Mr. Z
Address….
Dear Sir,
RE: DEEMED EXPORT OF GOODS.
Please refer to the papers/documents referred to us on 31.03.2002 on the above subject. As requested by you, we have drafted a reply to the notice dated 20.03.2002 issued by Mr. X, Inspector (Sadar), Office of the Superintendent, Customs, Excise & VAT, Sonargaon Circle, claiming an amount of Tk. 47,14,325.00 only as unpaid VAT.
The draft reply is enclosed herewith. All papers/documents referred to us are returned herewith.
Please acknowledge receipt of the draft and the papers/documents.
Thanking You
Yours faithfully
………………….
For: “The Lawyers & Jurists”
Mr. Z
Address….
Dear Sir,
RE: DEEMED EXPORT OF GOODS.
We have received your letter No. ____________________ dated 20.03.2002 requesting us to deposit an amount of Tk. 47,14,325.00 (Taka forty seven lac fourteen thousand three hundred twenty five) only as unpaid VAT in connection with supply of 1,654.50 metric tons of construction materials to Pubali Construction Limited, China Harbour, BDC and H. H. Construction.
In this respect we would like to state that the aforesaid supply is covered by section 3(2) of the Value Added Tax Act, 1991 and Rule 31 of the Value Added Rules, 1991.
Rule 31(1) of the Value Added Tax Rules, 1991 provides as follows:
†Kvb evskv‡`kx wbewÜZ e¨w³ KZ©„K ¯’vbxq ev AvšR©vwZK `ic‡Îi wecix‡Z ˆe‡`wkK g`ªvi wewbg‡q †Kvb cY¨ mieivn ev †Kvb †mev cª`Ë nB‡j D³ cY¨ ev †mevi wewbg‡q cÖvß ˆe‡`wkK g`ªv ißvbxi mvaviY bxwZ Abyhvqx evsjv‡`k e¨vs‡Ki gva¨‡g cÖZ¨vewmZ nB‡j AvB‡bi aviv 3 Gi Dc-wewa (2) Abyhvqx ißvbxK…Z ewjqv MY¨ nB‡e|
All exports from Bangladesh are guided under Chapter 22, Section-1 of the Guidelines for Foreign Exchange Transactions of Bangladesh Bank. Pursuant to Clause 5 of Chapter 22, Section-1 of the said Guidelines payment for goods exported from Bangladesh should be received through an AD (Authorised Dealer) in freely convertible foreign currency or in Taka from a non-resident Taka Account.
Pursuant to the aforesaid provisions of law, Rahim Steel Mills Co (Pvt) Ltd supplied 1,654.50 metric tons of construction materials to Pubali Construction Limited, China Harbour, BDC and H. H. Construction against foreign currencies. The foreign currencies were received by us through __________________ Bank which is an Authorised Dealer. Necessary returns were filed by the said Bank with Bangladesh Bank regarding the receipt of the foreign currency.
In this respect we would like to refer the explanation given by the National Board of Revenue vide Memo No. _____________________ dated 19.09.93. In the said Memo the National Board of Revenue explained that any notice published in the newspapers for purchase of products shall be treated as a “Local Tender” for the purpose of Rule 31 of the Value Added Tax Rules. The National Board of Revenue also explained that the name, description and quantity of the product to be purchased and the condition to make payment in foreign currency must be stipulated in the notice.
COMPANY 1 supplied 1,654.50 metric tons of construction materials to Pubali Construction Limited, China Harbour, BDC and H. H. Construction against Tender Notices published in the newspapers. The Tender Notices contained the name, description and quantity of the product to be purchased and the condition to make payment in foreign currency. (Copies of Tender Notices are enclosed herewith).
Pursuant to the provision of Rule 31(4) of the Value Added Tax Rules, 1991 we have the following documents, which are enclosed herewith as well:
a) Tender Notices
b) Acceptance of Tender
c) Work/Supply Order
d) Encashment Certificates (evidencing the receipt of foreign currencies)
In the premises stated above it is clear that the above supplies are Deemed Exports for the purpose of section 3(2) of the Value Added Tax Act, 1991 and no VAT is payable against the said supplies. As such your claim of Tk. 47,14,325.00 (Taka forty seven lac fourteen thousand three hundred twenty five) only as unpaid VAT in connection with supply of 1,654.50 metric tons of construction materials to Pubali Construction Limited, China Harbour, BDC and H. H. Construction is not tenable.
Thanking you
Yours faithfully
………………….
For: “The Lawyers & Jurists”