DECEMBER 9, 2022

The Commissioner Broadening Tax Basis (BTB) vested with Jurisdiction to pass Assessment Order on behalf of the Chief Commissioner Inland Revenue Rawalpindi --- Lahore High Court

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The Commissioner Broadening Tax Basis (BTB) vested with Jurisdiction to pass Assessment Order on behalf of the Chief Commissioner Inland Revenue Rawalpindi --- Lahore High Court

 

Islamabad 28-06-2024: In a significant decision, the Lahore High Court's Rawalpindi Bench has ruled in favor of the Commissioner Inland Revenue in the case [Income Tax Reference No.01 of 2019 etc.]. The judgment, delivered by Division Bench of Lahore High Court presided by Mr. Justice Mirza Viqas Rauf and Mr. Justice Jawad Hassan, addressed the legal contention surrounding the jurisdiction of tax assessments.

 

The Commissioner Inland Revenue had filed Reference Applications (No. 01, 02, and 04 of 2019) under Section 133 of the Income Tax Ordinance, 2001, challenging the orders passed by the Appellate Tribunal Inland Revenue, Islamabad Bench. The Tribunal had previously overturned assessments for tax years 2010, 2011, and 2012, declaring them illegal due to jurisdictional issues.

 

The assessments in question were initiated under Section 122 and Section 111(1)(b) of the Ordinance due to the Respondent's failure to provide satisfactory explanations. The Appellate Tribunal had ruled that the Commissioner Inland Revenue (BTB), Rawalpindi, did not have the jurisdiction to pass the orders, a decision which the Commissioner Inland Revenue contested.

 

The Court examined the jurisdictional provisions under Section 209 of the Income Tax Ordinance and referred to previous case law [PLD 2021 Lahore 343]. The Court noted that the Chief Commissioner had explicitly vested jurisdiction in the Commissioner BTB, Rawalpindi, through an order dated August 20, 2014. Additionally, the Court highlighted that the Respondent had not raised any objections to the jurisdiction during the initial proceedings.

 

The Court criticized the Appellate Tribunal for not adequately considering the jurisdictional authority conferred by the Chief Commissioner and found the Tribunal's decision to be based on misreading and non-reading of the record. Consequently, the High Court ruled in favor of the Commissioner Inland Revenue, setting aside the Appellate Tribunal's order dated November 17, 2018. The decision mandates the forwarding of the High Court's order to the Appellate Tribunal as per Section 133(5) of the Ordinance.

 

This ruling reaffirms the jurisdictional authority of tax officials and underscores the importance of proper procedural adherence in tax assessment cases.

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