1995 P T D (Trib.) 523

[Income-tax Appellate Tribunal Pakistan]

Before Nasim Sikandar, Judicial Member,

Iftikhar Ahmad Bajwa and Ihsan Ellahi Sheikh Accountant Members

I.T. As. Nos.8163/LB of 1991-92 and 202/LB of 1994, decided n 23rd November, 1994.

Per Nasim Sikandar, Judicial Member---

(a) Interpretation of statutes---

---- Statute must be construed according to the plain meaning of the words that are used in it.

36 IA 148 and 67 IA 416 ref.

(b) Interpretation of statutes---

---- When meaning of the words are clear and plain, Courts cannot refuse to give effect to the same on equitable consideration or on the ground that such construction would cause hardship.

36 IA 148 and 67 IA 416 ref.

(c) Income-tax---

----Appeal---Right of appeal is not a mere matter of procedure, it is a vested substantive right which cannot be created by way of implication and when allowed is confined within the statutory provisions.

CIT, Punjab v. Ram Lal Mansikh Rai (1970) 77 ITR 964; Deen Dayal Goyal v. ITAT 158 ITR 391 and PLD 1957 SC (Ind.) 448 ref.

(d) Income-tax---

----Appeal---In case of right of appeal, benefit has to go to person seeking appeal when there is doubt about existence of such a right.

Muhammad Hussain v. A.D.J., Lahore PLD 1966 (W.P.) Lah. 128;

(e) Income-tax---

----Appeal---Right of appeal cannot be taken away except by an express provision or by necessary implication.

PLD 1957 SC (Ind.) 448 ref.

(f) Interpretation of statutes---

---- Mistakes in statutes are not normally be assumed and substantial alteration in itself will amount to legislation and not construing of a statute.

Burmah Oil Co. Ltd.'s case PLD 1961 SC 452 ref.

(g) Interpretation of statutes---

---- Court only in case of ambiguity is entitled to ascertain the intention of legislature by construing the provisions of a statute as a whole and taking into consideration other maters and circumstances which lead to the enactment of statute.

Lt.Col. Muhammad Amir Khan v. The Controller, Estate Duty etc. PLD 1961 SC 119; Crawford on Statutory Construction and Maxwell's Interpretation of Statutes distinguished.

(h) Interpretation of statutes---

---- Beneficial construction, rule of ---Application.

The rule of beneficial construction comes into play only when the language of the statute is so ambiguous that two constructions are equally or almost equally possible. Where the language of the statute is, however, plain and unambiguous the rule of beneficial construction has no applicability.

It is a cardinal principle applicable to all kinds of statutes that one may not for any reason attach to a statutory provision a meaning which the words of that provision cannot reasonably bear. If they are capable of more than one meaning then a person can choose between these meanings but beyond that one must not go.

PLD 1951 FC 118; Pakistan Textile Mill Owners' Association, Karachi v. Administrator of Karachi PLD 1973 SC 137; Jones v. Director of Public Prosecution (1962) AC'635; 1 All ER 569 (HL) and PLD 1958 SC (Ind.) 308 ref.

(i) Interpretation of statutes---

---- Intent of legislature as manifested by the words used in the statute must be given effect.

(j) Interpretation of statutes---

---- Ambiguity in a statute---Meaning---Provision in a statute is to be held ambiguous only if it contains a word or phrase which in that particular context is capable of having more than one meaning---Court cannot first create an artificial ambiguity and then try to resolve it by taking resort to some general principles of interpretation.

By an ambiguity is meant a phrase fairly and equally open to diverse meanings. Where the language is of doubtful meaning or where an adherence to the strict letter would lead to injustice, hardship or to contradictory positions, it becomes the duty of a Court to ascertain the true meaning. In fact it is this area of legislative ambiguities that Courts have to fill in the gaps, clear the doubts and remove the hardships.

A provision is to be held ambiguous only if it contains a word or phrase which in that particular context is capable of having more than one meaning.

It is not permissible first to create an artificial ambiguity and then try to resolve it by taking resort to some general principles of interpretation.

1988 PTD (Trib.) 734; Kirkness v. John Huston and Co. Ltd. (1955) 2 All ER 345 and CIT, Madras v. Indian Bank Ltd. AIR 1965 SC 1473 ref.

(k) Interpretation of statutes---

---- Courts, in certain situations can supply or modify the language of the statute but subject to a number of qualifications.

(1) Income-tax---

----Appeal---Right of appeal to a party to proceedings is invariably a creation of a statute and, therefore, can never be a matter of Judicial discretion to allow or deny such right.

PLD 1961 SC 403; Maple Leaf Cement v. The Controller of Central Excise and Sales Tax 1993 MLD 1645; Pakistan through Secretary, Ministry of Defence v. The General Public PLD 1989 SC 6 and CIT, Peshawar v. M/s. Siemens A.G. PLD 1991 SC 368 ref.

(m) Income-tax---

----Appeal to Appellate Tribunal---Tribunal has to perform their functions as prescribed by law---Expression of own views about evils prevailing in the country are not desirable.

Sui Gas Transmission Co. Ltd. v. The Islamic Republic of Pakistan and 2 others PLD 1959 SC 66 and Malik Shoukat Ali Dogar and others v. Ghulam Qasim Khan Khakwani PLD 1994 SC 281 ref.

(n) Income tax Ordinance (XXXI 1979)--

----S. 134(1)---Words "having the effect of in S. 134(1), Income Tax Ordinance, 1979---Connotation and impact

Stroud's Judicial Dictionary, 3rd Edn., p.923 ref.

(o) Interpretation of statutes---

---- Courts are not supposed to question the motives or policy of the legislature or to refuse to give effect to legislation merely because it appears to be harsh or unreasonable or vindictive---Plain duty of Courts is to ascertain the intention of legislature and to carry it out irrespective of the consequences that may ensue to a particular party.

The Punjab Province v. Malik Khizar Hayat Tiwana PLD 1956 FC 200 ref.

(p) Interpretation of statutes---

---- Matter must depend on the wording of the section and not upon the consequences, which follow.

Iron and Steel Company Ltd. v. CIT (1943) ITR 328 ref.

(q) Income Tax Ordinance (XXXI of 1979)---

----S. 66-A---Cancellation of assessment---Effect.

Ibrahim Khan and others v. Mehr Mumtaz Hussain Lali, ADJ, Sialkot PLD 1979 Lah.524 ref.

(r) Income Tax Ordinance (XXXI of 1979)---

----S. 134(1)---Appeal to Tribunal---Maxim: "Expressio unius est exclusio alterius"---Application.

Ghulam Sarwar v. Pakistan PLD 1962 SC 142 ref.

(s) Income-tax---

----Practice, and procedure---Practice which is not supported by law cannot have any legal validity---Any alleged practice of the Department, therefore, cannot negate the provisions of the statute.

Central Insurance Co. v. C.B.R. 1993 SCMR 1232 = 1993 PTD 766; Nazir Ahmad v. Pakistan and 11 others PLD 1970 SC 453 and Asian Food Industries Ltd. v. Pakistan 1985 SCMR 1753 ref.

(t) Maxim---

-----Cursus curiae lex curiae"---Application of maxim---Scope.

(u) Appeal---

----Vested right of appeal---Principles.

Colonial Sugar Refining Company Ltd. v. Irving 1905 AC 369; R.M. Seshadri v. Province of Madras AIR 1955 Bom. 287 and AIR 1955 Bom.332 ref.

(v) Appeal---

---- Conferment of right of appeal or further appeal during pendency of case--?Effect.

Muhammad Ibrahim and others v. Mst. Surrayia-un-Nisa and others PLD 1992 SC 637; Sh. Muhammad Sadiq and another v. IA. Khan 1991 MLD 1205; SAO No.42 of 1991; Debi Prasad v. Phundan Lal AIR 1942 Oudh 291 ref.

(w) Interpretation of statutes---

---- Curative or remedial statute can be given retrospective effect.

Dilawar Hussain v. Province of Sindh PLD 1993 Kar. 578; QIT v. Shah Nawaz Ltd. 1993 SCMR 73 and Statutory Constructions by Grawford ref.

(x) Income-tax?

----Appeal---Retrospective application of amendment in the statute cannot validate the appeal---An act or action for which no statutory sanction existed at the time it was made, done or foreborne cannot be validated except by an express words of the statute which are not there in the amendment.

(y) Income Tax Ordinance (XXXI of 1979)---

----S. 134(1) [as amended by Notification No. S.R.O. 1163(1)/80 dated" 20-11-1980; Finance Ordinance (XXV of 1980) and Finance Act (XII of 1994), [preamble]--- Appeal---Effect of amendments in S.134(1).

