MUHAMMAD RAFIQ VS COMMISSIONER OF INCOME-TAX, FAISALABAD ZONE, FAISALABAD
2002 P T D 2743
[Lahore High Court]
Before Naseem Sikandar and Jawwad S. Khawaja, JJ
MUHAMMAD RAFIQ
Versus
COMMISSIONER OF INCOME-TAX, FAISALABAD ZONE, FAISALABAD
C.T.R. No.374 of 1991, decided on /01/.
st
December, 2000. (a) Income Tax Ordinance (XXXI of 1979)----
----S. 136(1)---Reference to High Court---High Court declined to answer the question that when Assessing Officer did not attempt service by post, was he legally competent to order service by affixture as such question was not a substantial question of law.
Zaibtun Textile Mills Ltd. v. Central Board of Revenue and others PLD 1983 SC 358 eel.
(b) Income Tax Ordinance (XXXI of 1979)---
----S. 136(1)---Reference to High Court----High Court declined to answer the question whether the Tribunal was justified in refusing to consider and adjudicate upon the issue of validity of service by fixture on the ground that it did not raise any substantial question of law.
(c) Income Tax Ordinance (XXXI of 1979)---
----S. 136(1)---Reference to High Court---Tribunal refused to accept the plea that the findings qua lack of adequate opportunity had to. result in annulment instead of setting aside the assessments---High Court confirmed the finding of the Tribunal as no illegality was found in the findings---Remand of appeal by the Appellate Authority was in accordance with law on the given facts.
Muhammad Iqbal Hashim for Petitioner.
Muhammad Ilyas Khan for Respondent.
Date of hearing: 21st December, 2000.
ORDER
NASEEM SIKANDAR, J.---This is a case stated by the Lahore Bench of the Income Tax Appellate Tribunal, at the instance of the assessee; an individual, who at the relevant time engaged himself in purchases and sales of Deg, Pig-iron and Hardcoke. Following questions have been framed for our consideration and reply:
(1)Whether on the facts and in the circumstances of the case when I.T.O. did not attempt service by post, was he legally competent to order service by affixture?
(2)Whether on the facts and in the circumstances of the case was the ITAT justified in refusing to consider and adjudicate upon the issue of validity of service by affixture on the ground that it was immaterial?
(3)Whether on the facts and in the circumstances of the case the assessment order under section 63 without proper, service of notice under sections 61 and 62 is to be set aside for de' novo, assessment, or to be annulled/cancelled.
2. In the two assessment years involved viz. 1983-84 and 1984-85, assessments were framed under section 59(1) of the- Income Tax Ordinance. Subsequently, on a raid on business premises, the Revenue came across certain books of accounts which were impounded. Consequent thereupon notice under section 65 of the Ordinance was issued and ultimately re-assessments were made at Rs. 38,00,000 and Rs.23,50,000. The learned First Appellate Authority, CIT (Appeals) though did not agree that notice under sections 61 and 62 were not properly served, yet be set aside the assessment on the ground that reasonable opportunity being heard was not provided to the assessee. Accordingly both assessments were set aside and the case remanded to the Assessing Officer.
3. Before the Tribunal, the petitioner took a number of pleas. One of them being that service of notice through affixture was improper inasmuch as, the Assessing Officer proceeded to make resort the substituted service without first exhausting the mode of service through post. The Tribunal, however, concluded that the service in this case had been affected in the manner provided for in the Code of Civil Procedure and therefore, it was not necessary for the Assessing Officer to first issue a notice by post in order to reach the stage for a direction to effect service through affixture. Also the contention of the assessee that the C.I.T. Appeal after reaching the conclusion that adequate opportunity was not allowed ought to have cancelled the assessment was not accepted.
4. The learned counsel for the assessee by relying upon PLD 1983 SC 358 Re: Zaibtun Textile Mills Ltd. v. Central Board of Revenue and others prays for negative answer to the aforesaid three questions.
5. However, we are not persuaded to agree. In the first instance, the first two questions as framed cannot be said to have raised a legal controversy. The learned C.I.T. Appeals recorded a finding of fact that the assessee had properly been served through affixture and the learned Tribunal maintained those finally the learned Tribunal refused to accept the plea that the findings qua lack of adequate opportunity had to result in annulment instead of setting aside assessments. In the aforesaid judgment relied upon by the learned counsel for the petitioner, it was inter alia found that no assessee could be made liable for payment of tax without providing him safeguards dictated by rules of natural justice. In the case in hand, the C.I.T. Appeals though agreed that the assessee had properly been served still proceeded to set aside the assessment and to remand the case. In fact he appears to be charitable in setting aside the assessment which ordinarily on his finding of proper service had to be maintained. In Question No. 2 the statement of fact has not been correctly recorded inasmuch as the Tribunal never refused to consider the issue of validity of service by affixture. In fact they agreed with the earlier findings of C.I.T (Appeals) that service of notice had been proper and therefore they rightly observed that after setting aside of assessment by the C.I.T. Appeals, the issue of service by affixture was not material. The learned counsel for the assessee failed to convince the Tribunal that the finding with regard to lack of adequate opportunity had to result in annulment of possible exception nor the learned counsel has been able to bring home one.
6. For what has been said above, the first two questions are declined to be answered as these do not raise any substantial question of law. As regards Question No. 3, no illegality is found in the findings of the learned Tribunal that in the given facts the remand of appeal by the First Appellate Authority was in accordance with law.
7. Answered accordingly.
C.M.A./M.A.K./M-1337/L
Reference answered.