Law: Income Tax Ordinance, 2001

Section: 149,165,182,182(1A)

ORDER M. M. AKRAM (Judicial Member): The above titled appeal has been filed by the taxpayer against the Appeal Order No.847 dated 28.03.2018 passed by the learned Commissioner Inland Revenue (Appeals), Peshawar for the Tax Year 2017 on the grounds as set forth in the memo of appeal. 2. Brief facts of the case are that the taxpayer is a private limited company and derives income from manufacturing and sales of pharmaceutical products. The penalty order was finalized by the learned DCIR vide C.No.2319 dated 07.02.2018 u/s 182(1A) of the Income Tax Ordinance, 2001 ("the Ordinance") whereby penalty @ Rs.2,500/- per day for 160 days totaling at Rs.400,000/- has been imposed for alleged non-filing of statement u/s 165 of the Ordinance. The taxpayer being aggrieved, filed appeal before the learned CIR (A) who confirmed the impugned penalty order vide Appeal Order No.847 dated 28.03.2018. Being aggrieved, the appellant has now come up before this forum and has assailed the impugned order on number of grounds. 3. This case came up for hearing on 13.05.2019. Learned AR reiterated the contentions already submitted in the grounds of appeal as set forth in the memo of appeal. Learned DR opposed the appeal on the ground that learned Commissioner (Appeals) has passed a speaking order and there is no illegality or lacuna in his order. 4. We have heard both the parties to the case and perused the record keeping in view the judgments relied upon by the appellant. The submissions made by the learned AR of the taxpayer have substance. The filing of annual statement u/s 149 of the Income Tax Ordinance, 2001 is just a procedural process and non-filing of return like statements has not resulted in any loss to the Government Exchequer. Further it is settled law that imposition of penalty is deterrent to tax evasion and when there is no evasion of tax, penalty cannot be imposed. This Appellate Tribunal Inland Revenue in numerous cases has deleted the penalty in such like circumstances, reliance may be placed on the judgment reported as 2016 SLD 1193, 2017 PTD 770 and 2017 PTD 1080. In the case of M/s Resilience Expert (Pvt) Ltd. Vs Commissioner Inland Revenue, Range-B, WHT, RTO,…

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