Per Iftikhar Ahmed Bajwa, Accountant Member--

(z) Income Tax Ordinance (XXXI of 1979)---

----S. 134(1)---Notification NO.S.R.O.1163(1)/80 dated 20-11-1980---Finance Ordinance (XXV of 1980), Preamble---Finance Act (XII of 1994), Preamble--?C.B.R. Circular No.6 of 1994 dated 7-10-1994---Amendment in S. 134(1), Income Tax Ordinance, 1979 originally inserted by Notification NO.S.R.0.1163 (1)/80 dated 20-11-1980 issued under S. 167 of the Income Tax Ordinance, 1979 and later enacted through Finance Ordinance, 1981 was tainted by drafting omission as confirmed in C.B.R. Circular No.6 of 1994--[1993 PTD 1236 dissented from].

(aa) Interpretation of statutes---

----Taxing statute---Retrospective application of law---Parties to dispute, in income-tax proceedings, being citizens and the State, Courts generally favour liberal interpretation especially if it benefits the citizens and results in complete justice to the citizen.

(bb) Income Tax Ordinance (XXXI of 1979)---

----S. 134(1) [as amended by Notification No. S.R.O. 1163(1)/80 dated 20-11-1980; Finance Ordinance (XXV of 1980) and Finance Act (XII of 1994), Preamble & S. 66-A---Appeal to Appellate Tribunal---Amendment in S. 134(1) of the Income Tax Ordinance, 1979 being designed to soften the law in favour of tax-payers and unquestionably a remedial and curative measure to remedy the effect of a drafting error would apply to all pending proceedings---Orders under S. 66, Income Tax Ordinance, 1979 being contested before the Income Tax Appellate Tribunal which were pending proceedings, till the decision by the Tribunal on these appeals---Retrospective application of the amendment and adjudication of the appeals thus would not disturb vested rights of any party---Amended provision of S. 134(1), Income Tax Ordinance, 1979 therefore would govern the pending appeals as well.

Per Inam Ellahi Sheikh, Accountant Member agreeing--

Per Nasim Sikandar, Judicial Member, Contra--

Per Inam Ellahi Sheikh, Accountant Member--

(cc) Income Tax Ordinance (XXXI of 1979)---

----S.134-A [as amended] and S. 66-A---Appeal to Appellate Tribunal---Order under S. 66-A of the Income tax Ordinance, 1979 whereby an assessment was enhanced or a refund was reduced was appealable.

(dd) Income Tax Ordinance (XXXI of 1979)---

----S. 134-A [as amended] & S. 66-A---Appeal to Appellate Tribunal--?Tribunal can hear appeal against an order under S. 66-A of the Income Tax Ordinance, 1979 which has cancelled the assessment and does not result in enhancement of an assessment or reduction of a refund.

(ee) Income Tax Ordinance (XXXI of 1979)---

----S. 134-A [as amended] & S. 66-A---Appeal to Appellate Tribunal---Order under S. 66-A of the Income Tax Ordinance, 1979 is a continuation of the original proceedings whether it enhances the assessment, reduces the refund or simply cancels the assessment---Amendment introduced in S. 134(1), Income Tax Ordinance, 1979 by Finance Act, 1994 is fully applicable to all the pending appeals before the Tribunal.

(ff) Income Tax Ordinance (XXXI of 1979)---

----S. 134---Second appeal would lie under S. 134, income Tax Ordinance, 1979 [as it existed before amendment effected by Finance Act (XII of 1994)] where the order passed by the Inspecting Additional Commissioner under S. 66-A of the Ordinance cancels the assessment order.

Dr: Ilyas Zafar and Tahir Mahmood Butt for Appellants.

Zahid Pervaiz LA. and Muhammad Sadiq Butt, D.R. for Respondents.

Date of hearing: 5th October, 1994.

ORDER

NASIM SIKANDAR (JUDICIAL MEMBER).--The question to be considered by this Full Bench is stated as under:--

"Whether second appeal would lie under section 134 of the Income Tax Ordinance (as it existed before amendment effected by Finance Act (XII of 1994) where the order passed by the Inspecting Additional Commissioner under section 66-A cancels the assessment order."

2. The need for constitution of this Bench arose in view of an order of a Division. Bench of this Tribunal comprising Mr. AA. Zuberi, learned Accountant Member and Mr. Abrar Hussain Naqvi, learned Judicial Member (later the Chairman) dated 28-3-1992 in ITA Nos. 517 and 518/LB/1990-91 (assessment years 1988-89 and 1989-90) now reported as (1993) 68 Tax 166 (Trib.). Through that order two appeals filed by an assessee against the order of IAC cancelling the assessment orders in exercise of his powers under section 66-A were dismissed as incompetent. Before reaching the conclusion the Division Bench considered the history of legislation of section 66-A and the provisions of comparable section 34-A of the Repealed Act. The Division Bench also discussed at length the provisions of section 134(1) of the Ordinance which provide for appeals to the Tribunal and the impact of insertion of words "or an order made by Inspecting Assistant Commissioner under section 66-A" by way of Finance Act, 1981. The connotation and impact of words "having the effect of originally used for an order -passed by AAC under section 156 of the Ordinance and the subsequent insertion of the aforesaid phrase in section 134(1) of the Ordinance were also-considered. In this connection the learned Division Bench observed that:---

"There should be no doubt that the framers of the law from the very inception were clear in their mind that rectification under section 156 could be appealable if "the order enhances the tax or reduces the refund" and not otherwise. Therefore, the meticulousness with which the legislature inserted the word "or an order made by an IAC under section 66-A" after the words "having the effect" in section 134 clearly demonstrates their intention to confine appeals only against those orders by the IAC which had "the effect of enhancing the assessment or reducing a refund or otherwise increasing the liability of the assessee:

?3. The Division Bench concluded by saying:--

"What is to be firmly borne in mind is the striking similarity of expression used in sections 66-A and section 156 as also in section 134 of the Ordinance i.e. "enhancing or modifying the assessment", or "enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee". The anxiety of the legislature is so clearly evident that at the time of the original order adversely effecting a party, an opportunity of hearing is to be extended by the authority passing the order "(= AAC and IAC) and again appeal may also be filed to the Tribunal impugning order when the same is passed to the disadvantage of the party. It, therefore, flows from the preceding analysis that no appeal would lie where the AAC makes an order which rectifies any mistake which does not result in enhancing the assessment or reducing a refund or otherwise increasing the liability of the assessee. Likewise, an order under section 66-A will be appealable only when it "enhances or modifies the assessment" but not those covered by the second limb of subsection (1) of section 66-A resulting in "cancelling the assessment and directing a fresh assessment to be made". Had the legislature intended to make all orders under section 66-A appealable it could do so on the same pattern as in the repealed Income Tax Act, 1922. A different intention prevailed with the legislature is all the more manifest because this time in the Ordinance it consciously classifies the orders to be passed under section 66-A into two grouping: (1) those "having the effect of enhancing the assessment or reducing the refund or otherwise increasing the liability of the assessee", and (2) those "cancelling the assessment and directing afresh assessment to be made". While those falling in the former group are appealable, no such appeal lies against those falling in the later group. This interpretation appears to us to be reasonable and in harmony with the scheme of the Ordinance besides being in conformity with the history of enactment."

4. The appellant Farooq Baig is represented by Dr. Ilyas War, Mian Ashiq Hussain while Mr. Tahir Mahmood Butt represents the other appellant M/s. Mount Everest Public School. The Department is represented by Mr, Zahid Perviaz, LA and Mr. Muhammad Sadiq Butt, D.R. In the case of first appellant assessment for the year 1989-90 framed under section 59(B) of the Ordinance on 13-12-1989 at Rs.50,000 was cancelled by IAC/Range II, Zone A, Lahore on account of its being erroneous and prejudicial to the interest of Revenue In the other case Inspecting Additional Commissioner, Range II, Zone B, Lahore on 28-2-1994 cancelled the assessment for the year 1992-93 on similar grounds exercising his powers under section 66-A of the Ordinance. The Assessing Officers in both of the cases, were directed to frame fresh assessments in accordance with law. The view expressed through the aforesaid Division Bench being that no appeal lies to this Tribunal in such cases, we are called upon to reconsider the issue stated in the opening part of this order.

5. Learned counsel for the appellants as also the Legal Advisors for the department having had the benefit of going through the said order of the Division Bench of this Tribunal formulated their arguments in favour and against the proposition keeping in view the reasons and findings as contained in the said order.

