Zero-rating of Supplies against International Tender for Afghan Refugees Rules, 2001

GOVERNMENT OF PAKISTAN MINISTRY OF FINANCE, ECONOMIC AFFAIRS, STATISTICS AND REVENUE (CENTRAL BOARD OF REVENUE) ***** Islamabad, the 16th October, 2001. NOTIFICATION (SALES TAX) S.R.O. 712 (I)/2001.- In exercise of the powers conferred by section 50 of the Sales Tax Act, 1990, read with clause (e) of sub-section (1) of section 22 thereof the Central Board of Revenue is pleased to make the following rules, namely:-- 1. Short title, application and commencement.- (1) These rules may be called the Zero-rating of Supplies against International Tender for Afghan Refugees Rules, 2001. (2) They shall apply to supplies of taxable goods made by registered persons against international tender to UNICEF, UNDP, WHO, WFP, UNHCR, Euron Aid and ICRC for Afghan refugees. (3) They shall come into force at once. 2. Definitions.- (1) In these rules, unless there is anything repugnant in the subject or context, - (a) “Act” means the Sales Tax Act, 1990; (b) “foreign currency” means foreign currency as defined in clause (c) of section 2 of the Foreign Exchange Regulation Act, 1947 (VII of 1947); (c) "ICRC" means Internal Committee of Red Cross; (d) “State Bank” means the State Bank of Pakistan; (e) “UNDP” means United Nations Development Program; (f) “UNHCR” means United Nations High Commission for Refugees; (g) “UNICEF” means the United Nations International Children’s Emergency Fund; (h) “WFP” means World Food Program; and (i) “WHO” means World Health Organisation; 3. Procedure and conditions for making zero-rated supplies.- In terms of clause (a) of section 4 read with serial No. 4 of the Fifth Schedule of the Act, supplies against international tender for Afghan refugees shall be charged to tax at the rate of zero percent subject to the following procedure and conditions, namely:-- (i) the supply shall be made against international tender issued by UNICEF, UNDP, WHO, WFP, UNHCR, Euron Aid or ICRC. The contract signed with the concerned organisation shall be retained by the supplier in his record alongwith a copy of the tender notice; (ii) payment for the supply shall be received in foreign currency which shall be surrendered to the State Bank and the supplier shall receive payment in Pak rupees as per State Bank procedure and foreign exchange regulations. A certificate from the bank or authorised dealer in foreign exchange to this effect shall be retained by the supplier in his record; (iii) a zero-rated invoice shall be issued for each supply, mentioning the full particulars of the buyer and the contract number, besides the particulars required in section 23 of the Act; and (iv) the goods shall be duly received by the organisation which signed the contract and a certificate to this effect shall be issued by the organisation which shall be duly attested by the Chief Commissioner or Commissioner of Afghan Refugees or as the case may be, by the ICRC Kabul or Herat, in which case ICRC Pakistan will also furnish relevant copies of Bill-of-Export. 4. Maintenance of records.- (1) The supplier shall maintain separate records of supplies of zero-rated goods and receipt of foreign currency under these rules, indicating the number and date of the international tender, number and date of the contract, name of the organization to whom goods were supplied, value of the goods, amount of foreign currency involved, and number and date of the certificates obtained under clauses (ii) and (iv) of rule 3. (2) The supplier shall retain the documents specified in rule 3 in his record in addition to those prescribed under section 22 of the Act. 5. Refund.- When filing a claim for refund of sales tax against supplies made under these rules, in addition to the relevant supporting documents specified in the Sales Tax Refund Rules, 2000, the claimant shall furnish the documents specified in rule 3 in original alongwith one set of legible photocopies. The original documents shall be returned to the claimant after tallying and endorsement of verification on the photocopies by the officer-in-charge of the refund division. 6. Penalty.- In case the goods are found not to be supplied to the organisation specified in rule 3, or foreign exchange is not received within one hundred and twenty days of making the supply, the sales tax involved on such goods shall be recoverable from the supplier, besides legal or penal action under appropriate provisions of the Act. [C. No. 2(4)STP/99] (DR. ASHFAQ AHMED TUNIO) Secretary(ST-L&P) Amended vide SRO 259(I)/2002 dated 11.05.2002 Amended vide SRO 788(I)/2002 dated 11.11.2002