W.T.AS. NOS. 70(LB) TO 72(LB) OF 1983-84, W.T.AS. 47(LB) TO 49(LB) OF 1986-87 AND 59(LB) OF 1987-88, VS W.T.AS. NOS. 70(LB) TO 72(LB) OF 1983-84, W.T.AS. 47(LB) TO 49(LB) OF 1986-87 AND 59(LB) OF 1987-88,
1991 P T D 963
[Income-tax Appellate Tribunal Pakistan]
Before Sayed Amjad Hussain Bokhari, Judicial Member and A.A. Zuberi, Accountant Member
W.T.As. Nos. 70(LB) to 72(LB) of 1983-84, W.T.As. 47(LB) to 49(LB) of 1986-87 and 59(LB) of 1987-88, decided on 18/10/1989.
(a) Income Tax Appellate Tribunal Rules, 1981--
---R.12---Oanun-e-Shahadat (10 of 1984), Art. 129---Sending by appellant copy of memorandum of each appeal and grounds of appeal to the respondent before the institution thereof in the Tribunal---Department (appellant) submitted certificate. in terms of R. 12, Income Tax Appellate Tribunal Rules, 1981---Presumption of truth attached to such certificate----Such certificate being a public document prepared in the ordinary course of official business, a presumption of truth was attached and appeal of the department could not bye rejected straightaway on account of violation of a mandatory provision of the Rules.
(b) Wealth Tax Act (XV of 1963)---
----Ss. 2, (m), expln. (i) &. 21---Assessee, mother of a minor daughter made a gift of one half share in a house to the said minor which gift was accepted on behalf of the minor by her grand-mother who had been appointed as her guardian by the Court---Share so gifted by mother would be assessed to Wealth Tax in the hands of mother of minor, and not in the hands of her grand-mother.
Under the scheme of the Guardians and Wards Act, 1890 there is a watertight division of the authority of a minor's guardian of person and guardian of property. The one cannot assume the duties and functions of the other. This holds good even where the same person has been appointed in dual capacity. In the present case the grandmother of minor had been appointed by the Court as the guardian of her person alone, and as such she enjoyed no legal existence or authority in respect of minor's property. There was no controversy about the factum of gift and minor's ownership of one-half share in the house on the basis thereof. Although minor enjoyed unimpeachable title with respect to her one-half portion in the house, the fact remained that it had to be assessed in hands of her mother, in terms of Explanation (I) to clause (m) of section 2 of the Wealth Tax Act. It is not possible to appreciate the point sought to be made with reference to subsection (3) of section 21 of the Act. This subsection cannot be construed in isolation and has to be considered conjunctively with the entire text of section 21 of the Act. What subsection (3) of section 21 signifies is that the guardian of a minor's property would be treated as having stepped into the shoes of the minor as regards the levy and recovery of wealth tax. It does not, in any manner, empower the guardian of a minor's person to deal with the minor's property and this provision cannot also be stretched in support of the plea that the assets of a minor have to be assessed in the hands of the guardian of the minor's person and are not to be clubbed with the net wealth of the minor's father or mother.
A.H. Najfee, Legal Advisor and Farid-ud-Din Qaiser, DR. for Appellant.
Siraj-ud-Din Khalid, for Respondent.
Date of hearing: 18th October, 1989.
ORDER
These seven departmental appeals relate to the charge years 1980-81 to 1986-87. The appeals for the periods 1980-81 to 1982-83 and 1983-84 to 1985-86 are directed against the orders passed by Mr. Abdul Aziz Khalid, Commissioner of Wealth Tax (Appeals), Zone-III, Lahore, on 23-8-1983 and 20-4-1986, respectively, whereas the appeal pertaining to the year 1986-87 assails the legality and propriety of the order made by Azra Feroze Bakhat, Commissioner of Wealth Tax (Appeals), Zone-III, on 25-5-1987. We propose to dispose of all the seven appeals by a single order as common points of facts and law are involved in them.
