I.T.AS. NOS.9558/LB, 9559/LB OF 1992-93, 4136/LB OF 1994, DECIDED ON 30TH JUNE, 1998. VS I.T.AS. NOS.9558/LB, 9559/LB OF 1992-93, 4136/LB OF 1994, DECIDED ON 30TH JUNE, 1998., 1998 PTD-INCOME-TAX-APPELLATE-TRIBUNAL-PAKISTAN 3179 (1998)

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

----Ss.30, 19 & 15---Income from house property or other sources---Assessee being an Association of Persons entered into an, agreement with the Capital Development Authority (C.D.A.) to purchase superstructure of the covered bazar and to take the land on lease initially for thirty years---Capital Development Authority failed to transfer the property in the name of the members of the A.O.P.---Assessee having paid total price was duly authorized to let out the shops and receive the rent---Receipts of such rent etc. were being taxed in the hands of tile assessee since the year 1967-68---In the year 1992-93 assessee disclosed the net income and claimed exemption on the ground that property had not vet been transferred in the name of the members of the A.O.P. and argued that as the receipts clearly fell under the head "income from house property" same could not be assessed in the hands of the assessee in absence of a valid transfer deed and since property in question neither belonged to the assessee nor it could be said to be vested in it in any manner, income of one head could not be assessed into another head for any reason whatsoever- --Assessee's version was rejected with the observations that receipts of an income from whatever source, assessee was obliged not only to disclose it to the revenue but also to show that same was exempt under the provisions of the law under which it was claimed---Mere contention that the assessee was not owner of the property in question, did not absolve him from the duty to pay tax on such receipts---Receipts were accordingly assessed under the head "income from other sources".

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

----S.30---Income from other sources---Interest income is assessable under S.30 of the Income Tax Ordinance read with sub-cl. (f) of S.15 of the Ordinance but where it is established that the interest had accrued to the assessee on account of a particular business, such-like banking, the sub-head of income shall be changed and it will be assessed under sub-cl. (d) of S.15 as "income from business or profession".

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

----S.15---When an income properly fell in one sub-head, it could not be assessed in another sub-head---However, it was never held that if an income falling in one sub-head cannot, for any reason, be taxed under that sub-head then it shall not be taxed at all.

(1957) 32 ITR 688 ref.

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

----S.15(c)---Income from house property---Property not owned by assessee- Rent received by assessee would not fall under the head "income from house property" ---Contention that rent received could not be carried to any other head for the purpose of assessment was baseless.

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

----Ss.30 & 15(f)---Income from other sources---Income of every kind has to be included in the total income' of an assessee chargeable under the head "income from other sources" if it is not included in his total income under any other head---Income which is not chargeable under any of the sub heads (a) to (e) of S. 15 will automatically fall under head "income from other sources" and assessed as such---One and the same kind of income, however, shall not be charged to tax under two different heads.

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

----S.14---Exemption---Provisions of exemption---Onus of proof-- Exemption when claimed must be supported by reference to an express provision of law and onus of proof to establish such exemption from levy of tax is always on the claimant.

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

----S.14---Provision of exemption from payment of tax---Burden of proof-- Principles-- -Burden of proof is always on the person who claimed exemption---Interpretation of statutes--- Prevention containing exemption-- Construction---Mode---Provision relating to grant of tax exemption is to be construed strictly against the person asserting and in favour of the Taxing Officer.

1992 SCMR 1652 ref.'

(h) Income-tax---

----Nature of receipts---Determination---Character of income or receipts is determined in the hands of the recipient and not on the basis of the treatment given to such receipts by a payer in its books---Nature of payment by the tenants is not determinative factor of the nature of receipts in the hands of the assessee.

Mian Muhammad Azeem for Appellant.

Shafqat Mahmood Chohan, L. A. for Respondent.

Date of hearing: 17th June, 1998.