6. Dr. Ilyas Zafar learned counsel for the appellant assisted by Mian Ashiq Hussain and Tahir Mahmood Butt supporting the proposition adopted following arguments for returning an answer in the affirmative:

"(a) That the words "or an order by an IAC under section 66-A" added in 1981 in section 134(1) were inserted at a wrong place due to draftsman's mistake and therefore the conveyed wrong impression should be ignored:

(b) That this Tribunal has all along been entertaining appeals under section 134(1) of the Ordinance against cancellation of assessment by I.AC.s after the aforesaid amendment and till the aforesaid decision and that the practice needs to be continued:

(c) That in any case simple cancellation of assessment order also has the effect of enhancing the assessment and therefore is appealable;

(d) That beneficial interpretation of this clause should be adopted keeping in view the whole provisions of section 66-A to allow right of appeal to an assessee rather than giving an unfettered power to an IAC:

(e) That in absence of a right of appeal there would be no forum available to judge the legality of exercise of powers under section 66-A which is conditional to the assessment order being erroneous in so far as the same is prejudicial to the interest of revenue as also the providing of an opportunity to the assessee in this regard; and

(f) That alternatively, the right of appeal having expressly been provided by the Finance Act 1994 and the ambiguity if there was any; having been done away with, pending appeals against cancellation have become competent:

7.???????? The Legal Advisor and the Departmental Representative, on the other and, submit:

"(i) That a right of appeal being a creation of a statute must be confined within the four corners provided by the statute;

(ii) That the words of statute are clear inasmuch as only a qualified right of appeal is available to the assessee and that a simple cancellation of assessment under section 66-A does neither amount to enhancement nor otherwise increases the liability of an assessee and, therefore, is not appealable;

(iii) That the stress being placed on the words "having the effect of is improper as the law concern itself with the immediate effect or result of an act rather than far fetched ,eventuality which may or may not occur,

(iv) That cancellation of assessment simpliciter is an "interim" order or at best akin to "remand" of a case whereafter none of the parties stand in an advantageous position against the other;

(v) That the legislature while amending section 134(1) having picked up only some of the powers given under section 66-A clearly indicated that right of appeal by an assessee was restricted only to the cases covered by it and the rest of powers including cancellation were left out of the ambit of appellate jurisdiction of this Tribunal;

(vi) That celebrated Golden Rule of interpretation of statutes should be pressed into service as here words of the statute are clear and need no indulgence of niceties of logic, reason or construction; and

(vii) That the amended provision allowing right of appeal to all orders under section 66-A being prospective only, pending appeals, cannot be benefited from and only those appeals will be competent which will arise on an order under section 66-A (including cancellation) rendered on or after first of July, 1994:

8. In order to clearly understand the scope of discussion, relevant provisions of section 134 (1) of the Ordinance pre- and post-amendment stating the four corners of appellate jurisdiction of this Tribunal(so far as relevant) are reproduced as under:--

Section 134(1). Appeal to the Appellate Tribunal.--(1) An assessee objecting to an order passed by an Appellate Assistant Commissioner under section 111 or 132, or subsection (2) of section 148, or an order made by the Appellate Assistant Commissioner under section 156 (or an order made by an Inspecting Additional Commissioner under section 66A) having the effect of enhancing the assessment or reducing a refund or otherwise increasing the liability of the assessee may appeal to the Appellate Tribunal against such order.

(2) ... .... .... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ..

(3) ... ... .... .... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ..

(4) ... ... ... ..... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ..

(5) ... ... ... ..... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ..

(6) ... ... ... ..... ... . . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ??

As indicated earlier, section 66-A was introduced in the Ordinance in 1980 and consequent thereupon, the phrase underlined in section 134(1) was introduced in 1981. Through an amendment brought about by the Finance Act (XII of 1994) the underlined phrase has been omitted from its present place and suffixed to the words "liability of the assessee". The amended section 134(1) from first of July, 1994 therefore reads as under:--

"134. ?? Appeal to the Appellate Tribunal.--(1) An assessee objecting to an order passed by an Appellate (Additional Commissioner) under section 111 or 132, or subsection (2) of section 148 or an order made by the Appellate (Additional Commissioner) under section 156, having the effect of enhancing the assessment or reducing a refund or otherwise increasing the liability of the assessee or an order made by an Inspecting Additional Commissioner under section 66 A may appeal to the Appellate Tribunal against such order".

The effect of this change shall be taken up after discussing the provisions as these stood before the amendment.

9. After hearing the parties and going through the provisions of the above-quoted sections, it is clear that different meaning are being assigned by the parties to the same (unamended) words of the statute. The department sees no right of appeal conferred upon an assessee in case of an order under section 66-A which does not enhance the assessment or reduces a refund or otherwise increases the liability of an assessee. According to them mere cancellation of an order neither enhances the amount (nor reduces a refund) nor it results into increasing the liability of an assessee and therefore it is not appealable according to the scheme of section 134(1) of the Ordinance that prevailed before the amendment. Learned counsel for the assessees supporting the proposition think this interpretation to be restricted and narrow view of the word "having the effect of.? ?In their view these words are purposely used to include not only direct and express orders of enhancement of assessment or increase of liability but also those cases in which an enhanced assessment is covertly or overtly directed or desired. It may be expressed that none of the parties before us dispute that in a case of cancellation which is coupled with a direction or an observation e.g. for application of a higher G.P. rate, the order will be one of enhancement of assessment and therefore, appealable before this Tribunal. Hence our reported decision cited as 1963 PTD (Trib.) 113.

10. The contention of the Revenue that a statute must be construed according to the plain meaning of the words that are used in it, otherwise called "Golden Rule of Interpretation of Statutes", has to be granted on the face of it. The discussion on the case-law cited by the department would however, be an unnecessary repetition of the principle as laid down in 36 IA 148 at 166 and 67 IA 416 at 426. The proposition that when meaning of the words are clear and plain, Courts cannot refuse to give effect to the same on equitable consideration or on the ground that such construction would cause hardship is also established beyond doubt. Their other submissions that right of appeal is not a mere matter of procedure and that it is a vested substantive right which cannot be created by way of implication and when allowed is confined within the statutory provisions are again recognized dictums of law. Therefore, the reliance of the department on cases CIT Punjab v. Ram Lal Mansikh Rai cited as (1970) 77 ITR 964, Deen Dayal Goyal v. ITAT 158 ITR 391 and PLD 1957 SC (India) 448 also needs no detailed discussion. Likewise the contentions of the learned counsel for the appellant based upon the principle enshrined in the reported cases cited as PLD 1966 (W.P.) Lahore 128 re: Muhammad Hussain v. ADJ Lahore PLD 1966 (WP) Lahore 684 re; Wahid Bus v. Afzal Transport and others and 1982 137 ITR 176 re; CIT Orissa v. Ravi Talkies that in case of right of appeal benefit should go to person seeking appeal when there is a doubt about existence of such a right can hardly be contradicted. So also their assertions that right of appeal cannot be taken away except by an express provision or by necessary implication as laid down in PLD 1957 SC (India) 448. However, the appellant's contention that unamended provisions of section 234(1) of the Ordinance clearly, or by implication provided for a right of appeal against simple cancellation of assessment order remains to be answered.

11. The nature and legislative history of section 66-A and the amendment in section 134(1) of the Ordinance in the year 1981 in the background of similar provisions in the repealed Act of 1922 having already been dealt with at length in the said order of the Division Bench, no useful purpose will be served by repeating them. The Department has referred to and supported the order of the Division Bench on the ground that every order under section 34-A of the Act (which is equivalent to section 66-A) was appealable under section 33 of the Act; that at the time of promulgation of the Ordinance no provision for exercise of revisional powers was provided for and that when it was actually provided for under section 66-A, the legislature unlike section 33 of the Act deliberately did not allow appeal against all the orders passed under section 66-A which was introduced in place of 34-A. The contention of the present appellant that earlier all the orders made under section 34-A were appealable under section 33 of the Act and that the confusion in this regard occurred only due to inadvertence or faulty draftsmanship which chose wrong place to insert the words "or an order made by an Inspecting Assistant Commissioner under section 66A" in the section after the words "section 156" thereby seemingly adopting all the qualifications basically prescribed for orders under section 156 of the Ordinance cannot be accepted because that would amount to imputing incompetence to legislature. The reliance of the appellants on PLD 1965 SC 139 re: Nazir Hussain Shah v. The State to say that in case of change in provision, history purpose and mischief which was intended to suppress should be given regard to while discovering the intention of the legislature and that per PLD 1961 SC 403 re: Pakistan Tobacco Co. Ltd. v. Pakistan Tobacco Co. Employees Union, Dacca and others, set up and context of statute may be examined for ascertaining its meaning will not help them either because the language of the statute is absolutely clear and does not admit of any ambiguity for invocation of these methods of interpretation of statutes. In PLD 1961 SC 452 re: Burmah Oil Co. Ltd their Lordships of the Supreme Court held that mistakes in statutes should not normally be assumed and the substantial alteration in itself will amount to legislation and not construing of a statute. Pressing in service of C.B.R. Circulars No.7 of 1981 and 15 of 1980 will also not help the appellants in any way. These were intended to explain addition of section 66-A in 1980 and of the abovesaid phrase in section 134(1) of the Ordinance.

