COMMISSIONER INLAND REVENUE, ZONE-II, LARGE TAXPAYERS VS DIGICOM TRADING (PVT.) LTD., 2017 PTD-KARACHI-HIGH-COURT-SINDH 1042 (2016)

Income Tax Ordinance (XLIX of 2001)---

----Ss. 132 (2)(3)(6) & 133---Reference---Maintainability---Authorities were aggrieved of direction issued by Appellate Tribunal to Commissioner (Appeals)---Validity---Reference would lie against an order of Appellate Tribunal deciding appeal of an aggrieved party or Commissioner in terms of Ss. 132 (2), (3) and (6) of Income Tax Ordinance, 2001---No reference would lie against an order passed by the Tribunal on some miscellaneous application seeking implementation of an order passed on stay application, when no final order had been passed on merits in terms of S. 132 of Income Tax Ordinance, 2001, on appeal pending before Appellate Tribunal---Reference was dismissed in circumstances.

Amjad Jawaid Hashmi for Applicant.

Date of hearing: 24th October, 2016.

ORDER

AQEEL AHMED ABBASI, J.---Through instant reference application, the applicant department has formulated following questions, which according to learned counsel for the applicant, are questions of law arising from the impugned order passed by the Appellate Tribunal Inland Revenue of Pakistan (Karachi) in M.A. (Add) Stay No. 321/KB/ 2015 [Tax Year 2015] in Ref. I.T.A. No.1430/KB/2015 under section 131(5) of the Income Tax Ordinance, 2001:-

"A. Whether in the facts and circumstances of the case, the learned Appellate Tribunal Inland Revenue has travelled beyond the limits of its discretion as structured for determination of undue hardship factor in order to grant stay under the dictates of section 131(5) of the Income Tax Ordinance, 2001?

B. Whether in the facts and circumstances of the case and in the absence of undue hardship, the learned Appellate Tribunal I.R. is justified to hold that the revenue has no legal authority or legal force to encash the pay orders which were obtained prior to the grant of stay of demand by the appellate fore?"

2.After having read out the impugned order passed by the Appellate Tribunal, learned counsel for the applicant was directed to point out any error or illegality in the impugned order passed by the Appellate Tribunal on a Misc. Application pursuant to an order on stay application passed on 07.12.2015, however, the learned counsel could not assist this Court as to how the impugned order passed by the Appellate Tribunal suffers from any error and illegality or gives rise to any question, which may be termed as a question of law arising from the order of the Appellate Tribunal. From perusal of impugned order, it appears that instead of abiding by the order passed by the Appellate Tribunal on 07.12.2015 on a misc. application for stay of demand in terms of section 131(5) of the Income Tax Ordinance, 2001, restricting the recovery of tax demand to 10%, the Revenue Authorities, in violation of Tribunal's order, recovered the amount of tax through coercive process of attachment. It is evident from record that the order dated 07.12.2015 passed by the Appellate Tribunal has not been challenged by the Revenue Authorities, which otherwise attained finality, whereas the impugned order passed by the Appellate Tribunal on the Misc. Application of the respondent, intimating the violation of the Tribunal's order restricting recovery of impugned tax demand to 10% has been assailed by filing instant reference application under section 133 of the Income Tax Ordinance, 2001.

3.Attention of learned counsel for the applicant was also drawn to the maintainability of the instant reference application, which has been filed against an order passed by the Appellate Tribunal on a Miscellaneous Application, intimating the violation of the Tribunal's order dated 07.12.2015, whereas, there is no final order of the Appellate Tribunal disposing of the appeal on merits in terms of section 132 of the Income Tax Ordinance, 2001, against which order, a reference could be filed within 90 days of the communication of such order under section 133(7) of the Income Tax Ordinance, 2001, and that too, in respect of question of law only, if arising out of the order of the Appellate Tribunal. Learned counsel for the applicant has candidly conceded to the legal position that a reference would lie against an order of the Appellate Tribunal deciding an appeal of an aggrieved party or the Commissioner in terms of Sections 132(2), (3) and (6) of the Income Tax Ordinance, 2001, whereas, no reference would lie against an order passed by the Appellate Tribunal on some Misc. Application, seeking implementation of an order passed on stay application, particularly, when no final order has been passed on merits in terms of section 132 of the Income Tax Ordinance, 2001, on the appeal pending before the Appellate Tribunal.

4.Accordingly, we do not find any substance in the instant reference application, which is misconceived in law and facts, hence, the same is hereby dismissed in limine along with listed application.

MH/C-26/Sindh Reference dismissed.