Law: Income Tax Ordinance, 1979

Section: 129,138

Income Tax Ordinance (XXXIX of 1979)----S. 138---Interpretation, scope and application of .S. 138---Revision by Commissioner- --Any action taken by the Commissioner under S. 138, Income Tax Ordinance, 1979, be it suo motu or on an application by the assessee, the order in no case should be prejudicial to the -assessee-Only such orders can be passed in such proceedings which are in favour of the assessee and do not adversely affect its interest, business or any tangible or intangible right--¬Words "not being an order prejudicial to the assessee"---Connotation. Section 138 of the Income Tax Ordinance, 1979 authorises the Commissioner to call for the record of any proceeding in which order has been passed by any authority subordinate to him, suo motu or on an application by an assessee and pass order subject to the provisions of the Ordinance with the limitation that no order shall be passed which i' prejudicial to the assessee. Any action taken by the Commissioner under section 138, be it suo motu or on an application by the assessee, the order in no case should be prejudicial to the assessee. Only such orders can be passed in such proceedings which are in favour of the assessee and do not adversely affect its interest, business or any tangible or intangible right. The words "not being an order prejudicial to the assessee" supply the guiding rule for interpreting section 138. The word "prejudicial" means: Detrimental or derogatory to a party; Detrimental, injurious, harmful, damaging, hostile, antagonistic and inimical. In the scheme of the Ordinance and the phraseology used "prejudicial" means adverse, not beneficial, damaging or an order, which adversely affects rights and obligations of an assessee. Therefore any order which may be harmful to the assessee adversely affecting his right, property, business, goodwill or credit will fall within this category. This provision has been designed to grant relief to the assessee and not to pass an order which may go against him. It confers quasi-judicial power on the Commissioner and there he has to act judiciously, reasonably and in accordance with the principles guiding the determination of any issue judiciously. The…

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