collector respectively as defined in Land Revenue Act, 1967 for the purposes of recovery of arrears of Sales Tax.

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Chapter-XI

AGENTS, REPRESENTATIVES AND E-INTERMEDIARIES

67. Agent.— (1) For the purpose of this Act and subject to sub-sections (2) and (3), the expression “agent” in respect of a registered person, means—

(a) where the person is an individual under a legal disability, the guardian or manager who receives or is entitled to receive income on behalf, or for the benefit of the individual;

(b) where the person is a company (other than a trust, a Provincial Government, or local authority in Pakistan), a director or a manager or secretary or accountant or any similar officer of the company;

(c) where the person is a trust declared by a duly executed instrument in writing whether testamentary or otherwise, any trustee of the trust;

(d) where the person is a Provincial Government, or local authority in Pakistan, any individual responsible for accounting for the receipt and payment of money or funds on behalf of the Provincial Government or local authority;

(e) where the person is an association of persons, a director or a manager or secretary or accountant or any similar officer of the association or, in the case of a firm, any partner in the firm;

(f) where the person is the Federal Government, any individual responsible for accounting for the receipt and payment of moneys or funds on behalf of the Federal Government; or

(g) where the person is a public international organization, or a foreign government or political sub-division of a foreign government, any individual responsible for accounting for the receipt and payment of moneys or funds in Pakistan on behalf of the organization, government, or political subdivision of the government.

(h) When any person is expressly or impliedly authorised by a registered person to be his agent for all or any of the purposes of this Act.

(2) Where the Court of Wards, the Administrator General, the Official Trustee, or any receiver or manager appointed by, or under, any order of a Court receives or is entitled to receive income on behalf, or for the benefit of any person, such Court of Wards, Administrator General, Official Trustee, receiver, or manager shall be the agent of the person for the purposes of this Act.

(3) Notwithstanding anything in this section, any registered person may expressly or impliedly authorised another person to be his agent for all or any of the purposes this Act.

68. Liability and obligations of agents.— (1) Every agent of a person shall be responsible for performing any duties or obligations imposed by or under this Act on the person, including the payment of tax.

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(2) Subject to sub-section (5) of this section, any tax that, by virtue of subsection (1), is payable by an agent of a registered person shall be recoverable from the agent only to the extent of any assets of the registered person that are in the possession or under the control of the agent.

(3) Every agent of a registered person who pays any tax owing by the registered person shall be entitled to recover the amount so paid from the registered person or to retain the amount so paid out of any moneys of the registered person that are in the agent’s possession or under the agent’s control.

(4) Any agent, or any person who apprehends that he may be assessed as an agent, may retain out of any money payable by him to the person on whose behalf he is liable to pay tax (hereinafter in this section referred to as the “principal”), a sum equal to his estimated liability under this Act, and in the event of disagreement between the principal and such an agent or a person as to the amount to be so retained, such agent or person may obtain from the Commissioner SRB a certificate stating the amount to be so retained pending final determination of the tax liability, and the certificate so obtained shall be his authority for retaining that amount.

(5) Every agent shall be personally liable for the payment of any tax due by the agent if, while the amount remains unpaid, the agent—

(a) alienates, charges or disposes of any moneys received or accrued in respect of which the tax is payable; or

(b) disposes of or parts with any moneys or funds belonging to the registered person that is in the possession of the agent or which comes to the agent after the tax is payable, if such tax could legally have been paid from or out of such moneys or funds.

(6) Nothing in this section shall relieve any person from performing any duties imposed by or under this Act on the person which the agent of the person has failed to perform.

69. Liability of the registered person for the acts of his agent.— A registered person shall be responsible for any and all acts done by his agent.

70. Appearance by authorised representative.— A registered person required to appear before the Appellate Tribunal or an officer of the SRB in connection with any proceedings under this Act may, in writing, authorise any person having such qualification as may be

prescribed in the rules to represent him or appear on his behalf.

71. E-intermediaries to be appointed.— (1) Subject to such conditions, limitations and restrictions, the Board may, by a notification in the official Gazette, appoint a person to electronically file returns under Chapter IV and such other documents electronically, as may be prescribed from time to time, on behalf of a registered person.

(2) A registered person may authorize an e-intermediary to electronically file returns or any other documents on his behalf, as specified in sub-section (1).

(3) The return or such other documents filed by an e-intermediary on behalf of a registered person shall be deemed to have been filed by that registered person.

