Messrs SKINTREND INTERNATIONAL (PVT.) LTD VS SECRETARY, CENTRAL BOARD OF REVENUE GOVERNMENT OF PAKISTAN, ISLAMABAD, 2002 PTD-LAHORE-HIGH-COURT-LAHORE 2222 (2002)

Income Tax Ordinance (XXXI of 1979)---

-----Ss.3(a), 80-D & Second Sched., Part I, Cl. (125-A)---Constitution of Pakistan (1973), Art. 199---Constitutional petition---Central Board of Revenue---Powers of ---Assessee while enjoying exemption from payment of tax in terms of Cl. (125) of Part I of Second Schedule of Income Tax Ordinance, 1979, was made to pay turnover tax under S.80D of the Ordinance- --Supreme Court later on in the case of Elahi Cotton Mills PLD 1997 SC 582 held that exemptees were not liable to pay tax-- Assessee then made application for refund, which was rejected by Authority for the reason that Central Board of Revenue, through letter dated I1-12-1997, had prohibited grant of such relief---Validity---Central Board of Revenue had no jurisdiction to interpret the law and it was for the forums empowered to adjudicate upon the matters arising under the Ordinance in accordance with law---High Court accepted Constitutional petition and set aside the impugned order, resultantly application of assessee would be deemed to be pending before Authority, who would decide same in accordance with law after hearing assessee independently of said letter of Central Board of Revenue.

Elaht Cotton Mills v. Federation of Pakistan PLD 1997 SC 582 and Central Insurance Co. Ltd. v. Central Board of Revenue 1993 ,SCMR 1232 rel.

Ch. Fatal Hussain for Petitioner. Nemo for Respondents.

ORDER

According to the writ petition, the petitioner was enjoying exemption from payment of incomes tax in terms of clause (125-A) of Part I of Second Schedule to the Income Tax Ordinance, 1979 when he was made to pay the turn over tax under section 80D of the Ordinance Later, according to the learned counsel, by virtue of the decision given by the Hon'ble Supreme Court of Pakistan in Elahi Cotton Mills v.

Federation of. Pakistan PLD 1997 SC 582, it was held that the exemptees are not held liable to pay the said tax. An application was filed for refund. However, the officer concerned instead of adjudicating upon the said application and deciding the same in accordance with law proceeded to reject the same vide order dated 20-12-1997 for reason that a letter dated 11-12-1997 issued by the C.B.R. prohibits him from granting. any said relief. Learned counsel with reference to Central Insurance Co. Ltd. v. Central Board of Revenue 1993 SCMR 1232 contends that the C:B.R. would not be having any jurisdiction to interpret the law and that it would be for the adjudicating authority to decide the matter after hearing the petitioner.

2. No one has turned up for the respondents who are proceeded against ex-prate.

3. I have given some thought to the contentions of the learned counsel, and I find myself. in agreement. In the said case of Central Insurance Company, the Hon'ble Supreme Court has laid down that the C. B. R. would not be having lawful authority to interpret the law and it would be for the forums empowered to adjudicate upon the matters arising under the said Ordinance who will be deciding the case before them it accordance with law.

4. This writ petition accordingly is allowed and order, dated 20-12-1997 of respondent N o.3 is declared to be without lawful authority and accordingly is set aside. The result would be that the application filed by the petitioner shall be deemed to be pending before the said officer who shall decide the same in accordance with law after hearing the petitioner, independently of the said C.B.R. letter:

5. A copy of this order be immediately remitted to respondents Nos. 2 and 3 by the office.

S.A. K./M.A.K./S-429/L Petition allowed.