Law: Income Tax Ordinance, 2001

Section: 221,131

Income Tax Ordinance (XLIX of 2001)---Ss. 131 & 221---Assessment---Rectification of order---Appeal to Appellate Tribunal---Appellant/taxpayer was a private limited company and the assessment for the subject year was completed in year 2002 under provisions of S.62 of repealed Income Tax Ordinance, 1979---Taxpayer had declared total income of Rs. 1,787,824 and export proceeds were declared at Rs. 4,807,040---Taxation Officer after a show-cause notice to the taxpayer rectified the order under S.221 of Income Tax Ordinance, 2001 on the ground that while prorating the expenses between normal sales and exports sales, export freight expenses by mistake were not excluded from the expenses related to normal sales---Taxpayer agitated said order passed under S.221 of Income Tax Ordinance, 2001 before the Commissioner Income Tax (Appeals) who vide impugned order rejected the appeal of the taxpayer and maintained the action of Taxation Officer---Contention of taxpayer was that the assessment for the subject year was completed on 16-3-2002 under S.62 of repealed Income Tax Ordinance, 1979, issuance of show-cause notice under the provisions of S.221 of Income Tax Ordinance, 2001, was change of opinion of the Taxation Officer insofar as the rectification in orders passed. by him under repealed Ordinance was concerned---Assessee contended that while finalizing the case, Taxation Officer having applied his mind, any change in the order requiring interpretation of statute or enhancing tax liability or any action detrimental to the interest of taxpayer was the `change of opinion' by the same authority, which was not permissible under the law---Validity---Action taken by Taxation Officer under provisions of S.221 of Income Tax Ordinance, 2001 and upheld by Commissioner Income Tax (Appeals) vide his impugned order was without any legal basis and lawful authority-Orders of two officers below were annulled, in circumstances---Taxation Officer was directed to examine issues involved in the case and take action as per law after affording an opportunity of being heard to the taxpayer. 2008 PTD 253 ref. THIS ORDER PASSED BY: This appeal has been filed by the taxpayer against the…

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