Replies sought in tax on POL case

LAHORE

The Lahore High Court Thursday directed the federal government to submit replies on two petitions challenging a levy of up to 55 per cent sales tax on petroleum products and the standard mechanism for setting prices of the products in international market. 

Justice Mamoon Rashid took the first petition moved by Pakistan Justice Party. The counsel argued that according to existing prices, after adding the income tax along with allied taxes, the rate of the oil should not be increased from Rs 30 per litre with any stretch of imagination. However, he said, in the instant case the government functionaries were adamant to sale the oil to the public at the rate of Rs71.25 per litre. 

The counsel said the federal government had no authority and jurisdiction to fix the petroleum prices in view of the provisions of Ogra Ordinance, 2002 and any policy which was taking away such power was violation of the Constitution.

He said the government was playing fraud with the nation by fixing petroleum prices and that too at exorbitant rates in contradiction with the international prices. The lawyer pleaded that the government should be directed to charge the prices of the oil according to the existing international market rate in the large interest of public welfare and to meet the ends of justice. Justice Rasheed directed the government to submit its reply by February 24. Hearing a similar petition filed by Punjab opposition leader Mian Mahmood-ur-Rasheed, Justice Shahid Waheed issued notices to the government, Ogra and FBR. Representing the petitioner, Advocate Sheraz Zaka argued that section 3(2) & (6) of Sales Tax Act 1990 was repugnant to the Constitution.

He challenged the latest notification through which fixed amount of sales tax had been imposed on the petroleum products inflating the prices.