(4) Where this Act requires anything to be done by a registered person and if such thing is done by an e-intermediary authorized by the registered person under sub-section (2), unless the contrary is proved, such thing shall be deemed to have been done with the knowledge

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and consent of the registered person so that in any proceedings under this Act, the registered person shall be liable as if the thing has been done by him.

(5) Where an e-intermediary, authorized by a registered person under subsection (2) to act on his behalf, knowingly or willfully submits false or incorrect information or document or declaration with an intent to avoid payment of tax due or any part thereof, such e-intermediary shall be jointly and severally responsible for recovery of the amount of tax short paid as a result of such incorrect or false information or document or declaration, without prejudice to any other action that may be taken against him under the relevant provisions of the law.

(6) The Board may, by notification in the official Gazette, prescribe rules for the conduct and transaction of business of e- intermediaries, including their appointment, suspension and cancellation of appointment, subject to such conditions as specified therein.

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Chapter-XII

GENERAL ADMINISTRATION

72. Power to make rules.— (1) The Board may, with approval of the Government, make rules for carrying out the purposes of this Act.

(2) All rules made under this section or any other provisions of this Act, shall be collected, arranged and published along with general orders and departmental instructions, directions, notifications and rulings, if any, at appropriate intervals and sold to the public at a reasonable price.

73. Computerized system.— (1) The Board may prescribe the use of a computerized system for carrying out the purposes of this Act, including the receipt of applications for registration, returns and such other declarations or information required to be provided under this Act and the rules made thereunder, from such date and for such registered persons or class of persons as the Board may, by notification in the official Gazette, specify.

(2) The Board may make rules for regulating the conduct and transaction of business in relation to the submission of returns or other information to the Board by the persons required to transmit or receive any information through the computerized system, including matters such as the grant of authorization, suspension and cancellation of authorization and for security of the information transmitted or received through the computerized system.

(3) Unless otherwise proved, the information received in the computerized system from or on behalf of any registered person shall, for all official and legal purposes, be deemed to have been furnished by and received from such registered person.

(4) The business information gathered through computerized system shall be confidential to be used only for official and legal purposes and no unauthorized person shall claim or be provided any access to such information.

74. Removal of difficulties.— The Government may, for the purposes of removing any difficulty or for bringing the provisions of this Act into effective operation, by order, direct that provisions of this Act shall, during such period as may be specified in the order, have effect subject to such adaptations whether by way of modification or addition or omission as it may deem to be necessary or expedient:

Provided that the power under this section shall not be exercised after expiry of five years from the commencement of this Act.

75. Service of orders and decisions.— (1) Subject to this Act, any notice, order or requisition required to be served on an individual for the purposes of this Act shall be treated as properly served on the individual if:

(a) personally served on the individual or, in the case of an individual under a legal disability the agent of the individual;

(b) sent by registered post or courier service to the individual’s usual or last known address in Pakistan; or

(c) served on the individual in the manner prescribed for service of a summons under the Code of Civil procedure, 1908 (No.V of 1908)

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(2) Subject to this Act, any notice order or requisition required to be served on any person, other than an individual to whom sub-section (1) applies, for the purposes of this Act, shall be treated as properly served on the person if:

(a) personally served on the agent of the person;

(b) sent by registered post or courier service to the person’s registered office or address for service of notices under this Act in Pakistan or where the person does not have such office or address, the notice is sent by registered post to any office or place of business of the person in Pakistan; or

(c) served on the manner prescribed for service of a summons under the Code of Civil Procedure, 1908 (No.V of 1908)

(3) Where an association of persons is dissolved, any notice, order or requisition required to be served under this Act, on the association or a member of the association may be served on any person’s who was the principal officer or a member of the association immediately before such dissolution.

(4) Where a business stands discontinued any notice order or requisition required to be served under this Act, on the person discontinuing the business may be served on the person personally or on any individual who was the person’s agent at the time of discontinuance.

(5) The validity of any notice issued under this Act or the validity any service of a notice under this Act shall not be called into question after the notice has been complied with in any manner.

(6) Any registered person may indicate, in the manner prescribed in the rules made hereunder, that it wishes to receive all or specific communications, including notifications, orders, assessments and requisitions, from the Board, the Appellate Tribunal or any officer of the SRB electronically.

(7) The Board may, by notification in the official Gazette, direct that all or specific communications, including notifications, orders, assessments and requisitions from the Board, the Appellate Tribunal or any officer of the SRB to a specific registered person or class of registered person shall be made electronically.

(8) For the purposes of sub-section (6) and (7), a registered person shall be considered to have received the electronic communication within seventy two hours of the sending of the electronic communication by the Board, Appellate Tribunal or officer of the SRB.

