Out of four captioned appeals for the assessment years 1993-94 to 1995-96, three appeals have been filed at . The instance of the assessee/appellant. For the assessment year 1993-94 the department is also in cross appeal. For all the three years the assessee took combined grounds, while agitating that the learned CIT(A) was not justified in confirming the change of tax u/S. 52 of the repealed Income Tax Ordinance, 11379 (hereinafter called the repealed Ordinance, It is pertinent to mention here that subsequent to filing of assessee's appeal, following additional grounds were also submitted:
(1) That since the proceedings initiated u/S. 52, vide show-cause notice No 212, dated 30.9.1999, were void ab initio being hit by limitation and laches, the entire super structure raised thereon is illegal and must fall to ground.
(2) That the 'Order passed u/S. 86 by the lower taxation authority is illegal and liable to be cancelled, as the officer has failed to establish mala fide and deliberate default on the part of the assessee in default."
2. Since the additional grounds taken up by the assessee are legal grounds and also go to the roots of the Case, the misc. Applications filed in this respect are accepted and the additional grounds are being formed part of the original grounds,
3. The revenue filed cross appeal for the assessment year 1993-94 agitating following ground of appeal:- "That the CIT(A). Was not justified to Exclude the amount bf Rs. 26,481,410/- from the purview of Section 52 of Income Tax Ordinance, 1979."
4. Briefly stated the facts of the case are that the proceedings U/S. 52 of the repealed Ordinance were originally completed on 16.10.1999 which resulted in creation of liability amounting to Rs.
6,84,212/-, Rs 10,39,403/- and Rs. 7,12,664/- for the respective assessment years under consideration. On appeal preferred by the assessee, the learned CIT(A) cancelled the assessments framed by the Assessing Officer and remanded the case to the Assessing Officer with the direction to properly scrutinize and ascertain true facts with regard to purchases made by the assessee. In the Second round of litigation the learned first appellate authority directed to modify. The assessm ents framed by the Assessing Officer' that payments made to Delite Industries at Rs.
26,48,410/- (Assessm ent year 1993-94) ordered to be excluded from the payment since the same was. Incorrectly charged to tax u/S. 52. However, the assessments framed with regard to assessm ent years 1994-95 and 1995t96 were confirmed. The assessee is in appeal before the Tribunal assailing the same. .Conversely, the revenue is also in appeal with regard to directions made by the learned CIT(A) for the assessment year 1993-94.
5. We have heard both the parties and have gone through the relevant orders. Right at the outset the learned A.R. Has assailed the impugned findings with the contention that the original assessm ent framed;.u/S. 52/86 of the repealed Ordinance were--time-barred, hence all the subsequent proceedings conducted-thereafter, are void ab initio, It was argued by the learned A.R.
That original assessm ents-were framed on 16.10.1999 while proceedings u/S. 52/86 for the respective assessm ent years were supposed to be concluded by 30.6.1997 for the assessment year 1993-94, 30.6.1998 for the assessm ent year 1994-95 and 30.6.1999 for the assessment year 1995-96.
He pointed of that clearly the framing of assessments u/S. 52/86 on 16.10.1999 were time-barred because the law envisages passing of order u/S. 52/86 within four years from the end of the financial year, In support of his contention, the learned A.R. Relied upon reported judgments cited as 2003 PTD 1571 (H.C ), 2003 PTD (Trib.) 1167, 2003 PTD 2287 and 2007 PTD 963 etc. Wherein it has been held that proceedings u/S. 52 can be initiated during the financial year or period of issuance notice-u/S. 61 (for last 3 years i.e. Within 4 years from the end of the Financial year). The learned D.R. Has been heard in support of the revenue who opposed the arguments advanced by the learned A.R.
6. After hearing both the. Parties and going through the relevant orders as well as case-law cited supra, we have no hesitation in holding that law on the issue has already stands settled in a number of judgments including the superior Courts. The stance of the assessee-also stands substantiated by the judgment cited at the bar. Keeping all the facts in view as well as in the light of reported judgment of the High Court, we hold that the assessments framed for all the three years were time-barred, hence directed to be Cancelled.
7. As far as appeal of the revenue is concerned, since we have cancelled the assessments for all the three years including assessm ent year 1993-94, the appeal of the revenue has become infructuous, is hereby dismissed.