The Central Board of Revenue (CBR) has decided to withdraw contravention cases against wrongly registered jewellers having annual turnover below Rs 1 million.
The CBR on Monday conveyed the decision to All Pakistan Sarafa Association (Apsa) supreme council, Hyderabad.
The CBR has informed the jewellers that the exemption available under serial number 42 of the Sixth Schedule of the Sales Tax Act, 1990 is also available to jewellers through Special Procedure for Jewellers Rules 2001.
If any jeweller with low threshold has been wrongly registered, the association should immediately approach the concerned Collector of Sales Tax for rectification.
The jewellers had also contested that collectors of sales tax have made cases against those who were regularly paying sales tax.
The CBR observed that if such cases have been made against jewellers, the adjudicating officers should be provided copies of the returns for proper decision. However, if any cases have been decided against jewellers who were filing returns, the correct legal procedure is to file an appeal against the order.
Giving the benefit of SRO 500(I)/2003 (exemption of additional sales tax) to jewellers community, the CBR has also announced that any registered person, including a registered jeweller who complied with the provisions of SRO.500(I)/2003, is entitled to the benefit of the notification.
However, jewellers must understand that one of the conditions of this notification is that it does not apply to a registered person against whom a case of tax fraud or evasion has already been framed by the department. SRO 500(I)/2003 deals with the exemption of sales tax and additional tax for different categories of persons who get themselves registered with the sales tax department under the timeframe given in the notification.
The jewellers also expressed their worries that the returns of jewellers paying sales tax were being dispatched to concerned Collectorate of Sales Tax for calculation of additional tax and penalty.
Responding to the query, the CBR said that the calculation of additional tax and penalty does not mean that it would also be recovered. The returns have been sent for verification of payment of sales tax ie to ascertain whether the full amount payable has been paid.
Calculation of additional tax and penalty is necessary to determine the amount, if any, to be waived, the CBR added.
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