I.T.A. No.1491/LB of 2005, decided on 5th May, 2006. VS I.T.A. No.1491/LB of 2005, decided on 5th May, 2006., 2006 PTD-INCOME-TAX-APPELLATE-TRIBUNAL-PAKISTAN 2607 (2006)

Income Tax Ordinance (XLIX of 2001)---

----S. 122(1)---Income Tax Ordinance (XXXI of 1979), S.65---Amendment of assessments---Re-opening of assessment by Taxation Officer---Validity---Original assessment was completed as on 30-6-2001 and the Taxation Officer had reopened the case under S.122 of the Income Tax Ordinance, 2001 and in his order, there was nowhere mentioned that he was delegated powers to reopen the case---Section 65 of the Income Tax Ordinance, 1979 being not saved in S.239 of the Income Tax Ordinance, 2001 no order in this regard could be passed---Case had also been reopened on the basis of record which was already available on file and there was no justification for reopening the case--Taxation officer had assumed jurisdiction under S.122 of the Income Tax Ordinance, 2001 without any justification as he had not been delegated powers by the Commissioner of Income Tax---Order of First Appellate Authority and the order passed by the Taxation Officer were vacated by the Appellate Tribunal.

(2003) 88 Tax 245 (Trib.); (2003) PTD (Trib.) 714; 2003 PTD (Trib.) 742; 2000 PTD (Trib.) 2904; 2006 PTD 673 and 2005 PTD 1316 rel.

Muhammad Shahid, Abbas for Appellant.

Sabiha Mujahid D.R. for Respondent.

ORDER

JAWAID MASOOD TAHIR BHATTI, (JUDICIAL MEMBER).-Through this appeal, the appellant has objected to the impugned order of the learned CIT(A), dated 23-2-2004 for the assessment year 2000-2001 setting aside the order passed under section 122.(1.) of the Income Tax Ordinance, 2001.

It has been contended by the learned counsel for the appellant that order passed under section 122(1) of the Income Tax Ordinance, 2001 by the Taxation Officer has been set aside for de novo consideration by the learned CIT(A) without considering the fact that order passed by the Taxation Officer is void ab initio and illegal for want of jurisdiction. It has been contended that order passed by the Taxation Officer is illegal and not sustainable in the eyes of law, as the order under the aforesaid section can only be passed by the Commissioner of Income Tax and unless the powers in this regard are delegated to the Taxation Officer, no order can be passed, but in the present case, no such powers have been delegated by the Commissioner of Income Tax to the Taxation Officer regarding assumption of jurisdiction over the case. According to the learned counsel, order under section 122 has been passed by the Taxation Officer without issuing notices. According to the learned counsel, Taxation Officer had no powers to invoke the proceedings under section 122 of the Income Tax Ordinance, 2001, as material on the basis of the which he has passed the order under section 122(1), was already available on file and no new material has come to his possession after completion of assessment, which is pre-condition for initiation of proceedings under section 122. Reliance in this respect has been placed on the decision of this Tribunal reported as (2003) 88 Tax 245 (Trib.), (2003) PTD (Trib.) 714 and 2003 PTD (Trib.) 742. He has further contended that mere lesser claim of power bill is not good basis for invocation of proceedings under section 122. Reliance in this regard has been placed on the decision of this Tribunal reported as 2000 PTD (Trib.) 2904. It has further been contended that it has been held by the Hon'ble High Courts that section 122 is not applicable on the previous assessment years and in this case, original assessment was completed on 30-6-2001, while the order under section 122 has been passed on 12-8-2004. He has in this respect placed reliance on the decision of the Hon'ble High Court reported as 2006 PTD 673 & 734 and order of Karachi High Court reported as 2005 PTD 1316.

On the other hand, learned DR is supporting the impugned orders of the Officers below. She has contended that the learned CIT(A) has already set aside the matter and the assessee may explain his position before the Taxation Officer.

I have heard the learned representatives from both the sides and have also perused the impugned order of the learned CIT(A) and the assessment order.

I am of the view that original assessment hi this case was completed on 30-6-2001 and the Taxation Officer has reopened the case under section 122 and in his order, there is nowhere mentioned that he was delegated powers to reopen the case. I have further noted that section 65 of the repealed Income Tax Ordinance, 1979 being not saved in section 239 of the new income Tax Ordinance, 2001 no order in this regard can be passed. I have further found that the case of the assessee has been reopened by the Taxation Officer on the basis of record which was already available on file and there was no justification for reopening the case. In view of these facts and circumstances of the case, I am of the view that Taxation Officer has assumed jurisdiction in this case under section 122 of the Income Tax Ordinance, 2001 without any justification, as he has not been delegated powers by the Commissioner of Income Tax. Even otherwise, in view of the decision of the Hon'ble High Court reported as 2006 PTD 763 and 734, the invocation of section 122 in the present case is not justifiable. The impugned order of the learned CIT(A) and the order passed by the Taxation Officer under section 122(1) of the Income Tax Ordinance, 2001 are, therefore, vacated and the appeal filed by the assessee is allowed.

C.M.A./102/Tax (Trib.)Appeal accepted.