LAHORE: The Lahore High Court has suspended the notices issued by Lahore Electric Supply Company (Lesco) to various steel mills for recovery of arrears of General Sales Tax (GST).
The court passed the order on dozens of petitions of Mughal Iron & Steel Industries and other mills and sought reply from the Lesco in the petitions. On behalf of the millers, their counsels argued that the arrears of the GST could not be imposed on the petitioners as the relevant law Sales Tax Special Procedures Rules 2007 which impose such tax had already been repealed through a SRO in 2019.
The counsel contended that the Lesco started sending notices to the steel mills for the recovery of the arrears under the head of increased rate of GST. He said the respondent company had no authority to add the arrears of the GST in the current bills of electricity.
He argued that as per the dictum laid down by the superior courts, the discos had no powers to collect the arrears of sales tax under the provisions of the Sales Tax Act 1990.
He said the petitioners being consumers of the Lesco had been making regular payments of monthly electricity bills. He pointed out that during the tax period from July 2008 to June 2019 the petitioners had been paying the tax in the electricity bills under the 2007 rules.
He therefore asked the court to set aside the notices issued by the Lesco for being unlawful.
Copyright Business Recorder, 2021