2002 PLP 150 (PTD)

7th of January 3rd quarter 7th of April 4th quarter 7th of June

6. The dispute between the petitioner and respondent is on the point of applicability of income-tax ratio on the assessed turnover. From the impugned order, dated 5-10-2001 it is apparent that the respondent has adjusted advance tax for the first quarter at the income-tax ratio of 4.22% on the turnover and for facility the impugned order, dated 5-10-2001 is reproduced below: "OFFICE OF THE DEPUTY COMMISSIONER OF INCOME-TAX CIRCLE 01, SPECIAL ZONE, KARACHI No. DCIT/Cir.01/Spl.Zone/2000-01/283, January 5, 2001 To The Principal Officer, M/s. Sui Southern Gas Company Ltd. (SSGS), State Life Insurance Building No. 3, Dr. Ziauddin Ahmed Road, Karachi. SUB: POSITION OF REFUND AFTER RECTIFICATION ASSESSMENT YEAR 1999-2000. Please refer to above, As per order passed under' section 156 of the Income Tax Ordinance, 1979 vide Deputy Commissioner No. 19/52; dated 20-12-2000 your determined refund is Rs. 39,27,22,783 as against Rs. 38,32,09,366 as determined vide order under sections 62, 132, 66A/66 Deputy Commissioner No. 5/66, dated 29-11-2000. This office has received intimation from data processing centre regarding adjustment of the above refund against advance tax under section 53 for the 1st quarter of assessment year 2001-2002 besides an adjustment of Rs. 8,735,342 on account of additional under section 89 vide Deputy Commissioner No. 1/71, dated 6-11-2000. In a nutshell there is refund of Rs. 19,27,98,401 available to you notwithstanding the amount as communicated vide this Office Letter No. 231 dated 7-12-2000. This amount may be utilized for adjustment against any further tax liability. This is for your kind information. (DR. TARIQ MASOOD), DEPUTY COMMISSIONER OF INCOME-TAX; CIRCLE-01, SPECIAL ZONE, KARACHI TEL/FAX: 9211616 P. CODE (01-88-0484)."

7. However, it has been argued by Mr. Muhammad Javed Khurram learned Advocate for the petitioner that as the assessment order for the assessment year 1999-2000 has been the subject-matter of appeal which was decided on 2-1-2000 according to which the income-tax ratio of turnover has been reduced to 0.57 % therefore, for the 1st quarter of advance tax under section 53 of the Ordinance the reduced income-tax ratio is applicable.

8. Mr. Aqeel Ahmed Abbasi learned Advocate for the respondents besides supporting the action of the respondent No. 5 also raised by the preliminary objection that petition is not maintainable as what has been impugned is not an order and if it is assumed that it is an order therefore, the alternate, efficacious remedies one to be exhausted provided under the Ordinance which in this case have not been exhausted. As such the petition is misconceived and without jurisdiction. We do not however, agree with the learned counsel for the respondent as what has been impugned is an order passed under section 53 of the Ordinance according to which advance income-tax of the 1st quarter for the, assessment year 2001-2002 has been adjusted/recovered from the determined refund due to the petitioner. The said order is an order passed under section 53 of the Ordinance is not appealable as has been held by the Hon'ble Supreme Court of Pakistan in re: Chairman, Central Board of Revenue, Islamabad and 3 others v. Messrs Pak-Saudi Fertilizer Ltd. reported as 2000 PTD 3748 (SC Pak.) which is as under: "The right of appeal is a creature of statute and there can be no right of appeal unless it is conferred by the statute. Perusal of I section 129 of the Ordinance, 1979 would show that the Legislature has purposely not mentioned section 53 of this Ordinance, 1979 in respect of payment of advance income-tax so as not to a make it appealable. Considering that non-payment of the advance income-tax was to be subsequently dealt with under section 87 of the Ordinance, 1979, which order if passed would have the effect of enhancement or increase of liability of the assessee the respondent. The instant case is not even of the charge of additional tax for failure to pay advance income-tax under section 87 of the Ordinance so as to treat the impugned order to be one of increase or enhancement of the liability of the assessee or part of process of assessment." which requires our consideration is in relation to which income-tax ratio is to be applied on the assessed turnover for the purposes of determining the amount of advance tax is payable under section 53 of the Ordinance for the 1st quarter in respect of the assessment year 2001-2002 for which the year is 1999-2000, the assessment of which completed on 26-2-2000 for which the income-tax ratio was 4.22 % of the turnover or 0.57 % as worked out as a consequent of appeal decided on 2-10-2000 which is prior to 7-10-2000 the date on which the first instalment of advance income-tax under section 53 of the Ordinance was due.

11. Mr. Muhammad Javed Khurram learned Advocate for the petitioner vehemently argued that once an order is the subject-matter of appeal it merges in the appellate order and as such the ratio of income tax determined at 4.22% of the turnover is not applicable in the case of the petitioner and that which has been determined viz. 0.57% is the correct income-tax ratio for charging advance income-tax under section 53 of the Ordinance for the 1st quarter. In support of his contention he relied upon on a decision of Hon'ble Supreme Court of Pakistan re: Glaxo Laboratories Limited v. Inspecting Assistant Commissioner of Income-tax and others reported in f992 PTD 932.

12. In our view the contention of the learned counsel for the petitioner has force and therefore, the ratio of income-tax for the purpose C of computing advance income-tax instalment under section 53 of the Ordinance for the first quarter is 0.57% of turnover and should be calculated accordingly.

13. On 8-5-2001 the counsel for the parties agreed that the petition be disposed of finally at the Katcha Peshi stage as both of them have argued the ease at full length. We, therefore, admit the petition and allow the same with no order as to cost. C.M.A./M,A.K./S-.140/K Petition allowed.