ORDER

NASIM SIKANDAR (JUDICIAL MEMBER).---The assessee appellant is an A.O.P. which is stated to have entered into an agreement with Capital Development Authority with respect to a Commercial Property namely G-613/4 Islamabad commonly known as Siraj Covered Bazar. The property in question was statedly constructed by the C.D.A. having done so it expressed an intention to lease out the same. Ch. Siraj Din member of the A.O.P. along with his wife and four sons joined themselves into a partnership on 25-5-1966 in order to acquire the said property. After a negotiated deal the aforesaid individuals as well as the C.D.A. entered into an agreement on 13-6-1'967. According to his agreement the authority agreed to sell the super structure of the covered Bazar for a sum of Rs.20,00,000 and to lease out the land/site there under initially for period of thirty years. This period was allegedly extendable for another two terms of thirty years each. The prospective purchasers assumed possession of the building by making an initial deposit of Rs.5,00,000 and the remaining consideration of the agreement was also duly paid. It is stated that the purchasers were empowered under the agreement to lease out the shops to different tenants having experience in specific trades to recover rent from them. However for some good reason neither the transfer of the structure took place nor the lease agreement could be executed. This appears to have constrained the aforesaid individuals to file a suit for specific performance and permanent injunction before the Civil Court at Islamabad. The suit so filed on 24-1-1990 is stated to be still pending decision.

2. In the year 1990-91 the assessee A.O.P. initially filed a return to show income from property at Rs.5,07,054. However, subsequently it was revised to claim exemption by mentioning in part 2 of the return form IT-11. On being confronted the assessee stated that since a transfer deed had not so far been executed in its favour with respect to the superstructure nor a regular lease deed had been executed and registered with the Sub-Registrar regarding initial lease of thirty years, the rental income received from the tenants of Bazar was in fact the income of the C.D.A., and therefore, was not liable to tax in the hands of 'the A.O.P. The assessing officer was, surprised with the gesture. He noted that since the year 1967-68 till the immediate preceding year 1989-90 rentals received by the A.O.P. were assessed in its hand as income from property. Also that the assessee during the aforesaid period has all along been voluntarily offered these sums for taxation except in the years under review for which no plausible reason was found to have been made. The assessee in reply to a notice under section 62 of the Ordinance as well as orally repeated the plea that since no sale-deed had been executed in favour of the assessee A.O.P. it was not "owner" of the property and as such provisions of section 19 of the Ordinance were not attracted to its case. In support of its submission the learned A.R. for the assessee relied upon a reported judgment of the Karachi High Court cited as 1967 PTD 231 re: Bacho Bhai F.E. Dinsha, Karachi v. CIT. Also reliance was placed upon a Full Bench decision of this Tribunal dated 18-7-1991 recorded in the case of the assessee W.T.As. Nos. 150 to 154 (I-B)/1985-86 (Assessment years 1979-80 to 1983-84) and W.T.As. Nos.50 to 56(1-B) of 1988-89 (Assessment years 1976-77 to 1982-83). By way of at order a Full Bench of this Tribunal accepted the appeals of the assessee on Wealth Tax side and cancelled the wealth assessments for the aforesaid years.

3. The assessing officer, however, was not impressed. He found that the assessee was enjoying all the rights as an "owner" and was receiving rent from the tenants including the assessment years in question. Further that, as for the department was concerned the issue of taxability of the rentals were finally determined by a Division Bench of this Tribunal at Lyallpur on 12-2-1975 in W.T.As. Nos.2240 to 2243 of 1973-74. (Assessment Years 1967-68 to 1970-71) re: Siraj Covered Bazar Islamabad, Head Office Lyallpur v. the I.T.O. Investigation Circle-III, Lahore. For the reasons stated in this judgment the assessing officer opined that he was not obliged to follow the principle laid down in the aforesaid order of the Tribunal recorded on 18-7-1991 on the Wealth Tax side. Also he attempted to distinguish the aforesaid judgment of the Karachi High Court in re: M/s Bachu Bhai Dinsha (supra). It was further noted that the assessee having failed to approach any higher forum against the aforesaid order of the Tribunal recorded on 12-2-1975 its reliance on the judgment of the Karachi High Court was of no use. Also he attempted to distinguish that case from the case of the assessee on the ground that before their Lordships of the Karachi High Court the matter pertained between two individuals but here it was a Ideal body, namely C.D.A. whole income was exempt from levy of Income Tax. In the view of the assessing officer the assessee having paid the total price and having duly been authorised to let out shops and to receive rent could not wriggle out from its liability to pay tax in one guise or the other. Further that, since all these receipts were being taxed in the hands of the assessee since the year 1967-68 no justification under the sky appeared to deviate from that course after so many years. Finally it was noted that the C.D.A. never refused to execute documents of transfer though a dispute of technical nature existed between the assessee and the C.D.A. For these reasons the assessing officer proceeded to assess net income of the assessee at Rs.6,64,578 and Rs.6,86,628 in the years 1990-91 and 1991-92 by way of a consolidated order recorded on 17-11-1992. The six members of the A.O.P. were accordingly directed to be assessed on their individual shares for the purpose of levy of Income Tax. It will be noted that for the purpose of computation of net income the assessing officer allowed only a sum of Rs.4,045 each in two years as ground rent paid to C.D.A..

