2003 PLP (Trib (PTD)

6. We have considered the facts of the case and related aspects and contentions of the learned A.R. Since the appellant failed to establish before the Assessing Authority the facts of being not member of association and also keeping in view that such agreements with C.B.R. are in the larger interest of the majority of taxpayers we feel that a waiver of individual opinion can be presumed. We are of the view that assessment framed in line with the agreement of the Yarn Merchants Association with C.B.R. need not to be interfered with. We find it exactly in line with principal of conformity and against discrimination. As appellant has not been able to make out a case for any relief we are persuaded to dismiss the instant appeals. (Sd.) (Sd.) KHALID WAHEED AHMED, (IMTIAZ ANJUM), JUDICIAL MEMBER. ACCOUNTANT MEMBER. With profound respect for my learned brother, sitting Accountant Member, I do not agree with his findings given on the issue regarding validity of assessment framed on the basis of agreement for assessment of income arrived at between the Pakistan Yarn Merchants Association and the Central Board of Revenue (C.B.R.). In my opinion, the Circular No.63, dated 10‑8‑1994 of the C.B.R. issued on the subject of Assessment of Yarn Commission Agents in consequence of agreement reached between the C.B.R. and Pakistan Yarn Merchants Association is not in conformity with the procedure for assessment of income provided under Chapters VII and VIII of the Income Tax Ordinance, 1979, therefore, not binding in the case before us. It is pointed out that withholding Tax deducted @ 10% under section 50(4A) of the Income Tax Ordinance, .1979 on payments representing commission was not the final liability of tax at the relevant time. Tax liability in cases of Yarn Commission Agents was to be determined by the Assessing Officer under Chapter VII of the Income Tax Ordinance, 1979. According to the procedure of assessment provided in section 62 under which the assessment, has been framed in the case before us, the income was first required to be assessed and then tax liability was to be worked out by the Assessing Officer on the basis of income assessed him. Agreement to frame the assessment by working back the income on the basis of tax charged on the amount of commission receipts at a rate not provided under the Ordinance in my opinion had no binding force. It is also pointed out here that reasons given in the assessment order by the Assessing Officer for not accepting the declared version is the rejection of accounts books whereas the assessment has been framed solely on the basis of commission income declared by the assessee at Rs.6,79,095 which has been accepted as such. In my opinion, the assessment framed on the basis of an agreement which had not binding force because of not being in accordance with the scheme of assessment provided under the relevant provisions of the Income Tax Ordinance, 1979 is not maintainable in law particularly when the assessee had not given his consent to pay the tax in terms of agreement reached between the Pakistan Yarn Merchants Association and the C.B.R. (Sd.) (KHALID WAHEED AHMED), JUDICIAL MEMBER. Since difference of opinion has arisen, the case is referred to the Hon'ble Chairman for third Member's opinion on the following issue: "Whether under the facts and circumstances of the instant case the assessment framed on the basis of the above mentioned agreement reached between the Pakistan Yarn Merchants Association and the C.B.R. the consent to which is denied by the assessee, is maintainable in law or not? (Sd.) (KHALID WAHEED AHMED), JUDICIAL MEMBER. (Sd.) (IMTIAZ ANJUM), ACCOUNTANT MEMBER. Date of hearing: 12th December, 2002. I have heard both the parties and have considered the relevant facts. I have also consulted the record and have gone through the view of my learned brothers the learned Accountant Member and the learned Judicial Member. I agree with the view‑point of the learned Judicial Member in holding that the agreement reached between the Pakistan Yarn Merchants Association and the C.B.R. is not applicable to the case of the appellant‑assessee as it is not member of the said Association. The case is, therefore, set aside and the matter is sent back to the Assessing Officer for de novo action. The Assessing Officer is directed to assess the income of the assessee in accordance with law on the basis of accounts of the assessee and work out tax liability of the assessee on the basis of income assessed by him and not on the basis of tax rate agreed between Pakistan Yarn Merchants Associations and C.B.R. However, before doing so he would summon and examine the record of the Association to ascertain whether assessee was really not member of the said Association during the period under consideration. However, if it turns out that the assessee was really member of the Association then the present assessment order based on agreement between C.B.R. and the Association then the present assessment order based on agreement between C.B.R. and the Association would stand restored. C.M.A./606/Tax (Trib.) Order accordingly.