COMMISSIONER OF INCOME-TAX, ZONE-C, KARACHI vs Messrs AGHA'S SUPER

ORDER

1. ' MUHAMMAD MUJIBULLAH SIDDIQUI, J.---After dismissal of reference application under section 136(1) of the Income Tax Ordinance, 1979 the Commissioner of Income Tax has submitted this application under section 136(2) of the Income Tax Ordinance, 1979, seeking our opinion on the following questions of law, allegedly arising out of the order of Tribunal.

2. "Whether on the facts and in the circumstances of this case the learned Income Tax Appellate Tribunal was justified in holding that order passed under sections 52 and 86 of the Income Tax Ordinance, 1979 after period of four years is barred, whereas no time period is provided under the Ordinance for passing such order?"

3. "Whether on the facts and in the circumstances of this case the learned Income Tax Appellate Tribunal was justified in holding the order passed under sections 52 and 86 of the Income Tax Ordinance, 1979 is to be treated as order passed under section 156?"

4. The relevant facts as contained in the order of Tribunal are that, the Assessing Officer passed orders under sections 52 and 86 of the Income Tax Ordinance, 1979, after six years from the end of the financial year when the default in deduction of tax under section 50(4) of the Income Tax Ordinance, 1979, was made. The respondent preferred appeal before the Commissioner' of Income Tax mainly assailing the order on the point of limitation. It was contended that although no period of limitation was provided for passing an order under section 52/86 but in all such cases the principle of applicability of reasonable period of limitation shall be attracted. It was submitted that, the time limit of four years was prescribed under section 156 of the Income Tax Ordinance for making any order by way of rectification and thereby retrieving the loss if any to the Revenue. The same period of limitation should be taken for making the orders under other provision where no such period of limitation is provided. The learned. Commissioner of Income Tax accepted the contention by placing reliance on the order of Tribunal reported as 2000 PTD (Trib) 2883. The order under section 52 of 1986 was accordingly annulled being barred by limitation.

5. The, department feeling aggrieved, preferred second appeal before the Tribunal and the Tribunal held that, the order was admittedly beyond the period of four years prescribed under section 156 of the Income Tax Ordinance, 1979. The appeal preferred at the instance of department was dismissed.

6. ' Being aggrieved With the above order, the department submitted reference application under section 136(1) of the Income Tax Ordinance, seeking to refer the questions already produced in the earlier part of this order for the opinion of this Court. The reference application was rejected vide order, dated 10-4-2000, holding that, the questions proposed to be referred by the department do not contain arty substance, as the law does not provide unlimited time for framing of orders under sections 52 and 86. It was further held that while deciding an identical issue relating to the levy of Workers Welfare Fund, Sindh High Court has held in the case of Commissioner of Income Tax v.

7. Kamran Model Factory 2002 PTD 14, that the time limit available under section 156 would be applicable.

8. ' Being still dissatisfied the department has preferred this direct reference application before us.

9. We have heard Mr. Jawaid Farooqi, learned counsel for the applicant. During the course of arguments the learned counsel for the applicant could not deny that, the principle enunciated in the case of Kamran Model Factory (Supra) is attracted to the issue under consideration. As the principle of law involved in the questions proposed in this reference application already stand decided by this Court in the judgment referred to above, therefore, we are of the opinion that, the Tribunal has rightly rejected the reference application, and no interference is warranted on our part. The reference application stands dismissed in limine.