12. Next contention of the appellant is that keeping in view the earlier similar provisions in the repealed Act and their subsequent introduction in the Ordinance justifies invoking of "beneficial interpretation" in favour of the appellant. In this connection learned counsel for the appellants rely upon a host of case-law including the cases reported as PLD 1966 (WP) Lahore 1.28 re: Muhammad Hussain v. Rehmat Ullah, PLD 1966 (WP) Lahore 684 re: Wahid and Mailsi Transport Co. to contend that in case of any doubt as to existence of right of appeal the same ought to be resolved in favour of party seeking appeal. It is further contended that in similar situations the Courts are even competent to modify the language of statutes in order to give effect to the manifest intention of legislature, which in this case clearly pointed out towards a right of appeal to the aggrieved assessee in case of cancellation of assessment. Reliance in this regard is placed upon PLD 1961 SC 119 re: Lt: Col Muhammad Amir Khan v. The Controller Estate Duty etc. wherein their Lordships of the Supreme Court discussed Crawford on Statutory Construction and Maxwell's Interpretation of Statutes and certain reported cases to conclude that a Court may even modify the language of statute to give effect to the manifest and undoubted intention of legislature. None of these reported cases, however, lend any support to the contention of the appellants who are simply presuming one thing without its existence and then building up myriad of further contentions not at all relevant to the point in issue. There is no dearth of case-law on the subject that it is only in case of ambiguity that a Court is entitled to ascertain the intention of legislature by construing the provisions of a statute as a whole and taking into consideration other matters and circumstances which lead to the enactment of statute. As to the contention of the appellant that rule of "beneficial construction" should be adopted we seek guidance from a reported case of Federal Court of Pakistan cited as PLD 1951 FC 118 wherein it was laid down that "The rule of beneficial construction comes into play only when the language of the statute is so ambiguous that two constructions are equally or almost equally possible. Where the language of the statute is however plain and unambiguous the Rule of beneficial construction has no applicability". Another case reported as PLD 1973 SC 137 re: Pakistan Textile Mill Owners' Association, Karachi v. Administrator of Karachi supports this view. The duty of Courts in this connection cannot be better explained than quoting Lord Ried in his address to the House of Lords in re: Jones v. Director of Public Prosecutions (1962) AC 635 at 667-1 All E.R. 569 (HL), "It is cardinal principle applicable to all kinds of statutes that you may not for any reason attach to a statutory provision a meaning which the words of that provision cannot reasonably bear. If they are capable of more 'than one meaning then you can choose between these meaning but beyond that you must not go". Further reference in this connection to a case reported as PLD 1958 SC (Ind.) 308 will suffice. By adopting the arguments that the above?said phrase" or an order made by an Inspecting Assistant Commissioner under section 66-A" was inserted at a wrong place in a way amounts to an admission that the words of the statute as they stand do not admit of a right of appeal to the assessee in case of cancellation of assessment. In both of the cases relied upon by the appellant the stated principles were laid down after the Courts concluded that existing words of the statute were either ambiguous or were leading to a manifest contradiction of the purpose of the enactment or to some inconvenience or absurdity, hardship or injustice presumably not intended. A plain reading of the provisions of section 134(1) of the Ordinance (as these existed before the said amendment) does neither create any confusion in the mind of the reader nor its practical implications lead one to an absurdity. In this connection we will repeat our view expressed in 1988 PTD (Trib) 734 that intent of the legislature as manifested by the words used in the statute must be given effect. In this case it was laid down that "a provision is' to be held ambiguous only if it contains a word or phrase which in that particular context is capable of having more than one meaning". As to what amounts to an ambiguity we relied upon a decision of House of Lords in (1955) 2 ALL E.R. 345 at 366 in re: Kirkness v. John Huston & Co Ltd wherein it was held:

"By an ambiguity is meant a phrase fairly and equally open to diverse i meanings. Where the language is of doubtful meaning or where an adherence to the strict letter would lead to injustice, hardship or to contradictory positions, it becomes the duty of a Court to ascertain the true meaning. In fact it is this area of legislative ambiguities that Courts have to fill in the gaps, clear the doubts and remove the hardships."

In this case we also quoted the warning by the Indian Supreme Court in the CIT Madras v. Indian Bank Limited AIR 1965 SC 1473 that it is not permissible first to create an artificial ambiguity and then try to resolve it by taking resort to some general principles of interpretation.

13. Looking at the provisions from this angle we do not find them to be either ambiguous or otherwise feel obliged to stretch them to the extent of reading a right of appeal against cancellation of assessment. The kind of right the appellant is looking for is simply not there. The contention that in certain, situations Courts can supply or modify the language of the statute is not contradicted. But such an eventuality is clearly subject to the existence of a number of qualifications none of which exists in this situation. In this case we neither find any inconvenience nor injustice in not allowing the right of appeal by the legislature to an assessee against simple cancellation who will always be entitled to two appeals as provided under the Ordinance after framing of fresh assessment. Even otherwise, academically speaking, this Tribunal being of a special and restricted jurisdiction cannot exercise these powers as contemplated in PLD 1961 SC 403 (supra) which obviously refers to Superior Courts of record. Same will be our answer to the contentions of the assessee based upon the ratio of reported cases PTCL 1993 CL 656 re: Maple Leaf Cement v. The Controller of Central Excise and Sales Tax (Appeals) Lahore and others PLD 1989 SC 6 re: Pakistan through Secretary, Ministry of Defence v. The General Public and PLD 1991 SC 368 CIT, Peshawar v. M/s Siemens A.G. In the first case a Single Bench of the Lahore High Court inter alia held that in Islamic polity and system of dispensation of justice the right of appeal is a natural right vesting in an individual which cannot be taken away even by a provision in the enactment. His Lordship (Justice Muhammad Qayyum) referred to and relied upon the views expressed by the Supreme Court of Pakistan in the second case stated above re: Pakistan through Secretary of Defence v. The General Public (supra). In that case the Supreme Court (Shariat Appellate Bench) found the remedy of review provided against decision of a Court Martial by various legislations governing the Armed Forces to be not equivalent to a right of appeal. Considering the position to be a denial of right of appeal and therefore, repugnant to the Injunctions of Islam the Court directed necessary amendments to be carried out in these statutes. In the third case of M/s. Siemen A.G. the Supreme Court held that so long the existing statutes are not brought in conformity with the Injunctions of Islam their interpretation application and enforcement, wherein discretionary Judicial elements are involved only that course should be adopted which is in accord with the Islamic philosophy, its common law and jurisprudence. In this case the words, "wherein discretionary judicial elements are involved are the key as far the direction of Court is concerned. It hardly needs emphasis that a right of appeal to a party of proceedings is invariably a creation of a statute and, therefore, can never be a matter of judicial discretion to allow or deny such right. In all these cases their Lordships in exercise of their Constitutional jurisdiction arrived at these conclusions and made the directions. Even if we were convinced of the alleged injustice in the situation before us, we would have refused to act as a social, moral or legal reformers. The Supreme Court of Pakistan in PLD 1959 SC 66 (Lah.) re: Sui Gas Transmission Co. Ltd. v. The Islamic Republic of Pakistan and 2 others disapproved such an attempt by the Labour Appellate Tribunal. Their Lordships announced in no uncertain words that Industrial Tribunal was not to act as a benevolent despot or on its, own ideas of social justice. In the Trichotomous Constitutional set up that we have Courts and Tribunal are to perform their functions as prescribed bylaw. An attempt by any Tribunal however so high to do perfect justice is vanity according to the Supreme Court in re. Allahdino v. Fakir Muhammad and another PLD 1969 SC 582. Their Lordships of the Supreme Court rather P appreciated even the expression of (High Court's) Judges own views about the evils prevailing in the country and ordered expunction of such remarks in PLD 1994 SC 281 re: Malik Shaukat Ali Dogar and others v. Ghulam Qasim Khan Khakwani. Thus the edicts of judicial self-restraint, as we understand them in common law system were never as relevant for adherence as these are now.

