COMMISSIONER OF INCOME-TAX/ WEALTH TAX, FAISALABAD ZONE, FAISALABAD VS Messrs ZARI INDUSTRIES
2005 P T D 1913
[Lahore High Court]
Before Mian Saqib Nisar and Sh. Azmat Saeed, JJ
COMMISSIONER OF INCOME-TAX/ WEALTH TAX, FAISALABAD ZONE, FAISALABAD
Versus
Messrs ZARI INDUSTRIES
Income Tax Appeal No.237 of 1998, decided on /01/.
th
March, 2004. Income Tax Ordinance (XXXI of 1979)---
----Ss. 59, 136 & Second Sched., cl. (98)---Filing income tax return by new assessee under Self-Assessment Scheme---Appeal before High Court---Assessee filed income tax return as a new assessee claiming to be qualified under Simplified Assessment Procedure for a new assessee, but same was disallowed by Assessing Authority---Commissioner Income Tax and Appellate Tribunal, however found that assessee's return of income fully qualified for acceptance under Self-Assessment Scheme---Validity---Assessee was a registered firm which derived income from manufacture of agricultural implements and clause (98) of 2nd Schedule to Income Tax Ordinance, 1979 inserted by Finance Act, 1985 had exempted the income from manufacture of various agricultural machinery---Presumption would be that machinery manufactured by assessee fell within types of machinery specified in the said clause---Commissioner Income Tax and Appellate Tribunal, in circumstances had rightly found that return of income of assessee fully qualified for acceptance under Self-Assessment Scheme---In absence of any omission or illegality in impugned order, appeal against the order was dismissed.
Shahid Jamil Khan for Appellant.
Date of hearing: 13th December, 2004.
ORDER
The respondent filed the income return as a new assessee claiming qualified under the Simplified Assessment Procedure for a new assessee; this was disallowed by the Assessing Authority, however, the CIT Appeal, allowed the same, which order was challenged by the department, before the Income Tax Tribunal and the Tribunal has dismissed the same holding that "the assessee's return of income fully qualified for acceptance under Self-Assessment Scheme".
2. The question formulated in the matter follows as under:---
"Whether on the facts and in the circumstances of the case, the learned Tribunal was justified to uphold that assessee's return qualified for acceptance under simplified assessment procedure being a new assessee."
3. It is argued by the learned counsel for the appellant that an assessee shall only qualify to be assessed under the Self-Assessment Scheme, if it is so specifically mentioned in the scheme, as there is no reference to a new assessee in para. 3(2) of the Circular No.7 of 1989 issued by the C.B.R. therefore, the respondent does not qualify to be a new assessee.
4. Heard. The Tribunal has dealt with the question in the following manner:--
"The Board in its Circular No.7 of 1989, dated 26-6-1989, ordered for acceptance of return of income under Self-Assessment Scheme in the case of a new assessee, whose declared income was less than Rs.1,00,000. The new assessee was defined in para. 3(b) of the said Circular as under:
(i)???????? who had never filed a return of total income for any assessment year prior to the assessment year 1989-90 in respect of which tax (after any admissible rebate, allowance, etc) was payable or
(ii)??????? whose assessed total income for any assessment year prior to assessment year 1989-90 had not resulted in tax demand (after any admissible rebate, allowance, etc.)
5. In this case, the assessee, a Registered Firm, derives income from manufacture of agricultural implements. An income of Rs.2,91,828 was declared last year. Clause 98 of the 2nd Schedule, to the Income Tax Ordinance inserted by Finance Act, 1985 exempted the income from manufacture of various agricultural machinery. Neither of the two officers below have bothered to justify their actions by pointing out the specified machinery manufactured by the assessee/respondent. However, it is presumed that the machinery manufactured by the assessee/ respondent fell within 46 types of machines specified in the said clause. As such the income of Rs.2,91,828 declared by the assessee/respondent had not resulted in any tax demand being exempt from tax.
We do not find any amiss or illegality in the order of the Tribunal, therefore, the question is accordingly answered.
H.B.T./C-67/L???????????????????????????????????????????????????????????????????????????????????? Appeal dismissed.