W.T.A. Nos. 1010/LB of 2004 and 18/LB of 2005, decided on 16th April, 2005. VS W.T.A. Nos. 1010/LB of 2004 and 18/LB of 2005, decided on 16th April, 2005., 2006 PTD-INCOME-TAX-APPELLATE-TRIBUNAL-PAKISTAN 712 (2005)

(a) Wealth Tax Act (XV of 1963)---

----S. 17(1)(a)(b)---Time limit for completion of assessment and reassessment---Issue of limitation decided by ,the First Appellate Authority by properly relying on the reported order of Appellate Tribunal was upheld by the Appellate Tribunal.

2004 PTD (Trib.) 388 and 2004 PTD (Trib.) 1014 rel.

(b) Wealth Tax Act (XV of 1963)---

----S.31B---Additional Wealth Tax---Mandatory or discretionary---Assessee contended that charging of additional tax was not mandatory but was discretionary requiring the Assessing Officer to decide its chargeability on the merit of each case---Validity---Enactment had never been made to give it a mechanical or mandatory shape for imposing the additional tax and language of section had allowed the discretion to be exercised by the Assessing Officer on analyzing the merit of each case---Appellate Tribunal declined to uphold the findings of the First Appellate Authority that additional tax was mandatory under the law and not discretionary---Assessee's appeal on the issue of additional tax was accepted and departmental appeal was rejected.

1995 PTD 91; 2001 PTD 807; 2003 PTD 818; 2003 PTD 2653 and GST 2005 CL 54 rel.

(c) Wealth Tax Act (XV of 1963)---

----S.31B---Additional Wealth Tax---Provisions mandatory or discretionary---Provisions of additional tax in terms of language, "shall be liable to pay" has made it not mandatory and also that discretion has been given to judge each case on its merit.'

1995 PTD 91; 2001 PTD 807; 2003 PTD 818;.2003 PTD 2653 and GST 2005 CL 54 rel.

Ghazanfar Hussain, D.R. for Appellant.

Sirajuddin Khalid for Respondent.

Date of hearing: 16th April, 2005.

ORDER

By the appeal for the assessment year 1999-2000 the Revenue/ Department has called in question the combined order dated 1-11-2004 passed by the learned C.I.T./W.T.(A), Additional Appeals Zone, Lahore solely for the reason that the learned First Appellate Authority by relying on reported orders of this Tribunal:

(a) 2004 PTD (Trib.) 388.

(b) 2004 PTD (Trib.) 1014.

has held that the impugned assessment is hit by limitation.

2. After hearing both the parties and on perusal of record we find that the learned First Appellate Authority by properly relying on the reported orders has decided the issue of limitation which is upheld. The departmental appeal being devoid of any merit is dismissed.

3. On the other hand, for the assessment year 2000-01, the order ibid has also been called in question by the assessee as appellant on the point of directions for valuation of immovable and secondly for holding that charge of additional tax is mandatory under the law and not discretionary.

4. At the time of hearing the learned A.R. has not pressed the setting with directions on the point of valuation of immovable so it is rejected, but has very clearly and categorically challenged the findings on the point of additional tax. The learned A.R. has pleaded the charging of additional tax is not mandatory but is a discretionary requiring the Assessing Officer to decide its chargeability on the merit of each case. The learned A.R. by referring to the following reported judgment/order has supported his contention:

1995 PTD 91.

5. The learned A.R. has submitted that the liability to pay the additional tax keeping in view the language of sections for charging the additional tax has itself made it clear that it is not mandatory because there is a difference between the words "shall be liable" and "shall be payable", which has been dealt with by the Honourable Lahore High Court in reference to provisions of section 34 of Sales Tax Act. Prior to amendment section 34 in 1996, the words "liable to pay" as per ratio settled in reported judgment do not empower to give it mandatory shape. The other judgments quoted in favour of this ratio have also been referred by the learned A.R. which are as under:--

(1) 2001 PTD 807 (HC Lah.);

(2) 2003 PTD 818 (HC Kar.);

(3) 2003 PTD 2653; and

(4) GST 2005 CL 54 (HC Kar.);

6. In all these judgments supra clear rule has been enunciated that the provisions of additional tax in terms of language shall be liable to pay has made it not mandatory and also that discretion has been given to judge each case on its merit.

7. The learned D.R. has supported the order by submitting that the additional tax is invariably to be imposed wherever there is a situation described in the relevant sections but failed to quote even a single reported or unreported judgment to oppose the submission of the learned A.R.

8. After hearing both the parties and on perusal of record and also going through the case-law referred by the learned A.R. we do not feel any hesitation in holding that enactment has never been made as to give it a mechanical or mandatory shape for imposing the additional tax and also the language of sections as explained by the Honourable High Court has allowed the discretion to be exercised by the Assessing Officer on analyzing the merit of each case. So we are reluctant to uphold the findings of the learned First Appellate Authority that additional tax is mandatory under the law and not discretionary. The assessee's appeal for the assessment year 2000-01 on the issue of additional tax is accepted and the departmental appeal for the assessment year 1999-2000 is rejected.

C.M.A./508/Tax(Trib.)Order accordingly.