I. T. AS. NOS. 1881/LB OF 1987-88 AND 1798/LB OF 1988-89 VS I. T. AS. NOS. 1881/LB OF 1987-88 AND 1798/LB OF 1988-89
1997 P T D (Trib.) 1435
[Income-tax Appellate Tribunal Pakistan]
Before Nasim Sikandar, Judicial Member and Khalid Mahmood, Accountant Member
I.T.As. Nos. 1881/LB of 1987-88 and 1798/LB of 1988/89, decided on 20/03/1997.
(a) Income Tax Ordinance (XXXI of 1979)--
----S.9---Constitution of Pakistan (1973), Art. 165-A---Charge of income-tax---Exemption---Claim of---Burden of proof---No legal or juridical person created by or under a statute either by the Federal or a Provincial Legislature to undertake business or to provide services on behalf of such Government is entitled to claim an exemption from levy of income-tax in view of Art. 165-A of the Constitution of Pakistan.
No legal or juridical person created by or under a statute either by the Federal or a Provincial Legislature to undertake business or to provide services on behalf of such Government is entitled to claim an exemption from levy of income-tax after insertion of Article 165-A.
Punjab Flour Milling Corporation created under a statute is a "company" as defined in subsection (16) of section 2 of the Income Tax Ordinance, 1979 and there appears no legal bar whatsoever to tax it like rest of the assessees contemplated in the Ordinance.
The general principle is that the claimant of an exemption from levy of a charge must establish it in clear and unequivocal terms. Only a provision of law, a rule, regulation or a legally binding promise and a precedent can be pleaded to succeed.
The claimed exemption by the assessee under Article 165 is not available any more. Article 165-A taking away the exemption is applicable in its case. Therefore, it has not been able to discharge the burden laid upon it.
The contention of the assessee that Article 165-A contemplated only future legislation to create a charge is also misplaced. The Article is declaratory in nature and took effect irrespective of any decision by a High Court, the Supreme Court or a Tribunal. Even a plain reading of the Article will show that it was given retrospective effect taking away every kind of stated benefits earlier enjoyed by similar corporations under Article 165. Sub-clauses (2) and (3) of Article 165-A also show that every kind of orders made, proceedings taken, or acts done by any authority in exercise of powers derived from any law were validated, in spite of contrary-judgments of the superior Courts.
The charging provisions of Income Tax Ordinance, 1979 do not admit of any exception nor the Corporation has in fact been able to point out the availability of the claimed exemption.
I.T.As. Nos.1479-1480 of 1981-82; M/s. Rice Export Corporation v. Metropolitan Corporation PLD 1990 Kar. 186; National Fertilizer Marketing Ltd. v. Secretary, Local Government and Rural Development Department 1992 MLD 1203; Associated Cement (State Cement Corporation of Pakistan Limited) v. Government of Sindh 1992 MLD 1730; Union Council Ali Wahan Sakhar v. Associated Cement Private Limited 1993 SCMR 468; CBR and another v. S.I.T.E. PLD 1985 SC 97; Muhammad Ramzan Katiar v. Rice Export Corporation Limited 1983 CLC 3281; Punjab Smapp Industries v. DCIT Companies Zone, Lahore 1995 PTD 431; 1995 PTD (Trib.) 557; 1986 PTD (Trib.) 873 and M/s. Army Welfare Sugar Mills Limited and others v. Federation of Pakistan 1992 SCMR 1652 ref.
(b) Income Tax Ordinance (XXXI of 1979)---
----Ss.133 & 134---Powers of Income Tax Appellate Tribunal---Tribunal cannot travel beyond the contours of the Income Tax Ordinance, 1979 and cannot examine the vires of any of the provisions of the Income Tax Ordinance, 1979, muchless to say on Constitutional provision.
1986 PTD (Trib.) 805 and 1995 PTD (Trib.) 1113 ref.
Zafar Iqbal Khan for Appellant. Shahbaz Butt, L.A. for Respondent.
Date of hearing: 13th February, 1997.
ORDER
Article 253(1)(b) of the Constitution of Pakistan provides that the Parliament by law may declare that any trade, business, industry or service specified in such law shall be carried on, or owned, to the exclusion, complete or partial, of other persons, by the Federal Government or a Provincial Government or by a Corporation controlled by such Government.
