W.T.A. NO. 193/KB OF 1991-92 VS W.T.A. NO. 193/KB OF 1991-92
1997 P T D (Trib.) 1928
[Income-tax Appellate Tribunal Pakistan]
Before Muhammad Mujibullah Siddiqi, Chairman, Nasim Sikandar, Judicial Member and S.M. Sibtain, Accountant Member
W.T.A. No. 193/KB of 1991-92, decided on 30/06/1997.
(a) Wealth Tax Act (XV of 1963)---
----S.5(1)(xv)(i) & (ii) [before substitution]---Foreign Exchange Bearer Certificate Rules, 1985, Rr.6 & 7---C.B.R. Circular No. IT-J-I-1(42)85, dated 22-8-1985--- Exemption--- Foreign Exchange Bearer Certificates-- Proceeds obtained on encashment of Foreign Exchange Bearer Certificates-- Entitlement to exemption from levy of wealth tax---Extent---Principles.
A plain reading of the provisions contained in section 5(1)(xv)(i) and (ii) of Wealth Tax Act, 1963 reveals that an exemption is allowable in respect of assets, firstly which are brought into Pakistan, or are remitted by an assessee from outside Pakistan. Secondly, the exemption is also allowable in respect of assets which are created out of remittances received or brought in Pakistan through regular banking channels. The proviso to sub-clause (ii) provides for proportionate exemption when an asset is partly created out of remittances qualifying for exemption and partly from other amounts which are not eligible for such exemption. The first clause or sub-clause (i) contemplates assets which were created out of Pakistan and then were brought to Pakistan by the creator himself or were remitted to the benefit of another person who is an assessee. The provision is attracted only in respect of assets created outside Pakistan and then brought home or remitted to Pakistan for the benefit of the owner of the assets himself or any other person to whom such assets are sent or remitted. In sub-clause (i) the absence of use of words "through regular banking channel" as used in second sub-clause also implies that these are meant for both kind of assets i.e. cash as well as other forms of matter or material. Sub-clause (ii) on the other hand is exclusive to the assets created in Pakistan by an owner of foreign exchange brought in or remitted to Pakistan through regular banking channels, It is only sub-clause (ii) which allows one time conversion of the exempt asset i.e. foreign exchange, into any other asset. In other words the foreign exchange brought or remitted in prescribed manner enjoys exemption not only for itself but also in respect of an asset created out of it. The distinction and the purpose behind the sub-clauses is not far to seek. It is to see that exemption is allowed only in respect of and to encourage bringing of both assets and foreign exchange to Pakistan. However, in order to frustrate unproductive use of the facility it has been provided that the assets, both cash, matter or material remain identifiable. It should be so whether it accompanied an assessee while entering Pakistan or was sent and remitted to Pakistan to another person. The noticeable difference between the two sub clauses is that while under sub-clause (i) the asset in its original shape including cash foreign exchange is exempt, in sub-clause (ii) one time conversion of identifiable foreign exchange to another asset is also permissible for exemption.
