The appeals have been filed by the Messrs Asean International Islamabad against the orders Nos, 100, 101 and 102 /2013 dated of order 09.09.2013 passed by the CIR (Appeals-III), Rawalpindi for the tax Years, 2010, 2011 and 2012 on the following common grounds of appeals:-- GROUNDS
1. That the re-assessment framed is illegal and void. There is not provision in law for framing of fresh assessment on remanding back of the case by the Commissioner Inland Revenue (Appeals) after amendment made vide Finance Act, 2010 in section 124 of the Income Tax Ordinance, 2001.
2. That the re-assessment framed under section 124 of the Ordinance during the pendency of appeal before the Appellate Tribunal Inland Revenue filed by the taxpayer against the order of CIR(A) in original assessment is illegal and liable to be annulled in the light of the judgment of Higher Appellate Forums:-- 2008 PTD 1998 (Lah. H.C.), 2002 PTD 1 195, 2002 PTD (T rib.) 3129 and 1985 PTD 375 (Lan.H.C.)
3. That the charge of withholding tax @ 20% under section 152(2) on boarding/lodging in foreign Country is illegal and unjustified in view of the provisions of clause (d) of subsection (3) of section 152 of the Income Tax Ordinance, 2001.
2. Brief facts of the case are that the appellant taxpayer filed returns for the tax years, 2010, 2011 and 2012 declaring P&L expenses at Rs,59,179,128/- for the tax year 2010, Rs, 122,052,4 88/- for tax year, 2011 and Rs, 103,014,825/-for tax year, 2012 respectively . The appellant allegedly failed to discharge its responsibilities under the law to act as withholding agent and was issued show-cause notice by the department. In response to notice under sections 161/205, the taxpayer filed reply which was not found satisfactory and the officer, therefore, treated it as taxpayer-in-default and tax and default surcharge were levied at Rs, 3,096,802/-Rs, 5,318,538/- and Rs, 3,643,140/- for tax years 2010, 2011 and 2012 respectively . The taxpayer was aggrieved and filed appeal in this office. The CIR (A) remanded the case to the department for examination and provision of sufficient opportunity to the appellant. The impugned order shows that the taxpayer was provided several opportunities but, no evidence in support of its claims was ever submitted. The officer therefore treated it as taxpayer-in-default and tax and default surcharge were levied at Rs, 2,155,486/- Rs, 5,055,834/- for tax years, 2010, 2011 and 2012 respectively . The CIR
(A) has observed in his order:-- "The facts so ascertained show that the appellant did not present any evidence before the officer. It merely made unsubstantiated claims without producing any piece of evidence. Through my learned predecessor had remanded the case back in order to provide the appellant with opportunity to prove validity of its claims, yet the appellant shied away and instead chose not to properly associate itself with proceedings or produce any documents in its support. If the appellant indeed had any explanation, it would have submitted same. Thus all indicators point to one fact; that claims of the appellant are baseless and it had failed to discharge its liability as withholding agent."
3. The case was fixed for hearing and in response thereto Mr. Atif Waheed AR and Nazia Zaib, DR attended the proceedings on behalf of the taxpayer and the Revenue, respectively . We have heard the appellant and the AR at length and also perused the record. The order passed by the CIR (A) has also been perused. During perusal of the record it transpired that the Taxation Officer has passed this order despite the fact that against the previous impugned order of the CIR(A) remanding the original first order , the taxpayer had filed appeal before this Tribunal which is pending for adjudication. But despite this fact the taxation officer has passed this order , which is illegal and has wrongly been upheld by the commissioner appeal Impugned orders passed by both the officers below - the taxation officer and CIR(A) are cancelled. Placing reliance on the decision of the Honourable High Court reported as 2008 PTD 1998 (LHC) 2002 PTD 1 195 and 1985 PTD 375 (LHC).
4. The appeals filed by the, taxpayer for all the taxpayer are allowed.