2001 PLP 1380 (PTD)

NASIM SIKANBAR, J.

This is an appeal under section 136 of the Income Tax Ordinance, 1979.

2. The appellant a public limited company deriving income from manufacturing of yarn claims that following questions of law have arisen out of a consolidated order recorded by the Lahore Bench of -the Income Tax Appellate Tribunal on 11-10-1997:

(i) Whether in the facts and circumstances of the case where audited accounts and audit report on Form 35-A of the Companies (General Provisions & Forms) Rules, 1985 have been submitted, section 32 of Income Tax Ordinance, 1979 was not available to the Assessing Officer and whether rejection of accounts in the case of the assessee was, valid in law because of that reason? (ii) Whether in the facts and circumstances of the scan assessment order passed by an Inspecting Additional Commissioner of Income Tax is a legally valid order especially when section 62 of Income Tax Ordinance, 1979 clearly provides that the assessment would be completed by a Deputy Commissioner of Income Tax? (iii) Whether in the facts and circumstances of the case an assessment under section 62 completed without the issuance of notice as provided in proviso to section 62(1) was an invalid assessment and whether the same should have been annulled for that reason instead of being set aside? (iv) Whether in the facts and circumstances of the case notice under proviso to section 62 (1) especially when the same did not point out any defects in accounts and whether the Tribunal was right in treating the same as such? (v) Whether in the facts and circumstances of the case the additions made out of P&L accounts under the heads, Communication, Vehicle Expenses and Office Expenses on the basis of stock phrases and without pointing out any defect through a' notice under section 62 were not valid additions under the law which should have been deleted by the Tribunal?

3. The facts in brief are that the assessee company for the assessment year, 1993-1994 returned income of Rs.117,654 which was enhanced to Rs.1,65,65,

174. In the process an addition of Rs. 1,66,29,373 was made by applying a rate of 14.03% against the declared rate of 9.26%. Also a number of profit and loss additions were made to reach the income assessed as aforesaid.

4. The learned first appellate authority through a consolidated order, dated 12-12-1996 set aside the assessment in toto for de novo proceedings mainly on the ground that no notice under section 62(1) was issued as envisaged by proviso to section 62(l) of the Income Tax Ordinance, 1979.

5. On further appeal, the learned Tribunal maintained the setting aside of the assessment order with the observation that the notice spreading over 14 pages captioned as a notice under section 61 of the Income Tax Ordinance, 1979 fulfilled the requirement of section 62(1) thereof. In the view of the Tribunal notice so issued was detailed enough to be treated as a notice under section 62 of the Ordinance.

6. After hearing the learned counsel for the appellant at preliminary stage we are of the view that first two questions as framed do not arise out of the order of the Tribunal. It is now well-settled that only a question of law arising out of the order of the Tribunal can be a subject-matter of appeal before this Court. In a recent judgment re: Iram Ghee Mills Ltd. v. Income Tax Appellate Tribunal 1998 PTD 3835, this Court has concluded that section 136 of the Income Tax Ordinance, 1979 providing an appeal to this Court against the order of the Tribunal has not materially changed the exercise of advisory jurisdiction as available under the substituted provisions of section 136 providing for a reference to this Court.

7. A question of law can be said to have arisen out of order of the Tribunal only if the issue was raised and it was ruled upon by the Tribunal. In the present case we find that none of the issues raised in the first two questions was ever raised before the Tribunal nor it was ruled upon by them. Therefore, in absence of any finding recorded thereupon no authoritative pronouncement on the alleged question of law can be made.

8. Coming to questions Nos. 3 and 4 again we are not persuaded to entertain them. The Tribunal recorded a finding of fact that notice issued to the appellant though captioned to be one under section 61 was detailed enough to be taken as a notice under section 62(1) if the Income Tax Ordinance, 1979. Therefore, they rejected the contention against setting aside of the assessment and refused to accept the prayer of the assessee for annulment on account of that reason alone. The finding of fact that notice issued to the appellant fulfilled the requirement of section 62(1) of the Ordinance has not been challenged on the ground that it was, either not based on record or it was' against the record. Therefore, that factual controversy cannot be a moot point before this Court.

9. Question No.5 as framed again is pre-dominantly a question of fact inasmuch as even before the Tribunal the assessee never claimed that it could establish both admissibility as well as allowability of the total expenses claimed under the head profit and loss account. Also the Tribunal recorded it as a fact that details of the expense which was claimed to have wrongly been disallowed were not placed before them. In such situation, the refusal of the Tribunal to accept the contentions against the disallowance will always remain a question of fact.

10. That being, so we will hold that this further appeal is not maintainable. Dismissed in limine. M.B.A./N-67/L ?????????????????????????????????????????????????????????????????????????????????? Appeal-dismissed.