The contention that F.E.B.Cs. purchased abroad from foreign exchange and brought to Pakistan are equivalent to foreign exchange remittance is not acceptable both in fact as well as in law. A F.E.B.C. is an interest bearing security issued by Government of Pakistan in exercise of powers conferred upon it by section 28 of the Public Debt Act, 1944 (XVIII of 1944) as notified through Notification No.SR0.575(i)/85, dated June 6, 1985. Mere fact that these certificates can be obtained by making payment in foreign exchange cannot change the basic character of these certificates. A F.E.B.C. in itself is an exempt asset. It is wrong to suggest that both sub clauses (i) and (ii) of the said section are one and the same thing or that their legal effect is alike. The case of the assessee is squarely covered by the provisions contained in sub-clause (i) as the certificates being an asset were brought to Pakistan after purchasing them abroad from foreign exchange. Nothing in the aforesaid sub-clauses lends support to the distinction drawn between the certificates purchased abroad from use of foreign currency and those purchased in Pakistan. The case of the assessee cannot fall in the second category also for the reason that being a bearer security and admittedly purchased outside Pakistan, it cannot be said to have been created out of remittances received or brought into Pakistan through normal banking channel. The conditions prescribed in sub-clause (ii) are therefore- not answered in the case of the assessee. The foreign exchange having been spent abroad and used in purchase of the certificates, nothing was left to be remitted or brought through normal banking channels. These certificates, as provided in Rule 7 of the F.E.B.Cs. Rules, 1985, can be purchased abroad from an "office of issue" or the "buyer resident abroad may remit foreign exchange equivalent to the face value of the certificates to an office of issue located fn Pakistan". The office will then hand over the certificates to an authorised person in Pakistan. According to rule 6 "If the purchase is made in Pakistan the payment shall be made from a foreign currency account held in Pakistan, travellers cheques or remittance of the equivalent foreign exchange from abroad in favour of the office of issue". It will therefore be seen that the kind of distinction drawn between the certificates purchased within and beyond Pakistan is not contemplated in these Rules nor it is seen anywhere in the said provisions contained in section 5 of the Wealth Tax Act. Therefore, the F.E.B.Cs., even if proved to have been purchased abroad from foreign exchange, qualify for one time exemption in the original form both in view of their having been brought into Pakistan as an asset under sub-clause (1) as also on account of being an exempt asset in their own right. Moreover, it is not a remittance through regular banking channel to make it qualify for one time conversion as contemplated in sub-clause (ii). The position would not have been any different if the assessee had brought the foreign exchange in Pakistan or remitted the same to Pakistan and had then purchased these certificates. An assessee, in the scheme of provisions providing for exemption, cannot have the best of both. He cannot have an asset created which earns him interest and at the same time remains liquid so as to be treated as good as cash foreign exchange.
The word "remittances" as used in both sub-clauses of section 5(1)(xv) refers not only to the act of sending of money but also the money itself. "Remittance" means, "money sent, especially by post, for goods or services or as an allowance". Also it means the act of sending money. The word "remit", inter alia, means to transfer, to transmit as money etc. The word "remittance" has been described to mean, "the sending of money etc. to a distance, the sum or things sent". "Remittance" means "money sent by one person to another either in specie, bill of exchange, cheque or otherwise". The word "remittances" as used in sub-clause (ii) is qualified by the condition that it is "received in or brought into Pakistan through normal banking channels". A F.E.B.C. on the other hand is neither money nor it is a popular mode of transfer of foreign exchange from one person to another for any of the above objects. It is not a legal tender within Pakistan or in the country for whose currency it was issued. It is, an interest bearing security issued at home and abroad under the guarantee of Government of Pakistan. The only common character that it shares with money is its transfer by possession. Therefore by reason of its very character and form it can be brought or remitted to Pakistan only as an asset covered by sub-clause (i). It cannot at any rate be a remittance "received in or brought into Pakistan through normal banking channels".
Exemptions are exceptions to general levy. The onus of proof like all other exceptions always lies upon the claimant. A person alleging that his case falls out of the purview of general provisions of a legislation and is covered by the specific exceptions provided therein, must prove it.
The provisions granting exemption or privilege should be construed strictly.
In a taxing statute one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing to be implied. One can only look fairly at the language used.
Burden of proof is on the person who claims exemption and second that a provision relating to grant of exemption is to be construed strictly against the person asserting and in favour of the taxing officer.
Where language of a statute was clear and unambiguous the Court was brought to construe and give effect without taking into consideration anything extraneous to the same.
The proceeds obtained on encashment of F.E.B.Cs. are not entitled to exemption as contemplated in the sub,-clauses of section 5(1)(xv) of the Wealth Tax Act, 1963.
