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

‑‑‑‑S.134‑‑‑Appeal to Appellate Tribunal‑‑‑Issuance of certificate of pendency of departmental appeal before filing of appeal‑‑‑Effect‑‑‑Filing of appeal by the Department subsequent to issue a certificate to Member judicial, Central Board of Revenue regarding factum of having pendency of the Departmental appeal and decision of the same by the Member, C.B.R., amounted to evil intention or mala fide act of the Department in order to frustrate dispensation to the assessee.

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

‑‑‑‑Ss.8 & 134‑‑‑All Officers to follow the orders of the Central Board of Revenue‑‑‑Appeal to Appellate Tribunal after decision of the Member Judicial, Central Board of Revenue in revision petition ‑‑‑Validity‑‑ Assessing Officer had ‑acted in flagrant violation of law by filing the appeal before the Tribunal once the order had been made by the Member Judicial; Central Board of Revenue on the revision petition‑‑‑Person responsible for filing the appeal had disregarded the order passed by his higher authority in the Income‑tax hierarchy‑‑‑Order passed by the Member Judicial was binding on the subordinate Officer.

(1982) 136 ITR 652 rel. .

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

‑‑‑‑S. 134‑‑‑Appeal to the Appellate Tribunal ‑‑‑Member Judicial, Central Board of Revenue had decided the revision petition when the departmental appeal was not pending for adjudication before the Tribunal‑‑‑Filing of appeal subsequently before the Tribunal was not maintainable and the same was dismissed by the Tribunal.

Khalid Maqbool for Appellant (in I.T.A. No.2812/LB of 2001).

Sajjad Ali, D.R. for Respondent (in, I.T.A. No.2812/LB of 2001).

Sajjad Ali, D.R. for Appellant (in I.T.A. No.210/LB of 1997).

Khalid Maqbool for Respondent (in I.T.A. No.210/LB of 1997).

Date of hearing: 27th October, 2001.

ORDER

RASHEED AHMAD SHEIKH (JUDICIAL MEMBER).‑‑‑1. The precise question which was posed for our consideration is as to whether the Departmental appeal is not maintainable particularly when the revision petition has been decided by the Member Judicial C.B.R. prior to the expiry of stipulated period of filing the appeal by it.

2. Facts leading for disposal of this very question are that when the Departmental appeal came for adjudication on 7‑4‑2001, it came to the knowledge of the Bench that the assessee, by waiving his right of appeal before the Tribunal, had filed a revision petition before the Member Judicial C.B.R. against the order made by the First Appellate Authority, dated 22‑10‑1996. It is pertinent to mention that the departmental right of appeal had not yet been expired, the Member Judicial, C.B.R. modified the order of the First Appellate Authority to the extent of directing the Assessing Officer to allow credit of tax deducted under section 50(3)(b) of the Income Tax Ordinance, 1979 to the, assessee. It was thus observed by the Bench in the order sheet as under:

The learned A.R. for the assessee at the outset contended that the Member (Judicial) has already provided relief in the revisional order and the Department having not filed appeal till that time, the present appeal has become infructuous and is not maintainable. However, perusal of section 138 (2) transpires that the Member Judicial is only empowered to pass the revisional order after expiry of limitation period of 60 days as is provided in section 134(3).. In the present case the impugned order was got served on the Zonal Commissioner on 11‑11‑1996 while the Departmental appeal was filed before the Tribunal on 7‑1‑1997. So, this has been filed within the stipulated period of 60 days as was prescribed by law. Thus the order was passed by the Member Judicial C.B.R. without any lawful authority and as such is not sustainable. In the circumstances, the revisional order is clearly ignorable and the Departmental appeal should have been decided independently. This would result into depriving the assessee from his right of appeal. Anyhow in order to meet the ends of justice, the assessee is to be provided a period of 15 days for filing his appeal. The A.R. (Roster) is directed‑to inform the assessee in writing in this regard and keep the Departmental appeal pending till expiry of the period so provided to the assesee for filing the appeal. On receipt of the assessee's appeal, the, cross‑appeals shall be relisted for hearing in the next month before any available Bench.

