SHAIKH ABDUR RAZZAQ, J. -- This judgment shall also dispose of Reference Applications Nos.
7/1991, 10, 11, 15, 36, 39 and 40/1990, 2 and 19/1991, as common questions of law and facts are involved in all these applications.
2. Briefly stated the facts are . That the respondent/assessee filed return for the Assessment Year 1981-82 declaring his net income at Rs.24,700/- which was accepted under Section 59(1) of Income Tax Ordinance, 1979. Subsequently, the case was reopened under Section 65 of the said Ordinance on receipt of information that the assessee purchased two plots bearing No. AA 277-280 on 11.4.1981 as per sale-deed for a sum of Rs.9,000/- each. The value of the said plots was assessed by the Excise and \ Taxation Department at Rs.3,00,000/- each. Thus, the difference in value declared by the assessee and assessed by the Excise and Taxation Officer was Rs.5,80,000/- and the said amount was added by the Income Tax Officer after providing full opportunity to the assessee with the prior approval of the Inspecting Assistant Commissioner of Income Tax. The Income Tax Officer assessed the respondent's income at Rs.6,04,700/- vide order dated 25.6.1988. Being aggrieved by the said order, the respondent/assessee filed an appeal before the Commissioner of Income Tax (Appeals), Rawalpindi, who vide order dated 1.1.1989 deleted the addition of Rs.5,80,000/- made by the Income Tax Officer under Section 13(1 Maa) of the Income Tax Ordinance, 1979. The Income Tax Officer filed a second appeal before the Income Tax Appellate Tribunal, Islamabad, who vide order dated 12.1.1991 confirmed the order of Commissioner of Income Tax (Appeals), Rawalpindi. The Department/petitioner being aggrieved by the order of Income Tax Appellate Tribunal dated 12.1.1991 filecla Reference Application under Section 136(1) of the Income Tax Ordinance, 1979, requesting the Tribunal to refer the following question of law for decision by this Court: "Whether on the facts and circumstances of the case the learned Income Tax Appellate Tribunal was justified in confirming the action of the worthy Commissioner of Income Tax (Appeals) regarding deletion of additional made by the Income Tax Officer under Section 13 of the Income Tax Ordinance, 1979 on the plea that double approval under Section 13(1) and 13(2) were not obtained separately from the Inspecting Assistant Commissioner of Income Tax when the draft assessm ent order was got approved from the Inspecting Assistant Commissioner of Income Tax thereby fulfilling the requirements of Section 13 of the Ordinance namely that the value of property and quantum of unexplained income/investment should be finally determined with the approval of Inspecting Assistant Commissioner of Income-Tax."
The Income Tax Appellate Tribunal vide order dated 26.10.1992 rejected the Reference Application.
Hence the instant Tax Reference under Section 136(2) of the Income Tax Ordinance, 1979.
3. Similarly in Tax Reference No. 7/1991 an addition under Section 13(1)(d) made by the Income Tax Officer vide order dated 30.3.1986 was deleted by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 12.1.1987 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad vide order dated 28.3.1988 and Reference Application of which was dismissed vide order dated 30.10.1989. Similarly, in Tax Reference No. 10/90, an addition made by the Income Tax Officer vide order dated 25.6.1985 was deleted by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 16.7.1986 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad, vide order dated 27.6.1987 and Reference Application of which was dismissed on .28.8.1998. Similarly, in Tax Reference No. 15/90 an addition made by the Income Tax Officer vide order dated 27.4.1987 was deleted by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 14.6.1987 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad vide order dated 30.7.1988 and Reference Application of which was also dismissed vide order dated 24.12.1989. Similarly, in Tax Reference No. 11/90, an addition made by the Income Tax Officer vide order dated 30.6.1985 was deleted by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 16.7.1986 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad vide order dated 27.6.1987 and Reference Application of which was dismissed vide order dated 29.8.1988. Similarly in Tax Reference No. 36/1990, an addition was made by the Income Tax Officer vide order dated 18.6.1987, which was deleted by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 11.8.1987 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad vide order dated 23.10.1988 and Reference Application of which was declined by the said Tribunal vide order dated 24.2.1990. Similarly, in Tax Reference No. 39/1990 an addition was made by the Income Tax Officer vide order dated 20.2.1986 which was set