1990 PTD (Trib.) 1059; 1991 PTD (Trib.) 135; I.T.A. No.1028/Hq/87-88; W.T.As. Nos.251, 252/Hq of 1991; 1995 PTD (Trib.) 1162; Rehmatullah & Sons v. Commissioner of Sales Tax 1974 SCMR 127; Concise Oxford Dictionary, 9th Edn.; Chambers: 20th Century Dictionary, New Edn.; Black's Law Dictionary, 5th Edn.; CIT, Rawalpindi v. Rashid Burner, Sialkot (1974) 29 Taxation 221; Government of Pakistan v. Hashwani Hotels Limited PLD 1990 SC 68; Cape Brandy Syndicate v. Inland Revenue Commissioners (1921) 1 KB 65; Messrs Army Welfare Sugar Mills Limited and others v. Federation of Pakistan 1992 SCMR 1652; Salim & Company etc. v. C.B.R. 1997 PTD 1901; A & B Food Industries Limited v. CIT 1992 SCMR 663; 1998 PTD (Trib.) 211 and 1995 PTD (Trib.) 1162 ref.
(b) Wealth tax---
----Exemption---Entitlement---Principles.
Exemptions are exceptions to general levy. The onus of proof like all other exceptions always lies upon the claimant. A person alleging that his case falls out of the purview of general provisions of a legislation and is covered by the specific exceptions provided therein, must prove it.
The provisions granting exemption or privilege should be construed strictly.
Burden of proof is on the person who claims exemption and second that a provision relating to grant of exemption is to be construed strictly against the person asserting and in favour of the taxing officer.
Rehmatullah & Sons v. Commissioner of Sales Tax 1974 SCMR 127; CIT, Rawalpindi v. Rashid Burner, Sialkot (1974) 29 Taxation 221; Government of Pakistan v. Hashwani Hotels Limited PLD 1990 SC 68; Cape Brandy Syndicate. v. Inland Revenue Commissioners (1921) 1 KB 65; Messrs Army Welfare Sugar Mills Limited and others v. Federation of Pakistan 1992 SCMR 1652 and Salim & Company etc. v. C.B.R. 1997 PTD 1901 ref.
(c) Interpretation of statutes---
---- Fiscal statutes---Guidelines for interpretation.
In a taxing statute one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing to be implied. One can only look fairly at the language used.
Where language of a statute was clear and unambiguous the Court was brought to construe and give effect without taking into consideration anything extraneous to the same.
Government of Pakistan v. Hashwani Hotels Limited PLD 1990 SC 68 and A & B Food Industries Limited v. CIT 1992 SCMR 663 ref.
Muhammad Naseem for Appellant.
Anayat Ullah Kashani, D.R. for Respondent
Date of hearing: 5th January, 1997
ORDER
This Full Bench intends to examine if the Division Bench orders of the Tribunal reported as 1990 PTD (Trib.) 1059 and 1991 PTD (Trib.) 135 need reconsideration. The point in issue being whether the proceeds obtained on encashment of foreign exchange bearer certificates enjoy an exemption from levy of Wealth Tax.
2. The answer of the above, question involves interpretation of section 5(1)(xv) of the Wealth Tax Act (as it existed at the relevant time and since substituted by amended section 5 inserted through Finance Act, 1996) allowing exemption in respect of certain assets. It reads as under:------
5(1)(xv) assets
(i)brought or remitted by an assessee into Pakistan or received by an assessee from outside Pakistan, in the year in which they are brought, remitted or received and the following five years;
(ii)created by an assessee out of remittances received in, or brought into, Pakistan through normal banking channels during the period referred to in sub-clause (i):
Provided that where investment in the assets is not made entirely out of remittances received in, or brought into, Pakistan through normal banking channels, the exemption shall apply in the same ratio as the foreign remittances bear to the total investment:
3. In the first reported decision the appellant claimed exemption under the foresaid provision of the Act in respect of the amounts received on encashment of F.E.B.Cs. The assessing officer refused the claim which was upheld by the first appellate authority. A Division Bench of this Tribunal maintained the orders of the Revenue authorities inter alia on the ground that mere possession of certificate did raise a presumption of ownership thereof but such presumption could not extend or lead to another presumption that these were purchased out of foreign exchange. Therefore, in spite of the fact that the assessee had produced the encashment certificates, the claimed exemption was denied on the ground that no proof was adduced regarding the receipt of foreign exchange in Pakistan through normal banking channel.