(9) For the purposes of sub-sections (6), (7) and (8), an electronic communication is a communication sent by email.

76. Correction of clerical errors.— (1) Clerical or arithmetical errors in any assessment, adjudication, order or decision may, at any time, be corrected by the officer of the SRB who made the assessment or adjudication or passed such order or decision or by his successor in office, through an order made under this section.

(2) Before any correction is made under sub-section (1), a notice shall be given to the registered person affected by such correction.

77. Issuance of duplicate of sales tax documents.— An officer of the SRB not below the rank of Assistant Commissioner SRB may, on payment of 500 rupees, issue an attested duplicate of any document filed by a registered person with the department to that registered person.

(56)

78. Power to issue orders, instructions and directions.— The Board may issue such orders, instructions and directions to all officers of the SRB, as it may deem necessary to administer and implement the provisions of this Act and any rules made thereunder.

79. Officers of the SRB to follow Board's orders.— All officers of the SRB and other persons employed in the execution of this Act and the rules made there under shall observe and follow the orders, instructions and directions of the Board:

Provided that no such orders, instructions or directions shall be given so as to interfere with the discretion of officers of the SRB in the exercise of their quasi-judicial functions.

(57)

Chapter-XIII

MISCELLANEOUS

80. Computation of limitation period.— In computing the period of limitation prescribed for any appeal or application under this Act, the day on which the order complained of was served and, if the concerned person was not furnished with a copy of the order, the time requisite for obtaining a copy of such order shall be excluded.

81. Condonation of time-limit.— Where any time or period has been specified under any of the provisions of the Act or rules made there-under within which any act or thing, including submission of an application, filing of a return or payment of tax, is to be done, the Board may, in any case or class of cases, permit such application to be made or such act or thing to be done within such time or period as it may consider appropriate:

Provided that the Board may, by notification in the official Gazette, and subject to such limitations or conditions as may be specified therein, empower any Commissioner SRB to exercise the powers under this section in any case or class of cases.

82. Bar of suits, prosecution and other legal proceedings.— (1) No suit shall be brought in any civil court to set aside or modify any order passed, any assessment made, any tax levied, any penalty or default surcharge imposed or collection of any tax made under this Act.

(2) No suit, prosecution or other legal proceeding shall lie against the Government or against any public servant in respect of any order passed in good faith under this Act.

(3) Notwithstanding anything in any other law for the time being in force, no investigation or inquiry shall be undertaken or initiated by any governmental agency against any officer or official for anything done in his official capacity under this Act, rules, instructions or directions made or issued there under without the prior approval of the Board.

83. Repeal and Saving.— (1) The Sindh Sales Tax Ordinance, 2000 shall stand repealed with effect from the date this Act comes into force.

(2) Subject to sub-section (3), in making any assessment in respect of any financial year ending prior to the date notified under sub-section (3) of section 1, the provisions of the repealed Ordinance shall in so far as these relate to the amount of sales tax payable in such financial year as if this Act had not come into force.

(3) The assessment, referred to in sub-section (2), shall be made by the officer of the SRB competent under this Act to make an assessment in respect of a financial year beginning after the date notified under subsection (3) of section 1, in accordance with the procedure specified in this Act.

(4) The recovery of any sum found due as a result of the assessment under sub-section (2) shall be recovered under the provisions of this Act.

(5) Any proceeding under the repealed Ordinance pending on the date notified under sub-section (3) of section 1 before any authority, the Appellate Tribunal or any Court by way of appeal, reference, revision or prosecution shall be continued and disposed off as if this Act had not come into force.

(6) Any proceeding relating to an assessment in respect of any financial year ending prior to the date notified under sub-section (3) of section 1 which is initiated after the date

(58)

notified under sub-section (3) of section 1 will be initiated and conducted in accordance with the procedure specified in this Act.

(7) Any sales tax payable under the repealed Ordinance may be recovered under this Act, but without prejudice to any action already taken for the recovery of the amount under the repealed Ordinance.

(59)

FIRST SCHEDULE

(see sub-section (35) of Section 2)

Tariff Heading

Description

(1)

(2)

98.01

Services provided or rendered by hotels, restaurants, marriage halls, lawns, clubs and caterers.

9801.1000

Services provided or rendered by hotels

9801.2000

Services provided or rendered by restaurants

9801.3000

Services provided or rendered by marriage halls and lawns

9801.4000

Services provided or rendered by clubs

9801.5000

Services provided or rendered by caterers, suppliers of food and drinks

9801.6000

Ancillary services provided or rendered by hotels, restaurants, marriage halls, lawns, 32[clubs and] caterers

9801.7000

Services provided or rendered by messes and hostels

9801.9000

Other

98.02

Advertisement

9802.1000

Advertisement on T.V.

