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High Court Division
(Special Original Jurisdiction)
Md Ashfaqul Islam J      
SM Emdadul Hoque J    
Zastat Limited.................
..................................Petitioner
vs
Customs Excise and VAT Appellate Tribunal and others
.............. Respondents
Judgment January 31st, 2011.
Value Added Tax (XXII of 1991)
Section 5(4)
The words and phrases ÔAb¨vb¨ †mevÕ as envisaged under HS Code 064.20 should be construed as the services attached with the category that has been clearly spelt out and explained in the said HS Code. Under head of "service render" with HS Code 064.20, the petitioner company has been allowed to render service in respect of picnic spot, shooting spot, historical places and tourist spot. But hotel and restaurant are not there. By any stretch of imagination it cannot be construed in the context of the case that hotel and restaurant even if rendering service under a different code shall have to be charged VAT at the rate of 4.5% within the meaning of HS Code 064.20. Law does not allow anything to be done indirectly which cannot be done directly ..............(22)
AFM Hasan Arif, Senior Advocate with Md Shamsul Islam and Zakir Hossain Munshi, Advocates--For the Petitioner.
SM Moniruzzaman, KM Masud Rumy, Pratikar Chakma, Assistant Attorney Generals-For the Respondent No. 2.
Judgment
Md Ashfaqul Islam J: Zastat Limited a private limited company engaged in the business of tourism invoked this writ petition upon which this Rule was issued calling upon the respondents to show cause as to why the impugned order dated 14-11-2007 passed by the respondent No. I vide Nathi No. Customs Excise and VAT Appellate Tribunal /CASE (VAT) 36/2007 (Annexure-G-1) dismissing the appeal and affirming the order dated 22-1-2007 passed by the respondent No.2 vide Nathi No. 4th VAT  12(35)/Zastat Ltd/CF: COM/06/115 should not be declared to have been passed without any lawful authority and is of no legal effect.
2. The background leading to the issuance of the Rule, in short is that the petitioner company is engaged in hotel and tourism business. The respondent No. 2 Customs Excise and VAT Commissionerate, Sylhet issued a notice claiming demand for the period of July, 2006 charging 15% VAT on the service rendered by the petitioner in the business of hotel and restaurant. On the other hand, petitioner's case is that its industry is a tourism industry and it is not liable to pay 15% VAT against the service rendered and for that VAT may be charged at the rate of 4.5% if any.
3. It has been further stated that petitioner's industry was incorporated under the Board of Investment and accordingly the Board of Investment on 17-4-2005 issued a certificate in favour of the petitioner industry and that in the said certificate the character of the petitioner industry was wrongly mentioned as "Hotel and Restaurant" and that the petitioner on 16-5-2006 filed an application to the Chairman of the Board of Investment to rectify the said mistake and to issue a correct certificate by depicting the industry as "Industry for Tourism" and accordingly the Board of Investment on 17-5-2006 rectified the mistake and mentioned the character of the petitioner industry as "Industry for Tourism".
4. On an application under Rule 12 of the VAT Rules, 1991 filed by the petitioner the respondent No.2 on 8-5-2006 issued a VAT certificate showing its business under HS Code No. S064.20 which included picnic spots, shooting spot, historical places and tourist spot.
5. The respondent No.4, National Board of Revenue under SRO No. 170 dated 8-6-2000 gave definition of some services and thereafter time to time the said SRO was amended and that on 10-6-2006 the definition of the petitioner's industry was included in the said SRO under heading No, S064 and the said heading was divided in two sub-codes namely, S064.1 0 and S064.20 and that the petitioner's industry falls under the HS Code of S064.20.
6. It has been further stated that the respondent No.4, NBR then again on 10-6-200-4 by SRO No. 173 promulgated Òwbw`©ó †mevi †ÿ‡Î cÖK…Z g~j¨ ms‡hvR‡bi nv‡ii wfwˇZ Ki avh©KiY wewagvjv,  2004" and under the said rules the VAT upon the petitioner industry was fixed at the rate of 4.5% under Sub-Code No. S064.20 and that under the said SRO if the petitioner is at all liable to pay VAT it can only be charged VAT at the rate of 4.5%. Further respondent No.4 under section 14(1) of the VAT Act issued SRO No. 131 dated 8-6-2006 exempting the petitioner industry from payment of VAT and under the said SRO the petitioner is not liable to pay VAT since the petitioner's industry is an "Industry for Tourism" which falls under the purview of HS Code No. S064.20.
7. In that circumstances by Annexure-'F' dated 22-1-2007 the Commissioner, Customs Excise and VAT, Sylhet issued the demand dated 22-1-2007 and directed the petitioner to pay VAT from 1st July, 2006 at a higher rate against which the petitioner filed an appeal before respondent No, I Customs Excise and VAT Appellate Tribunal who dismissed the appeal and thereafter the respondent No. 3 Superintendent Customs Excise and VAT, Circle Zindabazar, Sylhet issued a demand dated 26-10-2009 asking the petitioner to pay VAT of Tk 1,48,683. The petitioner at this stage moved this Division and obtained the present Rule.
8. Mr AFM Hasan Arif, the learned Senior Advocate, appearing with Mr Md Shamsul Islam, Mr Zakir Hossain on behalf of the petitioner after taking us with the petition and the supplementary affidavit along with the Annexures thereof mainly submits that as per SRO No, 170 dated 8-6-2000 the petitioner industry falls within the ambit of Tourist Industry under heading No. S064 and sub-heading No. S064.20 and, as such, the petitioner is liable to pay VAT at the rate of 4.5% under SRO No. 173 dated 10-6-2004 and, as such, the claim of VAT more than 4.5% is illegal and without lawful authority.
9. Next he submits that under SRO 131 dated 8-6-2006 the petitioner industry is exempted from paying VAT and, as such, claim of VAT by the respondent No.2 and the issuance of the impugned order in spite of that by the respondent No. I is illegal and without lawful authority and is of no legal effect. Substantiating his argument the learned Advocate submits that the demand dated 22-1-2007 issued by the respondent No.2 is vague and baseless in that the said demand is in violation of the SRO 131 dated 8-6-2006 by which the petitioner has been exempted from paying VAT.
10. Mr SM Moniruzzaman appearing with Mr KM Masud Rumy, Mr Pratikar Chakma, the learned Assistant Attorney Generals on behalf of respondent No, 2 by filing affidavit in opposition, on the other hand, opposes the Rule on several grounds. He submits that this Rule has no merit, which should be discharged outright. The petitioner obtained VAT Registration under Service Code No. 001.00 as Hotel and Restaurant. Subsequently it was amended under Service Code S064.20 as Picnic Spot and Shooting Spot (Annexure-A) though the petitioner company was rendering services of other codes i.e. Code No. S001.00 as Hotel, Code No. S 001.20 as Restaurant and Code No. 064.10 as Amusement and Theme Park.
11. The rate of VAT is 15% on Service Code S 001.00 for Hotel & Restaurant and the rate of VAT is Taka 4.5% on Service Code No. S064.10 Amusement & Theme Park and Code No. 064.20 Picnic and Shooting Spot. The petitioner have obtained VAT Registration for rendering  services under different codes in the same premises and VAT should be paid at the rate specified for every Service Code as per law but the petitioner paid VAT @ 4.5% only on Service Code 064.20 though it has been rendering service under Service Code S001.10 and 0