2. The Federal Legislature with reference to the above Article on 3rd of September, 1976 passed and promulgated and Act called the Flour Milling Control and Development Act, 1976. Section 2(h) of the Act defined "Industry" as the Flour Milling Industry composed of one or more flour mills equipped with rollers. Then in section 3 of the, Act it was declared that industry shall be owned and carried on by the Federal Government or by a Corporation controlled by a Provincial Government to the exclusion of the other persons except foreign investors. Section 5 of the Act empowered the Federal Government to acquire ownership and management of any establishment. An "establishment' was earlier defined in section 2(f) of the Act as any, company, firm, concern, institution or enterprise, the whole or any part of undertaking of which pertained to the "industry". Section 6 of the Act further empowered the Provincial Government to which ownership and management of an "industry" was transferred to set up corporation and to transfer the ownership and management of the affairs of such establishment to such corporation.
3. On 17th July, 1976 in exercise of powers conferred by section 5 of the above Act the Federal Government issued a statutory Notification S.R.O. No.710(1)/76 titled "Acquisition of Ownership and Management of Flour Milling Establishments, Order. 1976". This order declared the acquisition of ownership and managements of the establishment mentioned in the Schedule attached with the Order. Through another Notification S.R.O. No.711(1)/76 issued on the same day the ownership and management of establishments given at S. Nos. l to 58 in the Schedule attached with order were transferred to the Government of Punjab. The Province of Punjab thereupon through a Notification No.ASS&G AD/3508/975 set up the Punjab Flour Milling Corporation under section 6(2) of the above Act to "own and manage the acquired establishments transferred to the Government of Punjab". The life 'of the Corporation as well as that of the Act under which it was created did not prove to be long. It was taken away by Ordinance No. XXIX of 1977 issued on 5th September, 1977. It was described as the Flour Millings Control and Development Repeal Ordinance, 1977. Section 3 of the Ordinance required the Corporation to return the establishment to previous owners within a specified time. Section 6 of the Ordinance further provided that notwithstanding the repeal of the Act under which the Corporation was established, it shall continue to exist until it is wound up by an order of the Provincial Government, before us the Government of Punjab".
4. The appellant Flour Milling Corporation, we are informed has already returned all establishments transferred to it by the Federal Government through the Provincial Government and exists only in order to settle compensation affairs with owners who have since taken over the possession of the establishments. It is also stated that the Corporation is not doing any business as such except perusing its claim through Courts or otherwise against the owners of the establishments. It does not earn nor it is engaged in any other service. The total assets of the Corporation comprise some amounts already recovered on account of its claims against the owner of the establishments. These amounts are lying in banks and are earning interest. A small office manned by less than a dozen persons is statedly engaged in picking up pieces and wrapping up whatever is left of the erstwhile business empire.
5. It appears that in the assessment years 1977-78 and. 1978-79 Corporation caught eye of Income Tax Collector for the first time. Its defence that being a part of the Provincial Government it was protected from levy of income-tax under Article 165 of the Constitution failed before the authorities. On further appeal before this Tribunal in I. T. As. Nos.1479-1480 of 1981-82 (assessment years 1977-78 and 1978-79 decided on 13-11-1982) its view point prevailed. A Division Bench of this Tribunal in para. 5 of the order concluded:
"We accordingly hold that the Punjab Flour Milling Corporation is only an 'agent' of the Punjab Government to whom the ownership and the management of the taken over establishment vested in the relevant assessment years under consideration and, therefore, income derived by the Punjab Flour Milling Corporation was the income of the Punjab Government and not liable to Income-tax under Article 165 of the Constitution of the Islamic Republic of Pakistan."
6. How the things went along thereafter is not clear. Nor any, of the parties has taken us to that corner. However, after a decade, i.e., in 1987-88 again the Revenue raised a bead upon the Corporation. No income for the year was returned with the remarks "Corporation is not liable to tax under Article 165 of the Constitution of the Islamic Republic of Pakistan". The assessing officer, however, was not impressed. He remarked that same contention was made in previous years and was rejected in view of insertion of Article 165-A in the Constitution through Constitution Amendment Order II of 1985. After rejecting the claimed exemption the interest received at Rs.6,31,618 was brought to tax through assessment order recorded on 11-2-1988. The Corporation failed before the first appellate authority as well which found no difficulty in interpreting Article 165-A in favour of the Revenue.
7. Nothing changed for better for airy of the parties in the year 198-?89 as well. The assessee did not declare any income for similar reason while the Revenue proceeded to tax the interest received declared to the tune of Rs.5,99,912. Going a step further the claimed amount of gratuity at Rs.32,835 and expenses incurred on Chairman's training at Rs.2,500 were also added to compute taxable income for the year at Rs.3,31,851. First appeal by the Corporation again failed as Article 165-A was found showing no leniency to the Corporation. The disallowance of claimed gratuity was maintained in absence of required approval for creation of the fund. The other addition of Rs.2,500 was, however, found as a valid expense and, therefore directed to be allowed.
