NASIM SIKANDAR, J.---This is a case stated by the Lahore Bench of the Income Tax Appellate Tribunal. The following question of law has been framed for our consideration and reply: "Whether on facts and circumstances of the case the ITAT was justified in confirming the order of the A.A.C. Deleting the penalty imposed under section 91 of the Income Tax Ordinance, 1979 on the ground that assessm ent/demand in original has been modified in appeal."
2. According to the statement of the case after framing assessment in respect of the assessee, an individual, the Assessing Officer proceeded to impose penalty of Rs.16,115 under section 91 of the Income Tax Ordinance, 1979. On appeal penalty so imposed was deleted on the ground that assessm ent on the basis of which it was imposed was modified. The learned Tribunal maintained the findings by relying upon a judgment of this Court in re: CIT v. Begum Mumtaz Jamal PLD 1976 Lah. 761.
3. In a recent opinion while disposing of C.T.R. No.105 of 1993 re: CIT v. Good Luck Trading Company Lahore, we have found that till the amendment brought about in section 91 whereby subsection (4- A) was inserted therein the ratio settled by this Court in the aforesaid case re: CIT v. Begum Mumtaz Jamal (Supra) held the field. It will be seen that in the aforesaid judgment of this Court expressed the view that where an assessm ent was modified in appeal, the issuance of a fresh demand notice consequent upon the appellate order was necessary. Also that where the original assessment was modified in appeal the penalty already imposed did not remain in the field. As observed earlier these findings were recorded in the face of the provisions of section 91 of the Income Tax Ordinance, 1979 as originally framed and before the aforesaid subsection (4-A) was introduced to existing provision of section 91 by way of the Finance Act, 1997.
4.. Since the penalty in this case was imposed much earlier to the aforesaid amendment, the principle settled by this Court squarely covers the same.
5. That being so our answer to the question is in the affirmative. .