9802.2000

Advertisement on radio

9802.3000

Advertisement on closed circuit T.V.

9802.4000

Advertisement in newspapers and periodicals

9802.5000

Advertisement on cable T.V. network

33[9802.6000

Advertisements on poles

9802.7000

Advertisements on billboards]

9802.9000

Other

98.05

Services provided or rendered by persons authorized to transact business on behalf of others.

9805.1000

Shipping agents

9805.2000

Stevedores

9805.2100

Ship management service

9805.3000

Freight forwarding agents

9805.4000

Customs agents

9805.5000

Travel agents

9805.5100

Tour operators

9805.6000

Recruiting agents

9805.7000

Advertising agents

9805.8000

Ship chandlers

9805.9000

Share transfer agent

9805.9100

Sponsorship services

9805.9200

Business support services

9805.9090

Other

32 . The words “clubs and” inserted vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013).

33 . Substituted vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013).

(60)

9808.0000

Courier services

98.06

Services provided or rendered in matters of hire.

9806.1000

Purchase or sale of moveable or immovable goods or property.

9806.2000

Property dealers

9806.3000

Car/automobiles dealers

9806.9000

Dealers of second hand goods other than automobiles other

9809.0000

Services provided or rendered by persons engaged in contractual execution of work or furnishing supplies.

9810.0000

Services provided or rendered for personal care by beauty parlours/clinics, slimming clinics and others.

9811.0000

Services provided or rendered by laundries, dry cleaners.

98.12

Telecommunication services.

9812.1000

Telephone services

9812.1100

Fixed line voice telephone service

9812.1200

Wireless telephone

9812.1210

Cellular telephone

9812.1220

Wireless Local Loop telephone

9812.1300

Video telephone

9812.1400

Payphone cards

9812.1500

Prepaid calling cards

9812.1600

Voice mail service

9812.1700

Messaging service

9812.1710

Short Message service (SMS)

9812.1720

Multimedia message service (MMS)

9812.1910

Shifting of telephone connection

9812.1920

Installation of telephone extension

9812.1930

Provision of telephone extension

9812.1940

Changing of telephone connection

9812.1950

Conversion of NWD connection to non NWD or vice versa

9812.1960

Cost of telephone set

9812.1970

Restoration of telephone connection

9812.1990

Others

9812.2000

Bandwidth services

9812.2100

Copper line based

9812.2200

Fiber-optic based

9812.2300

Co-axial cable based

9812.2400

Microwave based

9812.2500

Satellite based

9812.2900

Others

9812.3000

Telegraph

9812.4000

Telex

(61)

9812.5000

Telefax

9812.5010

Store and forward fax services

9812.5090

Others

9812.6000

Internet services

9812.6100

Internet services including email services

9812.6110

Dial-up internet services

9812.6120

Broadband services for DSL connection

9812.6121

Copper line based

9812.6122

Fiber-optic based

9812.6123

Co-axial cable based

9812.6124

Wireless based

9812.6125

Satellite based

9812.6129

Others

9812.6130

Internet/email/Data/SMS/MMS services on WLL networks

9812.6140

Internet/email/Data/SMS/MMS services on cellular mobile networks

9812.6190

Others

9812.6200

Data Communication Network services (DCNS)

9812.6210

Copper Line based

9812.6220

Co-axial cable based

9812.6230

Fiber-optic based

9812.6240

Wireless/Radio based

9812.6250

Satellite based

9812.6290

Others

9812.6300

Value added data services

9812.6310

Virtual private Network services (VPN)

9812.6320

Digital Signature service

9812.6390

Others

9812.9000

Audiotext services

9812.9100

Teletext services

9812.9200

Trunk radio services

9812.9300

Paging services

9812.9400

Voice paging services

9812.9410

Radio paging services

9812.9490

Vehicle tracking services

9812.9500

Burglar alarm services

9812.9090

Others

98.13

Services provided or rendered by banking companies, insurance companies, cooperative financing societies, modarba, Musharika, leasing companies, foreign exchange dealers, non-banking financial institutions and other persons dealing in any such services.

9813.1000

Services provided or rendered in respect of insurance to a policy holder by an insurer, including a reinsurer.

