Law: Income Tax Ordinance, 1979

Section: 121,121(1)(d),133(5),177(10)

INCOME TAX ORDINANCE, 2001 (XLIX OF 2001) Sections: 121, 121(1)(d) & 177(10) - Reference to High Court - Audit - Best Judgment assessment - Passing of order by the Taxation officer u/s 121 read with Section 177(10) of ordinance - ATIR declared that the Impugned order is not maintainable - Validity - FACTS In this Tax Reference, inter-alia, following question is pressed and argued before us which is asserted to have arisen out of order dated 19-12-2011 passed by Appellate Tribunal Inland Revenue, Lahore Bench, Lahore, ("Appellate Tribunal"):- (i) Whether on the facts and in the circumstances of the case, the ATIR was justified to declare the order passed u/s 121 read with 177(10) not maintainable without considering the fact that the taxpayer failed to provide and record/document required to verify that the declared version is in conformity with the provisions of Seventh Schedule to the I.T.O. 2001 or not? Question proposed is regarding jurisdiction of taxation officer to pass order under Section 121 of the Income Tax Ordinance, 2001 ("Ordinance of 2001") during audit proceedings. Admittedly, the impugned order under section 121(1)(d) was passed on 18.03.2010 and Sub-section (10) of Section 177 of the Ordinance of 2001 was inserted in the Statute Book w.e.f. 1st July, 2010 vide Finance Act. 2010. Learned counsel for the respondent has apprised that this Court has already answered this proposition in by this court in Commissioner Inland Revenue (Legal) v. Commissioner Inland Revenue (Appeals) and others (2013) 107 TAX 60 (H.C. Lah.), which was upheld by the Hon'ble Supreme Court of Pakistan vide dated 09.05.2013 passed in Civil Petitions No. 526 (and others) of 2013. The decision was followed in case The Commissioner of Income Tax v. Doaba Plastics Industries (Pvt.) Limited (2015) 111 TAX 153 (H.C. Lah.). Learned counsel for applicant department could not deny that very action under Section 121 of the Ordinance of 2001 has been held without lawful authority and that the above said decisions are applicable to the facts of this case. DECISION (A.) Question Proposed is answered accordingly - In view of the dictum laid down, on the proposition of law, in the…

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