W.T.AS. NOS.84/IB TO 86/IB OF 1999-2000 AND 1003/113 TO 1005/113 OF 1998-99, VS W.T.AS. NOS.84/IB TO 86/IB OF 1999-2000 AND 1003/113 TO 1005/113 OF 1998-99,
1999 P T D (Trib.) 4026
[Income-tax Appellate Tribunal Pakistan]
Before Mansoor Ahmed, Accountant Member and Syed Masood ul Hassan Shah, Judicial Member
W.T.As. Nos.84/IB to 86/IB of 1999-2000 and 1003/113 to 1005/113 of 1998-99, decided on 31/08/1999.
Wealth Tax Act (XV of 1963)---
----Ss.2(10), 8 & .16---Jurisdiction to make assessment by Deputy Commissioner and Assistant Commissioner of Wealth Tax under S.16, Wealth Tax Act, 1963---Scope---Held, assessment could be made by Deputy Commissioner of Wealth Tax under S.16, Wealth Tax Act, 1963 but Assistant Commissioner of Wealth Tax having not been listed as Wealth Tax Authority in S.8 of the Act, assessment order passed by him was ab initio, illegal, void and without jurisdiction which was annulled by Tribunal. [p. 4028) A '
Sardar Sajjad Haider Khan, D. R: for Appellant (in W.T.As. Nos..84/IB to 86/113 of 1999-2000).
Mir Ahmed Ali, Mrs. Sofia Humayun and Zahoor Ellahi Bhatti for Respondents (in W.T.As. Nos.84/IB to 86/113 of 1999-2000).
Mir Ahmed Ali; Mrs. Sofia Humayun and Zahoor Ellahi Bhatti for Appellants (in W. T: As. Nos. 1003/IB to 1005/113 of 1998-99).
Sardar Sajjad Haider Khan, D.R. for. Respondents (in. W.T.As. Nos.1003/,113 to 1.005/113 of 1998-99).
Date of hearing 25th August, 1999.
ORDER
MANSOOR AHMED (ACCOUNTANT MEMBER).---These six cross-appeals by the department and the assessee are directed against the -consolidated order dated 30-4-1999 passed by the learned A.A.C., Islamabad in respect of assessment years 1995-96 to 1997-98.
2. Mir Ahmed Ali, Advocate, Mrs. Sofia Humayun, Advocate, and Mr. Zahoor Ellahi Bhatti, Advocate, on behalf of the assessee and Sardar Sajjad Haider Khan, D.R., on behalf of the department, present. Parties have been heard.
3. The facts of the case are that the assessee owns a house in Islamabad, shown to be built on half portion of the plot and claimed to be in self-occupation of the assessee. In the original returns, the remaining half portion of plot was shown as open piece of land. In the original return for the year 1995-96, the assessee declared its value at Rs.10,50,000 and for the next two years i.e. 1996-97 and 1997-98 claimed exemption on the ground that he had paid tax under section 14C. Then the assessee filed a ,revised return wherein the property, in question was claimed to have been gifted to his sons. Once again, the assessee revised the returns and this time he claimed exemption of the house on account of self-occupation for the two years i.e. 1995-96 and 1996-97 but claimed exemption for the year, 1.997-98 on the ground that tax has separately been paid in respect of this property under section 14C. The remaining half portion of plot was shown as under construction. The assessing officer accepted the claim of exemption on account of self-occupation for all the three years in respect of half portion of the house. However, the remaining half portion of the house was valued at Rs.54,50,148 in each of the years under appeal. While calculating the value of half portion, the assessing officer valued the land at Rs.82,80,297 on the basis of some notification probably issued by the C.D.A. The value of half portion of land was worked out at Rs.41,40,148. The cost of construction was adopted at Rs.13,10,000. In this way, the value of half portion of house was worked out at Rs.54,50,148.
4. In respect of assessment year 1995-96, the assessee had also declared two amounts of Rs.98,889 and Rs,.6,00,000 as cash/prize bonds. The assessee had claimed exemption in respect of amount of Rs.6,00,000 on the ground that it was declared under section 59D of the Income Tax Ordinance. 1979, and this asset is not liable to wealth tax under Amnesty Scheme made under section 3A of the Wealth Tax Act, 1963. The assessing officer however added this amount in the net wealth of the assessee.
5. The learned A.A.C. determined the value of half portion of the property at Rs.36,22,500 by stating that the District Collector, Islamabad has fixed the rate of Rs.7,000 per Sq. Yd. in F-10 Sector. The learned A.A.C. rejected the claim of exemption in respect of amount of Rs.6.00.000 by stating that section 59D of the Income Tax Ordinance, 1979, has no relevance to the wealth tax assessment for the year 1995-96. Both the department and the assessee feel aggrieved with the order of the learned A.A.C. The assessee contests the valuation of the half portion of the house and disallowance of exemption to amount of Rs.6,00,000. He also challenges the jurisdiction of the Assessing Officer and agitates the levy of Additional Tax under section 3113. On the other hand, the department objects to the reduction in the value of the house ordered by the learned A.A.C.
6. At the commencement of the hearing proceedings, the learned A.R. of the assessee pointed out that the assessment orders made by the Assistant Commissioner of Wealth Tax are without lawful jurisdiction and hence ab initio illegal and void. He stated that under section 16, assessments can be made by a Deputy Commissioner of Wealth Tax having jurisdiction over the cases assigned to him. It is argued that the term "Deputy Commissioner" has been defined in section 2(10) which does not include an Assistant Commissioner of Wealth Tax. The said definition is reproduced as under:--
"(10) 'Deputy Commissioner' means a -person appointed to act as a Deputy Commissioner of Wealth Tax, a Wealth Tax Officer, a Special Officer and a Tax Recovery Officer;"
The learned A.R. of the assessee further states that the Assistant Commissioner of Wealth Tax is also not listed as a wealth tax authority in section 8 of the Wealth Tax Act, 1963. Therefore, the Assistant Commissioner of Wealth Tax who made these assessments had acted without jurisdiction and his orders are consequently illegal and void. The learned D.R. conceded that there is a lacuna in the law. After considering the arguments of the learned AR, we find ourselves to agreement with him that the orders passed were illegal and without jurisdiction. Therefore, the order of the learned A.A.C. is vacated and the orders of the Assistant Commissioner of Wealth Tax are annulled.
C.M.A./M.A.K./86/Tax(Trib.)Order accordingly.