4. In the year 1992-93 the assessee disclosed net income at Rs.5,82,226 and indicated the same in part-II of the return of the Income. The claim for exemption was repeated for the same reasons that since the property had riot been transferred in the names of the members of the A.O.P. and that it still belonged to C.D.A. the rentals were not taxable in its hands. The assessing officer, however, with reference to its findings recorded in the immediate preceding years proceeded to reject the contention and to determine net income at Rs.8,17,951. In this years again the ground rent of Rs.4,025 was allowed as expense and the six members of the A.O.P. were appointed part of income in proportion to their shares by way of the assessment order recorded on 25-5-1993.

5. Learned first appellate authority CIT(A)-I. Faisalabad vide its order dated 3-4-1993 only partially agreed with the submissions made before it. After considering the ratio settled in the reported judgments relied upon before it namely; 59 ITR 547 (SC), 42 ITR 49(SC), 39 ITR 114(SC), 46 ITR 665 (SC) and 41 ITR 428 (SC) it came to the conclusion:

"I have gone through the decision of the Hon'ble Judges referred to above. The appellants case is clearly distinguishable. No doubt income from property, cannot be assessed in the hands of the A.O.P. as the property was never transferred in their name. However, the receipts are there against certain investment and the receipts are revenue receipts in nature. Even the learned A.R. did not dispute the nature of receipts. Under the circumstances, the appellants's income shall be assessed tinder section 30 of the Income Tax Ordinance, 1979 as income from other sources. The income assessed by the learned I.A.C. is fully justified. The grievance are thus, misconceived".

6. In the year 1992-93 learned first appellate authority by way of its order dated 11-8-1994 rejected the contention of the assessee that the property having not been transferred in the names of the members of the A.O.P. and still belonged to C.D.A. which alone was responsible for payment of Income Tax as an owner. Before the first appellate authority reliance was placed upon the aforesaid two judgments of the Karachi High Court namely 1967 PTD 231 re: Bacho Bhai F.E. Dinsha (supra) and 1989 PTD 670 re: B.D. Avari v. CIT. Learned first appellate authority distinguished the cases on the ground that the parties involved in both of them were private individuals while in the case of the appellant it was a statutory body namely C.D.A. which was a party. Also inference was drawn from the transfer of properties in Cantonment area, where lease hold rights are allowed to the individuals who built houses thereon and also frequently sold to other person for consideration. In the present case learned first appellate authority opined, the appellant was enjoying all the rights of the individuals including receiving of rents from the tenants. Even the market in question was named for the eldest member of the A.O.P. Mr. Siraj Din and was known as Siraj Covered Bazar. The conduct of the assessee in changing position was also taken into account to finally held that the A.O.P was an owner of the property both in fact as well as in law. Finally the alternate plea of the assessee with regard to 20% allowance for repair etc. was found justified and, therefore directed to be allowed However, the assessee still feels dissatisfied.