4. In the second reported decision the assessee purchased F.E.B.Cs. out of foreign exchange remitted to Pakistan and subsequently encashed them. The amount so received was claimed exempt under the aforesaid clauses of section 5 of the Wealth Tax Act. The assessing officer rejected the claim and the first appellate authority approved the refusal. On further appeal Division Bench of the Tribunal upheld, the orders of the Revenue Authorities. It was inter alia observed:---
"It is important to note that the emphasis is on creation of an asset and not on asset itself. Thus, if the assessee has purchased the certificates out of remittances received or brought by him through proper banking channels in Pakistan he has surely created an asset Out when subsequently he is encashing them into Pak rupees he is converting it into another asset. The exemption has been granted to an asset which is created and not to an asset which comes into existence after conversion of the already created asset. Even if it is held that the encashment in Pak rupees is also creation of an asset yet the exemption cannot be extended to it for the simple reason that the law has granted exemption to the asset which is created for the first time out of remittances received or brought in Pakistan through proper banking channels and not to subsequently created assets. If we apply exemption to subsequently created assets then every asset obtained on conversion of previously created asset would be exempted and thus the wealth tax would never be chargeable on it which of course, does not appear to be the intention of the Legislature."
5. The facts in the case in hand are that the assessee an individual returned net wealth for the charge year 1989-90 at Rs.14,13,035. A sum of Rs.5,00,000 was claimed exempt under section 5(1)(xv) as it existed at the relevant time, allegedly advanced 'as loan to M/s. Management and Enterprises Private Limited. The advanced sum was claimed as proceeds obtained from encashment of F.E.B.Cs. purchased abroad from foreign exchange. The assessing officer found the claim as untenable and by referring the C.B.R. Circular No.1T-J-11(42)/85, dated 22-8-85 declined the claim and added the sum to the net wealth of the assessee. Learned first appellate authority C.I.T.(A)-V Karachi through an order recorded on 4-6-1991 maintained the order by placing reliance upon the aforesaid reported decisions of the Tribunal. It was accordingly concluded that under sub-clause (ii) of clause (xv), subsection (1) of section 5 of the Wealth Tax Act, 1963, exemption was available to an asset created for the first time and not to recreated asset which is obtained on re-conversion of the already created assets.
6. Parties have been heard. Learned counsel for the assessee states that the assessing officer was not justified in disallowing the exemption nor the first appellate authority in confirming the same. The reliance by the first appellate authority on the said judgments of the Tribunal is described as inappropriate. The views expressed in the two reported decisions, according to the learned counsel need reconsideration for various reasons. To support the submission he places reliance upon the reasons and the result arrived at by a Division Bench of the Tribunal in I.T.A. No.1028/Hq/81-88 (Assessment year 1986-87), decided on 7-12-1995. Through that order the proceeds on encashment of F.E.B.Cs. were found entitled to exemption. To reach this conclusion the learned Division Bench referred to another unreported decision recorded on 31-10-1991 in W.T.As. Nos. 251 and 252-Hq of 1991 (assessment years 1986-87 and 1987-88). A reported decision of the Tribunal cited as 1995 PTD (Trib.) 1162 was also referred by the learned Division Bench. Learned counsel for the assessee supports the ratio settled in these decisions. Also submits that in the first mentioned unreported decision the learned Division Bench very rightly took a wider view and examined the issue in the context of the Scheme to issue these certificates. It is further stated that the approach adopted in the aforesaid reported decisions has negated the purposes and the objects sought to be achieved by issuance of the F.E.B.Cs. Learned counsel in this connection also refers to the Budget Speech of the Finance Minister for the fiscal year 1985-86 delivered on 23-5-1985 when these certificates were issued for the first time. Interpreting the provision of section 5(1)(xv)(i) and (ii) he states that his case falls tinder sub-clause (ii). Also attempts to draw distinction between the F.E.B.Cs. purchased outside Pakistan from foreign exchange and those purchased within Pakistan from local