VS, 2009 PTD-INCOME-TAX-APPELLATE-TRIBUNAL-PAKISTAN 953 (2008)

(a) Income Tax Ordinance (XXXI of 1979)---

----Ss. 52 & 86---S.R.O. No.586(I)/91, dated 30-6-1991---Liability of persons failing to deduct or pay tax---Purchase of diesel and buses---Assessee was taken as "assessee-in-default" in respect of payment made towards diesel purchases and for payment on account of purchase of buses---First Appellate Authority noticed that payments made for diesel purchases was not liable to tax deduction as per S.R.O. No. 586(I)/91, dated 30-6-1991 and deleted the same---Tax deductions on account of payments for purchase of buses was also deleted for the reason that the recipient had discharged its tax liability---Validity---Deletion of tax on account of payments made for petroleum products were quite in compliance with the S.R.O. No.586(I)/91, dated 30-6-1991---Tax levied for non-deduction of tax on payment on account of purchase of buses had also been properly deleted as it was wholly supported by Full Bench order of Appellate Tribunal---Departmental appeal was dismissed by the Appellate Tribunal.

2000 PTD (Trib.) 2883 rel.

(b) Income Tax Ordinance (XXXI of 1979)---

----S.52---Liability of persons failing to deduct or pay tax---When recipient had discharged its liability of tax, then proceedings against the taxpayer under the provisions of S.52 of the Income Tax Ordinance, 1979 would amount to double taxation.

2000 PTD (Trib.) 2883 rel.

Dr. Muhammad Akram Khan, D.R., for Appellant.

Ahmad Nauman, I.T.P./A.R. for Respondent.

ORDER

EHSAN-UR-REHMAN (JUDICIAL MEMBER).---The titled departmental appeal is directed against first appellate order, dated 30-11-2004 recorded by the learned CIT(WT), Appeals Zone-III, Lahore pertaining to the assessment year 1999-2000 to contest the deleting of tax charged under the heads payments made on account of diesel purchases and purchases of buses.

2. Relevant facts giving rise to filing of this departmental appeal are that the respondent Company was taken as "assessee-in-default" by an order under sections 52/86 of the repealed Income Tax Ordinance, 1979 in respect of payment made towards diesel purchases and for payment to Messrs Gandhara Nissan Limited on account of purchase of buses.

3. The learned First Appellate Authority on noticing that the payments made for the diesel purchases is not liable to tax deduction as per S.R.O. No.586(I)/91, dated 30-6-1991, hence deleted the same. As for as tax deductions on account of payments for purchase of buses was also deleted for the reason that the recipient has discharged its tax liability.

4. Now, before us the learned D.R. has pleaded for maintaining the order passed under sections 52/86 of the repealed Income Tax Ordinance, 1979 but when his attention was drawn to the S.R.O. mentioned above issued by the C.B.R. exempting the payments from the scope of section 50(4) of the repealed Ordinance, in reply, nothing could be submitted. In the case of payments on account of purchase of buses, the assessment order of recipient Messrs Gandhara Nissan Limited passed for the assessment year 1999-2000 which was referred by the learned A.R. was also confronted that by this it is proved that recipient has discharged its tax liability.

5. The learned A. R. in reply has submitted the availability of S.R.O. specifically exempting the payments on account of petroleum products from the scope of section 50(4) of the repealed Ordinance. So, the learned First Appellate Authority has rightly deleted the imposition of tax under section 52 of the repealed Ordinance in respect of payments on account of purchase of buses. The impugned findings were further supported by the learned A.R. by referring to the citation reported as 2000 PTD (Trib.) 2883 wherein it has been held that when recipient has discharged its liability of tax, then proceedings against the taxpayer under the provisions of section 52 would amount to double taxation.

6. We have heard the learned representatives of both the parties and perused the available documents.

7. The findings with regard to the deletion of the tax on account of payments made for petroleum products are quite in compliance with the C.B.R.'s S.R.O. ibid. So, also the payments on account of purchase of buses where tax deduction has properly been deleted as it is wholly supported by the Full Bench order of the Tribunal referred by the learned A.R. In the result the departmental appeal having no substance fails and is dismissed accordingly.

C.M.A./27/Tax (Trib.) Appeal dismissed.