I.T.A. NO. 55/KB OF 1999-2000 VS I.T.A. NO. 55/KB OF 1999-2000
2000 P T D (Trib.) 505
[Income-tax Appellate Tribunal Pakistan]
Before Tahseen Ahmed Bhatti, Judicial Member
I.T.A. No.55/KB of 1999-2000, decided on 28/10/1999.
Income Tax Ordinance (XXXI of 1979)---
----Ss.108(b)(ii), 139 & 55---Income Tax Rules, 1982, 8.197---Penalty-- Date of filing statement under S.139, Income Tax Ordinance, 1979---Penalty was imposed at Rs.2,000 + Rs.200 per day by the .Assessing Officer for default in filing of statement under S.139, Income Tax Ordinance, 1979, as prescribed under R.197, Income Tax Rules, 1982, on 1st September, 1998; despite issue of proper notice---Penalty was reduced only to payment of Rs.2,000 by the First Appellate Authority on the ground that statement under S.139, Income Tax Ordinance, 1979 in respect of salaried employees could be filed on or before the last date of filing of return under S.55, Income Tax Ordinance, 1979, and initially penalty order had to be restricted to Rs.2,000 only while separate order had to be passed imposing penalty at Rs.200 per day for subsequent default---Validity---Statement under S.139, Income Tax Ordinance, 1979, had to be submitted in prescribed manner as provided under R.197, Income Tax Rules, 1982; as applicable in the relevant year---Penalty for any default in submission of said statement had to be levied as provided under S.108(b)(ii), Income Tax Ordinance, 1979---Said provision of runs found to have been overlooked by the First Appellate Authority while adjudicating the issue and had adopted the interpretation which was neither according to the provision of law nor in consonance with the Rules-- Order of the First Appellate Authority was vacated and the matter was remanded for fresh adjudication according to the relevant law and Rules.
Muhammad Umer Farooq, D.R. for Appellant.
Abdul Tahir Ansari, A. R. for Respondent
Date of hearing: 28th October, 1999.
ORDER
This appeal by the Department, is directed against the order dated 29-5-1999 in the First Appeal No.338 of 1999 for the Assessment Year 1998-99 passed by the learned A.A.C. of Income Tax Sukkur contesting the findings that the date of filing of statement under section 139 should be the same as the date of filing of return under section 55 of the Income Tax Ordinance, 1979. The Department has also contested the consequential reduction in the amount of penalty to Rs.2,000 and has also contested the observation made by the learned A.A.C. in this regard that the first penalty is to be imposed at Rs.2,000 only and the subsequent penalty should be imposed by separate order.
2. Heard the learned Representative for the Appellant/Department and the learned Authorised Representative for the respondent/assessee.
3. The impugned order has been perused. As it transpires from the penalty order passed under section 108, the penal provision was invoked by the Assessing Officer on the ground iliac the statement under section 139 was not submitted on the prescribed format on 1st September. 1998 despite issue of proper notice. Accordingly, the penalty was imposed at Rs.2,000 + Rs.200 per day of default. The number of days was calculated at 216 and the total penalty worked out to Rs.45,200. The issue was contested before the learned A.A.C. on the ground that no proper notice was served while imposing the penalty and that the statement under section 139 had been filed in time. When the matter went to the learned A.A.C., he proceeded on the assumption that statement under section 139 which pertained to deduction of tax in respect of salaried employees could be filed on or before the last date of filing of returns under section 55 in case the same was extended. The penal action was upheld by him on the ground that, said statement was filed on the last date of filing of return. However, according to him, the Assessing Officer was empowered to impose the penalty of Rs.2,000 at one particular time and separate orders had to be passed for the subsequent default., As according to the learned A.A.C. two penalties had been imposed in one go, and therefore, the action was not sustainable in law. Accordingly, it was observed by him that "as the statement has been filed after the last date of filing of return the penalty was reduced to Rs.2,000 as discussed above.
4. The Department in appeal has contested these directions of the learned A.A.C Perusal of the order of the, learned A.A.C. shows that he has proceeded on the assumption that date for filing of statement under section 139 corresponded to the date of filing of return under section 55 and that initially the penalty order has to be restricted to Rs.2,000 only and that to respect of subsequent default, separate order had to be passed imposing penalty at Rs.200 per day Reference to the prescribed provision of law and the rules provided in this regard, however, reveals that a statement under section 139 has to be submitted in the prescribed manner as provided under, rule 197 of the Income Tax Rule, 1982 as applicable in that year Penalty for any default in submission of this statement has to be levied as provided under section 108(b)(ii) of the Income Tax Ordinance, 1979. This provision of law' is found to have been overlooked by the learned A.A.C. while adjudicating, the issue and he has adopted the interpretation which is neither according to provisions of law nor according to rules. It will, therefore, be proper if the, order of the learned A.A.G. is vacated and the matter is remanded back to', him for fresh adjudication according to above provision of law and rules prescribed by the C.B.R. in this regard.
5. The departmental appeal stands allowed to the extend and in the manner mentioned above.
C.M.A./M.A.K./110/K(Tax Trib.) Order accordingly.