9813.1100

Goods insurance

9813.1200

Fire insurance

9813.1300

Theft insurance

(62)

9813.1400

Marine insurance

9813.1500

Life insurance

9813.1600

Other insurance

9813.2000

Services provided or rendered in respect of advances and loans

9813.3000

Services provided or rendered in respect of leasing

9813.3010

Financial leasing

9813.3020

Commodity or equipment leasing

9813.3030

Hire-purchase leasing

9813.3090

Other

9813.3900

Services provided or rendered in respect of 34[modarba and musharika] financing

9813.4000

Services provided or rendered by banking companies in relation to:

9813.4100

Guarantee

9813.4200

Brokerage

9813.4300

Letter of credit

9813.4400

Issuance of pay order and demand draft

9813.4500

Bill of exchange

9813.4600

Transfer of money including telegraphic transfer, mail transfer and electronic transfer

9813.4700

Bank guarantee

9813.4800

Bill discounting commission

9813.4900

Safe deposit lockers

9813.4910

Safe vaults

35[9813.4990

Other service not specified elsewhere]

9813.5000

Issuance, processing and operation of credit and debit cards

9813.6000

Commission and brokerage of foreign exchange dealings

9813.7000

Automated Teller Machine operations, maintenance and management

9813.8000

Service provided as banker to an issue

9813.8100

36[Others, including the services provided are rendered by nonbanking finance companies, modaraba and musharika companies and other financial institutions]

9813.9000

Service provided or rendered by a foreign exchange dealer or exchange company or money changer

98.14

Services provided or rendered by architects, town planners, contractors, property developers or promoters, interior decorators.

9814.1000

Architects or town planners

9814.2000

Contractors of building (including water supply, gas supply and sanitary works), roads and bridges, electrical and mechanical works (including air conditioning), horticultural works, multi-

34. Substituted for the word “Musharika” vide the Sindh Sales Tax on Services (Amendment) Act, 2012.

35. Added vide the Sindh Sales Tax on Services (Amendment) Act, 2012.

36. Substituted for the word “Others” vide the Sindh Sales Tax on Services (Amendment) Act, 2012.

(63)

discipline works (including turn-key projects) and similar other works.

9814.3000

Property developers or promoters

9814.4000

Landscape designers

9814.9000

Other

98.15

Services provided or rendered by professionals and consultants etc.

9815.1000

Medical practitioners and consultants

9815.2000

Legal practitioners and consultants

9815.3000

Accountants and auditors

9815.4000

Management consultants

9815.5000

Technical, scientific, engineering consultants

9815.6000

Software or IT based system development consultants

9815.9000

Other consultants

9816.0000

Services provided or rendered by pathological laboratories.

98.17

Services provided or rendered by medical diagnostic laboratories including X-Rays, CT Scan, M.R. Imaging etc.

9817.1000

Scientific laboratories

9817.2000

Mechanical laboratories

9817.3000

Chemical laboratories

9817.4000

Electrical or electronic laboratories

9817.9000

Other such laboratories

98.18

Services provided or rendered by specialized agencies.

9818.1000

Security agency

9818.2000

Credit rating agency

9818.3000

Market research agency

9818.9000

Other such agencies

98.19

Services provided or rendered by specified persons or businesses

9819.1000

37[Stockbrokers and commodity brokers]

9819.1200

Indenters

9819.1300

Commission agents

9819.1400

Packers

9819.2000

Money exchanger

9819.3000

Rent a car

9819.4000

Prize bond dealers

9819.5000

Surveyors

9819.6000

Designers

37 . Substituted for “Stockbrokers” vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013.

(64)

9819.7000

38[Outdoor photographer and videographers]

9819.8000

Art painter

9819.9000

Cable TV operators

9819.9100

Auctioneers

9819.9200

Public relations services

9819.9300

Management consultants

9819.9400

Technical testing and analysis service

9819.9500

Service provided by a registrar to an issue

9819.9090

39 [Others, including the services provided by port operators, airport operators, airport ground service providers and terminal operators]

98.20

98.20 Services provided or rendered by specialized workshops or undertakings

9820.1000

40[Auto-workshops including authorized service stations]

9820.2000

Workshops for industrial machinery construction and earthmoving machinery or other special purpose machinery etc

9820.3000

Workshops for electric or electronic equipments or appliances etc including computer hardware

9820.4000

Car washing or similar service stations

9820.9000

Other workshops

98.21

Services provided or rendered in specified fields.

9821.1000

Healthcare center, gyms or physical fitness center etc.

9821.2000

Indoor sports and games center

9821.3000

Baby care center

9821.4000

Body massage center

9821.5000

Pedicure center

98.22

Services provided or rendered for specified purposes.

