URBAN DEVELOPERS vs COMMISSIONER INLAND REVENUE, RTO-II, LAHORE S — 2024 PTD 270 INLAND REVENUE APPELLATE TRIB

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URBAN DEVELOPERS VS COMMISSIONER INLAND REVENUE, RTO-II, LAHORE S.221---Rectification application---Maintainability---Matter sub-judice---Effect---While the Reference Application filed by the taxpayer (company/developers) was pending before the High Court, rectification application was moved by the taxpayer before the Assessing Officer purportedly on a new/different ground ; previous order-in-original was rectified, yet not satisfied with the rectification done, appeal was filed whereby the Commissioner Appeals passed certain directions to the Officer Inland Revenue regarding rectification order---Taxpayer, still discontented, preferred appeal before the Appellate Tribunal Inland Revenue ('the Tribunal')---Held, that both the Authorities had passed the orders in complete oblivion of law as once the Appellate Authority had decided the appeal, the order of the lower Authority would have merged into the appellate order---In the present case, not only the Commissioner (Appeals) but the Appellate Tribunal also had finalized the appeal against order-in-original by the Assessing officer and , admittedly, Reference Application was pending before the High Court against the order of the Appellate Tribunal---After exercising original jurisdiction, the Officer Inland Revenue became functuous officio with little window of rectification and that too could be against a mistake apparent and floating on the surface of such order---But after decision of the Appellate Forum, the order-in-original had merged into the order of the Appellate Authority and there remained no authority with the Officer Inland Revenue to rectify his own order---Present case was a clear example of capriciousness on the part of the Taxation Officer as despite the matter having been decided by the Appellate Forums and being pending before the High Court in continuation of the Assessment Order, the Officer Inland Revenue proceeded to rectify the very order-in-original---Further, in doing so, the Officer Inland Revenue had changed the same (order-in-original)---By rectifying order-in-original, the Officer Inland Revenue had nullified all the proceedings / orders having been conducted /passed by the Appellate Forums---Such proceedings carried out by the Officer Inland Revenue should have been dealt strictly by the Commissioner (Appeals), which was not done by him rather he, after examining the merits once again, annulled the order with certain directions to the Officer Inland Revenue and he had indirectly contributed in the error that had been committed by the Assessing Officer in rectification proceedings and completely over sighted the fact that while Reference Application was pending , at that subsequent stage the Officer Inland Revenue had no authority to rectify his order---Thus, passing directions by Commissioner amounted to justifying rectification made by the Assessing Officer---Record revealed that the High Court on Reference Application, had suspended the assessment order subject to deposit of certain amount against charge of Federal Excise Duty ('FED') and the Officer Inland Revenue, in rectification, had even re-calculated the payable FED---Both the Authorities below had transgressed their jurisdiction by passing rectification orders in application and appeal which were not sustainable in the eye of law---Tribunal set aside both orders passed in rectification proceedings as being illegal and void ab-initio---Appeal filed by the taxpayer, against certain directions given by the Commissioner Appeals in rectification proceedings was dismissed, in circumstances.

URBAN DEVELOPERS vs COMMISSIONER INLAND REVENUE, RTO-II, LAHORE S — 2024 PTD 270 INLAND REVENUE APPELLATE TRIBUNAL OF PAKISTAN

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