ORDER NASIM SlKANDAR, JUDICIAL MEMBER.- Through these Miscellaneous Applications, Commissioner of Income-tax, Zone-I, Lahore, prays for rectification of an order recorded by this Tribunal in ITA Nos. 1660 to 1663/LB/92-93 (Assessment years 1988-89 to 1991-92) on 21.3.1993 in Re: Holder Management & Consultant v. The to, Companies Circle-13, Lahore.
2. The assessee respondent in this case is a non-resident company engaged in providing professional services in the fields of corporate affairs, financial analysis, engineering economics and business administration etc. The assessee-company claimed exemption from levy of tax under section 50(3) of the Ordinance on the ground that it did not have a permanent establishment in Pakistan. The contention was refused oh the ground that during the period under consideration the assessee did have an establishment in Pakistan and that the major part of the receipts/income resulted to its activities carried on within Pakistan. The first appellate authority confirmed the treatment meted out to the assessee for somewhat similar reasons. On further appeal this Tribunal by way of the aforesaid order held that receipts of the assessee were covered by the terms of the convention for avoidance of double taxation between the Government of Pakistan and the Swiss Federal Union. It was further found that the receipts were not fees for technical services but industrial or commercial prof and, therefore, did not fall within the mischief of Section 80-AA of the Ordinance. On facts also this Tribunal held that the assessee had no permanent establishment in Pakistan.
3. Mr. Shahbaz Butt, Legal Advisor, speaking for the revenue contends that section 80-AA of the Ordinance does not mention in section 129 of the Ordinance and, therefore, the appeal filed by the assessee before the first appellate authority was incompetent. It is further submitted that the second appeal before this Tribunal was equally incompetent. The main thrust of his argument is that all superstructure based upon an illegal and viold order is equally fallacious and illegal.
Reliance in this connection is placed on (1964) 10 Tax-12 at 17, PLD 1958 SC 104 at 107 and 129 ITR 351 at 364. In support of the competency of this application u/S. 156 of the Ordinance reliance is placed upon a reported decision cited as (1971) 23 Tax 236 at 242. It is further submitted that per ratio of the case cited as (1986) 54 Tax 32 overlooking of a mandatory provision of law is an error apparent from the record and, therefore, this application merits acceptance.
4. Learned A.R. For the assessee controverts the submissions made by the revenue both on legal as well as factual plain. On facts it is submitted that the assessments in the years 1988- 89 and 1989- 90 were framed u/S. 62 of the Ordinance and, therefore the revenue is incorrect in saying that the assessm ents were framed u/S. 80-AA of the Ordinance against which no appeal was competent before the first appellate authority. On legal plain it is submitted that section 80-AA is not by itself a charging section and all kinds of incomes under whatever head they may fall are taxed on the authority of charging provisions in the statute which in this case is Section 9 of the Ordinance. It is also contended that mere mention of section 80-AA in the assessment order will not change the nature of levy and the order shall remain an assessment order framed u/S. 62 of the Ordinance as happened in the other two years. Reliance in this regard is placed upon a reported decision of Supreme Court of India cited as 1957 32 ITR 688 Re: United Commercial Bank Limited v. CIT, West Bengal. Another case of Allahabad High Court Re: Remchand & Sons v. CTT UP reported as 1967 63 ITR 252 at 260-261 is relied upon to say that wrong or mistaken mention of a particular section or the label or nomenclature used is not determinative of the validity of an assessment. It is also asserted on the authority of 1964 51 ITR 823 Re: CIT v. Khen Chand Ram Dass that mere fact that an order proposed to have been made under a particular section does not shut out an appeal if the facts go to show that the correct section under which the order ought to have been made was another one. Learned A.R. Also seeks support form 1962 42 ITR 123 and 1944 12 ITR 59 at 65 to plead that the first appellate authority as a Court of appeal had jurisdiction to determine the soundness of the conclusions of the assessing officer both on question of fact and law as well as the jurisdiction of the assessing officer to pass the order appealed against.
5. After hearing the parties, we have concluded that the revenue has no case as for this application is concerned. For the moment we are not willing to adjudicate whether an order u/S. 80-AA amounts to an order u/S. 62 of the Ordinance. The fact remains that in two of the four years under consideration before us section 62 was expressly mentioned in the assessment order as the provision under which the order was being recorded. Also the jurisdiction of this Tribunal to entertain appeal against first appellate order cannot be described to be illegal either. Madras High Court in Additional Commissioner of Income-tax, Madras-I v. Dalmaia Maganasite Corporation cited as 117 ITR 930 held that if "intermediary appellate authority purported to deal with a matter in appeal as if that intermediary authority had jurisdiction to deal with that appeal, thought, in fact that authority had no jurisdiction to deal with that appeal the order of that appellate authority would become appealable to a higher appellate authority "
6. Besides, we have noted that no such contention was ever made by the revenue at the time of hearing of this appeal. Again it was not suggested as a question of law in reference application made qua the aforesaid order of this Tribunal. It may also be mentioned that on the application of the department in RA Nos. 312 to 315/LB/1993-94 (assessment years 1988-89 to 1991- 92) this Tribunal on 15.12.1993 referred the questions of law said to have Arisen out of the aforesaid order of this Tribunal. No mention of this objection was made in the statement of the case or the question framed for a reference to the High Court u/S. 136(1) of the Ordinance.
7. The scope of application of section 156 of the Ordinance has lately been determined by the Supreme Court of Pakistan in (1992) 65 Tax 253 in Re: The CTT, Companies-II, Karachi v. National Food Laboratories. The relevant portion of this judgment is reproduced to highlight the view of Supreme Court of Pakistan with regard to the powers available to an income tax authority or this Tribunal for rectification of mistakes under section 35 of the repealed Act, 1922 (which is equivalent to section 156 of the Ordinance, 1979): "Therefore, essential condition for exercise of such order is that the mistake should be apparent on the face of record; mistake which may be seen floating on the surface and does not require investigation or further evidence. The mistake should be so obvious that on mere reading the order it may immediately strike on the face of it. Where an officer exercising powers u/S. 35 enters into controversy, investigates the matter, reassesses the evidence or takes into consideration additional evidence and on that basis interprets a provision of law and forms an opinion different from the order, then it will not amount to rectification of the order."
8. On a query from the Bench, learned Legal Advisor for the Revenue states that through this petition the Revenue prays for recalling of the afore-said order of the Tribunal and also its substitution by another, probably after hearing the parties again, that the first appellate order was incompetent and, therefore, no appeal laid before this Tribunal. We are afraid this grayer can neither be allowed on facts nor it is covered by the provisions of Section 156 of the Ordinance. The Revenue has not been able to bring home that the aforesaid order of the Tribunal suffers from a turbidity which is apparent on its face. The question whether section 80-AA is a charging section and that assessm ent made with reference to provisions of this section could not be assailed before the first appellate authority, can hardly be considered in these miscellaneous application.
Travelling beyond the order sought to be rectified u/S. 156 of the Ordinance on the basis of contentious pleas is not warranted.
9. For these reasons, we will refuse to grant the prayer.
9. These applications, therefore, fail.