14. The contention of the Revenue that only a qualified right of appeal has been given by the statute in case of exercise of powers under section 66-A is certainly correct. Their further submission that simple cancellation is not included in the qualifications as contemplated by the words of the statute is also beyond any doubt. The counter-arguments that cancellation of an assessment on the ground of its being prejudicial to the interest of Revenue itself means "enhancement" or a "direction" for framing the assessment at a higher amount and therefore conveniently covered by the phrase "having effect of is without any force. In this respect Mr. Ilyas War Advocate has placed a lot of stress on a reported case from Indian Jurisdiction. In Commissioner of Income Tax, Bombay v. Mangl Das Moti Lal and Company (1944) 12 ITR 89, the Commissioner of Income-tax acting under section 33 of the Income-tax Act (XI of 1922 before amendment) in exercise of his revisional powers which were similar to the powers' now conferred on IAC under section. 66-A of the Ordinance set aside the order of the Appellate Assistant Commissioner as also the ITO and the assessment proceedings with a direction to the ITO to make a further and fuller inquiry. In this case the ITO had earlier included in the assessment certain cash items which were considered formed part of the income of the assessee though the same was disputed by the assessee. On appeal before the Appellate Assistants Commissioner these cash items were held to be not forming part of the income of the assessee in the year of assessment. And therefore, the assessment was reduced to a large extent. The Commissioner of Income Tax issued a notice under section 33 of the Income?tax Act (before its complete substitution in 1939) and after hearing the party, set aside the order of both the Appellate Assistant Commissioner and the ITO to the stage where notices under various sections of the Act were issued and directed the assessing officer to "make further and fuller inquiry and give the assessee full opportunity to produce such evidence as they wish and then to proceed to assess in accordance with the provisions of the Act". Their lordships Beaumount and Chaghla, JJ. on reference under section 66(3) of the Income-tax Act answered the question "whether the order of Commissioner of Income Tax, Bombay, Sindh and Balochistan under section 33 of the Income Tax Act dated 15th April, 1940 is a valid order" in the negative. The main reason for answering the question in the negative was their Lordships agreement with the arguments of the assessee that the Commissioner was not competent to do some thing while exercising his revisional powers which involved enhancement of assessment unless he proceeded under section 34 of the Act. Their Lordships though agreed that the Commissioner had not himself enhanced the assessment, held;

?As I have already pointed out, it is obvious that the order is intended to result in the assessment as passed by the Assistant Commissioner being enhanced, if that is done, then the Commissioner has done exactly what Privy Council, and this Court, in the cases I have referred to, decided that he could not do, and he has in fact caused the assessment to be enhanced without regard, and contrary to the provisions of section 34 .... We must assume that the result of the new assessment would he to enhance the figure if that were not the result intended obviously the assessee would not object to it. But assesment that to be the result in my Judgment it is not competent to the Commissioner under section 33 to bring about that result.?

15. The findings in the case again do not support the averments of the appellants. Firstly the real matter in issue in that case was as to whether the Commissioner of Income tax was competent to proceed to order enhancement under section 33 after the lapse of a period of one year as provided under section 34 of Act empowering ITO to serve a notice upon an assessee expressing his intention to reopen the case. The Honourable Judges referred to a decision of the Privy Council and followed the same wherein it was held that revisional powers of Commissioner under section 33 were restricted in terms of the time limit of one year provided by section 34 of the Act. The Court noticed and referred to one of their earlier decided cases in which they had held that the Commissioner could not under section 33 of the Act himself enhance the assessment though he could direct the ITO to proceed under section 34 for the purpose of enhancing the assessment. Further, that an assessment could only be reopened in circumstances stated under section 34 or rectified under section 35 of the Income Tax Act and that both of these sections prescribed a certain time limit to proceed. The assumption of their Lordships that result of new assessment would be to enhance the figures are relevant only in that context. It is also to be seen that their Lordships twice used the word "assumed" in the aforesaid para which makes it clear that they were looking at the order of the Commissioner on account of its having been rendered in disregard of the time limit prescribed for such an action. It may also be noticed that no appeals to the Appellate Tribunal were provided for in the Repealed Income-tax Act of 1922 by that time and the concepts of finality of assessment and merger of original order into the appellate order had not yet undergone the changes which took place subsequently. Therefore, it is respectfully concluded that the "assumptions" arrived at in that case are not relevant as far the said contention of the appellant is concerned.

16. The appellants have also referred to dictionary meaning of the words "effect" in support of their claim that use of these words implied inclusion of "cancellation" in the appealable orders. It is stated that according to Stroud's Judicial Dictionary, third Edition, page 923, word "effect" has been described as "the effect of a cause: is anything which would not have happened but for that cause; and it is nonetheless effect of such cause because it has been developed or accelerated by something supervening". From this the learned counsel develops his argument that a cancellation order in itself is both effect as well as a cause of enhancement of assessment, and therefore, is appealable. However, the contention is not tenable. Firstly because, it is based upon a presumption that cancellation will always result into an enhanced assessment. And secondly, that it does neither find any support from the rest of the language of the provision nor a manifestation of legislative intent.

17. The words "having effect or' in my way of thinking simply mean resulting "directly" as used in section 134(1) of the Ordinance. The phrase has been used to cover only those cases wherein a direction to the assessing officer will result into an enhancement of assessment, reduction in refund or otherwise increase in the liability of the assessee without further proceeding or an exercise of a discretion by the Assessing Officer. This phrase has to be read alongwith the following three qualifications stated in the section and not in isolation thereof. A situation, as stated earlier, can conveniently be visualize wherein cancellation is ordered by an IAC which is coupled with a direction for application of a higher G.P. rate. The ITO in such situation would do nothing but to calculate the income at a higher rate and therefore, the cancellation order will have the "effect" of enhancement of assessment. In that case of course the framing of assessment would be a formality. There can also be a situation where the LAC may cancel an assessment under section 66-A on the ground of its having been framed in respect of one assessee instead of another. Will this cancellation have the effect of-enhancement, reduction in refund or increase in the liability of the assessee? if so, which of them? The one in whose aspect the assessment was framed and cancelled or the one who has been directed to be roped in instead. Obviously none of them.

18. The next contention that even a simple cancellation also amounts to a "desire" or "direction" for enhanced assessment is again repelled. For in case of simple cancellation the Assessing Officer will have to take some steps before he makes another assessment order which may either be repetition of the original assessment or otherwise not adverse to the interest of the assessee. Beyond this the phrase "having effect of " can neither be stretched nor be squeezed. Again, the submission that an assessment having been cancelled on the ground of its being prejudicial to the interest of Revenue will invariably result in a higher assessment of income is a mere contemplation and without any basis. The superior Courts have persistently held that guessing in law is neither permissible nor favoured where certainty is available. It cannot be refuted that after cancellation as long fresh assessment is not made, the assessee owes the Revenue nothing at all much less to say of an enhanced or increased liability. The suggestion that a cancellation will invariably result into a higher assessment and that framing of a higher assessment after a cancellation order will merely be a formality is only a fear which is not well founded. One cannot rule out the possibility that after cancellation of assessment by the IAC on account of a doubt about a particular transaction, the Assessing Officer can again conclude that the same either did not fall in the ambit of income or was otherwise reflected and duly considered in the original assessment. To the objection that reassessment would only be formality we are of the view that law does take into account the formalities and meticulously considered the form and content. No appeal can lie against an order which has not attained a form and exists only in the mind of the authority or a Judge, howsoever a party is sure of the result till the order has actually seen the light of the day and is reduced into black and white, signed and announced. A subjective order can neither be, a subject of appeal nor implementation.

19. The next contention of the appellant that acceptance of the, view of Revenue would result in harshness towards the assessee and giving unfettered powers to the Revenue Officers without a check is not tenable at law because the same amounts to challenging the wisdom of legislature. The Federal Court of Pakistan in a case reported as PLD 1956 FC 200 re: The Punjab Province v. Malik Khizar Hayat Tiwana held that "it is not for the Courts to question the motives or policy of the legislature or to refuse to give effect to legislation merely because it appears to be harsh or unreasonable or vindictive. The plain duty of Courts is to ascertain the intention of legislature and to carry it out irrespective of the consequences that may ensue to a particular party". Reference in this regard may also be made to the observation of Lord Porter as made in 1943 ITR 328 (at 339) re: Iron and Steel Company Limited v. CIT "the matter must depend on the wording of the section and not upon the consequences which follow".