Hence, now these cross‑appeals.

3. Recapitulating the facts, copy of the First Appellate Authority, dated 22‑10‑1996 had been served upon the assessee on 6‑11‑1996. Instead of preferring 2nd appeal before the Tribunal assessee opted to file revision petition before the Member Judicial C.B.R. in terms of section 1380) of the Income Tax Ordinance, 1979, which was filed before her on 11‑12‑1996. Accordingly the decision was delivered by the said authority on 7‑1‑1997. Coming to the Departmental appeals, the impugned order was served upon the Zonal Commissioner on 11‑11‑1997 and the last date of filing the appeal was reckoned to be 10‑1‑1997 whereas he preferred that one‑day earlier from expiry of the last date. These facts clearly spell out that the appeal was filed by the Department after having made the decision by the Member Judicial of Income Tax C. B. R.

4. We have given anxious thought to the rival arguments and perused the facts of the case in its entirety. Subsection (2) of section 138of the Income Tax Ordinance has laid down three conditions to be accomplished before entertaining the revision application filed by the assessee. Firstly, according to clause (a) of subsection (2) of section 138 of the Income Tax Ordinance, 1979 is to be looked into as to whether the assessee has waived his right of appeal or, not. Secondly, clause (b) of subsection (2) of the said section mentions about whether the order made by the First Appellate Authority has been made the subject of an appeal to the Appellate Tribunal or not, while as per the clause (c) of sub section (2)‑‑of this section this is to be verified that the revision petition has been made within 90 days of the date on which such order was communicated to the assessee. Admittedly the assessee's case does not hit by, any such conditionalities.

5. Proceeding further we are convinced that prior to fixation of revision petition by the Member Judicial C.B.R. a certificate is requisitioned from the concerned Assessing Officer regarding factum of having filed or pendency of the Departmental appeal, against the impugned order, before the Income Tax Appellate Tribunal or not. Thereafter, the; revision petition is admitted for hearing and the decision is delivered thereon by the competent authority. In this background, filing of appeal subsequent to issuing a certificate amounts to evil intention or mala fide act of the department in order to frustrate dispensation to the assessee.

6. Looking the case from another angle we are persuaded to hold that the Assessing Officer has acted in flagrant violation of law by filing the appeal before the Tribunal once the order has been made by the Member Judicial, C.B.R. on the revision petition. Actually the person responsible for filing the appeal has disregard the order passed his higher authority in the Income Tax hierarchy. According to section 8 of the Income Tax Ordinance, 1979, all officers and persons employed in the execution of the Income Tax Ordinance, 1979 shall observe and follow the orders, instructions and directions of the Central Board of Revenue, subject to its proviso, in order to enforce administrative discipline in the Department. So, this section in plain words describes that the orders, instructions and directions issued by the Central Board of Revenue or the powers conferred by it, on any authority subordinate to it are binding on the functionary discharging their function under, the Income Tax Ordinance; 1979 so long as they are confined to the administrative matters.' Though the order, instruction and directions issued by .the C.B.R. are not binding on the Court or the assessee yet in general those are binding on the Income‑tax Authority. In any case the Board through them cannot impose a burden on the taxpayers greater than what the statute provides but it can relax the rigour of law. The Courts have, in fact, recognized the validity of beneficent orders, instructions and, directions and the right of the taxpayers to enforce these and 'get relief even in Court. The same view was adopted by the Honourable Delhi High Court in the case reported as (1980 136 ITR 652. We, therefore, are of the considered view that order passed by the Member Judicial was binding on the subordinate officer.

7. Reverting to the facts of the case, the Member Judicial C.B.R. had decided the revision petition when the Departmental appeal was not pending for adjudication before the Tribunal. In the circumstances we further hold that the Departmental appeal was not maintainable before the Tribunal and the same is, accordingly, dismissed as such. The assessee's appeal is consequently declared redundant.,

8. Hence, the Departmental appeal fails and is dismissed while that of the asses see, stands disposed of.

C.M.A./178/Tax(Trib.) Appeal dismissed.