1997 PLP (Trib (PTD)

2. The order passed by the assessing officer was assailed by the assessee in the first appellate forum for various reasons, as is made out from the grounds of appeal filed over there. However, the appeal was not heard on merits by the CIT(A) and the same was rejected for the reason that the assessee had deposited less fee of appeal. According to the CIT(A) the assessee was supposed to deposit fee of Rs.160 whereas he had deposited appeal fee of Rs.25 only and thus the assessee had failed to fulfil the statutory requirement in this regard. It may be pointed out that for the year under appeal the total income of the assessee was assessed at Rs.46,000 and as such tax demand of Rs.1,600 was created against the assessee.

3. Aggrieved by the order passed by the CIT(A) the assessee has come up in second appeal. The case of the assessee is that the order passed by the CIT(A) was bad in law and against the facts of the case.

4. We have heard the arguments addressed by the learned authorized representatives of both the parties and have also gone through the orders which have been passed by the departmental officers in this case.

5. It has been submitted by the learned A.R. of the assessee that the legal provisions of section 130 of the Income Tax Ordinance 1979 were duly fulfilled by depositing the appeal fee of Rs.25 for the year under review and thus there was no justification for the CIT(A) to reject the appeal on that score saying that the fee was less. He has further submitted that the enhancement in fee as understood by the CIT (A) was applicable to the appeals pertaining to the assessment year 1994-95 onwards and all appeals upto the assessment year 1993-94 were to be governed by the old Law, as was also decided by the Income-tax Appellate Tribunal (Hyderabad) Karachi on 17-4-1995, in their consolidated order, disposing of various appeals such as I.T.A. No. 1217/KB of 1994-95 (Assessment Year 1988-89) and many other appeals. The contention of the learned A.R. of the assessee is not devoid of force because the amendment for enhancement of fee was introduced by the Finance Act 1995 and there is nothing in it to show that it had retrospective effect, and thus the amendment was to take effect prospectively.

6. When confronted with the above state of affairs Learned D.R. was unable to defend the order passed by the CIT(A). Instead, it was gracefully conceded by him that the line of arguments which has been adopted on behalf of the assessee was correct and must prevail.

7. On account of what has been observed above, we have no hesitation in holding that the order which has been passed by the CIT(A) was illegal and without Jurisdiction. The same is, therefore, quashed.

8. As a consequence of the above, it is held that proper fee for filing the first appeal has since been deposited by the assessee and the appeal of the assessee shall be deemed to be pending, before the CIT(A) for hearing and adjudication in accordance with Law, on all the points which were raised by the assessee in the appeal filed before the CIT(A). The First appellate Court shall decide the appeal on merits afresh after providing reasonable opportunity of being heard to both the parties.

9. The appeal filed by the assessee, therefore, stands disposed of accordingly. C.M.S./240/Trib. Appal disposed of.