Law: Income Tax Ordinance, 1979

Section: 87,88,156(2)

[Income Tax Ordinance (XXXI of 1979)].....Sections 87, 88 & 156(2)---Charge of additional tax for failure to pay advance tax---Levy of additional tax without formal order and confrontation-Set aside of such order by the First Appellate Authority---Validity---After recognition of the fact that no order was in existence, additional tax under Ss. 87 & 88 of the Income Tax Ordinance, 1979 could not be levied---Assessing Officer also committed flagrant violation of law when he proceeded to levy tax under Ss.87 & 88 of the Income Tax Ordinance, 1979 without confronting the assessee under S.156(2) of the Income Tax Ordinance, 1979---Since assessment was made in flagrant violation of law, firstly there was no formal order in the field, and secondly, the assessee was not confronted through issuance of notice under S. 156(2) of the Income Tax Ordinance, 1979---Non-issuance of requisite notice vitiated the whole proceedings---Appellate Tribunal vacated the order passed by the First Appellate Authority whereby he remanded the case of Assessing Officer and also cancelled the assessment finalized by the Assessing Officer. (b) Income-tax Remand of illegal order---Validity---Once the First Appellate Authority had come to the conclusion that assessment framed by the Assessing Officer was patently illegal, he had no legal justification to remand the case to Assessing Officer for assessment afresh---Power to remand should not be used in a routine manner, especially, to give an advantage to revenue to improve its case or to fill in the lacuna already crept in the assessment. ORDER SYED NADEEM SAQLAIN (JUDICIAL MEMBER).---The titled two appeals for the assessment years 1996-97 and 1997-98 have been preferred at the instance of the assessee/appellant calling in question the impugned order dated 20-12-2004 passed by the learned C.I.T.(A) Zone-II, Lahore. The common ground which has been alleged at the bar is that the Assessing Officer erred in law while levying additional tax under sections 87 and 88 of the repealed Income Tax Ordinance, 1979 (hereinafter called the repealed Ordinance) and the learned C.I.T. (A) was also wrong in setting aside the impugned levy of tax for…

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