GOVERNMENT OF PAKISTAN

MINSITRY OF FINANCE, ECONOMIC AFFAIRS

STATISTICS AND REVENUE

*****

Islamabad, the 23^rd May, 2001

NOTIFICATION

(SALES TAX)

                S.R.O. 313(1)/2001.- In exercise of the power conferred by section 71 of the Sales Tax Act, 1990, the Federal Government is pleased to direct that the following amendment shall be made in the Ship-breaking Industry (Special Procedure Rules, 1997, namely:-

                In the aforesaid Rules, ____

1. in the preamble, after the comma, occurring for the second time, the word, figure, letter and comma "read-with section 34A thereof," shall be inserted;
2. in rule 6, in sub rule (3), in the beginning, for the words "The following shall be", the word and comma "Subject to the maximum aggregated wastage upto ten percent, the following shall normally be" shall be substituted;
3. in rule 8, in sub rule (2),____

(a) for the first proviso, the following shall be substituted, namely:-

"Provided that subject to the provisions of rule 9, as and where applicable and notwithstanding anything contained in any notification issued for the purpose of valuation under these rules, the liabilities of sales tax in respect of a ship, including a ship in respect of which bill of entry is filed in future, shall be deemed to have been discharged only when the tax is paid in the basis of minimum vale addition twenty-one percent over and above the value assessed on the bill of entry for the sales tax purposes".;

and

(b) for the second proviso, the following shall be substituted, namely:-

"Provided further that the maximum aggregate wastage, permissible under sub-rule (3) of rule 6, shall not affect the minimum value addition of twenty-one percent as aforesaid while discharging the total liabilities of sales tax in respect of a ship."; and

4. after rule 8, the following new rules shall be added, namely:-

"9. Final discharge of tax liabilities and waiver of additional tax or penalties.—(1) Notwithstanding anything contained in these rules, or any other notification issued for the purpose of valuation under these rules, if a ship breaker in respect of____

1. stocks held on 19^th December, 1997;
2. stocks relating to bills of entry filed thereafter; and
3. stocks of those bills of entry filed on or after 19^th December, 1997, as have already been cleared.

Pay on or before 30^th June, 2001, tax liability on the basis of a minimum value addition of twenty-one percent over and above the value assessed on the bill of entry for sales tax purposes, the liabilities of sales tax shall be deemed to have been discharged as laid down under the first pro0viso to sub-rule(2) of rule 8 and penalty in terms of section 33 and additional tax in terms of section 34 or any other provisions of the Act or rules made thereunder shall stand exempted:

Provided that in case of the stocks already cleared, if the tax liability on the basis of minimum value addition of twenty-one percent as aforesaid exceeds the amount of tax already paid, the ship breaker shall pay on or before the said date only the differential amount of tax:

Provided further that in case of such stocks, if the tax liability computer on the basis of minimum value addition of twenty-one percent as aforesaid is lesser than the amount of tax already paid or recovered, the ship breaker shall not be entitled to refund of any amount of tax.

(2) In case of a ship breaker who discharges his tax liabilities under sub-rule (1), audit of records shall be commenced two weeks after 30^th June, 2001, and certificate as required under sub-rule (3) of rule 8 shall be issued by the Assistant Collector Incharge Audit thereafter but not later than 15^th September, 2001."