Law: Income Tax Ordinance, 1979

Section: 13(1)(b),65

Income Tax Ordinance (XXXI of 1979)----Ss.13(1)(b) & 65---Addition---Self-Assessment Scheme---No account case---Special audit ---Assessees case was selected for Special Audit for assessment°year 1997-98---While making reconciliation statement, assessee made accretion in wealth in the assessment year 1984-85 and explained the investment made in purchase of property on 20-9-1997---Assessing Officer found that income declared in previous years i.e. assessment years 1981-82 to 1984-85 was less than the accretion made in wealth for the assessment year 1984-85 and made addition of balance amount under S.13(1)(b), Income Tax Ordinance, 1979 in the assessment year 1997-98---Contention in appeal was that addition under S.13(1)(b) could not be made during the year 1997-98 and the action was to be taken under S.65 of the Income Tax Ordinance, 1979 for the assessment year 1984-85 which was time-barred---Accepting such contention addition was deleted by the First Appellate Authority--¬Validity---Unexplained accretion as on 30-6-1997 had to be taken notice of during the assessment year i.e. 1997-98 and not during the assessment year 1984-85---Property purchased on 20-9-1997, however, was not relevant to the assessment year 1997-98, hence, there was no justification to invoke S.13(1)(b) of the Income Tax Ordinance, 1979---Addition, held, was rightly deleted, though on a different ground. ORDER SHAHID JAMAL (ACCOUNTANT MEMBER).---The above appeal has been filed by Department to contest the deletion of addition under section 13(1)(b) amounting to Rs.2,30,760 and reduction of an ad hoc addition from Rs.40,000 to 20,000. 2 Heard Mr. Shaukat Soomro, learned D.R. for the appellant and Mr. Abdul Tahir Ansari, A.R. for the respondent. 3. The facts giving rise to the above appeal are that the respondent, an individual, deriving income from repair of Motorcycles, had filed return of total income at Rs.51,500 under the Self-Assessment Scheme for the impugned year, the return was selected for Special Audit through Randum Ballot. During the process of Special Audit, the respondent was required to reconcile his wealth as on 30-6-1997 which was shown at Rs.5,00,000. The assessee…

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