1997 PLP (Trib (PTD)

2. In the proceedings that ensued the Assessing Officer disbelieved the affidavits submitted in support of the aforesaid loan. Therefore, an addition under section 12(18) of the Ordinance at Rs.1, 60,000 was made to reach total income assessed for the year at Rs.3,30,

000. The business income was also discarded. The capacity of kiln was adopted at 5 lacs bricks and the number of rounds of baked bricks during the year at three. In this manner total bricks were estimated at 15,00,

000. After bifurcating them into various classes total sales were computed at Rs.8,10,000 and subjected to a rate of 25%.

3. Learned First Appellate Authority, CIT(A) Sialkot Zone, Sialkot through its order recorded on 2-3-1994 found that the assessment order did not .indicate the provision of law under which the case of the assessee was set apart -from the purview of S.A.S. Also that in case it was done under para 4(ii) the formalities of the Scheme were not fulfilled nor the necessary approval from the RCIT was obtained. From the assessment record learned First Appellate Authority observed that even the correspondence between various authorities failed to express the circumstances under which the case of the assessee was excluded from the scope of the Scheme. In the circumstances the assessment was set aside with the direction that eligibility of return under S.A.S. be examined on merits. This has grieved the assessee.

4. Parties have been heard. Learned counsel for the assessee vehemently contends that the First Appellate Authority having found that selection of case for process under normal law was not justified the remand order amounts to allowing the Assessing Officer another opportunity to fill in the lacunas and the deficiencies in the original assessment order. Further submits that in the year 1990-91 selection of case for audit could only be done either through computer ballot upto 5 % of the returns received or under para 4(ii) with the approval of RCIT where gross under-statement of income was suspected on the basis of definite information based on material evidence. It is claimed that the return filed by the assessee did not fall under any of the categories and, therefore, the Assessing Officer was not justified in recommending the case for setting apart nor the concerned was empowered to direct setting apart of the case processing under normal law.

5. Learned D.R. on the other hand supports the assessment order and states that the remand order recorded by the First Appellate Authority already being in favour of the assessee its complaint (against the remand order is baseless.)

6. Having heard the parties we are inclined to agree with the submissions made for the assessee As observed earlier the Assessing Officer, apparently of his own, picked up the return for process under normal law and served the assessee with a notice to explain the availability of loan from her husband. It was after receipt of -the reply submitted on 18-2-1992 from the assessee that he referred the matter to Commissioner of Income Tax on 3-3-1992. However, it appears that the suggestion to the Commissioner that since the addition under section 12(18) of the Ordinance was warranted, the case of the assessee should be set apart for process under normal law did not find favour with the authority addressed. On a later stage the I.A.C. Sialkot Range allowed the request of the Assessing Officer to exclude the case from the S.A.S. on 19-3-1992. The Self-Assessment Scheme notified for the year 1991-92 through Circular No.22 of 1991, dated 21st July, 1991 suggests only two modes for selection of case for audit. Both of these modes detailed in para 4 as referred to by the learned counsel for the assessee indicate that in the circumstances the selection of case for process under normal law was clearly improper. According to para. 4 returns qualified for S.A.S. could be selected for audit only through computer ballot (upto 5 % of the total returns received) or with the approval of the RCIT. None of the stipulated conditions were present in the case of the assessee nor any of the two methods were adopted for picking up the case for processing under normal law. Learned First Appellate Authority agreed with the submissions made before it. However, it stopped short of allowing adequate relief. It is by now well-settled that a remand can only be made where documents or material on record are insufficient to render final order. In re: Chairman Wapda v. Gunboat Khan (1996 SCMR 230) the Supreme Court held that primary rule for remand is that where there was adequate evidence on record to decide the case itself, the Court was not under obligation to make an order of remand.

7. In this case learned First Appellate Authority was satisfied after going through the record that proper reasons for processing of case under normal law were neither present nor were otherwise brought on record. Therefore, remand of the case on the issue of eligibility of return under S.A.S. was of clearly improper.

8. Therefore, we will allow this appeal and hold that the conditions necessary for selection of case for total audit in the year 1991-92 were not fulfilled. The assessment order under section 62 and the first appellate order dated 2-3-1994 stand set aside. Resultantly the return filed under S.A.S. shall be accepted.

9. Since we have directed acceptance of the return under S.A.S. the other submissions made that provisions of section 12(18) were not applicable to the facts and circumstances of the case in the year 1991-92 do not need any discussion.

10. The appeal succeeds in the manner and to the extent indicated above. C.M.S./326/Trib. Appeal partly allowed.