currency, or as he would like to call it "arranged foreign exchange". In the view of the learned counsel the first kind of transaction falls within sub-clause (ii) and the F.E.B.Cs. so purchased are convertible for any number of times. In the second case he submits, the proceeds available on encashment are exempt for one time only. It is also asserted that F.E.B.Cs. purchased from foreign exchange are in fact foreign exchange in a different form and, therefore, are entitled to all the attributes, characteristics and concessions allowable to foreign exchange under law. The two sub-clauses of section 5(1)(xv) per learned counsel whether read together or separately the result would not be different. Further states that the findings recorded in the aforesaid reported decisions in particular the last portion of para. 5 of the case reported as 1991 PTD (Trib.) 135 as reproduced above is not correct interpretation of law. Similar objection is made in respect of second half of para. fi of the decision. This portion of the order wherein C.B.R. Circular, dated 22-8-1985 was approved reads as under:---
"Thus, if the contention of Mr. Gangat is accepted the exemption would be available to an asset which has come into existence out of an asset which was created out of remittances received or brought in Pakistan through normal banking channels. But as pointed out earlier the exemption is available to an asset which is created and not which is obtained on conversion of the already created asset. I think it is for this reason that the C.B.R. Circular bearing NO.IT.Jr(42)/85, dated 22nd August, 19855 appears to be compatible and in consonance with the provisions of Paragraphs (i) and (ii) of clause. (xv) of subsection (1) of section 5 of the Act."
7. Learned D.R. supports the assessment as well as the first appellate order. The ratio settled in the aforesaid reported decisions of the Tribunal is also supported on the reasons stated therein.
8. After hearing the parties we are of the view that the submissions made at the bar for the assessee are neither new nor these in any way have effectively challenged the above decisions. A plain reading of the provisions contained in section 5(1)(xv)(i) and (ii) reveals that an exemption is allowable in respect of assets, firstly which are brought into Pakistan, or are remitted by an assessee from outside Pakistan. Secondly, the exemption is also allowable in respect of assets which are created out of remittances received or brought in Pakistan through regular banking channels. The proviso to sub-clause (ii) provides for proportionate exemption when an asset is partly created out of remittances qualifying for exemption and partly from other amounts which are not eligible for such exemption. The first clause or sub-clause (i) contemplates assets which were created out of Pakistan and then were brought to Pakistan by the creator himself or were remitted to the benefit of another person who is an assessee. The provision is attracted only in respect of assets created outside Pakistan and then brought home or remitted to Pakistan for the benefit of the owner of the assets himself or any other person to whom such assets are sent or remitted. In sub-clause (i) the absence of use of words "through regular banking channel" as used in second sub-clause also implies that these are meant for both kind of assets i.e. cash as well as other forms of matter or material. Sub-clause (ii) on the other hand is exclusive to the assets created in Pakistan by an owner of foreign exchange brought in or remitted to Pakistan through regular banking channels. It is only sub-clause (ii) which allows one time conversion of the exempt asset i.e. foreign exchange, into any other asset. In other words the foreign exchange brought or remitted in prescribed manner enjoys exemption not only for itself but also in respect of an asset created out of it. The distinction and the purpose behind the sub-clauses is not far to seek. It is to see that exemption is allowed only in respect of and to encourage bringing of both assets and foreign exchange to Pakistan. However, in order to frustrate unproductive use of the facility it has been provided that the assets, both cash, matter or material remain identifiable. It should be so where it accompanied an assessee while entering Pakistan or was sent and remitted to Pakistan to another person. The noticeable difference between the two sub clauses is that while under sub-clause (i) the asset in its original shape including cash foreign exchange is exempt, in sub-clause (ii) one time conversion of identifiable foreign exchange to another asset is also permissible for exemption.
