OMV (PAKISTAN) EXPLORATION GmbH, ISLAMABAD VS FEDERATION OF PAKISTAN through Secretary, Revenue Division, Islamabad, 2012 PTD-ISLAMABAD 396 (2011)

Income Tax Ordinance (XLIX of 2001)---

----Ss. 131 & 132(2-A)---Constitution of Pakistan, Art.199---Constitutional petition---Disposal of appeal by Appellate Tribunal---Limitation---Rehearing of appeal---Scope---Plea raised by petitioners was that as appellate authority did not decide their appeals within six months, therefore, appeals should be reheard---Validity---Provision of S.132 (2A) of Income Tax Ordinance, 2001, was directory in nature and not mandatory---Purpose of S.132(2A) of Income Tax Ordinance, 2001, was only to secure ordinary transaction of business of Tribunal and it was for guidance of Tribunal as a check upon Tribunal to avoid delay as much as possible---If delay was caused, the same would not render the judgment as nullity in the eye of law---Not the delay itself, which would make a judgment void or illegal, rather it was the prejudice which was caused due to delay which would affect validity of judgment---If no prejudice was caused to any of the parties, then mere delay by itself would not render the judgment as illegal---Writ could not be issued on mere apprehension of the parties---Any direction to authorities pronouncing of judgment within a time frame, as provided in S.132 (2A) of Income Tax Ordinance, 2001, otherwise to rehear the case, would amount to changing the nature of S.132(2A) of Income Tax Ordinance, 2001, from directory to mandatory provision of law---Legislature itself had not provided any penalty for delay, so the same could not be provided by interpretation of law---High Court directed the authorities to decide the case within ten days---Petition was dismissed accordingly.

2007 SCMR 1587; 1996 SCMR 669; PLD 2002 SC 823; 2011 SCMR 408; 2003 CLC 1797; PLD 2009 SC 493; 2005 SCMR 1802 and 2001 SCMR 1053ref.

Muhammad Akram Sheikh for Petitioners (in Writ Petition No.2810 of 2011)

Makhdoom Ali Khan, Khurram M. Hashmi and Sajid-ur-Rehman Mashwani for Petitioners (in Writ Petitions Nos.2825to 2835 of 2011).

Abid Aziz Sheikh for Petitioners (in Writ Petition No.2836 of 2011)

Shafi Muhammad Chandio, D.A.-G. for Respondents

Ahmr Bilal Sofi, Ayyaz Shaukat, Usman Kareem for FBR, Muhammad Aaqil Usman, Member Legal FBR, M. Bilal and Babar Bilal for Taxation Officer, Ch. Shaukat (Registrar) and Shahid Mustafa (Assistant Registrar), Representatives of the Appellate Tribunal for Respondents.

Date of hearing: 1st November, 2011.

JUDGMENT

RIAZ AHMAD KHAN, J.---This judgment is directed to disposeofinstantwritpetitionalongwithWritPetitionsnumbers 2810,2826,2829,2830,2831,2832,2833, 2834,2835and2836 of 2011.

2.The only question involved in all these petitions is that the appeals of the petitioners were pending before the Appellate Tribunal Inland (Revenue); arguments were addressed on 22-2-2011 and up till now the decision has not been announced. Grievance of the petitioners is that the learned tribunal was required to announce the judgment within three months and now ten months have passed, therefore, there is every possibility that learned members of the tribunal may have forgotten the arguments put forward by the parties and therefore, the learned tribunal may be directed to rehear the case and then decide the same in accordance with law.

3.It is pertinent to mention here that in Writ Petitions numbers 2825, 2826, 2829, 2830, 2831, 2832, 2833, 2834 and 2835 of 2011, an additional issue was also raised regarding constitution of the tribunal, as according to the petitioners, in those petitions, the tribunal had not been constituted with the consultation of the Chief Justice and therefore, the tribunal was not properly constituted. Since in respect of this issue, other writ petitions are pending in this Court, so it was decided with consent of the petitioners that this issue shall be taken up along with those cases and the petitioners may file separate writ petitions in respect of this issue and the present petitions would be confined only to the issue of rehearing the cases, in which arguments have already been addressed before the learned tribunal.

