W.T.As. Nos. 687/LB to 691/LB of 2004, decided on 1st October, 2005. VS W.T.As. Nos. 687/LB to 691/LB of 2004, decided on 1st October, 2005., 2006 PTD-INCOME-TAX-APPELLATE-TRIBUNAL-PAKISTAN 1862 (2005)

Wealth Tax Act (XV of 1963)---

----S.17---Wealth escaping assessment---Setting aside of assessment---First Appellate Authority set aside the case for de novo assessment after having held that the combined notice issued under S.17 of the Wealth Tax Act, 1963 was illegal---Validity---Notice under S.17 of the Wealth Tax Act, 1963 issued was a combined notice for all the assessment years---First Appellate Authority admitted such fact and the same did appear in the order---First Appellate Authority, instead of annulling the assessments framed on the basis of combined notice, remanded the case for de novo assessments---First Appellate Authority erred in law while remanding the case---Appellate Tribunal vacated the order of First Appellate, Authority and annulled the assessments framed by the Assessing Officer---Assessments were supposed to be completed within two years from the date of issuance of notice which was not done, rather, the assessments were framed after almost four years of the issuance of the notice and such assessments had become tine-barred---Assumption of jurisdiction by Assessing Officer thereafter was nullity in the eye of law.

2000 PCTLR 815 and 1987 PTD (Trib) 314 rel.

Siraj-ud-Din Khalid, for Appellant.

Imran Raza Kazmi, D.R. for Respondent.

ORDER

Captioned five appeals pertaining to the assessment years 1996-97 to 2000-01 have been directed by the assessee/appellant against the impugned order dated 1-6-2004 passed by the learned Commissioner of Income/Wealth Tax (Appeals), Bahawalpur. It is the grievance of the assessee that the learned CIT/WIT (A) erred in law while setting aside the case for de novo assessment after having held that the combined notice issued under section 17 of the repealed Wealth Tax Act, 1963 (hereinafter called the repealed Act) was illegal.

2. Learned counsel for both the parties were present and heard.

3. Brief facts, giving rise to the institution of the instant appeals, are that the Department on the basis of information made by the complainant that the assessee purchased 127-Acres of agricultural land for sale consideration of Rs.2, 41,30,000. The Wealth Tax Officer, Circle-11, Rahim Yar Khan issued statutory notice dated 27-8-2001 under section 17 of the repealed Act, for filing of wealth tax returns for the assessment years under appeal. The assessee made compliance to the notice issued under section 17 and filed returns in circle-11, R.Y. Khan on 30-10-2001 recorded at Receipt Registrar Serial No. 564. However, the case of the assessee was transferred to the DCWT, Circle-25, Rahim Yar Khan, on 23-10-2003 by the CIT/WT, Bahawalpur. Thereafter, another notice under section 16(2) of the Act dated 5-1-2004 along with letter of even date was sent to the assessee by the DCWT, Circle-25, . R.Y. Khan asking for compliance to notice under section 17 dated 27-8-2001 issued previously by the DCWT, Circle-11. The assessee, in response to the fresh notice under section 16(2) of the Act, filed wealth tax returns. The Assessing officer framed the assessment on 8-3-2004 for all the assessment years under consideration. Feeling aggrieved with the assessment proceedings, the assessee approached the learned first appellate authority who vide order dated 1-6-2004 set aside the assessments for valuation of agricultural land on PIU basis instead of valuation under section 7(2)(aa)(1) of the repealed Act. The appellant is in further appeals before the Tribunal. Since, the issue involved in all the appeals is common, we intend to dispose of the same through this consolidated order.

4. The learned AR of the assessee vehemently argued the case and submitted at the outset that, admittedly, a combined notice under section 17 of the Act for all the assessment years under reference was issued by the assessing authority. He stated that the learned first appellate authority held that combined notice under section 17 of the Act was illegal but still proceeded to set aside the case for de novo assessments. He pleased that after having observed that the notice under section 17 of the Act was illegal, the learned CWT (A) was not legally justified to remand the case to the assessing officer. Besides, the learned AR argued that the original notice under section 17 of the Act was issued on 27-8-2001 while the assessments were made on 8-3-2004. He elaborated that the assessments were to be completed within two years and, therefore, the assessments framed on 8-3-2004 were coram non judice for the reason that the same were time barred. In support of his contention, the learned AR relied upon the judgments of the Tribunal. In this regard, the first judgment which was relied upon by the learned AR is reported as 2000 PCTLR 815. In the said judgment, it was held as under: ---

"The relevant assessment record was perused and it was found hat combined notice under section 56 was issued for the years 1990-91 to 1994-95. This is settled law that he basic notice assigning jurisdiction to the assessing officer has to be issued separately for each year, it is missing in this case. In the absence of proper notice, the subsequent proceedings were illegal and unjustified. Under the circumstances, all the assessment orders for the }fears 1990-91 to 1994-95 are hereby cancelled".

The second judgment, which has been referred to by the learned AR, is reported as 1987 PTD (Trib.) 314 on the issue of limitation. On the contrary, the learned DR has opposed the arguments addressed by the learned AR and strenuously argued in favour of the impugned order.

5. have heard the learned counsel for both the parties and have also gone through the orders of the officers below in the light of case laws cited at the bar. We have no hesitation in holding that the arguments addressed by the learned AR carry force. There is no doubt that notice under section 17 of the repealed Act issued in the instant case was a combined notice for all the assessment years under appeal. It is pertinent to mention here that the learned first appellate authority admitted this fact and the same does appear in the impugned order. However, strangely enough, the learned CIT/WT (A) instead of annulling the assessments framed by the Assessing Officer on the basis of combined notice, remanded the case for de novo assessments. Perusal of the judgments relied upon by the learned AR also substantiate the assessee's stance in this respect. We, therefore, are of the considered view that the B learned CIT/WT (A) erred in law while remanding the case, hence, we vacate the impugned order and annual the assessments framed by the assessing officer for the foregoing reasons. Even otherwise, the assessments were supposed to be completed within two years from the date of issuance of notice which was not done in the instant case; rather, the assessments were framed after almost 4-years of the issuance of the notice meaning thereby, that the said assessments had become time barred, therefore, assumption of jurisdiction thereafter was nullity in the eye of law.

6. For the foregoing reasons, the appeals of the assessee stand accepted.

C.M.A./554/Tax(Trib)????????????????????????????????????????????????????????????? Appeals accepted.