The submission that F.E.B.Cs. purchased abroad from foreign exchange and brought to Pakistan are equivalent to foreign exchange remittance is not acceptable both in fact as well as in law. A F.E.B.C: is an interest bearing security issued by Government 9f Pakistan in exercise of powers conferred upon it by section 28 of the Public Debt Act, 1944 (XVIII of 1944) as notified through Notification No.SR0.575(i)/85, dated June 6, 1985. Mere fact that these certificates can be obtained by making payment in foreign exchange cannot change the basic character of these certificates. It may also be remembered that an F.E.B.C. in itself is an exempt asset. The contention of the learned counsel that his case falls under sub-clause (ii) of clause (xv) of section 5(1) of the Wealth Tax is also not correct. It is equally wrong to suggest that both sub-clauses (i) and (ii) of the said section are one and the same thing or that their legal effect is alike. The case of the assessee is squarely covered by the provisions contained in sub-clause (i) as the certificates being an asset were brought to Pakistan after purchasing them abroad from foreign exchange. Nothing in the aforesaid sub-clauses lends support to the distinction drawn by the learned counsel between the certificates purchased abroad from use of foreign currency and those purchased in Pakistan. The case of the assessee cannot fall in the second t category also for the reason that being a bearer security and admittedly purchased outside Pakistan, it cannot be said to have been created out of remittances received or brought into Pakistan through normal banking channel. The conditions prescribed in sub-clause (ii) are therefore not answered in the case of the assessee. The foreign exchange having been spent abroad and used in purchase of the certificates, nothing was left to be remitted or brought through normal banking channels. These certificates, as provided in Rule 7 of the F.E.B.Cs. Rules, 1985, can be purchased abroad from an "office of issue" or the "buyer resident abroad may remit foreign exchange equivalent to the face value of the certificates to an office of issue located in Pakistan". The office will then hand over the certificates to an authorised person in Pakistan. According to rule 6 "If the purchase is made in Pakistan the payment shall be made from a foreign currency account held in Pakistan, travellers cheques or remittance of the equivalent foreign exchange from abroad in favour of the office of issue". It will, therefore, be seen that the kind of distinction drawn by the learned counsel between the certificates purchased within and beyond Pakistan is not, contemplated in these Rules nor it is seen anywhere in the said provisions contained in section 5 of the Wealth Tax Act. Therefore, the F.E.B.Cs., even if proved to have been purchased abroad from foreign exchange, qualify for one time exemption in the original form both in view of their having been brought into Pakistan as an asset under sub-clause (1) as also on account of being an exempt asset in their own right. Moreover, as observed above it is not a remittance through regular banking channel to make it qualify for one time conversion as contemplated in sub-clause (ii). The position would not have been any different if the assessee had brought the foreign exchange in Pakistan or remitted the same to Pakistan and had then purchased these certificates. An assessee, in the scheme of provisions providing for exemption, cannot have the best of both. He cannot have an asset created which earns him interest and at the same time remains liquid so as to be; treated as good as cash foreign exchange.
The word "remittances" as used in both sub-clauses of section 5(1) (xv) refers not only to the act of sending of money but also the money itself. "Remittance" according to Concise Oxford Dictionary 9th Edition means, "money sent, especially by post, for goods or services or as an allowance". Also it means the act of sending money. In Chambers 20th Century Dictionary, new Edition, the word "remit", inter alia, means to transfer, to transmit as money etc. The word "remittance" in this Dictionary has been described to mean, "the sending of money etc. to a distance, the sum or things sent". According to Black's Law Dictionary 5th Edition "Remittance" means "money sent by one person to another either in specie, bill of exchange, cheque or otherwise". The word "remittances" as used in sub clause (ii) is qualified by the condition that it is "received in or brought into Pakistan through normal banking channels". An F.E.B.C. on the other hand is neither money nor it is a popular mode of transfer of foreign exchange from one person to another for any of the above objects. It is not a. legal tender within Pakistan or in the country for whose currency it was issued. It is, as said earlier, an interest-bearing security issued at home and abroad under the guarantee of Government of Pakistan. The only common character' that it shares with money is its transfer by possession. Therefore, by reason of its very character and form it can be brought or remitted to Pakistan only as an asset covered by sub-clause (i): It cannot at any rate be a remittance "received in or brought into Pakistan through normal banking channels".