aside by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 19.1.1987 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad vide order dated 22.5.1989, against which Reference Application was declined on 12.2.1990. Similarly in Tax Reference No. 40/90 an addition was made by the Income Tax Officer vide order dated 10.6.1987 which was set at naught by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 16.7.1987 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Range, Islamabad vide order dated 23.10.1988, against which Reference Application was declined vide order dated 24.2.1990. Similarly, in Tax Reference No.2/91 an addition was made by the Income Tax Officer vide order dated 18.6.1987 which addition was deleted by the Appellate Assistant Commissioner of Income Tax, Rawalpindi Range, Rawalpindi, vide order dated 28.7.1987 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad vide order dated 27.11.1989, against which Reference Application was declined on 3.6.1990. Similarly in Tax Reference No. 19/91 an addition was made by the Income Tax Officer vide order dated 9.6.1987 which addition was set aside by the Commissioner of Income Tax (Appeals) Rawalpindi, vide order dated 20.8.1987 which order was upheld by the Income Tax Appellate Tribunal, Islamabad Bench, Islamabad vide order dated 5.6.1990 and against which order Reference Application was declined vide order dated 3.2.1991.
4. Arguments have been heard and record perused.
5. It is submitted by learned counsel for the petitioner that Commissioner of Income Tax (Appeals) was not justified in deleting the addition on the ground that prior approval under Section 13(1) and 13(2) of the Income Tax Ordinance, 1979 had not been obtained. His contention is that the assessee had concealed the price of the plots purchased by him, so the Assessing Officer was justified in adding the income which had been concealed by the assessee and there was no need of double approval as required by Ss. 13(1) and 13(7) of the Income Tax Ordinance, 1979.
6. Conversely, the stand of learned counsel for the respondent is that the Commissioner of Income Tax (Appeals) had not deleted the addition made by the Income Tax Officer merely on the ground that double approval had not been obtained as required by Section 13(1) and 1.3(2) of the Income Tax Ordinance, 1979 but had factually held that there was nothing on the record to prove the value of the plots as assessed by Assessing Officer. He thus submitted that as the decision of the Commissioner of Income Tax (Appeals) confirmed by the Income Tax Appellate Tribunal, Islamabad, does not pertain to question of law and it was merely a factual determination, so the Income Tax Appellate Tribunal has rightly declined the Reference Applications referring the matter to this Court.
7. According to Section 136(2) of the Income Tax Ordinance, 1979, a Reference can be made only in respect of question of law if the Appellate Tribunal refuses to make such Reference under Section 136(1) of Income Tax Ordinance, 1979. The question posed in the instant Reference is, if double approval was required by the Income Tax Officer before adding the value of the plots or not.
According to Section 13 of the Income Tax Ordinance, 1979, if the Assessing Officer wants to include unexplained investment under sub-clauses (aa) and (e) of Section 13(1) he has to seek approval of the Inspecting Assistant Commissioner of Income Tax under Section 13(2) and when the said approval is obtained and he wants to include the said amount to be deemed income, then he has to seek another approval as required by proviso to sub-section (I) of Section 13 of the Income Tax Ordinance, 1979. In the instant case, admittedly only one approval has been obtained, as such mandatory provision of Section 13 has been violated. However, the record shows that determination of the value of the plots was a question of fact and not only of law as there was nothing on the record to show if the value assessed by Excise and Taxation Department was a genuine one. So in the instant case the Commissioner of Income Tax (Appeals) deleted the addition on facts and not due to the lack of double approval as required by Section 13(1) and 13(2) of the Income Tax Ordinance, 1979.
8. The upshot of the above discussion is that no question of law is involved in these Cases because had the appeals been dismissed only on the ground of lack of double approval, then the proper course for the Tribunal was to remand the cases to the Assessing Officer for removal of said defect, In these cases the Commissioner of Income Tax (Appeals) has deleted the addition on facts as there was no evidence on record to prove the value of the properties/plots as assessed by the Income Tax Officer. Thus we do not find any force in these Reference Applications and dismissed the same.