ADMINISTRATOR, THAL DEVELOPMENT VS MUHAMMADA
1995 P T D 794
[Lahore High Court]
Before Ahmad Saeed Awan, J
Messrs VENUS STATIONERY MART, URDU BAZAR, LAHORE
Versus
MEMBER, INCOME-TAX (JUDICIAL), CENTRAL BOARD OF
REVENUE, SUB-OFFICE, LAHORE
Writ Petition No. 14165 of 1994, decided on 24/01/1995.
Income Tax Ordinance (XXXI of 1979)---
----Ss.134 & 138---C.B.R. Circular No.9 of 1989, dated 26-7-1989---Appeal-- Revision---Assessee has been provided' an option under Ss.134 & 138, Income Tax Ordinance, 1979, either to file an appeal before the Income-tax Appellate Tribunal or a Revision before the Member (Judicial), Central Board of Revenue---Conditions---If an appeal is decided by the Income Tax Appellate Tribunal, order of the Tribunal in the case is binding even on the Member (Judicial), Central Board of Revenue.
Section 138 of the Income Tax Ordinance, 1979 has been amended; hence from 1st July 1989 and onwards powers of revision vests in the C.B.R. instead of Commissioner, Income Tax (Additional Commissioner) and Member Judicial, Income Tax has been posted in the C.B.R. to perform these functions according to Circular No. 9 of 1989, dated 26-7-1989.
Under section 134(1). of the Ordinance an assessee has the right to appeal to the Appellate Tribunal against the order passed by an Appellate Commissioner/Additional Commissioner of Income Tax; further he has been given option to file a revision under section 138(1) of the Ordinance subject to the condition imposed under provision of clause (a) of subsection (2) of section 138 of the Ordinance. Meaning thereby, an assessee has been provided an option either to file an appeal before the Income Tax Appellate Tribunal or a revision before .the Member (Judicial), C.B.R.
On the one hand; an assessee has been given option either to file an appeal or revision and no bar has been imposed under section 138(1) of the Ordinance to avail the option; while on the other hand, limitation has been imposed on the Member (Judicial), C.B.R., prior to 1st July, 1989 on the Commissioner Income Tax (Appeals), not to revise an order under subsection (1) of section 138 of the Ordinance i.e. unless the prescribed period of filing has not expired and secondly the order in revision is either pending in appeal before the Appellate Commissioner/Additional Commissioner or has been made the subject of an appeal before the Income Tax Appellate Tribunal.
The Income Tax Appellate Tribunal is the highest forum in the hierarchy of Income - Tax Ordinance; hence if an appeal is decided by the Tribunal it is even binding on the Member (Judicial), C.B.R.
Hindustan Aeronautics Ltd. v. Commissioner of Income Tax, Karnataka-I (1981) 132 ITR 461 ref.
Muhammad Hanif v. ITO (1973) TLR 645 distinguished.
M. Altaf Hussain Jamal for Petitioner.
Shahbaz Ahmad Butt for Respondent.
Date of hearing: 11th January, 1995.
ORDER
The petitioner Messrs Venus Stationery Mart, Urdu Bazar, Lahore for the assessment year 1991-92; relating to the financial year ending on 30-6-1991, filed his return of income declaring net income of Rs.40,182 and turn over at Rs.9,33,765. The Income Tax Officer estimated the turn over at Rs.23 Lakhs against the declared turn over at Rs.9,33,765. The petitioner filed an appeal before the Commissioner of Income Tax (Appeals) against the assessment order of the Income Tax Officer. The appeal was partly allowed and partly disallowed and the turn over was reduced to Rs.12 Lakhs. The petitioner assessee filed a revision petition before the Member Income Tax (Judicial) under section 138 of the Income Tax Ordinance 1979 against the order of Commissioner Income Tax (Appeals) on 26-9-1992. The Sub-Office of Member Income Tax (Judicial), C.B.R. vide its letter No. C-8(159) II-Jud/92, dated 25-5-1994 refused to entertain the revision petition under provision of clause (b) of subsection (ii) of section 138, as appeal by the Income Tax Department was filed with the Appellate Tribunal against the order of Commissioner Income Tax (Appeals) 'on 28-10-1992; hence this writ petition.