7. Parties have been heard. Learned counsel for the assessee has narrated in detail each and every factual aspect of the case starting from the offer made by the A.O.P. to take the aforesaid Bazar on lease hold rights. The pending litigation between the assessee and the C. D. A. According to him the arrangement with the C.D.A. was basically a hire ,purchase agreement but the promisee authority failed to honour the same by placing reliance upon the aforesaid order of the Tribunal dated 18-7-1991. Learned counsel states that the issue of status of the assessee with regard to the property in question stands finally decided by a Full Bench of this Tribunal. Therefore, in the view of the learned counsel this issue can no more be touched. As far the earlier year the Tribunal dated 12-2-1975 is concerned learned counsel states that since the question of ownership was not raised before the learned Benches the issue was not decided and that being a legal issue the assessee can raise it at any time and even before the highest forum. According to the learned counsel mere non-raising of the issue of ownership or an objection against assessment on Income Tax side on this score does not debar the assessee from raising this defence in any subsequent year. Every assessment year being an independent accounting period learned counsel stresses that an objection to the vires of the assessment can be raised by the assessee whenever it is made irrespective of the fact whether or not a similar objection was taken in earlier years. Learned counsel further contends that there is neither estoppel against law nor principle of the res judicata is applicable to Income Tax Proceedings. On facts he claims that the C.D.A. still being the owner of the property all rental receipts were liable to be assessed in its hands as income from house property under section 19 of the Income Tax Ordinance. Again places reliance upon- the aforesaid two judgments-of the Karachi High Court to state that a proper registered sale deed having never been executed in favour of the assessee A.O.P. or its members individually the question of assessment of rental receipts in its hands as income from house property could not arise at all. According to the learned counsel the classes or categories of income enshrined in section 15 of the Income Tax Ordinance are mutually exclusive. Further that, where a particular receipt or income properly falls in one head it cannot be taken into another or for that matter cannot be assessed in the residuary clause (f) of section 15. It is explained that all rental receipts in the hands of the assessee were in fact from house property but these could not be assessed in its hands on the ground that it was not full owner of the same. In such situation, in the view of the learned counsel income from house property cannot be assessed under any of other sub-heads of section 15 including the residuary clause of income from other sources. In other words learned counsel continues an income or receipts which is squarely covered by one sub-head it cannot be assessed in another sub-head for any reason whatsoever. In the case in hand according to the learned counsel it is only the C.D.A. which can be assessed to Income Tax for the aforesaid rental receipts and that the same cannot be assessed under that head in the hands of any other person including the assessee. In support of the proposition learned counsel places reliance upon (1962) 46 ITR 655 re: Bengal Assam Investors Limited v. CIT West Bengal. In that case a Division Bench of the Calcutta High Court while interpreting the various provisions of the late Act of 1922 propounded that the language of section 6 and the phraseology of sections 7 to 12 shows that intention of the legislature was to make various heads of income profits and gains matually exclusive. The second case relied upon is cited as (1960) 39 ITR 114 re: Behar State Cooperative Bank Limited v. CIT. In that case their Lordships of the Supreme Court of India in similar terms found that various heads in section 6 of the Income Tax Act were mutually exclusive.

8. On the proposition that in the facts and circumstances of this case since no registered sale-deed had been executed by the C.D.A. in favour of the assessee, and therefore, ownership still vested in the same authority the learned counsel relies upon (1976) 102 ITR 499 re: CIT Bombay City v. Zorostrian Building Society Limited, (1970) 77 ITR 637 re: CIT West Bengal II v. Ganga Properties Limited, (1982) 83 ITR 794 re: CIT Bombay City-I v. Union Land and Building Society Limited. In all these cases from Indian jurisdiction their Lordships expressed the view that in absence of the valid transfer deed the prospective purchase under an agreement to sell or a like document did not acquire any right, title or interest in the demised property. Therefore, in these cases it was found that seller remained an owner of the property and accordingly liable to various levies. Besides the aforesaid two cases of the Karachi High Court re: Bachu Bhai F.E. Dinshaw (supra) and B.D. Avari v. CIT (supra) learned counsel has also cited at the Bar an order of the Peshawar Bench of the Tribunal cited as (1997) PTD Trib. 286. In that order it was found that expression "of which the assessee is owner" as used in section 19(2) of the Income Tax Ordinance, 1979 was very significant and clearly showed that it was only the owner of the land or building in whose hands its income was liable to be taxed. The learned Benchers were deciding the treatment of rental income arising out of the mortgaged property. While interpreting the provisions of subsection (3) of section 83 of the Income Tax Ordinance they found that a mortgage was essentially a revocable transfer and the above provisions of subsection (3) (were clear that where the assets remained the property of the transferor, the income, from the same shall be taxed in his hands and not the transferee.

