COMMISSIONER OF INCOME-TAX AND WEALTH TAX, SIALKOT ZONE, SIALKOT VS HAMAYUN IQBAL C/o Prestige Surgical Instruments (Pvt.) Ltd., 2005 PTD-LAHORE-HIGH-COURT-LAHORE 2583 (2005)

Wealth Tax Act (XV of 1963)---

----Ss. 16(3) & 17-B---Refraining of assessment in view of order of Revising Authority---Pendency of appeal before Tribunal against order of Revising Authority---First Bench of Tribunal vacated order of Revising Authority---Appellate Authority in view of order of First Bench of Tribunal vacated order of Assessing Officer refraining assessment---Second Bench of Tribunal in appeal by department set aside order of Appellate Authority while observing that order of First Bench of Tribunal had no force in law---Assessee's appeal against order of Second Bench of Tribunal and Department's appeal against order of First Bench of Tribunal---Validity---Second Bench of Tribunal on judicial courtesy should not have proceeded to decide matter in presence and availability of judgment of a Bench of equal strength in favour of assessee on same legal and factual issues---Such matter ought to have been referred to Chairman for Constitution of a Larger Bench---High Court set aside both impugned order and remanded case to Chairman for Constitution of a Full Bench or Larger Bench not comprising any member of two Division Benches, which had earlier decided appeals.

Mian Yousaf Umar for Appellant.

Shafqat Mehmood Chohan for Respondent.

Date of hearing: 9th May, 2005.

JUDGMENT

NASIM SIKANDAR, J.---Before us these are two sets of appeals under section 27 of the Wealth Tax Act, 1963, one by the Department (W.T.As. Nos. 112 to 126 of 2002) and the other (W.T.As. Nos.508 to 516 of 2003) by the taxpayers /asses sees of the Wealth Tax Department.

2. The individuals-respondents in W.T.As. 112 to 126 of 2002 were assessed to wealth tax at various amounts. The assessments so framed were however, revised by the IAC, Sialkot under section 17-B of the Wealth `Tax Act, 1963 on 17-11-2001 on the ground that these were erroneous and prejudical to the interest of the Revenue. The main reason for reaching that conclusion being that the properties declared by the assessee were assessed on estimate basis without taking into consideration the rates notified by the District Collector. According to the Revising Authority the Assessing Officer was required to apply these rates under Rules 8(3) of the Wealth Tax Act, 1963. All assessments were accordingly remitted to the Assessing Officer to re-frame them in the light of the direction made to him.

3. The assessees challenged the order of the Revising Authority before the learned Tribunal. By way of its order dated 26-2-2002 a Division Bench of the Tribunal vacated the said order passed by the Revising Authority/IAC, Sialkot. Earlier the learned Members expressed the view that even a registered agreement to sell did not transfer title in property from the seller to the assessees as purchaser.

4. It appears that in the meanwhile, the Assessing Officer after remand proceeded to frame re-assessments in the light of the guidelines provided by the Revising Authority. These assessment orders were challenged by the assessees and were disposed of in their favour by the C.I.T. (Appeals), Sialkot on 4-4-2002 with reference to the said order of the learned Tribunal dated 26-2-2002. According to the Commissioner (Appeals) the matter having already been decided and settled by the Tribunal with regard to the same property and involving the same legal issues, the order, of the Assessing Officer recorded under section 16(3) after remand could not stand in the field.

5. The department agitated the order of Commissioner (Appeals) and another Division Bench of the learned Tribunal on 15-8-2003 accepted the plea that Commissioner (Appeals) was misconceived in his view that the assessees were not owners of the property in question. In the process they further observed that earlier decision of the Tribunal dated 26-2-2002 vacating the orders of the Revising Authority being per incurium had no force in law.

6. The assessees-taxpayers are in appeal against the second order of the Tribunal recorded in departmental appeals on 15-8-2003 while the Department has filed appeals against the earlier order of the Tribunal dated 26-2-2002 whereby the orders of the Revising Authority were vacated.

7. Learned counsel for the assessees as well the Revenue after arguing the matter at some length have agreed that the Second Bench of the Tribunal, even on judicial courtesy should not have proceeded to decide the matter in the presence and availability of a judgment of a Bench of equal strength in favour of the same assessees on the same legal and factual issues. They also agree that the matter ought to have been referred to the Chairman for constitution of a larger Bench. On their A agreement, as said above, we are of the view that the first order of the Tribunal also cannot remain in the field inasmuch as the reference of the issue involved to a Full Bench will not change the legal force and validity of the first order of the Tribunal which, if remains in the field, would affect adversely the interest of the Revenue. The reason obviously being that even in the case the Full Bench of the Tribunal adopts a different view from the one adopted by the Division Bench in its earlier decision the same will continue to remain in the field.

8. Therefore, keeping in view the agreement of the parties and in all fairness to the Revenue as well, we will set aside both judgments of the Tribunal dated 26-2-2002 and 15-8-2003 and remit the matter for hearing and consideration by a Full Bench of the Tribunal. In order to give a fair deal to both the taxpayers as well as the revenue it is desired that the Full Bench or a Larger Bench as the Chairman of the Tribunal may consider appropriate may not comprise any of the members of the two Division Benches who had earlier heard and disposed of the appeals.

9. Cross appeals partly allowed to the extent that the matter is remitted to the Tribunal.

10. This order will also govern W.T.As. Nos.112 to 121, 123 to 125 of 2002 and W.T.As. Nos.508 to 516 of 2003.

S.A.K./C-126/LCase remanded.