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

----S. 136---Reference---Question of fact---Adjudication by High Court-- Principles---Failure to raise question of law before Tribunal---Factual controversy was raised in the reference which was with regard to number of power looms being run by the assessee---Validity---None of the two questions as framed had arisen out of the order of the: Tribunal nor otherwise the questions could be taken to be questions of law raising any legal controversy---Issue of number of power looms operating by the assessee in a particular year was a question of fact---Question framed for reference to High Court and actually referred by the Tribunal were neither raised before the Tribunal nor ruled upon by it --- Question of fact could be answered by High Court only if it was raised before the Tribunal and ruled upon by it or it arose as a natural result of the order of the Tribunal---Where neither of the two conditions was answered High Court refused to entertain the questions---Reference was answered in negative.

Muhammad Ilyas Khan for Appellant.

Nemo for Respondent.

Date of hearing: 28th January, 2002.

JUDGMENT

NASEEM SIKANDAR, J. ---This is a case stated by the Lahore Bench of the Income T ax Appellate Tribunal, under section 136(2) of the Income Tax Ordinance, 1979. The following questions have been framed for our consideration and opinion: --

"(1)Whether on the facts and in 'the circumstances of the case the ITAT was justified in confirming the CIT(Appeals)'s order based on ITAT's earlier decision which is sub judice in the Hon'ble High Court Lahore and the reference has already been admitted for regular hearing?

(2)Whether on the facts and the circumstances of the case the ITAT was justified in confirming the order of the CIT (Appeals) based on ITAT's earlier decision instead of passing on independent order by applying its judicial mind particularly when the Tribunal hold that each assessment year is an independent year?"

2. The respondent is an individual. For the assessment years 1971-72 to 1975-76 an assessment was framed on the basis of four cotton power looms. On complaint, the enquiries conducted by the Department revealed that he was running 60 power looms in two different premises. Accordingly assessment framed in the above years were re-opened and fresh assessments were framed on the basis of 60 power looms. For the assessment years 1979-80 to 1981-82 again the assessment orders were based upon 60 power looms. However, the learned first Appellate Authority taking into consideration the assessments framed for the intervening years viz. 1971-72 to 1978-79 concluded that the Department than failed to bring on record the material/evidence on existence operation of 60 power looms. The orders so recorded by CIT (Appeals) were maintained by the Tribunal.

3. The Tribunal inter alia noted that in the assessment years 1971-72 to 1978-79 when the matter reached them they maintained the framing of assessments on four power-looms only instead of 60 power-looms. On the basis of their order recorded in respect of these assessment years they maintained the first appellate order. However, it was directed that for the future nothing will prohibit the Assessing Officer from estimating number of power looms as these factually existed at the site.

4. After hearing the learned counsel for the Revenue, we are of the view that none of the two questions as framed arise out of the order of IA the Tribunal nor otherwise these can be taken to be questions of law raising any legal controversy. The issue, if during the particular assessment year the assessee was operating a number of power loom is necessarily a question of fact. Those framed for reference to this Court and actually referred by the Tribunal and reproduced were neither raised before the Tribunal nor ruled upon by it. It hardly needs to mention that a question of law can be answered by this Court only if it was raised before the Tribunal and ruled upon by them or it arose as a natural result of the order of the Tribunal. Neither of the two conditions are answered in the present case we will refuse to entertain the question.

5. Answer declined.

Q.M.H./M.A.K./C-149/L

Answer declined.