Income Tax Ordinance (XXXI of 1979)---

----S.136---Constitution of Pakistan (1973), Art. 199---Constitutional petition--- Assessment--- Assessee's appeals against assessment were rejected by Appellate Forums including Income-tax Appellate Tribunal ---Remedy-- Assessee, if, aggrieved, could have moved High Court under S.136, Income Tax Ordinance, 1979 by making reference against decision of Income Tax Appellate Tribunal on points of law---Instead of filing such Reference, assessee moved miscellaneous application against decision of Appellate

Tribunal which was rejected ---Assessee, thereafter, moved review petition which was also dismissed ---Assessee, even then took no steps to move Reference under 5.136, Income Tax Ordinance, 1979 and instead filed Constitutional petition much after the expiry of time prescribed for making Reference to High Court under S.136, Income Tax Ordinance, 1979-- Assessee's prayer that his Constitutional petition be converted into Reference under S.136, Income Tax Ordinance, 1979 could not be accepted, for, last order by Income Tax Appellate Tribunal on review application was passed on 14-1 i-1993 whereas Reference was required to be filed within 90 days of date of original decision of Appellate Tribunal which was rendered on 3-4-1991---Inordinate delay of many years would hardly justify conversion of Constitutional petition into reference in terms of S.136, Income Tax Ordinance, 1979, which would now be patently and hopelessly time-barred- All factual and legal issues had been thoroughly thrashed out at the level of income Tax Appellate Tribunal---No material however, was pointed out from which question of law could be framed under S.136, Income Tax Ordinance, 1979---Interference in order in question was not warranted in circumstances.

Fayyaz Ahmad Khawaja for Petitioner.

Mansoor Ahmad for Respondent.

Date of hearing: 23rd September, 1997.

JUDGMENT

This writ petition is filed to challenge recovery of outstanding tax amounting to Rs.7,32,097 with the prayer that operation of the impugned order whereby the property of the petitioner has been attached be suspended.

2. The brief facts are that the petitioner was running a recruiting agency with the name 'Golden International Limited, Rawalpindi'. The petitioner had purchased a house at Nazim-ud-Din Road, Islamabad on 12-6-1980 from one Jawaid Inam son of Lt.-Col. Inamullah Khan for an alleged sale amount of Rs.6,00,000. An agreement to that effect was executed between the parties, which was attested by the marginal witnesses namely Kabir Ahmad Siddique and Razzi Haider Rizvi. The agreement is placed on record as Annexure-A. The payment of the sale price was made vide pay order dated 10-6-1980, a copy of which was placed on record as Annexure B.

3. The petitioner being an income-tax assessee did not declare the house in his Income-tax Return for the year 1980-81 as according to him the value of the house was less than 10 lacs and it stood exempted from the wealth tax. Later on the Income-tax Officer, Circle-01, Rawalpindi received an application against the petitioner that the house in question was purchased by him for an amount of Rs.11,50,000, payment of which was made by the petitioner to Jawaid Inam in the following manner:

4. On the above information, the petitioner was issued a notice by the income-tax Officer concerned regarding suppression of the actual value of the house. The petitioner however, resisted the notice by producing sale agreement and affidavits of two marginal witnesses of the sale agreement. He also produced copy of the letter addressed to him by the Manager, Habib Bank showing that an amount of Rs.6,00,000 was paid through pay order The Income: tax Officer however, disbelieved the contention of the petitioner and made an assessment order dated 28-7-1988 whereby the sale price of the house in question was fixed as Rs.11,50,000 against the declared value of Rs.6,32,000 A copy of the assessment order may be seen at Annexure-F. The petitioner filed an appeal before the Commissioner of Income-tax, Appeals, Rawalpindi, which was partly allowed to the extent that sale of ornaments was proved and that the same was wrongly disbelieved by the Income-tax Officer. However, the rest of the order of the Income-tax Officer was upheld in appeal vide order darted 12-6-1989, a copy of which is placed on record as Annexure-G. The petitioner still feeling dissatisfied instituted an appeal before the Income-tax Appellate Tribunal which too was dismissed vide order dated 3-4-1991, a copy of which was brought on record as Annexure-H. The petitioner also filed miscellaneous application before the Appellate Tribunal agitating its decision on the ground that addition made under section 13 of the Income Tax Ordinance, 1979 has not been made in accordance with law. However, that petition was also dismissed, whereupon a review petition was filed, which too failed. The property of the petitioner was, thereafter attached and directed to be auctioned whereupon the present writ petition was filed on the ground that the assessment made by the Income Tax Officer was incorrect and illegal because the house was actually purchased for an amount of Rs.6 lacs whereas it was wrongly assessed as Rs.11,50,000. The petitioner further alleged that he had been regularly submitting Income-tax Returns and had been paying income-tax after proper assessment and as such there was nothing due from him. The price of the house as Rs.6 lacs was proved by the letter addressed to the petitioner by the Manager Habib Bank and as such Income-tax Officer had no valid ground to value the house at the price of Rs.11,50,000. The payment of income tax amounting to Rs.7,32,097 was, therefore, alleged to be against the provisions contained in Article 2A of the Constitution of Islamic Republic of Pakistan, 1973. It was also urged that the compound interest was declared repugnant to the injunctions of Islam and could not, be charged.

