LAHORE - The Lahore High Court yesterday barred Lahore Electricity Supply Company from recovering the disputed arrears of general sales tax (GST) from electricity consumers through their bills.

Granting stay to industrial units against the recovery, Justice Abid Aziz Sheikh observed that Federal Board of Revenue (FBR) had the jurisdiction to recover the disputed arrears of the GST.

Representing the petitioner-companies, Advocate Mohsin Virk told the court that Lesco had been recovering disputed amount of the tax invoking section 48 of Sales Tax Act without any valid ground.

He maintained that Lesco or any other electricity distribution company had no power to recover arrears of the sales tax after the consumers had challenged the same before the forum concerned. Only FBR had power to recover the disputed arrears of the tax under the law and not Lesco, the counsel held.

Virk asked the court to restrain Lesco from going ahead with the impugned recovery.

The FBR counsel told the court that the Lesco had been recovering the arrears with the permission of the board.

After hearing both sides, Justice Sheikh observed that the Lesco had no jurisdiction to recover the disputed amount of the sales tax. The judge directed the FBR to decide the matter afresh after affording an ample opportunity of hearing to the petitioners. The petitions were disposed of by the court.