8. Before us the premises have not changed. Learned counsel for the assessee states that addition of Article 165-A did not in any way affect the position of the assessee-Corporation. Placing emphasis on the title of Article 165-A he states that it provides only for the power of the Federal Legislature to make laws which could result in taxing State-owned Corporations. According to the learned counsel the added/amended Article has only cleared a doubt as to the competency of the Federal Legislature to impose tax on the income of certain Corporation. It is further pleaded that this Article is prospective in application and is supply declaratory in nature that the Federal Legislature will be competent to do so. According to the learned counsel the Federal Legislature has not so far exercised the power vested in it under the amended Article and therefore has not expressly provided for or passed a law by which State-owned Corporations could be subjected to Income-tax. To the learned counsel in absence of afresh legislation after insertion of the above Article the legal position remains as it existed earlier to its addition. That is to say, the exemption enjoyed by the State-owned business concerns under Article 165 of the Constitution remains available and existent. Therefore, according to the learned counsel the bar contained under Article 77 of the Constitution that tax could be levied only by law still saves the assessee-Corporation. It is also stated that the assessee? corporation is not a company as defined in the Income Tax Ordinance but a part and parcel of the Food Department of the Government of Punjab as having been created by an administrator Order. All policy matters, per submissions made at the bar, are still being handled by the Federal Government. It is further claimed that the assessee-corporation enjoys a unique position as it is discharging the functions which basically vested in the Federal Government under the said Act. It is alleged that no other State-?owned Corporation or organisation is placed in such position. It is repeated that Corporation is not engaged in any business activity as it is in the process of winding up. Therefore, for this reason alone its interest income could not be subjected to income-tax. The assets or amounts on which the interest has accrued are vehemently claimed as Government dues recovered from the owners of denationalized establishments in accordance with the provisions of the said Act. Learned counsel for the assessee as an alternate also assails the vires of Constitutional Amendment Order II of 1985 by which Article 165-A was added to the Constitution. In the view of the learned counsel since this Tribunal has to decide the objection of the assessee against liveability of Income-tax it can very well declare the addition of the said Article as ultra vires of the Constitution. The reason put-forth for such declaration is stated to be the non-observance of the procedure contemplated for amendment in the Constitution and detailed in Part XI, Articles 238 and 239. By referring to Article 260 which defines "Act of Majlas-i-Shoora (Parliament) he says that amended article having not been passed by the Parliament in accordance with the procedure laid down in the aforesaid Chapter of the Constitution, it was of no legal affect.
9. Tracing the history of exemption from tax available to Provincial Governments' reference is also made to section 155 of the Government of India Act, 1935. Also both Articles 165 and 165-A are described as supplementing and not conflicting as erroneously taken by some people. It is stated that Article 165 declares exemption to public properties owned by Federal or Provincial Governments while Article 165-A provides for the power of the Legislature to take away the exemption by making prospective laws wherever deems suitable. At any rate, learned counsel continues, Article 165-A is not a taxing provision and, therefore, Revenue could not assess the Corporation with reference to this Article.
