COLLECTION OF EXCESS SALES TAX (SEC-3 B)
_ Any person who has collected or collects any tax or charge, whether under misapprehension of any provision of this Act or otherwise, which was not payable as tax or charge or which is in excess of the tax or charge actually payable and the incidence of which has been passed on to the consumer, shall pay the amount of tax or charge so collected to the Federal Government.
_ Any amount payable to the Federal Government shall be deemed to be an arrears of tax or charge payable under this Act and shall be recoverable accordingly and no claim for refund in respect of such amount shall be admissible.
_ The burden of proof that the incidence of tax or charge has been or has not been passed to the consumer shall be on the person collecting the tax or charge.
| Exercise :
Hassan (Pvt.) Ltd. under misapprehension collected additional sales tax of Rs. 100,000 from one of its customers. 65% of the goods on which additional sales tax was collected are still lying with the customer as unsold stock. |
| Answer :
In the above scenario, since 65% of the stock, on which excess tax of (100,000 x 65%) Rs. 65,000 was collected, is still unsold, Hassan Ltd should return this amount to its customer. However, the balance amount of Rs. 35,000, the incidence of which has been passed on to the consumers should be deposited with the Federal Government. |
M. Adil Hussain
Future Chartered Accountants 