Khudayar Mohla
ISLAMABAD (TLTP) Granting leave to appeal of Sindh Revenue Board seeking imposition of sales tax over builders and property developers business on Monday, Supreme Court observed that it has to ascertain whether such business activities comes under the ambit of service tax.
Appearing before a three member bench of Chief Justice Mian Saqib Nisar, Justice Faisal Arab and Justice Ijazul Ahsan, counsel for the Board Uzair Karamat Bhandari sought consideration of the Supreme Court over a number of law questions.The bench was hearing appeal of the Board challenging Sindh High Court verdict that declared while disposing of 21 identical pleas of Association of Builders & evelopers of Pakistan (ABAD) and others that any activity in which relationship of service provider and recipient is governed by a contract of sale/agreement to sell does not fall within the scope of taxable services under any of Tariff Headings.Raising questions of law before the apex court for consideration, Sindh Revenue Board submitted whether Sindh High Court was correct in holding that the entries in the Second Schedule of the Sindh Sales Tax on Services Act 2011, were subject to and circumscribed by the entries in the First Schedule thereof? “Whether the Sindh High Court erred in catagorizing a contract between a builder, property developer or promoter and the person who has booked a unit in the building to be constructed or a plot in the scheme to be developed to be paid for in installments as merely an agreement to sell immoveable property and nothing more?”, the counsel requested the bench to decide the question. He further said that another question of law has to be determined, “what is true nature of a contract between a builder, property developer or promoter and the person who has booked a unite in the building to be constructed or a plot in the scheme to be developed to be paid for in installments?” Bhandari also urged the court to ascertain whether finding that any activity in which relationship between the parties comes within the ambit of a contract of sale within the meaning of Section 54 of the Transfer of the Property Act 1882, is not subject to Sales Tax on Services is erroneous in law and fact? END
