MUHAMMAD HANIF VS ASSISTANT COMMISSIONER OF INCOME TAX AUDIT, LAHORE, 2007 PTD-LAHORE-HIGH-COURT-LAHORE 1184 (2005)

Income Tax Ordinance (XLIX of 2001)---

----Ss. 22(9), 122(1) & 137(2)---S.R.O. 633(I), dated 14-9-2002---Constitution of Pakistan (1973), Art.199 Constitutional petition---Deduction for depreciation, computation for---Amendment of assessments---Notice for payment of tax---Assessee had prayed that impugned notice issued under S.22(9), Income Tax Ordinance, 2001 along with superstructure built thereon by way of order passed under S.122(1) of Income Tax Ordinance, 2001, be declared illegal---Assessee also prayed to restrain the Authority from proceeding to effect recovery of tax on basis of demand notice issued under S.137(2) of Income Tax Ordinance, 2001 till the decision of constitutional petition---Petitioner had stated that issue raised in the petition, had already stood resolved by judgment of the High Court reported as 2005 PTD 1621---Counsel for Revenue, did not dispute that per ratio in said judgment, S.R.O. 633(I)/2002 dated 14-9-2002 was declared to be not a valid piece of Legislation---During the period in which said S.R.O. remained in force, no legally valid action under it could be initiated under S.122 in respect of assessments already completed under repealed Income Tax Ordinance, 1979---For the various reasons stated in the said reported judgment of High Court, impugned notice and amended assessment order recorded under S.122(1) of Income Tax Ordinance, 2001, were declared to be illegal and without lawful authority.

Kashmir Edible Oil Ltd. v. Federation of Pakistan and others 2005 PTD 1621 rel.

Siraj-ud-Din Khalid for Petitioner.

Muhammad Ilyas Khan for Respondent.

ORDER

NASIM SIKANDAR, J.---In this Constitutional petition following prayer has been made:--

"It is respectfully prayed that the Hon'ble High Court may be pleased:--

(1) To declare that the impugned notice, dated 31-3-2005 issued under section 22(9) along with its superstructure built thereon by way of order, dated 28-5-2005, passed under section 122(1) of the Income Tax Ordinance, 2001, are illegal, without lawful jurisdiction and of no legal effect.

(2) To restrain the respondent from proceeding to effect recovery of tax on the basis of demand notice, dated 28-5-2005 issued under section 137(2) of the Income Tax -Ordinance 2001, for Rs.1,70,316 till the decision of this petition."

2. Heard the learned counsel for the parties. Learned counsel for the petitioner states that the issue raised in this petition already stands resolved by a judgment of this Court in re: Kashmir Edible Oil Ltd. v. Federation of Pakistan and others 2005 PTD 1621 which already stands approved by the (sic).

3. Learned counsel for the respondent-Revenue does not dispute that per ratio settled in the above judgment S.R.O. 633(I)/2002, dated 14-9-2002 was not a valid piece of legislation. Therefore, during the period in which it statedly remained in force from 1-7-2002 to 1-7-2003 no legally valid action under it could be initiated under section 122 (Amendment of assessment) in respect of the assessments already completed under the late Income Tax Ordinance, 1979. I will also agree with the learned counsel for the petitioner that the two 'assessments earlier completed in respect of the petitioner for the assessment years 1997-98 and 1998-99 could be reopened under section 65 or 66-A of the Income Tax Ordinance, 1979 respectively till 30-6-2003 and 30-6-2004 only while the impugned show-cause notice was issued on 31-3-2005.

4. For the various reasons stated in the aforesaid judgment of this Court the impugned notice, dated 31-31.2005 and the amended assessment order, dated 28-5-2005 recorded under section 122(1) of the Income Tax Ordinance, 2001 are declared to be illegal and without lawful jurisdiction.

5. Petition accepted.

H.B.T./M-100/LPetition accepted.