1990 PLP 691 (PTD)

MUHAMMAD AFZAL LONE, J.‑‑‑Through this application under section 136(2) of the Income‑tax Ordinance, 1979 the following question of law said to have arisen out of the Tribunal's order dated 21‑12‑1986, is, sought to be referred to the High Court for its opinion:‑-- "Whether under the circumstances of the case the assessee was rightly disallowed to file the Return under section 3‑C of the Income‑tax Act, 1922?"

2. In its order dated 12‑12‑1989 the Tribunal while disallowing the petitioner's reference application, in respect of the question aforesaid maintained:‑‑ .......This question though arises out of the Tribunal's order but facts do not require its reference as on quantum of assessment as well as levy of penalty the assessee has succeeded in getting relief in extraordinary jurisdiction from the High Court."

3. We have heard the learned counsel. Upon his own showing, the assessment year involved in this case is 1977‑78, covering the period from 1‑7 1976 to 30‑6‑1977. Before grappling with the issue discussed before us, it appears appropriate to refer to the provisions of section 3‑C and of the Fifth Schedule of the Income‑tax Ordinance which in so far as relevant are reproduced below:‑‑ "3‑C. Charge of Income‑tax on undisclosed income.‑‑Subject to the provisions of the Fifth Schedule, every person shall pay Income‑tax, in respect of the undisclosed income, referred to in the said Schedule, at the rate of thirty per cent of such income."; "The Fifth Schedule (See section 3C) (1) Definition:‑‑For the purposes of this Schedule and section 3‑C, "undisclosed income" of a person means all income, profits and gains of any previous year or years ending before the first day of July, 1975, which were chargeable to tax but were not so charged. (2) Declaration of income:‑‑Every person who is chargeable to income‑tax under the provisions of section 3‑C, shall, on or before the thirty first day of August, 1976, furnish a declaration of his undisclosed income to the Income‑tax Officer in such form and verified in such manner as may be prescribed by rules made by the Central Board of Revenue." Section 3‑C merely confers a concession on the assessee to pay tax on his income from undisclosed source, at the rate of 30 percent. of such income. But as per para‑I of the Fifth Schedule such income had to be confined to any previous year ending before 1st July, 1975. Undoubtedly the assessment year 1977‑78, to which the petitioner's case relates is not covered by para. I ibid. Faced with this situation the learned counsel took up the stand that actually the undisclosed income pertains to the period prior to 1st July, 1975 but the petitioner was arrested and thus could not file the declaration before the target date of 1st August 1976 envisaged by Para. 2 of the Fifth Schedule. He then referred to Para. 9 of the Tribunal's order dated 12‑5‑1986 which is reproduced below:‑‑ "In regard to the second plea, no doubt the assessee's contention has considerable force, that any person could declare his undisclosed income under section 3‑C on payment of tax at the flat rate of 30% of the declared income. This is in evidence that the assessee did consult his Legal Advisor and had an intention to make a declaration of certain undisclosed income. However, we cannot accept the plea of the assessee for the simple reason that there was no provision in the law for extension of last date for whatsoever reason." to contend that issue now urged was raised before the Tribunal and arises out of its appellate order.

4. We do not feel persuaded to entertain this reference application. The assessee's whole case now argued before us seemingly is rested on the maxim "lex non cogit ad impossibilia". But it appears to us that the case was never projected before the Tribunal by the petitioner from that angle. In any case para. 2 of the Second Schedule expressly fixed 1st August, 1976 as the last date for furnishing declaration of the undisclosed income. This time limit could not be enlarged by the Income‑tax Authorities and the view taken by the Tribunal in this behalf is well grounded. Reference in this connection may be made to Sayaji Rao, Gaikwar, of Baroda v. Madhavrao Raghunathrao Dhavale (AIR 1929 Bombay 14) wherein it is laid down that the maxim that law does not compel a man to do that which he cannot possibly perform, cannot prevail against the express provision fixing period of limitation. In these circumstances the question of filing Return after 1st August, 1976 does not arise and in any case it was not within the competence of Income- tax Department to extend this date. The Tribunal's observations aforesaid appearing in its order dated 12‑12‑1989 do not march well with its order of 12‑5 1986. Upon the facts of the case we do not feel inclined to frame some additional questions for the opinion of the High Court. It may be reiterated that the assessment period relevant to the petitioner's case is 1‑7‑1976 to 30‑6‑1977. Whether or not the undisclosed income in question is not relatable to this period but accrued to the assessee in the period prior to 1st July, 1975 is a question of fact and not a question of law much less to say that it arises out of the Tribunal's order and has nexus with the question now sought to be referred to the High Court.

5. For all these reasons we uphold the rejection of the reference application by the Tribunal but for different reasons. Dismissed in limine. M.B.A./M‑2118/L Reference rejected.