W.T.AS. NOS. 126(PB) AND 180(PB) OF 1995-96 VS W.T.AS. NOS. 126(PB) AND 180(PB) OF 1995-96
1997 P T D (Trib,) 283
[Income-tax Appellate Tribunal Pakistan]
Before Fazalur Rehman Khan, Judicial Member and Abdur Rehman Afridi, Accountant Member
W.T. As, Nos. 126(PB) and 180(PB) of 1995-96, decided on 23/07/1996.
Wealth Tax Act (ACV of 1963)------
-----S,3----Constitution of Pakistan (1973), Art,247(3)---Provincially Administered Tribal Areas--.Application of Wealth Tax Act, 1963---Property of assessee was situated in District of Chitral, to which, the provisions of Wealth Tax. Act, 1963 had not been extended in the manner as prescribed by Art,247(3), Constitution of Pakistan ...Such property, held, could not be assessed to Wealth Tax Act.
1984 S C M R 374 ref,
M.A. Azeem for the Assessee.
Yousaf Ghaffar Khan, MR. for the Department,.
Date of hearing: 23rd July, 1996.
ORDER
These two Wealth Tax cross-appeals, arise out of the Order dated 8-1-1995 of the learned Commissioner of Wealth Tax (Appeals), Zone-I, Peshawar whereby appeal of the assessee/appellant for assessment year 1994-95 was partially accepted.
2. The brief facts giving rise to these appeals are that the appellant is an individual, having movable/immovable assets. The appellant furnished return for the year under appeal, declaring net value of his assets at Rs.3,95,195. In response to notices under subsections (2) and (4) of section 16 of the Wealth Tax Act, 1963 (hereinafter called the Act), the appellant alongwith his A.R. attended the office of the Assessing Officer and produced bank certificates, National Saving Certificates and Car registration. After discussion, the assessment was made as under:---
Immovable Assets:
| 1. | House belonging to wife and claimed exemption as self-occupied. | Exempt. |
| 2. | Property at Chitral. | |
| | No value has been declared in the return. In a separate letter, dated 20-6-1995 its value declared at? Rs.4,00,000. The property is not exempt and is taxable under section 2(m) of the Wealth Tax Act, 1963. However, the declared value is accepted subject to action under section 17/35. | Rs.4,00,000 |
Movable assets:
| 1. | DSC declared at Rs.3,50,000 being exempt. Hence ignored. | ------ |
| 2. | Cash in hand declared at Rs.3,70,000 is being certified, hence accepted. | Rs.3,70,000 |
| 3. | Saving Accounts. | Rs. 25,195 |
| | Declared at Rs.25,195. No zakat deducted. The declared is accepted. | |
| 4. | Motor Car. | |
| | The assessee has not declared the same In return but have filed its registration, the vehicle is Suzuki Car 89 Model. As per Model rate, its value is assessed at Rs.1,50,000. | |
| | Total taxable wealth. | Rs.1,50,000 |
| | Wealth tax on above. | Rs.9,45,195 |
| | | Rs. 6,952 |
3. Feeling aggrieved, the appellant went in appeal and the learned CWT(A) vide his order quoted above, partially accepted the appeal of the appellant, allowed basic exemption of Rs.10,00,000 and maintained rest of the treatment. Both the appellant and the Department are aggrieved by the order of the learned CWT(A) and have filed these cross-appeals.
4. We have heard the learned A.R. for the appellant as well as the learned D.R. and have also perused the record.
5. The appellant is mainly aggrieved by assessing the value of the house at Chitral and including the same in the assessment while the Department is aggrieved by allowing the appellant, the basic exemption.
6. So far as the valuation of the house at Chitral is concerned, under sub-clause (i) of clause (b) of Article 246 of the Constitution of the Islamic Republic of Pakistan, 1973 (hereinafter called the Constitution), the District of Chitral is included in the Provincially Administered Tribal Areas (PATA) and clause (3) of Article 247 of the Constitution provides that:---
"No Act of Majlis-e-Shoora (Parliament) shall apply to any Federally Administered Tribal Area or to any part thereof, unless the President so directs, and no Act of Majlis-e-Shoora (Parliament) or a Provincial Assembly shall apply to a Provincially Administered Tribal Area, or to any part thereof, unless the Governor of the Province in which the Tribal Area is situate, with the approval of the President so directs; and in giving such a direction with respect to any law, the president or, as the case may be, the Governor, may direct that the law shall in its application to a Tribal Area, or to a specified part thereof, have effect subject to such exceptions and modifications as may be specified in the direction."
7. According to clause (3) of Article 247 of the Constitution, as reproduced above, no Act of Parliament or a Provincial Assembly is automatically applicable to a Provincially Administered Tribal Area (PATA), or any part thereof, unless the Governor of the Province in which the Tribal Area is situated, with the prior approval of the President, so directs. The Act is a piece of Central legislation and at the time of arguments, the learned D.R. could not produce any Notification, or any Regulation showing that the Governor of N,W.F,P. with the prior approval of the President, has extended the Act to the District of Chitral. The above conclusion is not only supported by the express provision's of the Constitution but In this view of ours, we are also supported by 1984 SCMR 374.
8. Section 3 of the Act is a charging section and under the provisions of the same, wealth tax is leviable on the net assets of an assessee and not on the person of an assessee. As, the house of the appellant, which has been assessed, is situated in the District of Chitral, to which, the provisions of the Act had not been extended in the manner as prescribed by the Constitution, the same, therefore, cannot be assessed. As such, the finding of the learned two forums below on the issue is wrong? illegal and cannot be maintained.
8-A. As far as the departmental appeal which pertains to the allowance of basic exemption of Rs.10,00,000 is concerned, we find no force in the same. The learned Assessing Officer has not allowed any exemption to the appellant and the learned CWT(A) has allowed the same. The appellant has not claimed any other exemption in his assets, as such, the same is allowable. The order of the learned CWT (A) on the issue is therefore correct and calls for no interference.
9. Consequently, the appeal of the appellant is partially accepted in the manner and to the extent indicated above while the departmental appeal falls and is hereby rejected.
M.B.A/279/Trlb. ???????????????????????????????????????????????????????????????????????????????? Order accordingly.