4.Learned counsel for the petitioners contended that Order XX, rule 1, C.P.C. required, to pronounce the judgment on the date, when arguments are concluded or on some future date, not exceeding 30-days. The learned counsel submitted that the principles of C.P.C. apply to the tribunal and therefore, pronouncement of judgment could not be delayed for such a long time. The learned counsel further contended that under section 132(2A) of the Income Tax Ordinance, 2001 the Appellate Tribunal is required to decide the appeal within six months of its filing. So the appeals filed by the petitioner could not be delayed for such a long time. The learned counsel in support of their contention relied on the case-law reported as 2007 SCMR 1587, 1996 SCMR 669, PLD 2002 Supreme Court 823, 2011 SCMR 408and 2003 CLC 1797.

5.On the other hand, learned counsel for the respondents submittedthatthoughthepartieswereheardbytheTribunalon22-2-2011, but thereafter, the parties requested to file written arguments, which were filed on 28-3-2011. As such, it cannot be said that ten months have passed after the arguments were addressed. The learned counsel further contended that the matter of 40/50 billion is involved and object of the petitioners is to prolong the matter on one pretext or the other, as even before the Tribunal, the petitioners once raised the objection that Larger Bench be constituted, so a bench of three members was constituted and thereafter an other objection was raised, which was also accepted and a bench of five members was constituted, Now, the petitioners once again intend to prolong the case, on one pretext or the other. The learned counsel further contended that discretionary relief of law cannot be exercised on the whims of petitioners as up till now no prejudice has been caused to the petitioners and it is only apprehension of the petitioners, which can not be made basis for issuance of writ. The learned counsel for the respondents in support of his contention, relied on the case-law reported as PLD 2009Supreme Court 493, 2005 SCMR 1802 and 2001 SCMR 1053.

6.In response to the arguments of respondents, learned counsel for the petitioners, in exercise of right of rebuttal, submitted that since the respondents have not submitted comments or written statement, therefore, when no counter affidavit has been filed, the facts stated by the petitioners are to be taken as correct and the verbal averments of respondents on factual controversy cannot be accepted. The learned counsel therefore, contended that the submissions regarding the amount involved, the applications regarding request for constitution of Larger Bench, may not be taken into consideration by this Court. In support of this contention the learned counsel referred to the case-law reported as 2007 CLC 124, 1999 CLC 694 and 1989 MLD 2253.

7.I have heard learned counsel for the parties and have also perused the record.

8.Admitted position in the present case is that the appeals of the petitioners are pending before the Appellate Tribunal Inland Revenue and it is also admitted that oral arguments were addressed on 22-2-2011. As far as Order XX, rule 1, C.P.C. is concerned, the same is not applicable to this case, as there is no provision in Income Tax Ordinance, providing that C.P.C. is applicable in tax matters. Furthermore, in the Income Tax Ordinance, its own procedural law is available, which would apply to Tax Cases and not the general law of C.P.C.

9.Part3oftheIncomeTaxOrdinance,2001dealswithappeals; section 131 is regarding appeal of the Appellate Tribunal and section 132 is regarding disposal of appeal by the Appellate Tribunal. Subsection (2a) of section 132 provides as under:---

"The Appellate Tribunal shall decide the appeal within six months of its filing."