9. Lastly learned counsel contends that the assessee does not fall into any heads of income as contemplated in section 15 of the Ordinance and therefore its income is not liable to Income-tax. Further that the source of income being house property and the assessee not being an owner of the property is not liable and if a doubt in this regard exists it should be resolved in the favour of the assessee. On this proposition reliance is placed upon a reported judgment of the Karachi High Court in ref M/s. Electronic Lamp Manufacturers of Pakistan v. Government of Pakistan cited as 1989 PTD 42. In that case their Lordships settled it as a principle of interpretation of fiscal statutes that when two interpretation were possible one which favoured the tax payer/citizen had to be preferred. Mian M. Azeem learned counsel for the assessee also confidently cites a reported judgment of the Tribunal 1989 PTD 720 (Trib.) wherein inter alia it was reiterated that avoidance of incidence of tax was permissible in law. This case has been cited by the learned counsel to support submission and to answer the objection of the Revenue that avoidance of incidence of taxation wherever permissible in law does not carry any stigma with it.

10. Mr. Shafqat Mahmood Chohan, L.A. assisted by learned D.R. Mr. Ahmad Kamal, however, opposes the proposition. According to them in the first instance the assessee enjoying all the benefits of an owner is liable to pay tax an secondly an admitted receipts in the hands of an individual cannot be allowed to go untaxed merely for the reason that it fell under one sub head of section 15 of the Ordinance while the recipient was not identified in that sub-head of the income. Learned Legal Advisor, however, admits that the Revenue is not in appeal against the first appellate order which become at variance in the first two years when juxtaposed with the third year. Also placed reliance upon a reported judgment of the Tribunal cited as 1996 PTD 122 which, however, does not appear relevant to the issue in hand.

11. The contentions of the parties have been considered. We will not take long in saying that the issue of a relationship of A.O.P. or its members individually with the property in question having finally been settled by the aforesaid order of the Tribunal on Wealth Tax side dated 18-7-1991 no further strain is needed to be made. In that order, it is repeated, the Full . Bench of the Tribunal cancelled all the wealth tax assessments after holding that in absence of a valid transfer deed - the property in question neither belonged to the assessee nor it could be said to be vested to it in any manner. Before reaching that conclusion learned Benchers sought guidance from as many as twenty reported judgments of the superior Courts of India as well as the Supreme Court of Pakistan and the Karachi High Court. Also the principle settled in the three reported judgments of the Tribunal was recalled. The Full Bench in para. 18 of that order summarised the finding in these words:

"As the context reveals, the words 'held' 'belonging' and 'vests' in the Act with reference to 'assets' and 'net wealth' are ,interchangeable and connote the element of proprietary title or absolute ownership, distinct from permissive possession. Judging the matter in this light, it becomes crystal clear that the appellants do not enjoy any title or ownership in respect of the disputed property and hence they are not liable to any wealth tax levy on this score. These three words have been used as synonyms to denote ownership and admit of only one interpretation. Even otherwise, theinterpretation favourable to the appellants must prevail and, on this account also, the appellants do not stand in any worse position. From this, it follows as a corollary that the word 'or' appearing between the words 'title' and 'interest' in Explanation (iii) to clause (m) of section 2 of the Act has been used as a substitute for the word "and" and is interchangeable with it as held by the Superior Courts. Since the right title and interest in the disputed property have not been duly transferred to the appellants by the C.D.A. through a property registered instrument, they do not incur any wealth. Tax liability in respect thereof."

12. As remarked earlier the Tribunal having already held that the assessee was not an owner of the demised property the rentals received there from certainly could not be taxed in its hands under section 19 as income from house property. Therefore, the aforesaid reported judgments of the Indian jurisdiction, the Karachi High Court and of the Tribunal do not need discussion at length.

13. The other submission of the assessee that it was not liable to Income Tax on these receipts under any other sub-head is clearly mistaken. It may be noted that not only the receipts but their nature is also admitted. Also that this issue was being raised for the first time for the year 1990-91 inasmuch as earlier the assessee has always been offering these receipts for tax though as income from property. No objection of the kind either with regard to the head of income or eligibility of the receipts to tax was ever raised by the assessee at any stage of the proceedings, even when it approached this Tribunal last time in the year 1975 when its appeals for the years 1966-67 to 1970-71 were disposed of by the aforesaid order dated 12-2-1975. Although there is no estoppel against law and principle of res judicate is not applicable in Income Tax Proceedings to certain extent yet it betrays the conduct of the assessee in changing positions so that incidence of proper taxation is averted. Any person in receipt of an income from whatever source is obliged not only to disclose it to the Revenue but also to show that it is exempt under any of the provision of the law where so claimed. The claim of the assessee that rent receipts were exempt in its hands was never supported by any provision of the Income Tax Ordinance. It is an established proposition of law that every claimant of exemption has to establish it beyond any shadow of doubt. Mere contention that the assessee was not owner of the property in question did not absolve it from the duty to pay tax on such receipts. No provision of Income Tax Ordinance having been referred in support of the claimed exemption we will agree with the authorities below that no such concession was available to the assessee at all. It will also be noted that the assessee never denied the liability on the ground of diversion by overriding title. In fact such a plea could not arise at all inasmuch as the receipts and the source both are admitted. All the moreso when the assessee is still a contender of the demised property before the Civil Court by way of a suit for specific performance and permanent injunction.

