FINDINGS /DECISION ' In these two complaints filed by one and same person on identical grounds, 'maladministration' has been alleged on the part of Commissioner of Income Tax (Appeals) Gujranwala for rejecting the appeals of the Complainant arbitrarily without properly adjudicating various grounds of appeal.
2. The complainant is an 'individual earning his income from purchase and sale of jewellry who filed his Income Tax Returns for the assessment year 1995-96 (Complaint No,443 of 2003) and 1996-97 (Complaint No,444 of 2003) under the Self-Assessment Scheme. The Complainant has contended that assessm ents for the two years completed under section 59(i) were reopened on the ground that investment made by the Complainant in the property and cars was not properly explained.
The reassessm ents were completed after making additions under section 13 of Income Tax Ordinance, 1979 in spite of the fact that, investment made by the Complainant was properly explained. The appeals tiled by the Complainant were unjustly rejected by the Commissioner of Income Tax (appeals) Gujranwala without looking into the grounds of appeal and without adjudicating on them. This has caused grievance to the Complainant.
3. In the Respondent's reply it has been admitted that all the grounds of appeal indicated by the Complainant in Appeal memo have A not been discussed by him in seriatum however main grounds of appeal have been considered while disposing of the appeals.
4. Mr. Riaz Ahmed Complainant attended in person. He has explained that he was deriving income from purchase and sale of jewellery. For the assessment years 1995-96 and 1996-97 he filed his Income Tax Returns under Self-Assessment Scheme declaring net income at Rs,47500 for the assessm ent year 1995-96 and at Rs,49500 for the assessment year 1996-97. These two returns were accepted under Self-Assessm ent Scheme but subsequently his case was reopened on the ground that the Complainant had made investment in purchase of two cars and a shop. The Complainant explained that the investment in these assets was made by obtaining loan, sale of jewellery belonging to this mother and gift from his father. But in spite of the fact that he explained the investment satisfactorily reassessments were completed by estimating sales and by making addition under section 13(i)(aa) of Income Tax Ordinance, 1979 at exorbitant income of Rs,511612 for the assessm ent year 1995-96 and at Rs,82000 for the assessment year 1996-97. The Complainant filed appeals against the above assessments. In the memo of appeal the Complainant had challenged the above assessm ent orders on a number of factual and legal grounds but learned CIT(Appeals) dismissed the appeals without properly discussing all the grounds of appeals.
5. Mr. Moazam Bashir, DCIT who attended on behalf of the Revenue contended that the appeals of the Complainant were properly adjudicated because they were rejected by the Commissioner of Income Tax (Appeals) after discussing main grounds of appeal.
6. The Complaint and Respondent's replies have been examined and arguments of both the sides have been considered. An examination of the record indicates that both the appeals were disposed off by the CIT(A) by a combined order. A perusal of the appeal order shows that learned Commissioner of the Income Tax (A) did not consider the contentions of the complainant raised and pressed in appeal objectively. He has dealt with only two grounds. So far the first ground is concerned no reasons have been given for arriving at the conclusion and has agreed with the order of the Assessing Officer. It is a universally acknowledged principle of justice that the Appellate Court must state its reasons for the decision. It is not sufficient to say that the order of the Assessing Officer or the argument of any party represents the correct view of the case. It is necessary that reasons are given in the order for the decision arrived at. The reasons so given will enable a party to decide whether to appeal aga.Inst the order or not? Reasons are to be given even in cases where order is passed affirming the assessment order. Mere reproduction of the order of the Assessing Officer without giving his own reasons or applying his mind is improper. The object of appeal is that a higher forum may apply independent mind to the controversy and then decide by its own reasoning. The impugned Appellate Order suffers from infirmity and can be termed as arbitrary. Maladministration is established. It is therefore, recommended that:--
(i) CIT (A) Gujranwala to rectify appeal order, dated 27-12-2002 under section 221 of Income Tax Ordinance, 2001 and pass a speaking order after discussing the grounds of appeal.
(ii) Compliance report be submitted within 30 days of receipt of these recommendations by the Revenue Division.