COMMISSIONER INLAND REVENUE, LAHORE vs ATTA CABLES (PVT — 2024 SCMR 468 SUPREME-COURT

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COMMISSIONER INLAND REVENUE, LAHORE VS ATTA CABLES (PVT.) LTD., LAHORE S. 214D [since omitted]---automatic selection for audit---Scope---Taxpayer had not filed its return for tax year 2015 within the date required---Date for filing the return was 21.01.2016---On that date the respondent-taxpayer properly filed an application under section 119 of the Income Tax Ordinance, 2001 ('the Ordinance') for extension of time---Commissioner did not respond to said request---On such basis, the department claimed that the respondent came within the ambit of section 214D---Validity---In the present case, section 214D would have applied if the Commissioner had, under section 119, extended the period for filing the return (subject to a thirty day condition) and the return was not filed within such extended period---Now, the fact of the matter was that the Commissioner never took any action on the application, which was otherwise properly filed, for extension---Subsection (3) of section 119 specifically requires the Commissioner to grant the extension in writing---Since section 214D had to be applied exactly, this meant that for purposes of this provision the refusal of the Commissioner also had to be in writing---In other words, any inaction on the part of the Commissioner, or a failure to reject or refuse the application for extension in any manner other than in writing, would mean that for the purposes of section 214D the application would be regarded as pending---There could be no refusal or denial of extension by implication---For a provision as harsh and severe as section 214D to apply merely by way of implication or on a deemed basis would be incorrect---Clearly therefore, until the application for extension was actually disposed of by an order in writing the section would not become applicable---Furthermore, the condition of thirty days would have to apply, in the context of section 214D, not from the due date for the filing of the return, but the date of the order made by the Commissioner granting an extension---Of course, if the Commissioner refused the extension in writing, then the section would apply from the date of such order, subject to any remedies available to the taxpayer to challenge such refusal---Therefore, in the facts and circumstances presented in this case, section 214D never became applicable---appeal filed by the department was dismissed.

COMMISSIONER INLAND REVENUE, LAHORE vs ATTA CABLES (PVT — 2024 SCMR 468 SUPREME-COURT

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