I.T.R.A. No.92 of 2012.
Present
Mr. Justice Aqeel Ahmed Abbasi
Mr. Justice Abdul Maalik Gaddi
Date of hearing : 30.05.2014
Date of order : 30.05.2014
Applicant : The Commissioner Inland Revenue
through Mr. S. Mehmood Abbas, advocate
Respondent : M/s Wali Oil Mills Limited
Nemo for the respondent.
O R D E R
Aqeel Ahmed Abbasi, J. Through instant Reference Application, the following questions have been proposed, which according to the applicant have arisen from the order dated 17.4.2012 passed in I.T.A. No.757/KB-2011, Tax year 2009, by the Appellate Tribunal Inland Revenue:-
1. Whether on the facts, in the circumstance of the case, the learned Appellate Tribunal was justified to hold the order of the Commissioner Inland Revenue (Appeals) to the effect that discrepancies discovered through audit of taxpayer u/s. 177 of the Income Tax Ordinance, 2001 do not constitute “definite information” in terms of Section 122(5) of the Income Tax Ordinance, 2001 and therefore, assessment cannot be amended u/s. 122(1) or Section 122(4) of the Income Tax Ordinance, 2001?
2. Whether on the facts, and the circumstances of the case, the learned Appellate Tribunal has erred in holding that the information obtained through audit regarding wrong tax calculation, does not fall under the ambit of definite information as envisaged under section 122(5) of the Income Tax Ordinance, 2001 and 122(4) of the Income Tax Ordinance, 2001?
3. Whether on the facts and circumstances of the case, the manufacturer of vegetable ghee and cooking oils are obliged to pay tax @ 2% of gross purchase value of locally produced edible oil which full and final discharge of their tax liability under Clause (13-C) of Part-II of 2nd Scheduel to the Income Tax Ordinance, 2001 read with Circular No.14 of 2004 dated 13.7.2004?
2. Learned counsel for the applicant has read out the order passed by the authorities below as well as the impugned order passed by the Appellate Tribunal Inland Revenue, and submits that questions proposed arise from the impugned order passed by the tribunal which may be answered by this Court. However, while confronted as to pointing out any error in the impugned decision of the Appellate Tribunal on the subject controversy, the learned counsel could not satisfactory respond to such query and has candidly stated that prima-facie it appears that the subject controversy has been decided by the Appellate Tribunal after proper scrutiny of facts by applying correct law thereon.
3. We have heard the learned counsel for the applicant and perused the record and the impugned order passed by the Appellate Tribunal with the assistance of the learned counsel. It appears that the concurrent findings on facts as well as on law have been recorded by the forums below against the applicant department on the subject controversy, which has been dealt by the Appellate Tribunal in the following manner:-
“11. The arguments advanced by the parties have been given due consideration. We take up first legality of proceeding u/s. 122(5) of the Income Tax Ordinance, 2001 in order to appreciate legal position Section 122(5) is reproduced below:
“An assessment order in respect of a tax year, or an assessment year, shall not be amended under sub-section (1) and an amended assessment for that year shall only be further amended under sub-section (4) where, on the basis of definite information acquired from an audit or otherwise, the Commissioner is satisfied that:-
(i) any income chargeable to tax has escaped assessment; or
(ii) total income has been under-assessed, or assessed at too low a rate, or has been the subject of excessive relief or refund; or
(iii) any amount under a head of income has been mis-classified.”
12. It is evident from plain reading of the above provision that in case definite information has acquired otherwise through audit, specific ground to be covered in the notice, which is lacking in the instant case, further definite information has been defined u/s. 122(8) also does not come for rescue of the appellant therefore, there is no infirmity in the finding of the learned Commissioner Inland Revenue (Appeal) on this count.
13. As regard applicability of Clause 13C of Part-II of Second Schedule to the Income Tax Ordinance, 2011 there is no dispute about discharge of tax liability by the respondent as per First Schedule, we, therefore, do not see why additional burden or tax can be imposed in the garb of Second Schedule which is related to giving tax relief, exemption and concession and not additional burden of tax, further, we are fully in agreement with the finding of the learned CIR(A) that even otherwise Clause 13C of Part-II of Second Schedule to the Income Tax Ordinance, 2001 is not covered u/s. 169 of the Income Tax Ordinance, 2001 therefore, it cannot be termed as final tax liability, meaning thereby it is adjustable which in any case to be refunded back to the taxpayer in case tax liability has been discharged in First Schedule, therefore, finding of the learned CIR(A) does not warrant any interference on this ground also.”
4. From perusal of hereinabove findings as recorded by the Appellate Tribunal Inland Revenue in the instant case, it appears that the applicant has erred in law by reopening the case of the respondent without complying with the legal requirement as envisaged under Section 122(1), 122(4) and 122(5) of the Income Tax Ordinance, 2001 nor could appreciate the import of the provision of clause 13(c) of Part II of the Second Schedule to the Income Tax Ordinance, 2001, which is not covered under Section 169 of the Income Tax Ordinance, 2001, and therefore, cannot be termed as final tax liability.
5. In view of hereinabove facts and circumstances of this case, which have not been controverted by the learned counsel for the applicant, We are of the view that the questions proposed through instant Reference Application are not disputed or substantial questions of law, hence cannot be termed as question of law arising from the impugned order passed by the Appellate Tribunal Inland Revenue, which otherwise depicts correct legal position. We may observe that every question cannot be treated as a question of law, whereas every question of law if not substantial in nature and does not refer to any disputed legal controversy, cannot be referred for opinion of this court by filing Reference Application under section 133 of Ordinance, 2001. Reference in this regard can be made to the case of M/s Japan Storage Battery v. Commissioner Income Tax 2003 PTD 2849. Accordingly, we do not find any substance in the instant Reference Application, which is hereby dismissed in limine along with listed application.
J U D G E