20. It is further submitted that exercise of jurisdiction under section 66-A is conditional with the existence of at least two circumstances. Firstly that the assessment order is erroneous in so far as it is prejudicial to the interest of Revenue and secondly, that the assessee is provided an opportunity of being heard. According to the appellants, in case an assessee is held not entitled to file an appeal against cancellation then who will judge the legality of exercise of such powers in the context of the aforesaid two pre-conditions? According to them acceptance of a right of appeal to an assessee is all the more necessary and closer to the concept of justice and fairplay so that an assessee can have a remedy if the IAC exercises the power of cancellation arbitrarily and without a regard for the pre-conditions attached. The learned Legal Advisor of the department on the other hand contends that this argument itself provides explanation for the intention of the legislature in not providing for an appeal as an assessee is not adversely effected by simple cancellation. And, that in cases where he is adversely effected in three ways, enhancement of assessment, reduction of refund or an increase in liability, not only the order of enhancement etc but also the availability or non-availability of both of the pre?conditions could be challenged before this Tribunal under section 134. The submissions of the learned Legal Advisor for the Revenue appear cogent and relevant as the intention of the legislature in regarding cancellation to be not adverse to an assessee becomes all the more evident in these circumstances.

21. The Revenue has attempted to draw a parallel between cancellation of an assessment under section 66-A and remand of a case for retrial for a fresh decision by a lower Court. In this connection reliance has been placed upon PLD 1979 Lahore 524 re: Ibrahim Khan etc. v. Mehr Mumtaz Hussain Lali, A.D.J., Sialkot to contend that after being set aside a decision of lower Court no more holds the field nor it benefits any of the parties and that the comments and order resulting in remand has no binding force on the Courts below. On the basis of the reported case it is argued that cancellation of assessment by an IAC in exercise of his' powers under section 66-A is only a tentative decision, is not detrimental to the interest of the assessee and, therefore, cannot be said to have prejudiced the rights of the assessee. Without going into the characteristics and similarities of a remand and cancellations of assessment under section 66-A I am inclined to agree with the Revenue that once an assessment is cancelled the assessee is placed back in the position in which he was before framing of the assessment. And, in case of simple cancellation the observations and findings on the basis of which the order of cancellation took place are only of tentative nature. In such a situation the consideration of IAC in holding the assessment order to be prejudicial to the interest of revenue is by and large a "prima facie" conclusion of the facts needing further enquiry for clarity. Because, if he is positive of a particular transaction or material available on record he is himself empowered to order enhancement of assessment instead of simply cancelling it. Cancellation of assessment per se means that no order of assessment is in field irrespective of the ground on which it took place. Therefore, there is no question at all of increase in the liability of the assessee which is to be determined again and at later stage. The sole criterion is an immediate adverse effect to the interest of the assessee, and the legislative intent in this regard is easily discernible from the words of the statute.

22. The next contention of the Revenue that express mention of three situations in which appeal could lay under section 134(1) excludes any other kind of order including cancellation also finds support from the legal maxim expressio unius est exclusio alterius (express mention of one is the exclusion of another) sometimes worded as expressum facit cessare taciturn. The Supreme Court of Pakistan in re: Ghulam Sarwar v. Pakistan reported as PLD 1962 SC 142 held the dictum applicable in a somewhat similar situation. It was observed, "the question is, has the word "dismissed" been used in the Constitution Act of 1935 in the same sense as the words "dismissed" and "removed" have been used in Rule 49 of the Classification Rules read alongwith various other public service rules and regulations as the Classification rules do not define those words and merely use them in the context of disciplinary action. If the framers of the Constitution Act of 1935? intended to do so nothing was easier for them to say so The very fact that they have refrained from saying so while expressly adopting the Rules in respect of classification of various civil services leads to the irresistible conclusion that they have not adopted wholesale the provisions of Rule 49 and other Rules and regulations in order to give technical meaning to the term dismissal In this context the maxim "expressio unius est exclusio alterius" fully applies"

In the present set of things keeping in mind the wording of sections 33 and 34-A of the repealed Act of 1922 the manner and method of insertion of the said phrase in section 134(1) clearly giving only three classes of cases to be appealable, I will agree that the maxim applies to the situation with full force and therefore an attempt by the appellants to force another kind of order into the domain of appellate jurisdiction of this Tribunal must fail. For, if the legislature had intended to allow a right of appeal against cancellation as well, nothing was easier for, them to say so as it did later by way of the Finance Act of 1994.

23. The contention of the appellants that ever since the aforesaid amendment in 1981 in section 134(1) of the Ordinance appeals against cancellation of assessments by IAC's were filed and entertained/adjudicated upon by this Tribunal needs to be considered. This contention was repelled by the said Division Bench on the ground that a practice which is not supported by law cannot have any legal validity.

24. These observations find support from a recent ruling of the Supreme Court of Pakistan in re: Central Insurance Company v. C.B.R. 1993 SCMR 1232 = 1993 PTD 766. The question before the Court was if interest income from Khas Deposit Certificates was exempt. The treatment of such income in the hands of the insurance Companies by the department during the past four decades was pleaded as practice and reliance was placed upon PLD 1970 SC 453, Nazir Ahmed v. Pakistan and 11 others and 1985 SCMR 1753 Asian Food Industries Ltd v. Pakistan. The contention was rejected for the reason that any alleged practice of the department could not negate the provisions of the Ordinance. Maxim Cursus Curiae Lex Curiae, the practice of the Court is the law of the Court in my view has a very limited scope of application in the modern times. Not at all in the facts and circumstances before us.

25. Finally the effect of the aforesaid amendment in section 134(1) of the Ordinance through the Finance Act, 1994 allowing right of appeal to all orders rendered under section 66-A. According to appellants the right of appeal having been allowed while the appeals are still pending, these have also become competent and maintainable even if earlier these were not so. Reliance in this regard is placed upon AIR 1990 SC 499 re: Special Military Estate Officer v. Munivenkatarmiah, PLD 1957 SC (Ind.) 448 re: Garikapati Veeraya v. N. Subbiah Chaudhry and PLD 1969 Lah. 24 re: Essential Industries Lahore v. CBR.

26. In re: Special Military Estate Officer (supra) some lands belonging to the respondents were requisitioned by the Union of India under Defence of India Act, 1962. The Act pro-v7ded for determination of compensation to be paid to the owners of taken over properties by the competent authority, the Deputy Commissioner of the District. The Act also allowed a reference to the arbitrator whose award was final as no right of appeal was provided against it. The Defence Act was repealed on 10th January, 1968. Simultaneously the Requisitioning Act was amended and an existing section was substituted to provide that all properties requisitioned under the repealed Defence Act (except those already released before 10th January, 1968) shall be deemed to have been requisitioned by the competent authority under the provisions of the Requisitioning Act. Section 11 of this Act already contained a right of appeal to the High Court against the award of an arbitrator. The respondents, before repealing of the Defence Act were allowed compensation at a rate which was enhanced many a time by the arbitrator through an award made on June 30, 1971. The Military Estate Officer appealed to the High Court where objection of the land owners against maintainability of appeal against the awards succeeded and therefore, the appeal was dismissed. On further appeal the Supreme Court held that objection against the maintainability of appeal qua award relating to the period covering compensation before January 10, 1968 was valid but appeal against that portion of the award which related to the period after the said date on which the Defence Act was repealed was maintainable. The Court found that the determination for payment of compensation for the period of requisition before 10th January, 1968 shall remain unaltered as no right of appeal was provided in the Defence Act till that date of its repeal. As to the subsequent period, it was held to be a requisition deemingly under the Requisitioning Act which provided for an appeal against an award.

27. In Garikapati Veeraya (supra) a Full Bench of the Supreme Court of. India allowed a petition for special leave to appeal in the context of the effect of determination of its appellate jurisdiction by the Constitution of India coming into force on 26th January, 1950. The High Court of Andhra had earlier refused an application for leave to appeal to the Supreme Court. The suit out of which the leave petition arose was filed on 22 April, 1949 when there existed a Federal Court of India established under section 200 of the Government of India Act, 1935, the Indian Independence Act, 1947 read with the Federal Court (Enlargement of Jurisdiction) Act, 1947 (Act I of 1948) and the Abolition of Privy Council Jurisdiction Act, 1949. It was contended before the Court that the petitioner as from the date of institution of the suit acquired a vested right to appeal to the Federal Court since replaced by the Supreme Court. In this landmark case their Lordships examined the chain of case-law on the issue decided by the Court itself, its predecessor the Federal Court and all the High Courts of India; Beginning with the leading case on the subject re. Colonial Sugar Refining Company Ltd v. Irving 1905 AC 369 down to AIR 1955 Born 287 re: R.M. Seshadri v. Province of Madras and AIR 1955 Bom 332 re: Reference under section 5 of the Court Fees Act. On consideration of the plethora of case-law, these principles were held to have emerged:

(i) That the legal pursuit of a remedy, suit, appeal and second appeal are really but steps in a series of proceedings all connected by an intrinsic unity and are to be regarded as one legal proceeding;

(ii) The right of appeal is not a mere matter of procedure but is a substantive right;

(iii) The institution of suit carries with it the implication that all rights of appeal then in force are preserved to the parties thereto till the rest of the career of the suit;

(iv) The right of appeal is a vested right and such a right to enter the superior Courts accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgment is pronounced such right is to be governed by the law prevailing as the date of institution of the suit or proceedings and not by the law that prevails at the date of its decision or at the date of filing of the appeal; and

(v) This vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise.