9822.1000

Fumigation services

9822.2000

Maintenance or cleaning services

9822.3000

Janitorial services

9822.4000

Dredging or desilting services

9822.9000

Other similar services

9823.0000

Franchise services

9824.0000

Construction services

Consultancy services

Management services including fund and asset management services

Market Research agencies

Program producers

Brokerage and indenting services

Race Clubs

38. Substituted for the description “Outdoor photographer” vide the Sindh Finance Act, 2013 (the Sindh Act No. I of 2013).

39 . Substituted for the words “Others” vide the Sindh Sales Tax on Services (Amendment) Act, 2012.

40. Substituted for the description “Autoworkshops”, vide the Sindh Finance Act, 2013.

(65)

General Insurance Agents

Exhibition or convention services

Data Processing and Provision of information, services of Engineers, handling and storage of goods

Fashion designers

Cable Operators

Internet Café

Pandal and Shamiana service

Airport services

Intellectual Property services

Forward Contract services

Packaging services

Services provided or rendered in matters of hire

Purchase or sale of moveable or immovable goods or property

Property dealers

Car/automobile dealers

Dealers of second hand goods other than automobiles

Cosmetic and Plastic Surgery

Beauty Parlour/ Beauty Clinics

HR Consultants

Corporate Law Consultants

Tax Consultants

Human Resources & Personal Development Services

Coaching Centre

Vocational Centers

Actuarial Services

Training Services

Tracking Services

Security Alarm Services

Human Resource Development

Building Maintenance & Service Provider

Quality Control Services (ISO certification Board)

Services provided by Motels/guest houses & Farm houses.

Debt collection Agencies

Amusement Parks

Call canters

Film and Drama studios

Entertainment Services

Services provided in the matter of manufacturing or processing for other toll basis.

41[Event Management services including the services by event photographers, event videographers and the persons related to such event management.

Exhibition services.

Public bonded warehouses.

Labour and manpower supply services.]

41 Added vide the Sindh Finance Act, 2013.

(66)

SECOND SCHEDULE

(Taxable Services)

[see Sections 3 & 8 and general]

Part A

42[Tariff

Heading

Description

Rate of Tax

1.

2.

3.]

98.12 Telecommunication services. 19.5%

9812.1000 Telephone services 19.5%

9812.1100 Fixed line voice telephone service 19.5%

9812.1200 Wireless telephone 19.5%

9812.1210 Cellular telephone 19.5%

9812.1220 Wireless Local Loop telephone 19.5%

9812.1300 Video telephone 19.5%

9812.1400 Payphone cards 19.5%

9812.1500 Prepaid calling cards 19.5%

9812.1600 Voice mail service 19.5%

9812.1700 Messaging service 19.5%

9812.1710 Short Message service (SMS) 19.5%

9812.1720 Multimedia message service (MMS) 19.5%

9812.1910 Shifting of telephone connection 19.5%

9812.1920 Installation of telephone extension 19.5%

9812.1930 Provision of telephone extension 19.5%

9812.1940 Changing of telephone connection 19.5%

9812.1950 Conversion of NWD connection to non NWD or vice versa 19.5%

9812.1960 Cost of telephone set 19.5%

9812.1970 Restoration of telephone connection 19.5%

9812.1990 Others 19.5%

9812.2000 Bandwidth services 19.5%

9812.2100 Copper line based 19.5%

9812.2200 Fibre-optic based 19.5%

9812.2300 Co-axial cable based 19.5%

9812.2400 Microwave based 19.5%

9812.2500 Satellite based 19.5%

9812.2900 Others 19.5%

9812.3000 Telegraph 19.5%

9812.4000 Telex 19.5%

9812.5000 Telefax 19.5%

9812.5010 Store and forward fax services 19.5%

9812.5090 Others 19.5%

9812.6000 Internet services 19.5%

9812.6100 Internet services including email services 19.5%

9812.6110 Dial-up internet services 19.5%

42 . Added vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

(67)