5. Lastly it was contended that petitioner being a jobless person is residing in a portion of the house and would become destitute if the same was allowed to be auctioned in pursuance of the illegal demand by the Income-tax Authorities. It was, therefore, urged that the demand of the amount aforesaid was not only illegal, mala fide but also unconstitutional.

6. The learned

counsel for the respondents has submitted that the petitioner had sufficient opportunity to plead his case before the income-tax Authorities and he hotly contested the same as would be clear from the contents of the orders placed on record. In this connection reference was made to the assessment order of the Income-tax Officer Circle-O1, Rawalpindi Annexure F to show that the petitioner had not submitted his returns for the years 1980-81, 1981-82, and 1982-83. The order was passed under section 62 of the Income-tax Act, which not only runs into details, but also has met all the points raised by the petitioner before the Income Tax Officer. The vendor of the house had contended before the Income-tax Officer that the sale transaction took place for Rs.11,50,000, but it was mutually agreed with the purchaser that the price will be shown as Rs.6 lacs in the sale agreement. He also admitted that the mode of payment indicated above for an amount of Rs.11,50,000 was correct and that he acknowledged the aforesaid amount to have been received. The petitioner challenged the factual as well as legal aspects of the order passed by the Income-tax Officer before the appellate forums. The appellate order passed by the Commissioner, Income Tax (Appeals), Rawalpindi is also clear enough to sustain the order passed by the Income-tax Officer except that an amount of Rs.1,53,300 of the jewellery sold to M/s. M. Alam Gold Smith was directed to be adjusted by the Income-tax. Officer. The order of the Commissioner, Income-tax (Appeals) was assailed before the Income-tax Appellate Tribunal, which too dismissed the appeal after taking into account the factual as well as legal aspects of the matter. The order passed by the Appellate Commissioner was upheld by the Appellate Tribunal vide its order dated 3-4-1991. The appellant, if aggrieved, could have moved this Court under section 136 of the Income Tax Ordinance, 1979 by making reference against the decision of the Tribunal on the points of law. However, no such reference was made to this Court. Instead a miscellaneous application was moved against the decision of the Tribunal, which was rejected. Later on a review petition was moved, which too was rejected on 14-11-1993. Even after that no steps were taken under section 136 of the Income Tax Ordinance till the filing of this writ petition on 13-1-1997 much after the time prescribed for making reference to the High Court under the aforesaid section.

7. The learned counsel for the petitioner in reply has submitted that this writ petition be converted into a reference under section 136 of the Income Tax Ordinance, 1979. I am afraid this cannot be done firstly, because the last order passed by the Income-tax Appellate Tribunal on review petition was made on 14-11-1993 and the reference was required to be filed within 90 days of the date of original decision of the Tribunal which was rendered on 3-4-1991. However, instead of availing a proper remedy under section 136 of the Income Tax Ordinance, the petitioner opted to move a miscellaneous application against the decision of the Appellate Tribunal. This would hardly justify the conversion of this writ petition to a reference which has now been patently and hopelessly time-barred. Even otherwise, all the factual and legal issues have been thoroughly thrashed out at the level of Income-tax Appellate Tribunal and the learned counsel for the petitioner has not been able to show me any material from which a question of law may be framed under section 136 of the Income Tax Ordinance. Needless to say that the reference in the High Court is to be dealt with by a Division Bench if, at all, it is to be preferred.

8. In view of the above discussion, there is no ground for interference with the impugned orders. The writ petition is accordingly dismissed.

A.A./188/L Petition dismissed.