The bare reading of the above provision shows that it is directory in nature and not mandatory; the purpose of this provision is only to secure the ordinary transaction of business of the tribunal. It is for guidance of the tribunal and of course can be considered as a check upon the tribunal to avoid delay as much as possible. However, if delay is caused, the same would not render the judgment a nullity in the eye of law. It is not delay itself, which makes the judgment void or illegal, rather it is the prejudice which is caused due to delay which would effect validity of the judgment. If no prejudice is caused to any of the parties and if the contentions raised by the parties are adhered to, then mere delay by itself would not render the judgment illegal. On the other hand, if the contentions raised by the parties are not adhered to, the points raised are not considered or in any manner some prejudice is caused to the petitioner and if it is established that the prejudice is caused due to the delay, then definitely delay can be taken into consideration and the judgment can be set aside. So the important thing is not the delay itself, rather it is the prejudice caused to the petitioners, which is to be taken into consideration. In the present case, it is apprehension of the petitioners that if the judgment is pronounced now, the same may cause some prejudice to the petitioners, as learned members of the tribunal may have forgotten the arguments put forward by learned counsel for the parties. In such a way, it is to be presumed that the learned members may have forgotten the points raised by the parties. In fact, it is only members of the tribunal, who can say that the case is to be reheard and it is not for the parties to presume that the members may have forgotten the arguments advanced. It is also established principle of law that on the basis of mere apprehension of the parties writ can not be issued. If it is held that the judgment must be pronounced within the time framed, as provided in subsection (2A) of section 132 of the Income Tax Ordinance, 2001, otherwise case is to be reheard, then that would amount to changing nature of subsection (2A) of section 132 ibid from directory to mandatory provision of law. Since, the legislature itself has not provided any penalty for delay, so the same cannot be provided by interpretation of law. As far as the judgments referred to by learned counsel for the petitioners are concerned, with all due respect, I hold that those cases do not support the contentions of learned counsel for the petitioners. In 2007 SCMR 1587 the arguments were addressed on 19-5-2006 and judgment was announced on 8-3-2007 i.e. after passage of 10 months. The Hon'ble Supreme Court held that:--

"Order XX of C.P.C. apply to the writ petitions and the judgment should have been announced within 30 days, however, it was provided that the unreasonable delay of ten months in the instant case in pronouncement of judgment by the learned High Court has caused prejudice as well. In the lengthy arguments addressed before us on merits, we were referred to a bulk of documentary evidence going to the very route of the case which was never found mentioned in the impugned judgment of the High Court. This omission seems to be caused only and only due to the delay of ten months in question."

10.In judgment reported as PLD 2002 Supreme Court823, it was held that no inflexible rule of law prescribing a period can be laid down for the pronouncement of a judgment after conclusion of the arguments. It would always be just and proper to pronounce the judgment within a reasonable period after notice to the parties. Merely because of delay in pronouncement of judgment, decision itself is not vitiated. The case-law reported as PLD 2009 Supreme Court 493, is regarding pronouncement of judgment by Hon'ble Supreme Court of Pakistan and not High Court, wherein it was held that no period of limitation is provided for pronouncement of judgment. In judgment reported as 2005 SCMR 1802, it was held that Courts and Tribunals must announce the judgment within reasonable time but the mere delay in announcement of judgment would not be considered sufficient to set aside the same and remand the case if no prejudice was caused to any party on the merits. In the case-law reported as 2001 SCMR 1053 the judgment was announced after conclusion of the arguments and reasons for the same were given after a long delay, but since no prejudice was caused to any of the parties, so the same was not set aside. In the judgments stated at the bar, it becomes clear that in all these cases, the judgments had been announced, whereas, in the present case, the judgment has not yet been announced by the tribunal; secondly, the referred cases ware mostly writ petitions, wherein C.P.C. was applicable even then Hon'ble Supreme Court of Pakistan held that mere delay in pronouncement of judgment would not vitiate the trial and it is to be seen whether prejudice is cause to the petitioner or not. In the present case also if after judgment of the tribunal the petitioners succeed in establishing before the Court that prejudice was caused due to delay of pronouncement of the judgment, the same can be taken into consideration. But at this stage, it would be premature to hold that learned members of the tribunal might have forgotten the arguments addressed by the learned counsel for the parties. However, contention of learned counsel for the petitioner that factual controversy, if not controverted by the opposite party in writing, has to be admitted as correct, is valid.

11.In view of the above mentioned facts, I find no force in these writ petitions and all the petitions are accordingly dismissed. However, the tribunal is directed to decide the case within ten days after receipt of this judgment.

M.H./58/Isl.Order accordingly.