A Division Bench of the Supreme Court on Wednesday agreed to adjourn the Federal Government's petition against the Redco Textile Mills allowing time to company's lawyers to file a concise statement answering issues raised in the additional documents filed by the appellants.
The case had come up before the Fourth Bench comprising of Justice Syed Deedar Hussain Shah and Justice Faqir Muhammad Khokhar during which the government's Standing Counsel, Raja Abdul Ghafoor filed several documents including the list of directors of Redco Textiles and Redco Pakistan Limited.
Most of the names on the two lists were identical and were filed in support of Raja Abdul Ghafoor's contention that two were sister companies and same people were on their Board of Directors. He had also filed the reports of the firm's auditors.
The government is appealing against the order of the Lahore High Court ordering the Central Board of Revenue to refund claims amounting to millions of rupees paid as sales tax from October to December 1996 by REDCO Textiles.
The Redco companies owned and operated by former Senator Saifur Rahman Khan and his immediate family.
Khan was the Chief of the Ehtesab Cell of Prime Minister Nawaz Sharif and gained prominence for his investigations against another Prime Minister Benazir Bhutto and her husband Asif Ali Zardari.
The case revolves around the sales tax returns of above three months with a claim of refund of more than five million rupees for each month.
The company had gone to the LHC complaining that while the CBR had accepted its refund claim, it had however, not returned the money and adjusted it against the liabilities of its sister company, the REDCO Pakistan Limited.
The action, the company lawyers said struck at the "very fabric of corporate existence and responsibilities" and were illegal.
A single bench of the LHC had accepted the plea of REDCO against which the Federal Government, the Central Board of Revenue and the Collectorate of Sales Tax filed an appeal with the Supreme Court.
While Raja Abdul Ghafoor represented the Federal Government and its allied organs, Hamid Khan appeared for the Redco.
The Fixture Branch of the Registry will determine a firm date falling after four weeks from Wednesday.
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