The brief facts of the case are that the assessee-respondent is the mother of minor Rabia Hassan and daughter of Mst. Iqbal Begum. On 14-12-1978, a local Civil Court appointed Mst: Iqbal Begum as the guardian of the person of minor Rabia Hassan under the Guardians and Wards Act, 1890. On 20-10-1979, the respondent made a gift of one-half share in. house No. 100-A, New Muslim Town, Lahore, to her minor daughter Rabia Hassan. The gift was duly accepted on behalf of the minor by the guardian of her person, Mst. Iqbal Begum. While filing her wealth tax returns for all the assessment years mentioned above, the respondent did not include in her net wealth the share of the minor daughter in House No. 100-A. The Wealth Tax Officer, however, assessed the minor's one half share in the said house in the hands of the respondent by observing that the assets belonging to the minor daughter of the assessee have to be clubbed with those owned by the assessee herself. This action of the Wealth Tax Officer was challenged in appeals in consequence whereof the respective Commissioners of Wealth Tax (Appeals) accepted the plea of the respondent and held that the minor's one-half share in the aforesaid house could not be clubbed with the assets of the respondent and it has to be assessed separately under section 21 of the Wealth Tax Act, 1963 (hereinafter called the Ordinance). It is pertinent to point out here that Azra Feroze Bakhat has based her decision on the finding given by Mr. Abdul Aziz Khalid in the appeal relating to the year 1985-86.
3. Being dissatisfied with the decision of the abovenamed Commissioners of Wealth Tax (Appeals), the Department has invoked the jurisdiction of the Tribunal for the redress of its grievance about not including the assets of the assessee's minor daughter in her net wealth.
4. We have heard the learned Legal Advisor, Mr. A.H. Najfee, and the learned counsel for the respondent, Mr. Siraj-ud-Din Khalid. The record has also been examined with their assistance.
5. The learned Legal Advisor of the Department has drawn our attention to Explanation (1) under clause (m) of section 2 of the Act and stated that the assets of the respondent's minor daughter have to be included in her own net wealth because any property owned by any minor child of the assessee shall be deemed to belong to the assessee. Advancing his arguments further, he has maintained that although the grandmother of the- minor had been appointed as the guardian of her person, yet the case of the respondent is squarely covered by Explanation (I) to clause 2 (m) ibid, that the Guardians and Wards Act, 1890, speaks of two distinct concepts of guardianship viz., the guardian of minor's person and guardian of a minor's property, that under the Guardians and Wards Act, two separate persons may be appointed as the guardian of person and the guardian of property of a minor or one person may be appointed in both these capacities, that whatever may be the situation, the guardian of minor's person alone has nothing to do with the property of minor and is not legally competent to deal with it in any manner; and, similarly, the guardian of minor's property alone has to no concern with the person of the minor, that the mother of the assessee being the guardian of only the person of minor Rabia Hassan, has nothing to do with the property of the minor and, for this reason, the provisions of section 21 of the Act are not attracted to the facts of the instant case, that it is the guardian of a minor's property whose existence is recognized by. section 21 of the Act for the purpose of assessing the minor's assets separately in his hands and in that event the guardian of the minor's property would be liable to the tax levy and the recovery of the tax due in the like manner and to the same extent as it would be leviable upon and recoverable from the minor if of full age, as visualized by subsection (3) of section 21 of the Act and that one-half share of minor, Rabia Hassan, having been wrongly excluded from the net wealth of the respondent, the orders appealed against may be vacated and those of the .assessing officers restored.
6. Before touching the merits of the case, the learned counsel for the respondent has raised a preliminary objection regarding the maintainability of appeals. We will dispose of this objection in the first instance.
7. Referring to Rule 12 of the Income Tax Appellate Tribunal Rules, 1981, the learned counsel for the respondent has stressed that it was the duty of the appellant to send to the respondent a copy of the memorandum of each appeal and grounds of appeal before the institution thereof in the Tribunal and that the failure to comply with this obligatory requirement has rendered the appeals liable to outright dismissal. In reply to this argument, the learned Legal Advisor of the Department has pointed out that the needful was done at the proper stage, as is evident from the certificate to this effect submitted by the Department in terms of Rule 12 ibid. .