28. As stated above the leave was allowed and Court held that the suit out of which the application arose having been instituted even before the enforcement of the Constitution of India, the parties thereto had, from the date of institution of the suit a vested right of appeal upon the terms and conditions then in force.

29. In re: Essential Industries (supra) a Division Bench of the Lahore High Court found that the right of appeal vested in the petitioners would be governed by unamended provision of law and that the petitioners would not be asked to deposit 50% of the tax before filing of appeal as required by the amended proviso to section 30(1) of the Act. The petitioners in that case were assessed at different sums on 30th day of June, 1967 in respect of the assessment year 1962-63. The assessment orders were received by the assessees in the month of July. In the meanwhile, on 30th of June, 1967 the Finance Act, 1967 substituted the proviso in section 30(1) of the late Act whereby the entertainment of an appeal by the AAC was subjected to a prerequisite of part payment of tax demands. It was argued by the petitioners that a new proviso had virtually taken away the right of appeal which was in nature of vested right. Their Lordships reviewed the case-law from local as well as from foreign jurisdictions including the famous case re: Colonial Sugar Refinery Company (supra). Main question considered by the Court was whether the proviso enjoining deposit of 50% of demand before an appeal to AAC could be filed was in the nature of procedural amendment or it affected right of appeal secured to the petitioners. It was finally found that the said amendment could not be taken to be of a procedural nature and therefore, it substantially effected the vested right of appeal of the petitioners. And, that in absence of any express provision or necessary intendment to give this amendment a retrospective effect, the amended provision of law could not be applied to the cases of the petitioners because the "lis" in their cases commenced on various dates in the year 1962 when no such restriction was placed on the right of appeal which made available to them under section 30(1) of the Act as it then stood.

30. As indicated earlier the facts in these cases are markedly different from those before us. Therefore, the principle settled in them cannot be extended to hold that an appeal filed before there being a right of appeal (as we have already held) will become competent after a change in law conferring a right of appeal. The second principle stated by their Lordships in re: Garikapati Veeraya (supra) is that institution of a suit carries with it the implication that all rights of appeal then in force are preserved to the parties thereto till the rest of the career of the suit. In re: Special Military Estate Officer, the right of appeal to pending action was acknowledged on the ground that requisition proceedings could be deemed to have been taken under another Act. The effect of amendment in requisitioning Act was held to have covered the period subsequent to the repeal of Defence Act when the properties were originally acquired. In re: Essential Industries (supra) the right of appeal vested in the appellants was held to be governed by the unamended provision of law. The finding of the Court in this case that amendment in substantive law has no retrospective effect in a way runs counter to the submissions of the appellant before us.

31. The Supreme Court of Pakistan in a recent case re: Muhammad Ibrahim and others v. Mst. Surrayia-un-Nisa and others PLD 1992 SC 637 has considered the effect of amendment in law conferring right of appeal during pendency of proceedings. In that case an ejectment petition under the Punjab Urban Rent Restriction Ordinance, 1959 was filed on 1-6-1989. Section 15(7) of the Ordinance provided that orders of the Rent Controller subject to the appeal before the District Judges would be final. While that petition was still pending before the Rent Controller on 6-6-1990 the Ordinance was amended to allow right of second appeal to the High Court to the tenants of "non?residential buildings". The premises which were subject-matter of litigation clearly attracted the application of amended law to the proceedings. The eviction petition succeeded and the appeal filed by tenant was also dismissed by the District Judge on 4-7-1991. Second appeal filed before the High Court on 20-7-1991 was dismissed by a Single Judge on the ground that it was not competent. The Supreme Court set aside the order of the Single Judge (which was earlier reported as 1991 MLD 1205 re: Sh. Muhammad Sadiq and another v. IA. Khan) and remanded the case to the High Court for a decision of second appeal on merits. While deciding the matter the Supreme Court took into consideration another case decided by a Single Judge of the same High Court delivered in SAO No.42 of 1991 wherein second appeal in similar circumstances was held competent. The decision in that unreported case followed the principle expounded by a Full Bench of-the Oudh Chief Court in re: Debi Prasad v. Phundan Lal, AIR 1942 Oudh 291. The distinction drawn by the learned Judge in unreported case between the situation where right of appeal (or further appeal) hitherto non-existent or was earlier taken away is conferred or restored in the course of pending proceedings found favour with the supreme Court. The Court agreed that if the law chooses to give or confer such right during the pendency of case there is no principle of law which prevents it from doing so as no rule of finality is interfered with. Also that prohibition of appeal by existing law at the time of institution of the suit or of "lis" does not amount to a substantive or existing right accruing to the parties. Therefore, the Court held that no right then enjoyed by the parties was affected when the right of second appeal was conferred on the parties through the said amendment.

32. The facts before us, however, do not warrant invocation of the ratio of even the last cited case in favour of the appellants. Most important factor being that according to our view no right of appeal was available to the appellant before the amendment brought about by the Finance Act, 1994. The appeals both before us and those earlier dismissed by the Division Bench were held to have been incompetent and not maintainable. This being so mere availability of right of appeal by the Finance Act, 1994 cannot clothe the pending appeals with maintainability in absence of a clear legislative intent. In my humble view the question before us is not even that of retrospective application of right of appeal conferred by the Finance Act, 1994. Retrospective application of right of appeal could benefit only if, keeping in view the ratio of the said judgment of the Supreme Court a valid proceeding or appeal was pending at the time of enforcement of the Finance Act. An order under section 66-A may partake some incidents of an appellate order, yet it is in essence and predominantly an original order. Therefore, since there were no matters pending at the time of recording of the orders on the date on which the concerned revisional authorities exercised their powers under section 66-A and cancelled the assessments, the transactions came to an end then and there. Neither any "lis" was in the field nor a pending proceeding, original or appellate on first day of July, 1994 when right of appeal was conferred by Finance Act, 1994. Mere filing of appeal against an order which is not appealable cannot amount to or be made relateable to the existence or pendency of a "lis". I may also add that pendency of civil proceedings cannot always be equated with the assessment proceedings. The existence or availability of the revisional jurisdiction under section 66-A is again not the same thing as pendency of a civil or criminal proceedings before a Court of the first instance to attract application of retrospective effect of the amendment. Because the concerned authority, IAC may never exercise his powers and practically only a very few cases of completed assessment are revised under section 66-A. Nor can we consider a "lis" to be pending during the limitation in which an IAC has the powers to revise an assessment order after it has been framed. Making of an order under section 66-A is therefore, the only factor to which a right of appeal could be related. And, that order being an original order not subject to a right of appeal at that time matured into a passed and closed transaction before the Finance Act, 1994 came into being on 30th day of June, 1994.

33. I have also considered the matter from the angle of the amendment in question being in nature of a remedial or curative nature. Their Lordships of the Karachi High Court though in PLD 1993 Karachi 578 re: Dilawar Hussain v. Province of Sindh found that remedial statutes as a genus are not retrospective, the Supreme Court of Pakistan in 1993 SCMR 73 CIT v. Shah Nawaz Limited quoted with favour para 282 of the "Statutory Constructions" by Crawford confirming that curative or remedial statutes could be given retrospective effect. However, the same hurdle has stood in our' way to treat both of the pending appeals as maintainable. Therefore, even retrospective application of the amendment could not validate the appeals. An act or action for which no statutory sanction existed at the time it was made done or for borne cannot be validated except by an express words of the statute which are not there in the amendment.

34. In view of what has been stated above I entertain no doubt that a right of appeal against cancellation of assessment order was neither provided expressly nor arose by implication from the words of section 134(1) of the Ordinance as it existed before the said amendment. The legislative intent being clearly manifested by the words of the statute effect must be given to it. Further that the said amendment in section 134(1) of the ordinance is applicable to orders of cancellation recorded on or after first day of July, 1994 and the pending appeals challenging similar orders recorded before that day shall remain incompetent and not maintainable.

35. Accordingly both of the appeals shall be dismissed.

(Sd.)

NASIM SIKANDAR,

JUDICIAL MEMBER.

(Sd.)

INAM ELLAHI SHEIKH,

ACCOUNTANT MEMEBR.

(Sd.)

IFTIKHAR AHMAD BAJWA,

ACCOUNTANT MEMBER.