10. Learned Legal Advisor Mr. Shahbaz challenges the assertions made for the assessee. He, states that the assessee-Corporation as per law creating it, is a body corporate and, therefore, the claim that it was part of the provincial Government is misleading. The Federal Government in view of the powers allowed to it under Article 253 opted to take over and monopolize Flour Milling business which the assessee-Corporation has been conducting till the time it delivered possession of the taken over units after repeal of the said Act. Further says that the Revenue is not taxing any business income in the hands of the assessee. According to Mr. Shahbaz Butt whatever be the nature and source of funds in the hands of the assessee it is earning interest income which had been brought to tax in accordance with the provision of the Income Tax Ordinance. Also claims that no provisions in Income Tax Ordinance provides for the kind of exemption which the assessee? Corporation is claiming against taxability of its interest income. Further states that the levy of income-tax is not restricted to business income as was being tried to bring home by the learned counsel for the assessee. For the Revenue it is also stated that the assessee-Corporation falls squarely within the mis-chief of definition clause of the Income Tax Ordinance as contained in section 2(16). The claim of the assessee of being a part of the Provincial Government is therefore forcefully challenged. He states that the objection raised at the bar for the assessee stands totally and finally settled by Article 165-A of the Constitution as also by its interpretation as made by the Superior Courts from time to time. He agrees that before insertion of this Article the legal position was the same as is being claimed by the assessee. However, after introduction of Article 165-A, according to learned Legal Advisor, the position has changed altogether. In support of his submissions Mr. Shehbaz Butt has placed reliance upon PLD 1990 Kar. 186 re: M/s: Rice Export Corporation v. Karachi Metropolitan Corporation, 1992 MLD 1203 re: National Fertilizer Marketing Ltd. v. Secretary, Local Government and Rural Development Department 1992 MLD 1730 re: Associated Cement State Cement Corporation of Pakistan Limited v. Government of Sindh, 1993 SCMR 468 re: Union Council Ali Wahan Sakhar v. Associated Cement (Private Limited), PLD 1985 SC 97 re: CBR and another v. S.I.T.E., 1983 CLC 3281 re: Muhammad Ramzan Katiar v. Rice Export Corporation Limited, 1995 PTD 431, Re: Punjab Smapp Industries v. DCIT Companies Zone, Lahore 1995 PTD (Trib.) 557 and 1986 PTD (Trib.) 873. It will be noted that except for the last cited two decisions of the Tribunal, learned counsel for the assessee has also referred to 'the aforesaid reported decisions to strength his way and line of arguments.
11. After hearing the parties we entertain no doubt that the defence raised by the assessee is not at all available to it or for that matter any such kind of an organization. The status of the assessee-Corporation as a creation of administrative action according to the provisions of the aforesaid Act by which the power of creation was vested in a Provincial Government is not disputed. It is equally certain that the Corporation was created to take over, control, manage and monopolise the "industry" in the Province of Punjab in, execution of its functions it may have been receiving guidance and be subject to the policy made by the Federal as well as the Provincial Government. However, the fact remains that is engaged in a business activity, which the State by law made exclusive for it. After the repeal of the law that created it the business activity obviously came to a complete halt. It is engaged only recovering or perusing its claim against the owners to which the "establishments" were returned. The nature of its claim for most of the part appears to be the difference between "present value" and the "net worth, of the units returned to original owners. The Corporation, however, continues to exist till it is wound up by the order of the Provincial Government in accordance with section 6 of the said Repealing Ordinance, 1977. The present existence of the Corporation owes itself to the words contained in section 6 of that Ordinance which speak of winding up of the Corporation and when so desired by the Provincial Government. These words of statute itself indicate that the claim of the assessee-Corporation of being a department of the Provincial Government is not correct. For, no Government department is wound up. It is only Corporations, Companies or other similar juristic legal persons which are wound up and not a Provincial Government or any of its departments through which it functions.
12. The first case relied upon by the learned Legal Advisor re: Rice Export Corporation supra indicates the legal position before addition of Article 165-A in the Constitution. In this case M/s. Rice Export Corporation a wholly-owned-Corporation of the Federal Government challenged levy and imposition of octroi on its goods by Municipal Corporation, Karachi. The Corporation claimed its articles to be the property of the Federal Government -and, therefore, exempted from collection or levy of octroi in view of the provisions contained in Article 165. Learned Division Bench of the Karachi High Court agreed. For this conclusion reference was made to PLD 1975 Ka'. 125 and CBR v. SITE PLD 1985 SC 97. Both the cases explained the legal position vis-a-vis State-owned business Corporations before the introduction of Article 165-A. In 1992 MLD 1203 re: National Fertilizer Marketing Limited v. Secretary, Local Government Punjab a Single Bench of the Lahore High Court decided against the Corporation on the ground that it was a separate and independent legal entity as a company registered under law notwithstanding the fact that its shares were owned the Federal Government. Therefore, the learned Judge held that neither the profits the income of the Corporation could be deemed to be that of the Federal Government. In the third case cited by the Revenue? Wahan (supra) the Supreme Court found for the petitioner union counsel and against M/s. State Cement Corporation of Pakistan, a Corporation wholly-?owned by the Federal Government. The respondent claimed exemption from levy of octroi by placing reliance upon Article 165. The Supreme Court reversed the order of the Karachi High Court where the Corporation had earlier succeeded. The prayer of the respondent, as earlier accepted by the High Court for lifting of the veil of incorporation to allow exemption under Article 165 was also refused. Their Lordships observed that lifting of corporate veil would place the company at a better position against other private competitors or manufacturers of same goods in the field. The change brought by Article 165-A of the Constitution was ruled upon in these terms at page 480 of the report:---
"It is also evident that the effect of the incorporation of Article 165-A which was incorporated in 1985 as pointed out hereinabove, has also been considered and in that context it has been observed that 'the purpose, the object and the field of Article 165-A of the Constitution is to fix the legal ownership of the property and the identity of the recipient of the income. This has been achieved by reinforcing the statutory corporate veil for all fiscal purposes. The lifting of the corporate veil as such is no longer permissible and the distinct juristic personality of the incorporate or statutory body has been recognised notwithstanding the control, the destination and the functioning of such bodies."