8. Section 114 of the repealed Evidence Act, 1872, related to presumptions by Courts as to the existence of certain facts. It was identical in terms to section 129 of its successor enactment, i.e. Qanun-e-Shahadat, 1984 (President's Order No.10 of 1984), which lays down that the Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case. Illustration (e) under this section (which also existed in section 114 of the erstwhile Evidence Act, 1872) is to the effect that the Court may presume that a judicial and official acts have been regularly performed. It is clear, therefore, that a presumption of correctness attaches to all judicial and official acts done by the functionaries concerned in the ordinary course of their public duties. This presumption is, however, rebuttable, as held in PLD 1982 (Azad J&K) 54. It is a hard fact that, unfortunately, the respondent has not brought on record any material to negate the verity of the certificate furnished by the Department touching the controversy generated by the preliminary objection set up on behalf of the respondent as to the maintainability of appeal for want of due compliance with Rule 12 ibid. The onus clearly and heavily fell on the respondent to disprove and smash by cogent and strong evidence the contents of the certificate reflecting on proper adherence by the Department to the, requirement of Rule 12 ibid about the supply of copies of the memorandum and grounds of appeal by an appellant to the respondent before filing of appeal. .
9. On a perusal of the certificate, we find that the objection of the learned counsel for the respondent is not sustainable. Being a public document prepared in the ordinary course of official business, a presumption of truth attaches, in the peculiar circumstances of the instant case, to what has been mentioned in the certificate. It cannot, therefore, be urged with any justification that the appeals merit straightaway rejection on account of the violation of a mandatory provision of the said Rules. The objection is accordingly overruled.
10. Arguing on merits, the learned counsel for the respondent has contended that there is nothing wrong with the assailed orders of the appellate authorities below because the gift having been accepted by the grandmother of minor, Rabia Hassan, and the lady having been appointed as the minor's guardian, the share of the minor in the said house had to be assessed in the hands of the guardian, Mrs. Iqbal Begum, in terms of subsection (3) of section 21 of the Act and that the assets of minor, Rabia Hassan, cannot legally be clubbed with those of the respondent for the purpose of wealth tax assessment of the latter.
11. After a careful appraisal of the averments of the learned representatives of the parties, we find ourselves in complete agreement with the learned Legal Advisor of the Department. Under the scheme of the Guardians and Wards Act, 1890, there is a water-tight division of the authority of a minor's guardian of person and guardian of property. The one cannot assume the duties and functions of the other. This holds good even where the same person has been appointed in duel capacity. In the case presently before us, the grandmother of minor Rabia Hassan, has been appointed by Court as the guardian of her person alone, and as such, she enjoys no legal existence or authority in respect of her property. There is no controversy about the factum of gift and minor Rabia Hassan's ownership of one-half share in the aforesaid house No. 100-A on the basis thereof. Although minor, Rabia Hassan, enjoys unimpeachable title with respect to her one-half portion in the house, the fact remains that it has to be assessed in the hands of her mother, the respondent, in terms of Explanation (1) to clause (m) of section 2 of the Act. We are unable to appreciate the point sought to be made by the learned counsel for the respondent with reference to subsection (3) of section 21 of the Act. This subsection cannot be construed in isolation and has to be considered conjunctively with the entire text of section 21 of the Act. What sub section (3) of section 21 (ibid) signifies is that the guardian of a minor's property would be treated as having stepped into the shoes of the minor as regards the levy and recovery of wealth tax. It does not, in any manner, empower . the guardian of a minor's person to deal with the minor's property and this provision cannot also be stretched in support of the plea that the assets of a minor have to be assessed in the hands of the guardian of the minor's person and are not to be clubbed with the net wealth of the minor's father or mother.
12. In view of above discussion, we accept the departmental appeals, vacate all the impugned orders of the learned Commissioners of Wealth Tax (Appeals) and restore the assessment orders for all the charge years under consideration.
M.BA./1201/TAppeals accepted