2003 PLP 1784 (PTD)

NASIM SIKANDAR, J.

In this further appeal under section 136 of the late Income Tax Ordinance, 1979 (since repealed) the appellant an individual and an assessee of Income Tax Department claims that following .question of law has arisen out of the order of the Tribunal, dated 18-2-1999;-- "Whether the appellant should be afforded an opportunity to make the payment of the required appeal fee within prescribed period and without affording an opportunity to levy appeal fee the impugned order is sustainable in the law?

2. The assessee returned an income of Rs.1,62,000 from its business of stitching of lather under a contract with Messrs Service Industries Gujrat. However, the Assessing Officer framed an ex parte assessment order at Rs.12,3,913.

3. The appeal filed by the assessee was rejected on 16-9-1998 on the ground that "appeal documents are not accompanied by the appeal fee in fulfilment of provisions of subsection (1) of section 130 of the Income Tax Ordinance."

4. On further appeal a Division Bench of the Income Tax Appellate Tribunal, Islamabad Bench Islamabad by way of the impugned order agreed that deposit of appeal fee by the assessee on 17-9-1998 i.e. one day after the announcement of the impugned order was hardly of any avail as the fee had to be accompanied with. the appeal.

5. After hearing the learned counsel for the parties and on taking into account the ratio settled by the superior Courts in re: Allied Bank of Pakistan v. ITAT, AJK 2000 PTD 2872, re: Siddique Khand v. Abdul Shakur Khan (PLD 1984 SC 289) and re: Allied Bank of Pak. v. Income Tax Appellate Tribunal etc., 2000 PTD 2872 we are persuaded to agree with the learned counsel for the ,appellant. He is correct in pointing out that in fact the office of the First Appellate Authority/CIT (Appeals) was in a way contributory to the inadvertence on the part of the assessee. While accepting the appeal papers office of the First. Appellate Authority should have required the appellant in writing to deposit the appeal fee within a fixed period of time and in case of his failure they were obliged to place the matter before the learned First Appellate Authority as an objection case. That having not been done it was for the learner Appellate Authority to allow some time to the appellant to deposit appeal fee.

6. The failure on the part of the office of the First Appellate Authority to convey an objection in writing and then on the part of the First Appellate Authority, itself to refuse to allow an opportunity has resulted in loss of a valuable right of appeal to the assessee.

7. Therefore, we are not in agreement 'with the learned members of the Tribunal that assessee's appeal tiled before, them had no merits. The fee. for first appeal having already been deposited, the learned members ought to have directed the learned First Appellate Authority for a decision on merits on the appeal filed by the assessee. In view of their failure to have made such direction, their order is not sustainable in law.

8. Accordingly, the appeal filed by the assessee shall be deemed pending before the learned First Appellate Authority who will hear and decide the same on merits and in accordance with law after affording an opportunity to the appellant.

9. Appeal allowed. S. A. K./T-122/L Appeal allowed.