13. As the same page this apex Court referred to and quoted part of its judgment rendered in Civil Appeal No. 184 of 1987 re: Karachi Development Authority v. C.B.R. and another. The portion of the judgment referred reads:---
"It is true that what is mentioned in Article 165-A (1) of the Constitution is limited to the levy of income-tax. Nevertheless, the purpose, the object and the field of Article 165-A of the Constitution is to fix the legal ownership of the property and the identity of the recipient to the income. This has been achieved by reinforcing the statutory corporate veil for all fiscal purposes. The lifting of the corporate veil as such is no longer permissible and the distinct juristic personality of the incorporated or statutory body has been recognised notwithstanding the control, the distinction and the functioning of such bodies. Such a declaratory law would certainly stand in the way of the appellant because the same distinction which was sought to be created by lifting the veil in the matter of the income-tax is sought to be achieved in the matter of sales tax. "
14. Next case relied upon by the learned Legal Advisor re: Muhammad Ramzan Khatiar (supra) has no direct relevance to the issue before us.
However, the reported decision cited as Punjab Small Industries v. D.C.I.T., Lahore 1995 PTD 431 explains the latest view of the Lahore High Court on the subject. Malik Muhammad Qayyum, J., rejecting a similar plea remarked that if the arguments of the learned counsel for the assessee-petitioner were accepted the amendment made in the Constitution through above Article 165-A will be rendered futile and redundant. The ratio settled in this case accordingly invalidates the claim of the assessee before us that funds and deposits on which interest was earned were property of the Government of Punjab.
15. The plea raised before us is not a first case of its instance. A similar position was taken up by the assessee Defence Officers Mess, Karachi on the ground that it being controlled and organised by Ministry of Defence out of Karachi War Memorial Fund. The Revenue Authorities were not convinced. On second appeal that assessee also attempted to distinguish its income in order to prove that Article 165-A had no application in its case and it continued to enjoy the protection of Article 165. Learned Division Bench of the Tribunal at Karachi declined to interfere. Through a detailed order recorded now cited as 1995 PTD (Trib.) 557 the appeal was dismissed with the remarks that at the most the assessee/appellant could be held to be a Government established body which was liable to the levy of tax under Article 165-A of the Constitution. The last cited case, 1986 PTD 873 (Trib.) revolved around a legal controversy which is different from the one before us.
16. From the above we have gathered that the assessee-Corporation has not been able to prove its claimed status of being a department of Provincial Government. Artificial juridical persons, it may be remarked are created by or under a Statute. A body or corporation created by a statute is sometimes called a statutory corporation. An instance of such creation is Water and Power Development Authority. Sometimes a statute does not by itself create a corporation or a legal person but only provides for its creation. In such a case,. which is also that of the assessee before us, some further act is required to be done for the creation of the legal person. The assessee-Corporation came into being only upon issuance of a notification under the said Act. In cases of other statutory Corporations these come into existence simultaneously with the promulgation and enforcement of the relevant legislation. The juridical persons created under a Statute are those, which come into being after fulfilling certain conditions like registration etc. The companies registered under the Companies Ordinance, 1984 are legal persons created under a Statute. Sometimes law deems an already existing institution as a legal and juridical person. Corporation sole is the example of such legal fiction. The societies registered under the Societies Registration Act, 1860 are also artificial persons to a limited extent created under a Statute. The creation of legal persons by Statute to engage in business activity on behalf of the Government became popular in mid-seventies. The assessee ?Corporation is one of them. Before that period corporations were created and legal persons infused with life mostly to handle services. Municipal Corporations and Port Trusts are some of the big fraternity. Creation of "Authorities" under statutes has also become popular which signifies another kind of personality besides Government Departments and an incorporated company or a corporation. The idea, for most of the part is to give special status to person which would otherwise be Directors in a Company created under the Companies Ordinance. The intention appears to clothe a body with credibility, prestige and support of Federal or Provincial Government. However the common characteristic of all legal persons remains their perpetual succession till dissolution. Except for breathing, they can do every thing which a natural person can perform.