36. IFTIKHAR AHMAD BAJWA (ACCOUNTANT MEMBER).- Having heard the parties and having the benefit of history of legislative amendment as detailed in the foregoing order, my conclusions are different from that of the learned Judicial Member. ???????? `

37. The fact that amendment in section 134(1) originally inserted by Notification No. SRO 1163 (1)/80 dated 20-11-1980 issued under section 167 and later enacted through Finance Ordinance, 1981 was tainted by drafting omission is no more in dispute in view of CBR's admission of this fact in CBR Circular No.6 of 1994 dated 7-10-1994. The unambiguous declaration by the authors of the said enactment settles this issue, beyond any doubt and we need not resurrect an edifice, which is not supported by either of the parties in dispute. Though I respectfully differ with the judgment reported as 1993 PTD 1236 wherein it was held that IAC's orders under section 66-A cancelling the assessment are not appealable, I need not dwell on the subject as the said judgment has already been overtaken by the amendment effected through Finance Ordinance, 1994 whereby unfettered right of appeal against such orders has been provided.

38. Coming to the position in the wake of the 1994 amendment, the point at issue is whether the law as amended in 1994 would be applicable to orders under section 66-A passed prior to the amendment which have been challenged in appeals before the Tribunal. This issue was fiercely contested and extensive case-law was quoted by the parties in support of their positions. Plethora of case-law adduced by both parties is not of much help as the judgments relate to other statutes and mostly deal with civil matters. Civil litigation and Income Tax Proceedings are different in nature. In civil matters no law is presumed to have retrospective effect in the absence of an express provision as retrospective application of laws can disturb vested rights. In Income Tax proceedings parties to dispute are the citizen and the State and in such dispute Courts generally favour liberal interpretation especially if it benefits the citizen and results in complete justice to the citizen.

39. While most of the judgment cited at the Bar were not strictly relevant, the judgment of the Supreme Court of Pakistan in the case of CIT v. Shahnawaz Limited and others reported 1993 SCMR 73 was quite pertinent as it dealt with a situation similar to the situation before us. In the said case, the Court was seized with the question:

"Whether the amendment made in subsection (6) of section 18-A of the Income Tax Act, by the Finance Act of 1973 whereby the additional amount of tax under section (6) of section 18-A could only be charged for a period not exceeding 15 months, extended also to the cases of assessee who had submitted their returns before the coming into force of the said amendment, as their cases of regular assessment had not yet been finalized and were pending."

While dismissing the appeal filed on behalf of the Commissioner of Income Tax, the Supreme Court observed:

"The High Court, however, felt that the retrospective operation visualised by the instant amendment could extend only to such cases which were pending at the time the amending law was enacted i.e. cases which had not been finally determined or processing which had not attained finality. The retrospective effect of the amending law would, therefore, apply only those cases where assessment had not been made by the I.T.Os or where an appeal was pending before the Tribunal or a reference was sub judice before the High Court, at the time the amending law was enacted. The cases which had finally been determined or had attained finality i.e. which were past and closed transactions, could be reopened under amending legislation as there are no express words to the effect employed in the amending law.

As explained in Crawford's "Statutory Construction" a statute relating to remedial law may properly, in several instances, be given retrospective operation and we are of the opinion that as the amendment in the instant case was introduced to redress an injury which in the words of Circular &o.6 of 1973 (Income Tax) issued on 7th July, 1973 by the Central Board of Revenue itself was "designed to soften the law in favour of tax-payers who could previously be charged to additional tax upto the date of assessment even though the finalisation of assessment was delayed due to no fault of theirs." This was a proper case in which retrospective operation, to the extent the High Court gave to it, could be given to the amending law."

In the case before the Supreme Court, the CBR Circular had explained the amendment as "designed to soften the law in favour of tax?payers" and in case before us the amendment is designed to remedy the effect of a drafting error. Thus the amendment in section 134 (1) is unquestionably a remedial and curative measure. In the light of the Supreme Court Judgment it must apply to all pending proceedings.

40. There can be no dispute that the orders under section 66-A which are being contested by the assessees before the Tribunal are pending proceedings till the decision by the Tribunal on those appeals. Not only that the appeals are pending in such cases, the entire Income Tax proceedings involving determination of tax liability of the assessees are also pending in such cases. The retrospective application of this amendment and adjudication of the appeals will not disturb vested rights of any party which is considered to be the main objection to retrospective application of curative statutes. There is thus no legal or moral bar to maintainability of such appeals.

41. Lastly I would like to add that unfettered right of appeal against orders under section 66-A is not only in accord with the letter of law but is also consonant with the spirit of law. Action under section 66-A is violative of the principle of finality of proceedings as it tantamounts to reopening of a completed assessment. Laws embodying conferment of rights are liberally interpreted by the Courts while laws adversely effecting the citizens are always subjected to a close scrutiny. Action under section 66-A substantially effects the tax liability of an assessee. There is no reason why this action be placed beyond the scope of scrutiny by the Tribunal while under the scheme of law, all such acts are subject to appeal.

42. The balance of convenience also militates against any fetters on the right of appeal against orders under section 66-A. If 1AC's order is well founded it would no doubt stand the test of appeal and after its confirmation by the Tribunal, the Assessing Officer would be able to complete the assessment in accordance with law. Thus no prejudice would be caused to Revenue. On the other hand, if IAC's order is untenable, an assessee without a right of appeal, would suffer a new round of proceedings. Since the Assessing Officer is not likely to disregard the findings of his superior officer, assessee would inevitably have to knock at the doors of appellate authorities. Thus an assessee would be unnecessarily subjected to lengthy proceedings based on IAC's order which itself may ultimately be found to be untenable. It is evident that balance of convenience is in favour of allowing a right of appeal rather than refusing the same.

43. For the reasons stated above, I dare differ with the findings of my esteemed colleagues and hold that the amended provision of section 134(1)would govern the pending appeals.

(Sd.)

IFTIKHAR AHMAD BAJWA,

ACCOUNTANT MEMBER.

(Sd.)

INAM ELLAHI SHEIKH,

ACCOUNTANT MEMBER

44. INAM ELLAHI SHEIKH (ACCOUNTANT MEMBER).--I have carefully perused the above order passed by my learned brother Mi. Nasim Sikandar, the Judicial Member and by my learned brother Mr. Iftikhar Ahmad Bajwa, the Accountant Member. The question raised before this Bench has already been set out in the first paragraph of the order recorded by the learned Judicial Member. The facts and circumstances leading to the formation of this Full Bench have already been narrated. My learned brother, the Judicial Member has passed an elaborate and well-reasoned order and he has come to the conclusion that no appeal lay against the order passed under section 66-A when assessment order was cancelled. In my view he has very ably dealt with most of the aspects of the issue. My learned brother, the Accountant Member has also recorded some excellent reasons in his order for coming to a different conclusion. My learned brothers, the Judicial Member and the Accountant Member, have already substantially dealt with the issue involved and they have done so in an excellent manner. I have also perused the earlier order dated 28-3-1992 in ITA Nos. 517 and 518/LB/ 1990-91 reported as 1994 PTD (Trib) 108= 1994 PTD 112 which was passed by Mr. A. A. Zuberi, the learned Accountant Member, and consented to by Mr. Abrar Hussain Naqvi, the learned Judicial Member who later rose to be the Chairman of the Tribunal. Such earlier order was also a very well-written and well-reasoned order. However, I feel inclined to express my own views with regard to certain aspects of this question.

45. A Division Bench of the Tribunal, while deciding the appeals bearing ITAs Nos. 517 and 518/1,13/1990-91, came to the conclusion that no appeal lay against an order of the IAC passed under section 66-A of the Ordinance where the assessment order had simply been cancelled. From such earlier order and from the earlier part of this present order, one may draw an inference that what a simple order of cancellation means is an order where the IAC issues no specific directions which may prima facie result in the enhancement of assessment or reduction in refund or otherwise increase the liability of the assessee. The learned Judicial Member has also come to the conclusion that an order cancelling the assessment may not necessarily result in the enhancement of income. In coming to this conclusion, my learned brother has applied the Golden Rule of Interpretation as mentioned in earlier paragraph No. 10 of this order. I fully agree with approach although my learned brother Mr. Abrar Hussain Naqvi had expressed his apprehension in the order dated 28-3-1992 that there was a possibility of a drafting error at the time of insertion of the words and figures "or an order made by an Inspecting Assistant Commissioner under section 66-A" in section 134(1). History of legislation on this issue and also the enjoining factors, as spelt out in the earlier order as well as in the present order, indicate that the intention of the legislature was to continue the appeal ability of all the orders of the IAC. It may be noted that even after 28-3-1992 at least one appeal against an order under section 66-A of the Ordinance was heard on 04/05/1992.