Through instant Reference Application under Section 133 of the Income Tax Ordinance, 2001 ("the Ordinance of 2001"), the following question of law, asserted to have arisen out of the impugned order dated 14.11.2018, passed by learned Appellate Tribunal Inland Revenue, Lahore Bench, Lahore ("Appellate Tribunal"), has been pressed and argued for our opinion:- "Whether on the facts and in the circumstances of the case, the learned Appellate Tribunal Inland Revenue, while deleting additions made under section 174(2) in respect of Profit and Loss Expenses stating that specific amounts were not confronted has erred in misreading/non-reading of evidence on record as taxpayer was confronted vide para 13 of the Show-Cause Notice dated 14/01/2014 to produce supporting vouchers in respect of expenses claimed and additions were made to the extent of expenses not supported by documentary evidence after taking into account reply filed by the taxpayer?"
2. Brief facts of the case are that income tax return for the tax year 2011, filed by respondent-taxpayer, was taken as assessment declaring income at Rs.221,620,651/-. Subsequently, the case was selected for audit under Section 214C of the Ordinance of 2001, whereby respondent-taxpayer was required to produce relevant record, however, its partial compliance was made. Resultantly, show-cause notice under section 122(9) read with Section 122(1)(5) of the Ordinance of 2001 was issued to respondent-taxpayer, which resulted in amended assessment under Section 122(1)/(5) of the Ordinance of 2001 and income for the tax year 2011 was assessed at Rs.254,263,667/-. Being aggrieved, respondent-taxpayer preferred appeal before CIR (Appeals), Lahore, which was partly allowed. Feeling dissatisfied, applicant-department as well as respondent-taxpayer filed appeals before learned Appellate Tribunal, which were disposed of. Hence this Reference Application.
3. Learned counsel for applicant-department, at the very outset, were confronted with the fact that no question of law is arising out of impugned Appellate Tribunal's order, which is even otherwise based on findings of facts.
However, despite effort, he could not give any satisfactory reply.
4. Arguments heard. Available record perused.
5. Perusal of record reveals that learned Appellate Tribunal, after appreciating the available record, recorded findings of facts that addition on account of WPPF was wrongly made as provided in section 60A of the Ordinance of 2001 which is allowable as the taxpayer has made the payment of WPPF in next year. The addition on account of purchases and additions on account of profit and loss expenses were not confronted in show-cause notice as taxpayer has filed complete books of accounts which is also mentioned in the assessment order and both the additions have rightly been deleted by learned CIR(Appeals). Learned Appellate Tribunal also issued direction to Taxation Officer to give credit to respondent-taxpayer after verification of record.
The relevant part of impugned findings is reproduced hereunder:- "8. We have heard representatives of both the parties, perused the impugned orders of the officers below and available relevant record of the case. After considering the facts, perusing the record and case law's referred by the learned AR's, we are of the opinion that addition on account of Tax Ordinance, 2001 which is allowable as the taxpayer has made the payment of WPPF in next year according to the WPPF Act which is evident to the Note No.13.1 of the audited accounts provided by the learned AR's for the next year i.e. Tax Year 2012 therefore addition has wrongly been made and confirmed by the CIR (Appeals) which is hereby ordered to be deleted.
Regarding the deletion of additions by the CIR (Appeals) on account of purchases under section 21(1) of Income Tax Ordinance 2001 and profit and loss expenses under section 174(2) of Income Tax Ordinance, 2001, it has been noted that addition section 21(1) of Income Tax Ordinance, 2001 on account of purchases not confronted in the show-cause notice whereas additions on account of profit and loss expenses under section 174(2) of Income Tax Ordinance, 2001 specific amounts of additions not confronted as the taxpayer has filed complete books of accounts which is also mentioned in the assessment order and both the additions have rightly been deleted by the learned CIR (Appeals) by following the judgments of the Hon'ble Higher Courts mentioned Supra therefore on these issues order of the learned CIR (Appeals) is maintained and appeal filed by the department is dismissed.
Regarding credit of tax amounting to Rs.5,247,997/- not given by the taxation officer. The taxation officer is directed to give the credit after due verification.
Before parting with this case, we are fortified by the judgment of Honorable Islamabad High Court in FERA No.1 of 2013 dated 04.02.2015 in the case M/s Wateen Telecom limited wherein it has been held that:- "as a final note we would like to observe that the bar of statutory duty is high on the appellate forums on the statutory forums provided under the Sales Tax Act, 1990. The learned tribunal being the last forum for determination of questions of fact, undoubtedly carries a heavy burden of discharging its functions in a fair, just and judicious manner particularly in observing the requirements of due process and deciding appeals as provided under the relevant provisions. The levy, charge or payment of a tax or duty imposes a financial burden and therefore the role of the tribunal as the last statutory forum assumes greater importance. The jurisdiction of the High Court under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973 is barred when the statutes provide an adequate remedy. The role of the Appellate Tribunal Inland Revenue which exclusively hears and decides appeals under the Sales Tax Act, 1990 becomes crucial in ensuring that the interests and rights of the taxpayers are safeguarded and they are protected from being saddled with illegal, arbitrary or unwarranted imposition of financial burden. It is for this reason that there is a higher duty of care to be exercised by the adjudicating officers and 'the statutory appellate forums, particularly the Tribunal, inter alia, in taking into consideration all the matters before it, whether relating to the facts or law, and after thorough deliberation, manifesting application of mind, deciding the appeal by the deliberation reasoned judgment order".
9. Both the appeals are disposed off as indicated above."
[emphasis supplied]
6. Needless to say that the findings of facts recorded by learned Appellate Tribunal, unless found to be either perverse or contrary to record, cannot be interfered with by the High Court, while examining questions of law proposed under the law. Scope of reference jurisdiction under the law is restricted only to the extent of examining questions of law arising from order passed by learned Appellate Tribunal and not to decide questions of facts, or for determining disputed facts. Reference is made to Messrs F.M.Y. Industries Ltd. v. Deputy Commissioner Income Tax (2014 SCMR 907), Commissioner Inland Revenue, Zone-I v. Messrs Industrial Chemicals (Pvt.) Ltd. (2017 PTD 756), Commissioner of Income Tax v. Ghee Corporation of Pakistan (Pvt.) Ltd.
(2017 PTD 1167), Commissioner Inland Revenue v. Messrs Adeel Brothers (2017 PTD 1579) and Commissioner Inland Revenue, Zone-II v. Al-Hamad International Container Terminal (Pvt.) Ltd. (2017 PTD 2212).
7. Since the decision by learned Appellate Tribunal is based on findings of facts, therefore, we decline to exercise advisory jurisdiction.
This Reference Application is decided against applicant-department.
8. Office shall send a copy of this order under seal of the Court to learned Appellate Tribunal as per Section 133(5) of the Ordinance of 2001.