17. Be that as it may, no legal or juridical person created by or under a statute either by the Federal or a Provincial Legislature to undertake business or to provide services on behalf of such Government is entitled to claim an exemption from levy of income-tax after insertion of Article 165-A. The legal position before the addition of the Article is well-explained by the four judgments of the superior Courts on which the learned counsel for the assessees has also relied upon. However, the said amendment in the Constitution was obviously made to nullify them as sub-clause (3) of Article 165-A amply demonstrates. The language of this Article hardly admits of any doubt or ambiguity. The kind of interpretation the learned counsel for the assessee is attempting to place upon the words of the amended Article cannot be seen anywhere. Learned Legal Advisor is correct in pointing out that the assessee is a "company" as defined in subsection (16) of section 2 of the Income Tax Ordinance, 1979 and there appears no legal bar whatsoever to tax it like rest of the assesses contemplated in the Ordinance. The general principle is that the claimant of an exemption from levy of a charge must establish it in clear and unequivocal terms. Only a provision of law, a rule, regulation or a legally binding promise and a precedent can be pleaded to succeed. The assessee before us has, however, not been able to point out any of them. The pronouncement made by the Supreme Court of Pakistan in Re; Union Council Ali Wahan (supra) as also in the unreported decision mentioned therein leaves no room for any of the submissions made by the assessee against the levy.
18. The Supreme Court of Pakistan in 1992 SCMR 1652 re: M/s. Army Welfare Sugar Mills Limited and others v. Federation of Pakistan made the following observations:---
"There are two basic principles of construing a provision of a statute involving exemption from payment of tax, namely, the first rule is that the burden of proof is on the person who claims exempting. The second rule is that a provision relating to grant to tax exemption is to be against the person asserting and in favour of taxing officer.
In case of the assessee before us, as observed earlier, the claimed exemption under Article 165 is not available any more. It has also failed to convince us that the added Article 165-A taking away the exemption was not applicable in its case. Therefore, it has not been able to discharge the burden laid upon it.
19. We have also noted that after change in law since first day of July 1989 when interest income was brought to levy at source, the assessee has not challenged the same in respect of its interest income and has accepted the treatment without any objection.
20. The contention of the learned counsel for the assessee that Article 165-A contemplated only future legislation to create a charge is also mis-placed. As noted earlier the Article is declaratory in nature and took effect irrespective of any decision by a High Court, the Supreme Court or a Tribunal. Even a plain reading of the Article will show that it was given retrospective effect taking away every kind of stated benefits earlier enjoyed by similar corporations under Article 165. Sub-clauses (2) and (3) of Article 165-A also show that every kind of orders made, proceedings taken, or acts done by any authority in exercise of powers derived from any law were validated, in spite of contrary judgments of the superior Courts. The charging provisions of Income Tax Ordinance, 1979 do not admit of any exception nor the Corporation has in fact been able to point out the availability of the claimed exemption, express or implied, from other parts of the Ordinance.
21. The submission of the learned counsel that we should declare the amended Article 165-A as ineffective part of the Constitution is too innocent to be granted. Whatever be the reason and basis of his objection this Tribunal cannot travel beyond the contours of the Income Tax Ordinance. Being a forum of limited jurisdiction it cannot examine the vires of any of the provision of the Income Tax Ordinance muchless to say of a Constitutional provision. This is how we looked at the preposition in 1986 PTD (Trib.) 805. In 1995 (Trib.) 1113 we reiterated that jurisdiction of declaring any provision of law as un-Islamic or unconstitutional is exclusively vested in the Supreme Court of Pakistan, the Federal Shariat Court and the High Courts. Therefore, we will refuse to oblige the assessee before us. Even otherwise Article 165-A alongwith a number of other Articles added to the Constitution through the said amending order were adopted by the Parliament through Eighth Amendment. The Supreme Court of Pakistan quite recently has overruled similar objections against that amendment as a whole and has declared it to be a valid and operative part of the Constitution.
22. The assessee having failed to convince us of a single good reason against chargeability of income-tax on its interest income, no interference in the orders of the authorities below is warranted. The disallowance of gratuity in the second year before us, 1988-89 is also not open to exception as no claim or the approval to the fund by the competent Authority has been pleaded.
23. Therefore, both the appeals fail.
M.B.A./347/Trib.???????????????????????????????????????????????????????????????????? ?????????? Appeals dismissed.