14. The submission that once a class of income falls in one of the several heads given in section 15 of the Ordinance it cannot be taken or assessed in any other head is again a half truth. The instances are not lacking where one kind of income is taken to another on account of peculiar facts of the case. For example generally interest income is assessable under section 30 of the Income Tax Ordinance read with sub-clause (f) of section 15 of the Ordinance. However, where it is established that the interest accrued to the assessee on account of a particular business such like banking the sub-head of income shall be changed and it will be assessed under sub-clause(d) of section 15 as income from business or profession. The two reported judgments re: Behar State Cooperative Banking Limited v. CIT (supra) and Bengal Assam Investor Limited v. CIT (supra) also do not lend any support to the assessee. In the first case the assessee before the Supreme Court of India was a Cooperative Bank and had one of its objects the carrying on of general banking business not repugnant to the provisions of the Cooperative Societies Act. It received interest on short term deposits made with Imperial Bank of India. The assessee showed the interest as income from other sources, and the assessing officer assessed it to Income Tax as such under section 12 of the Late Act of 1922. The assessee made a claim of exemption with regard to the interest so earned by relying upon a Notification of Central Board of Revenue. The Tribunal held that interest was rightly treated as income from other sources as it did not form pan of the appellant's business profit and was therefore not exempt from Income Tax. On reference the Patna High Court held that only income derived from the business of the cooperative society qualified for exemption and that the same was not available in regard to income derived from investment on fluid assets with third parties. On further appeal their Lordships of the Supreme Court found for the assessee remarking that the appellant being a bank and one of its objects being to carry on the general business of banking which it was to deal in money and credit which included not only receiving deposits and lending money but also to invest money in such manner that they are readily available. Further that the moneys laid out in the form of deposits did not cease to be part of appellant's circulating capital The interest from the deposits arose from the business of the bank, and therefore, was exempt from Income Tax in view the said Notification. The proposition being put forth by the assessee before us does not find support from any of the aforesaid findings and in relation to that proposition these cases are not relevant at all. In the second decision the issue before the Calcutta High Court was also different. The assessee before the Court was an investment company. The question for decision before their Lordships being if income from dividend was a business income of the assessee company. By relying upon a judgment of the Supreme Court of India in re: United Commercial Bank Limited v. CIT cited as (1957) 32 ITR 688 their Lordships determined that when the shares were held by the investor company on which dividend was received tax had to be computed under section 12 of the Late Act of 1922 and that the assessee could not say that this being its main activity the income received was its "business income" under section 10 of that Act. In this case as well we find no authority to accept the contention of the assessee before us that once the income falling in a particular sub-head is not found liable to tax for one reason or the other then it shall escape assessment. In both the aforesaid decisions the Courts certainly found that when an income properly fell in one sub-head it could not be assessed in another sub-head. However, it was never held that an income falling in one sub-head if for any reason cannot be taxed under that sub-head then it shall not be eligible to tax at all. It may further be seen that the proposition is somewhat self -contradictory inasmuch as the assessee before the Revenue has never been the Capital Development Authority. It is only if the authority had been taxed the rentals received by the assessee under the head income from house property that such kind of contention could have been made. When the assessee itself claims absence of ownership of the demised property then rent received in its hand in the first instance could not properly fall under sub-clause (c) of section 15 of the Ordinance as income from house property. Since that sub head of income was not attracted on account of absence of ownership the contention of the assessee that it could not be carried to any other head for the purpose of assessment is baseless. Section 30 read with sub-clause(f) of section 15 of the Ordinance contemplates that income of every kind may be included in the total income of an assessee chargeable under the head "income from other sources" if it is not included in his total income under any other head. The last phrase of section 30(1) is self-speaking that an income which is not chargeable under any of the sub-heads (a) to (e) of section 15 will automatically fall under the head "income from other sources and assessed as such. The only condition appears that one arid the same kind of income shall not be charged to tax under two different heads. The kind of embargo being visualized by the assessee with regard to non-availability of an income to be carried to another sub-head neither exists in fact nor even if assumed it did is of any forensic value in the facts before us.

