2018 PLP (Trib (PTD)

3. Learned counsel further elaborated that against the aforesaid order of the CIR(A), the applicant filed Appeals bearing I.T.As. Nos.112 to 114/KB of 2017 before this Tribunal.

4. The learned counsel for the applicant stated that the demand has been raised on gross misapplication of law. The recovery thereof, would cause irreparable losses to the applicant/taxpayer. Learned counsel for the taxpayer urged that on the basis of facts and circumstances of the case relating to the issue under appeals, the applicant do expect favaourable decision allowing relief in the instant case meaning thereby, the balance of convenience is in fovour of the applicant. There is a prima-facie case for grant of stay from recovery of the tax demand till the matter is decided by the Hon'ble Tribunal. Moreover, if the department is allowed to recover the said demand, it would result in irreparable loss to the applicant/taxpayer.

5. In support of his arguments, the learned counsel for the applicant referred Tribunal orders reported as 2016 PTD 2695 and another decision passed in I.T.As. Nos.1274 to 1278/LB/2015 dated 28-09-2015. During the course of hearing before this Tribunal, learned counsel for the applicant also pointed out that during the pendency of appeals before the Tribunal the department initiated coercive proceedings for recovery of the impugned demand, hence, applicant has knocked the door of the Hon'ble High Court of Sindh at Karachi through Suit. The Hon'ble High Court of Sindh at Karachi was pleased to grant the interim Stay Order vide Order dated 04-10-2017 untill next date of hearing.

6. He lastly argued that the applicant apprehends that the tax department may resort to coercive measures for recovery of aforesaid tax demand which may cause irreparable financial and reputation loss for the application. He, therefore prayed for stay of demand, as recovery of tax shall cause undue hardship to the taxpayer and the applicant has prima facie strong arguable case and balance of convenience is also in his favour, if stay not granted, the entire purpose of the dispute will be frustrated or rendered nugatory by allowing the coercive measure and recovery proceedings to continue. He further requested before this Court that in the milieu of the above facts and circumstances, stay against recovery of tax demand till the decision of appeal may please be granted.

7. Learned D.R on the other hand, strongly opposed the stay application. He contended that the taxpayer has been assessed in accordance with law and therefore, liable to pay the amount determined as outstanding against the taxpayer. The learned D.R. went on to argue that the Hon'ble High Court of Sindh has allowed/granted stay till next date of hearing thereafter no stay available with the applicant. The learned DR prayed for dismissal of stay application.

8. We have considered contentions of the parties. We have observed that the Taxpayer has already approached the Hon'ble Court and the Hon'ble High Court vide Order dated 04-10-2017 has already stayed recovery proceedings. It may be deduced from the judgment that the responded shall not enforce coercive action/recovery of the impugned demand, which is subject matter of appeal before Appellate Tribunal Inland Revenue, in the instant suit till the next date recovery proceedings. The relevant extract from the order of the Hon'ble High Court is reproduced hereunder:-- "Issue notice to the defendants as well as DAG, however, till next date of hearing no coercive action shall be taken against the Plaintiff" (Underlining and highlighted by us)

9. We are of the considered opinion that the Order of the Hon'ble High Court in the above referred judgment would have held fields even after next date of hearing. It is settled law and the long time established practice of the Honourable Courts that in such circumstances an interim order granted earlier will remain in force and operative till the date such interim order was either expressly cancelled, vacated or re-called through an Order or the case is finally disposed off. If any authority is needed, one may easily place reliance upon on the case of Raja Talat Mehmood v. Ismat Ehtisham-ul-Haq reported as 2000 MLD 1755 at pages 1759 and 1760 A, the Lahore High Court observed as under:-- "The provisions of Order XXXIX, Rule 2-A are not mandatory in nature, rather only provides guideline to the Court not to grant ad interim injunction "ordinarily" exceeding 15 days. However, the Court has power to extent such ad interim order if the defendant has not been served and the failure in this behalf is not attributable to the plaintiff or when the defendant seeks time for defence of the application for injunction. As per this rule, ad interim injunction granted per se would not lapse after the expiry of fifteen days. The only requirement of law is that the Court should extend such injunction, but if the Court does not by any specific order grant the extension of the ad-interim order earlier passed, it would be presumed that the extension has been granted"

10. Further the Hon'ble Supreme Court of Pakistan while hearing the appeal from this judgment reported as Raja Talat Mahmood v. Ismat Ehtisham-ul-Haq 1999 SCMR 2215 at 2222 A & B affirmed the position and observed as under:-- "In the circumstances, where neither any reply was filed nor any request was made for discharge of the interim injunction/status quo order, the legal position would be that the interim order would continue despite no specific order having been passed extending the order, dated 10-4-1998 granting status quo order. Rule 2-A of Order XXXIX, C.P.C, does not require a specific order for extension of the interim injunction after expiry of 15 days in case defendants seek time for defence of application for injunction... ...In such circumstances, it was not necessary to pass specific orders of extension of the interim status quo order on each date of hearing."

11. In the light of the above judgments it is clear that the interim order passed earlier would automatically be continued and remains in force unless expressly cancelled/ revoked, vacated or recalled. There was no requirement under the law to have the interim order extend time and again. The Tribunal, being a sub-ordinate Special Court to the Hon'ble High Court is bound to follow the order of the Hon'ble High Court and cannot interfere with the order of Hon'ble High Court, the stay already granted by the Hon'ble High Court.

12. Now, adverting to the plea of the learned counsel regarding fixation of main appeal on out of turn basis. This court may opine that if the appellant so desires, the appeal to be heard on out of turn, the Applicant/appellant may apply through Roster Section of Karachi Bench, before the Hon'ble Chairman, ATIR, Headquarters, Islamabad as the powers for fixation of the main appeal vests on him and seeks order in writing from the Hon'ble Chairman for fixation of the case before any available bench as this Court has heard this application.

13. The upshot of the above discussion is that the ad-interim stay has been granted by the Hon'ble High Court of Sindh and as per the judgments of the superior courts referred supra, the same is still in the field and will remain enforce unless otherwise cancelled/revoked, recalled/ vacated by the Hon'ble High Court. In the event of recalling/ expiry/cancelling/vacating of the stay by the Hon'ble High Court the taxpayer would be at liberty to file fresh Misc. Application for stay before this Tribunal against the coercive measures to be adopted by the revenue.

14. In the circumstances supra, all the stay applications being infructuous stand dismissed in the manner as indicated above. HBT/103/Tax(Trib.) Applications dismissed.