1989 PLP 130 (PTD)

SALEEM AKHTAR, J.--These two Income Tax cases shall be disposed of by this judgment as they relate to the same assessee/respondent. During assessment year 1973-74 on 14-3-1973 the respondent received foreign exchange remittance amounting to Rs. 4, 81,306 repatriated from U.K., which was declared under M.L.R.

104. Likewise another sum of Rs.50, 679 was repatriated from Singapore and London on 29-9-1973 and 9-9-1973 during assessment year 1974-75. All these amounts were declared in the return of income for the years 1973-74 and 1974-75. The respondent claimed exemption and these remittances were not charged to tax. However, on the instructions of Central Board of Revenue that exemption from tax will not be allowed on foreign exchange repatriated under M L R 104 and 105 after 31st March, 1972, the Income Tax Officer invoking section 34 of the Income Tax Act issued a notice to the respondent. The Income Tax Officer by his revised assessment order charged Rs.481,306 to tax during the assessment year 1973-74 and Rs. 50,679 was included in the assessment for the charge year 1974-75. In appeal the Assistant Appellate Commissioner held that the receipts being remittance of a capital nature were not taxable in Pakistan. The Department filed appeal before the Tribunal, which was dismissed. The application under section 66 (1) of the Income Tax Act to refer the following questions to the High Court was not granted as the question did not arise from the order of the Tribunal:- (1) Whether, on the facts and in the circumstances of the cases, the Income Tax Appellate Tribunal was justified in treating the amount repatriated not chargeable to tax in the hands of the assessee being `RESIDENT BUT NOT ORDINARY RESIDENT' having migrated in Pakistan only in the year 1969. (2) Whether, on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in holding that the amount brought in Pakistan was not taxable in the hands of the assessee contrary to proviso to clause (e) of subsection (1) of section 4 of the Income Tax Act." We have heard the learned counsel for the parties. From the order passed by the Tribunal it transpires that the respondent migrated to Pakistan in the year 1969. Before migration while working outside Pakistan out of his earnings he had made investments during the years 1964 and 1965 in shares- in U.K., Ceylon and Singapore Corporations. He was for the first time assessed- in Pakistan for the assessment year 1972-73. He had also riled his Wealth Statement in which the shares acquired in foreign Corporations during the years 1964 and 1965 were declared. On promulgation of M L R 104 and 105 the respondent made declarati6n as required but repatriation was delayed beyond 15-3-1972. It was explained. that the delay in repatriation was caused as disinvestments took some time. M L R 105 provided that the rupee equivalent of any amount repatriated shall not be charged to tax which otherwise would have been chargeable to tax in Pakistan. It has therefore to be considered whether the amount repatriated could be charged to tax. It is a finding of the Tribunal that the amount repatriated after disinvestments of foreign share stocks was not income but capital receipt. Therefore the respondent had repatriated capital receipts and not revenue income. The nature of receipts being capital it could not be subjected to tax. The department has not challenged this finding of the Tribunal, which is the basis of granting relief to the respondent. From a perusal of the order of the Tribunal it is clear that the questions sought to be raised do not arise from it. The Tribunal has not granted relief on the grounds sought to be challenged by the foretasted questions. It is well settled that only those questions are referred or allowed to be raised under section 66 (2) of the Income Tax Act which arise from the order of the Tribunal. As these questions do not arise from the order of the Tribunal the application is dismissed. M.B.A./C-63/K ????????? ???????????????????????????????????????????????????????Application dismissed.