9812.6120 Broadband services for DSL connection 19.5%

9812.6121 Copper line based 19.5%

9812.6122 Fibre-optic based 19.5%

9812.6123 Co-axial cable based 19.5%

9812.6124 Wireless based 19.5%

9812.6125 Satellite based 19.5%

9812.6129 Others 19.5%

9812.6130 Internet/email/Data/SMS/MMS services on WLL networks 19.5%

9812.6140 Internet/email/Data/SMS/MMS services on cellular mobile 19.5%

networks

9812.6190 Others 19.5%

9812.6200 Data Communication Network services (DCNS) 19.5%

9812.6210 Copper Line based 19.5%

9812.6220 Co-axial cable based 19.5%

9812.6230 Fibre-optic based 19.5%

9812.6240 Wireless/Radio based 19.5%

9812.6250 Satellite based 19.5%

9812.6290 Others 19.5%

9812.6300 Value added data services 19.5%

9812.6310 Virtual private Network services (VPN) 19.5%

9812.6320 Digital Signature service 19.5%

9812.6390 Others 19.5%

9812.9000 Audiotext services 19.5%

9812.9100 Teletext services 19.5%

9812.9200 Trunk radio services 19.5%

9812.9300 Paging services 19.5%

9812.9400 Voice paging services 19.5%

9812.9410 Radio paging services 19.5%

9812.9490 Vehicle tracking services 19.5%

9812.9500 Burglar alarm services 19.5%

9812.9090 Others 19.5%

(68)

Part B

43[Tariff

Heading

Description

Rate of Tax

1.

2.

3.

98.01 Services provided or rendered by hotels, restaurants, marriage halls, lawns, clubs and caterers.

9801.1000 Services provided or rendered by hotels 16%

9801.2000 Services provided or rendered by restaurants 16%

44[9801.3000 Services provided or rendered by marriage halls and lawns 16%]

9801.4000 Services provided or rendered by clubs 16%

9801.5000 Services provided or rendered by caterers, suppliers of 16%

food and drinks

9801.6000 Ancillary services provided or rendered by hotels, restaurants, 16%

45[marriage halls and lawns, clubs and caterers]

98.02 Advertisement

9802.1000 Advertisement on T.V 16%

9802.2000 Advertisement on radio 16%

9802.3000 Advertisement on closed circuit T.V. 16%

9802.4000 Advertisement in newspapers and periodicals, excluding 16%

Classified advertisements.

9802.5000 Advertisement on cable T.V. network 16%

46[9802.6000 Advertisement on poles 16%

9802.7000 Advertisement on Billboards 16%

9802.9000 Other Advertisements including those on web or internet etc 16%]

9805.1000 Shipping agents 16%

9805.2000 Stevedores 16%

9805.2100 Ship management service 16%

9805.3000 Freight forwarding agents 16%

9805.4000 Customs Agents 16%

47[9805.7000 Advertising agents. 16%

9805.8000 Ship chandlers 16%

9805.9100 Sponsorship Services 16%

9805.9200 Business Support Services 16%]

9807.0000 Services provided or rendered by property developers 16%

or promoters for

a) development of purchased or leased land for conversion 16%

into residential or commercial plots.

(b) construction of residential or commercial units. 16%

43. Substituted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012), for the following column titles:

“No. Type of Service Rate of tax”

44. Tariff heading 9801.3000 and entries relating thereto added vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013).

45. Substituted for the word “Caterers” vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013).

46. Substituted vide the Sindh Finance Act, 2013.

47 . Substituted for Tariff heading 9805.8000 and the entries there against in column (2) and (3) vide the Sindh Finance Act, 2013(Sindh Act No. I of 2013).

(69)

9808.0000 Courier services 16%

9809.0000 Services provided or rendered by persons engaged 16%

in contractual execution of work or furnishing supplies.

48[9810.0000 Services provided or rendered for personal care by 16%]

beauty parlours, beauty clinics, slimming clinics

or centers and others

98.13 Services provided or rendered by banking companies, 16%

Insurance companies, cooperative financing societies,

modarabas, musharikas, leasing companies, foreign

exchange dealers, non-banking financial institutions and

other persons dealing in any such services.

9813.1000 Services provided or rendered in respect of insurance to 16%

a policy holder by an insurer, including a reinsurer.

9813.1100 Goods insurance 16%

9813.1200 Fire insurance 16%

9813.1300 Theft insurance 16%

9813.1400 Marine insurance 16%

9813.1500 Life insurance 16%

49[9813.1600 Other insurance including reinsurance. 16%

9813.3000 Services provided or rendered in respect of leasing 16%

9813.3010 Financial Leasing 16%

9813.3020 Commodity or equipment leasing 16%

9813.3030 Hire purchase leasing 16%

9813.3900 Services provided or rendered in respect of modaraba and 16%

Musharika financing]

9813.4000 Services provided or rendered by banking companies 16%

in relation to:

