Law: Income Tax Ordinance, 1979

Section: 108(b),132

Law: Income Tax Rules, 1982

Section: 53

ORDER Through this application it has been prayed by the Revenue/ Department that the following question of law which has statedly arisen out of the order, dated 16-9-2003 in I.T.A. No. 1350/LB/2003, may be referred to the Honourable High Court for an authoritative opinion:- "Whether on the facts and in the circumstances of the case, the learned ITAT was legally justified in maintaining the order of the CIT(A) whereby penalty under section 108(b) of the repealed Income Tax Ordinance, 1979 imposed at Rs.2,46,800 was reduced to Rs.18,000 whereas the said section does not have any provision for discretionary determination of the quantum of penalty." Facts in brief of this case are that the respondent/assessee is a private limited company and has been subjected to a penalty, for each day of default commencing from July, 2000 to March, 2001, for non-filing of monthly salary statements under the Rule 53 of the Income tax Rules, 1982, although such statements were filed after receiving of show-cause notice. It is particularly to be mentioned here that the requisite tax deduction was made and was also deposited in the Government Treasury. at the first appeal stage maximum amount of penalty was restricted to Rs.200 for each month from July, 2000 to March, 2000, the period for which the default was committed by relying on the orders in the other parallel cases decided at the first appeal stage. In this Tribunal it was contended by the learned DR that the replacement of word "shall" in-place of "may" in section 108(b) has made the Assessing Officer legally bound to impose the prescribed penalty for the period default continues. The learned DR failed to answer the question by this Bench on referred to the ground of appeal filed by the Department wherein it is given that when it is established that the fault was wilful", the learned DR has not any answer as to how the element of wilful has been proved by the Department. The learned AR on the other hand pleaded in this Tribunal that the primary duty of deduction and depositing of tax has been done and there has never been any intention with action for violating any provisions of the law. This Tribunal by respectfully…

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