2. The learned counsel for the petitioner contended that subsection (ii)(b) of section 138 of the Ordinance is no bar to the assessee for filing a . revision petition against the order of Commissioner Income Tax (Appeals) as the assessee have valuable legal right under subsection (ii) of section 138 of the Ordinance and the legal option of an assessee cannot be controlled or frustrated by a Departmental Appeal to the Tribunal against an assessment order; otherwise it would tantamount to deprive the assessee of his right to move an application under section 138(i) of the Ordinance and relied upon case "Hindustan Aeronautics Ltd. v. Commissioner of Income Tax, Karnataka- I" ITR 1981 Vol. 132 on page 461.
3. The learned counsel for the Department controverted the arguments of the learned counsel for the petitioner and stressed that provision of clause (b) of subsection (2) of section 138 of the Ordinance is mandatory in nature.
4. I have heard learned counsel of both sides at length.
5. Section 138(2) of the. Income Tax Ordinance, 1979 reads out as under:--
"The Commissioner shall not revise any order under subsection (1) if--
(a) Where an appeal against the order lies to the Appellate (Additional Commissioner) or to the Appellate Tribunal, the time within which such appeal may be made has not expired, or the assessee has not waived his right of appeal; or
(b) The order is pending on appeal before the Appellate (Additional Commissioner) or has been made the subject of an appeal to the Appellate Tribunal ...."
6. Section 138 of the Income Tax Ordinance, has been amended; hence from 1st July 1989 and onwards powers of revision vests in the C.B.R. instead of Commissioner Income Tax (Additional Commissioner) and Member, Judicial, Income Tax has been posted in the C.B.R. to perform these functions according to Circular No. 9 of 1989, dated 26-7-1989.
7. Under section 134(1) of the Ordinance an assessee has the right to appeal to the Appellate Tribunal against an order passed by an Appellate Commissioner/Additional Commissioner of Income Tax; further has been given option to file a revision under section 138(1) of the Ordinance subject to the condition imposed under provision of clause (a) of subsection (2) of section 138 of the Ordinance. Meaning thereby, an assessee has been provided an option either to file an appeal before the Income Tax Appellate Tribunal or a revision before the Member (Judicial), C.B.R.
8. On the one hand; an assessee has been given option either to file an appeal or. revision and no bar has been imposed under section 138(1) of the Ordinance to avail the option; while on the other hand, limitation has been imposed on the. Member (Judicial), C.B.R. prior to 1st July, 1989 on the Commissioner Income Tax (Appeals), not to revise an order under subsection (1) of section 138 of the Ordinance i.e. unless the prescribed period of filing has not expired and secondly the order in revision is either pending in appeal before the Appellate Commissioner/Additional Commissioner or has been made the subject of an appeal before the Income Tax Appellate Tribunal.
9. In case Hindustan Aeronautics Ltd. v. Commissioner of Income Tax, Karnataka-I, relied upon by the learned counsel for the petitioner; it was held that the revision is entertainable under subsection (4)(c) of section 264 c Income Tax Act, 1961 as the Departmental appeal to the Tribunal against a assessment order would not deprive the assessee of his right to move the Commissioner under section 264 in the light of Circular F.No. 6/52/68-I.T.J dated 30th July 1970 being binding on the Commissioner.
10. The Kerala High Court in case of Muhammad Hanif v. I.T.O. (1973) Tax L.R. 645 dismissed the revision petition filed by the assessee/petitioner a not competent and maintainable. This issue is still under dispute in the India Courts of Law. ,
11. The contents of the circular mentioned above relied upon by the learned Judges of Kerala High Court are as under:--
"The scope of the above-noted provisions was considered by the Ministry of Law in a recent case, vide copy of their note dated 18t May, 1978. They have held that the above-noted provision has to b construed so as to mean that the jurisdiction of the Commissioner t entertain a revision petition from an assessee against an order could be barred only if an appeal against that order has been preferred b the assessee before the Tribunal and not where such an appeal ha been preferred by the department. This legal position is brought t your notice."
12. The facts and circular mentioned above are not applicable to the present case. The Member (Judicial), C.B.R. was justified in intimating the assessee/petitioner that the revision is not maintainable in the light c provision (b) of subsection (2) of section 138 of the Income Tax Appellate Tribunal which is mandatory in its nature. Further the Income Tax Appellate if an appeal is decided by the Tribunal is even binding upon the Member (Judicial), C.B.R. The instant writ petition is without merits and is here dismissed with no order as to costs.
M.BA./M-2024/L Petition dismisses.