9813.4100 Guarantee 16%

9813.4200 Brokerage 16%

9813.4300 Letter of credit 16%

9813.4400 Issuance of pay order and demand draft 16%

9813.4500 Bill of exchange 16%

9813.4600 Transfer of money including telegraphic transfer, 16%

mail transfer and electronic transfer

9813.4700 Bank guarantee 16%

9813.4800 Bill discounting commission 16%

9813.4900 Safe deposit lockers 16%

9813.4910 Safe vaults 16%

50[9813.4990 Other services not specified elsewhere 16%]

48. Tariff heading 9810.0000 and entries there against in column (2) and (3) are added vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013)

49. Substituted vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012), for the following:

“9813.1600 Other insurance including reinsurance Services provided or rendered in respect of musharika 16%”

financing and mudarba or leasing and non banking and any other leasing institution and non

banking financial institutions. In case of such non banking financial institutions including but

not limited to all non-interest based services provided or rendered against a consideration in

50. Entry added vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

(70)

9813.5000 Issuance,, processing and operation of credit and debit cards 16%

9813.6000 Commission and brokerage of foreign exchange dealings 16%

9813.7000 Automated Teller Machine operations, maintenance 16%

and management

9813.8000 Service provided as banker to an issue 16%

9813.8100 51[Others, including the services provided or rendered 16%

by non-banking, finance companies, modaraba and

musharika companies and other financial institutions]

9813.9000 Service provided or rendered by a foreign exchange dealer 16%

or exchange company or money changer

52[9814.1000 Architects or town planners 16%]

53[9814.2000 Contractor of building (including water supply, gas supply 16%

and sanitary works), electrical and mechanical works

(including air conditioning), multi-disciplinary works (including

turn-key projects) and similar other works

9814.3000 Property developers or promoters 16%]

54[98.15 Services provided or rendered by professionals and

consultants, etc.,

9815.2000 Legal practitioners and consultants 16%

9815.3000 Accountants and auditors. 16%

9815.4000 Management consultants 16%

9815.6000 Software or IT based system development consultants 16%

9815.9000 Tax consultants 16%

98.18 Services provided or rendered by specialized agencies

9818.1000 Security agency 16%

9818.3000 Market research agency 16%]

98.19 Services provided or rendered by specified persons

or businesses

9819.1000 55[Stockbrokers and commodity brokers] 16%

9819.2000 Money exchanger 16%

56[9819.5000 Surveyors 16%

9819.7000 Outdoor photographers and videographers 16%

9819.9300 Management consultants 16%]

57[9819.9090 Services provided or rendered by port operators, 16%]

airport operators, airport ground service providers

and terminal operators

58[98.20 Service provided or rendered by specialized

Workshops or undertakings.

9820.1000 Auto workshops, including authorized service stations 16%

9820.2000 Workshops for industrial machinery, constructions 16%

51. Substituted for the word “Other” vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

52. Added by the Sindh Finance Act, 2013 ( Sindh Act No.I of 2013)

53. Entry added vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

54. Inserted vide the Sindh Finance Act, 2013 ( Sindh Act No.I of 2013)

55. Substituted for the description “stock brokers” vide the Sindh Finance Act, 2013 ( Sindh Act No.I of 2013).

56. Inserted vide the Sindh Finance Act, 2013( Sindh Act No.I of 2013).

57. Entry added vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

58 . Inserted vide the Sindh Finance Act, 2013( Sindh Act No.I of 2013).

(71)

and earth-moving machinery or other special

purpose machinery, etc.

98.21 Services provided or rendered in specified fields

9821.1000 Health care centre, gyms or physical fitness center, etc 16%

9821.4000 Body massage center 16%

9821.5000 Pedicure centre 16%]

9823.0000 Franchise services 16%

59[9824.0000 Construction services 16%

Management services including fund 16%

and assets management services

Airport services 16%

Tracking Services 16%

Security alarm services 16%

Services provided by motels and guest houses 16%]

60[Event Management services including the services 16%

by event photographers, event videographer

and the persons related to such event management

Exhibition services. 16%

9828.0000 Public bonded warehouses 16%

9829.0000 Labour and manpower supply services 16%

9830.0000 Services provided in the matter of manufacturing 16%

or processing for others on toll basis

9831.0000 Race Club:

(a) Services of entry/admission (a) Rs.200

per entry

ticket or entry

pass of the

person visiting

the race event.

(b) Other services (b) 16%]

BY ORDER OF THE SPEAKER

PROVINCIAL ASSEMBLY OF SINDH

59. Substituted for tariff heading “9824.000 and entries there against in column (2), and (3) vide the Sindh Sales Tax on Services (Amendment) Act, 2011 (Sindh Act No. II of 2012).

60 . Added vide the Sindh Finance Act, 2013 (Sindh Act No. I of 2013).