11. The acceptance of the claim of exemption by the learned Division Bench through the aforesaid unreported decision; dated 7-12-1995 was solely based upon the consideration of the whole scheme in the perspective of its objects. According to the learned Division Bench a denial of exemption to the proceeds obtained on encashment of F.E.B.Cs. will negate the purpose to introduce the scheme for attracting foreign exchange through issuance of F.E.B.Cs. We will respectfully disagree with the kind of reasoning. If accepted, it will reduce the words of law into a mere guideline. Exemptions are exceptions to general levy. The onus of proof like all other exceptions always lies upon the claimant. A person alleging that his case falls out of the purview of general provisions of a legislation and is covered by the specific exceptions provided therein, must prove it.
12. The provisions granting exemption or privilege according to the Supreme Court in re: Rehmatullah & Sons v. Commissioner of Sales Tax 1974 SCMR 127 should be construed strictly. Similarly were the conclusions of their Lordships of the Lahore High Court in re:" CIT Rawalpindi v. Rashid Burner Sialkot reported at page 221 of the same report. In re: Government of Pakistan v Hashwani Hotels Limited PLD 1990 SC 68 the Supreme Court laid down guidelines for interpretation of taxing statute. It was inter alia held, "In a taxing statute one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing to be implied. One can only look fairly at the language used". These findings based upon the ratio settled in the famous case re: Cape Brandy Syndicate v. Inland Revenue Commissioners reported as (1921) 1 KB 65 at page 71 though made with relation to charging provisions can also be made use of while interpreting provisions allowing exemption. The Supreme Court of Pakistan in re: M/s. Army Welfare Sugar Mills Limited and others v. Federation of Pakistan 1992 SCMR 1652 made a detailed analysis of exemption granting provisions. The two principles of construing a provision of a statute involving exemption from payment of tax as agreed by their Lordships being, first that burden of proof is on the person who claims exemption and second that a provision relating to grant of exemption is to be construed strictly against the person asserting and in favour of the taxing officer. A recent judgment of the Lahore High Court in re; Salim and Company etc. v. C.B.R. reported as 1997 PTD 1901 is based upon these findings of the Supreme Court. The exemption provisions reproduced in para. 2 ante do not admit of any imbugity nor these are stretchable to encompass the proceeds of F.E.B.Cs. The Supreme Court of Pakistan in 1992 SCMR 663 re: A & B Food Industries Limited v. CIT held that where language of a statute was clear and unambiguous the Court was bound to construe and give effect without taking into consideration anything extraneous to the same. We have also noted that it is not a case where two equally acceptable interpretations are possible so that one in favour of the assessee could be adopted. Therefore, applying the ratio settled in the aforesaid judgments of the superior Court, we find no force in ice submissions made in favour of a claim of exemption.
12-A. The point in issue was also considered by a Division Bench at Lahore in a case reported as 1997 PTD (Trib.) 211. The claimed exemption in respect of proceeds of F.E.B.Cs. was refused and in the process another reported decision cited as 1995 PTD (Trib.) 1162 was rather found as supportive to the Revenue. In that case the assessee had purchased F.D.R. and Khas Deposit Certificates out of foreign remittances. Therefore, the ratio settled in that case was held to be distinguishable. It may be noted that the learned Division Bench at Karachi in the unreported decision dated 7-12-1995 had relied upon that case which was not at all applicable to the facts in hand before it nor it is relevant to the facts of the case before us. As said above, the ratio in that case rather favoured the stand taken by the Revenue that only assets created out of foreign remittance received, brought or remitted in the prescribed manner were covered, by the aforesaid exemption clause (ii).
13. Therefore, we are of the considered view that the proceeds obtained on encashment of F.E.B.Cs. are not entitled to exemption as contemplated in the said sub-clauses of section, 5(1)(xv) of the Wealth Tax Act. 1963. Both the above reported decisions as also the reasons on which these were based do not call for any re-consideration as prayed for the assessee. The submissions made at the bar for the assessee in the circumstances must fail as the above referred unreported decision dated 7-12-1995 relied upon by the assessee does not state correct law.
14. These contentions raised by learned counsel for appellant shall fail accordingly and as a result thereto the appeal filed by the assessee will also fail.
M.B.A./360/Trib.Order accordingly.