15. The assessee being in receipt of rent was required to offer it for tax under the relevant sub-head given in section 15 of the Income Tax Ordinance. Its attempt to avoid the same by saying that since the nature of receipts was assessable under one sub-head but it could not be done in the hands of the assessee for a technical reason cannot be allowed to succeed. For, if accepted it would nullify the express provisions of section 30 of the Income Tax Ordinance read with sub-clause (f) of section 15. The claimed exemption is also non-existent both in fact as well as in law. The assessee wants to eat its cake and still to have it. For over two decades it offered rentals for tax as income from house property. However, after succeeding before the Tribunal on wealth tax side it appears to have decided to take a chance on Income Tax side as well. The reasoning and pleadings made for this purpose, as noted earlier, are legally unacceptable. Approbation and reprobation cannot flow side by side. It is not a question of interpretation of any provision of the Income Tax Ordinance including section 15, section 19 or section 30 so that the one favourable to the assessee should be adopted. Also it is not a case as alleged by the assessee in which income can legally escape assessment. It is a clear case where an assessee seeks an exemption, which is not available. An exemption when pleaded must be supported by reference to an express provision of the law. These provisions, it will be noted, are to be strictly construed and onus of proof to establish an exemption is always on the claimant. This was how their Lordships of the Supreme Court of Pakistan viewed the proposition in 1974 SCMR 127 re: Rehmatullah & Sons v. Commissioner of Wealth Tax. In another case re: Army Welfare Sugar Mills Limited v. Federation of Pakistan cited as (1992) SCMR 1652 the Supreme Court reiterated the two basic principles of construing a provision of a statute involving exemption from payment of tax. The first rule being that burden of proof is always on the person who claims exemption. The second rule being that the provision relating to grant of tax exemption is to be construed strictly against the person asserting and in favour of the taxing officer. These findings were followed by the Lahore High Court in 1997 PTD 1901 re: M/s. Salim & Company v. the C.B.R. In the case before us the assessee never referred to any provision of the Ordinance to plead exemption nor in fact any such exemption exists in the Ordinance or for that matter in any other relevant law.

16. As far the nature of receipts is concerned it is by now well -established that the character of income or receipts is determined in the hands of the recipient and not on the basis of the treatment given to such receipts by a payer in its books. The tenants of the assessee did pay rent but the assessee not being the owner of the premises was liable to tax as income from other sources. The nature of payment by the tenants is not determinative factor of the nature of receipts in the hands of the assessee.

17. The first appellate order recorded for the years 1990-91 and 1991-92 on 3-4-1993 therefore appears to have made a correct appreciation of facts as well as the law applicable to them. Through that order, as noted earlier, the first appellate authority directed that assessee's income should be assessed under section 30 of the Income Tax Ordinance as income frour other sources. The second appellate order recorded on 11-8-1994 for the assessment year 1992-93 has however suprised us. Not only it failed to take notice of the earlier order but also recorded a finding affirming treatment of income from house property which was against the principle settled by this Tribunal on Wealth Tax side by way of its order dated 18-7-1991. The recording of a contradictory order by the same authority in respect of the same assessee and on same set of facts cannot be approved. In absence of any change in the nature of income or the facts occurring after recording of earlier order the rule of consistence requires that recording of divergent opinion should be avoided as far as possible. Since no change in the facts occurred in the assessment year 1992-93 we will set aside the first appellate order recorded for that year dated 11-8-1994 and remand the matter to the CIT(A) to record a fresh finding in the light of the aforesaid observations as well as the order of the Full Bench made on the Wealth Tax appeals of the assessee. The consolidated first appellate order for the earlier two years 1990-91 and 1991-92 recorded on 3-4-1993 is approved and maintained.

18. The appeals of the assessee, therefore, will fail in the first two years and in the third year it will succeed only to the extent of remanding of issue for a fresh decision as directed above.

C.M.A./546/Trib. Order accordingly.