Law: Income Tax Ordinance, 2001

Section: 122,122(2),120

Income Tax Ordinance (XLIX of 2001)---Ss. 122(2) & 120---General Clauses Act (X of 1897), S.6(c)--- Amendment of assessment---Limitation---Taxpayer contended that assessment stood completed on 2-2-2006 in terms of S.120 of the Income Tax Ordinance, 2001, when the return was filed after seeking extension in time limit for filing the return; and that subsection (2) of S.122 of the Income Tax Ordinance, 2001 was inserted vide Finance Act, 2009 and period of five years would start from the end of financial year 2005 i.e. 31-12-2004 as per the provision of subsection (6); and order had been passed on 30-6-2012 after the time limit of five years---Revenue contended that subsection (2) of S.122 of the Income Tax Ordinance, 2001 was substituted by the Finance Act, 2009; and comparison of the present provisions of subsection (2) and the provisions substituted, revealed that there was no change in any substantive provision of law; and provisions of subsection (2) of S.122 of the Income Tax Ordinance, 2001 being not a change in substantive law would apply retrospectively---Validity---Right of amendment of assessment of the case ceased up to 1-2-2011 consequent upon filing of return/deemed assessment on 2-2-2006 as per law then prevailing---Department could amend the assessment up to 1-2-2011 only; and deemed assessment was amended on 30-6-2012 which could be amended up to 1-2-2011---For tax year, 2005, return was filed on 2-2-2006 and amendment was made on 30-6-2012---Taxpayer contended that assessment stood made on the date of filing of return and as per law prevailing at that point of time, amended assessment could only be made within five years i.e. up to 1-2-2011 and that amendment made in subsection (2) of S.122 of the Income Tax Ordinance, 2001 by Finance Act, 2009, whereby limitation was extended up to the expiry of five years from the end of the financial year in which the Commissioner had issued the assessment order to the taxpayer, would not be applicable---Taxation Officer had found that amendment was applicable retrospectively, it did not bring about change in any substantive provision---Held, amendment had been made in procedural/machinery provision…

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