IN THE HIGH COURT OF SINDH, KARACHI

CP No.D-3422 of 2014

alongwith

C.P. Nos.D-3374, 3375, 3376, 3377, 3378, 5085 of 2014 & 5363 of 2016.

Date

Order with signature of Judge

 

                                                            Present:

                                                          Mr. Justice Aqeel Ahmed Abbasi &

                 Mr. Justice Nazar Akbar.

 

18.10.2017

 

Mr. Hyder Ali Khan, advocate for the Petitioner

a/w. Mr. Samiur Rehman, advocate.

 

Mr. M. Sarfraz Ali Metlo, advocate for Respondent.

 

Mr. Mir Hussain, Assistant Attorney General.

 

 

O R D E R

 

 

AQEEL AHMED ABBASI, J.:   A common controversy has been agitated through instant petitions, whereby, petitioners have challenged the legality of Notices issued by respondents for the recovery of Advance Tax on the basis of estimate by the department instant of tax payer’s own estimates in terms of Section 147 of the Income Tax Ordinance, 2001, whereas, according to the learned counsel for the petitioners, subject controversy has already been decided by a Divisional Bench of this Court in a recent judgment dated 26.06.2014 passed in C.P. No.D-3305/2014 in the case of Pakistan Petroleum Company Limited ..Vs.. Federation of Pakistan and others, while placing reliance in the earlier reported judgments of this Court as well as judgment of Hon’ble Supreme Court in the case of Chairman Central Board of Revenue ..Vs.. Pak Saudi Fertilizer Ltd. (2000 PTD 3748), therefore, instant petitions are being disposed of through this common judgment. While confronted with above factual and legal position, learned counsel for the respondent do not dispute aforesaid position and submit that instant petitions may be disposed of in similar terms. Accordingly, we need not reiterate the facts of instant petitions as matter relates to interpretation of provisions of Section 147 of the Income Tax Ordinance 2001, and would by respectfully following the judgments already passed by High Court as well as by the Hon’ble Supreme Court as referred to hereinabove, dispose of instant petitions in terms of the aforesaid judgment of this Court by reproducing relevant finding on the subject controversy in the following terms:-

“We have heard both the learned counsel perused the impugned order and case law relied upon by the learned counsel for the petitioner on the subject controversy. It will be advantageous to reproduce the relevant para 13 of the decision of a division bench of this Court in the case reported as 2011 PTD 1996 Karachi Port Trust, Karachi V/S Commissioner Inland Revenue, Karachi, which reads as follows:-

 

“Now we will examine if a wrong estimate is filed then what are the options available to the Taxation Authorities to take action for filing such wrong estimate. A perusal of section 147 leads to the conclusion that once such estimate is filed whether right or wrong, there is no provision which provides any authority to the Taxation Officer to discard this estimate and ask the taxpayer to continue paying the tax in accordance with the provision of subsection (I) of Section 147 read with subsection (4)  of section 147. The learned counsel for the respondent has also not been able to point out any provision of law which provides such authority and therefore we are of the considered opinion that once an estimate is filed the only option available to the Taxation Authority is to levy default surcharge under subsection (IB) of section 205 after completing the assessment, if such default surcharge is leviable ton the basis of the assessment. The language of subsection (7) of section 147 is also clear which provides an authority to the Taxation Authority to recover advance tax not paid as if it was a tax due underan assessment order so that provisions of section 137(2) are not violated. However, we are inclined to agree with the learned counsel for the applicant that it does not provide them an authority and jurisdiction to pass any order for the recovery of such tax and therefore we are of the considered opinion that the order passed by the Taxation  Officer is without proper jurisdiction and authority and cannot be sustained.”

 

In view of herein above and the candid statement of the learned counsel for the respondents under instructions, the impugned order is hereby set aside. The Bank Officers of the two banks i.e. MCB PIDC Branch and Allied Bank of Pakistan PIDC Branch have also shown appearance pursuant to Court’s Notice and submitted that they have not, in any manner, shown defiance to the orders of this Court and are willing to cancel the two pay orders and credit the amount in the account of the petitioner. Since the impugned order has been set aside by this Court the amount mentioned in the pay orders is otherwise required to be immediately credited to the account of the petitioner. Petition stands disposed of along with listed applications in the aforesaid terms”.

 

 

The above petitions stand disposed of in the aforesaid terms alongwith listed applications, and in view of said disposal of instant petitions, the impugned Notices issued by the respondents for the recovery of Advance Tax on the basis of their own estimates in instant petitions, are hereby quashed.

 

JUDGE

        JUDGE

 

 

 

 

 

 

 

 

 

 

 

 

 

SM