NASIM SIKANDAR, J.---This judgment will dispose of I.T.As. Nos.353/2000, 354/2000 and 355/2000.
2. The appellant in these further appeals under section 136 of the Income Tax Ordinance, 1979 is a private limited company and derives income from manufacturing and sale of both agricultural as well as nonagricultural implements. The assessments framed in its respect for the years 1994-95 to 1996-97 were revised on 29-6-1996 by I.A.C., Faisalabad invoking his powers under section 66-A of the Ordinance, 1979. In reply to the show-cause notice dated 5-6-1999 the assessee took up an objection against the invocation of revisional jurisdiction by him. It was submitted that the assessm ent orders for the years under consideration having been passed by an I.A.C. Another I.A.C.
Did not hold jurisdiction to invoke the provisions of section 66-A in respect of such assessment orders. The objection was overruled by reference to a judgment of the Income-tax Appellate Tribunal. Thereafter, the I.A.C. Proceeded to cancel the three assessments after holding them to have been framed erroneously resulting in prejudice to the interest of the Revenue.
3. On first appeal the Lahore Bench of the Income-tax Appellate Tribunal maintained the exercise of revisional powers after endorsing the reasons assigned by I.A.C. While rejecting the objections. It was observed that for all intents and purposes while making an assessment after conferring of jurisdiction under section 5(1)(c) of the Ordinance, the I.A.C. Was a Deputy Commissioner and the Commissioner, an I.A.C. As far as the assigned cases are concerned. In other words according to the Tribunal, an I.A.C. Becomes an Assessing Officer and the Commissioner acquires the power previously exercised by an I.A.C. However, it was concluded that when power had been exercised and the assessm ent or other proceedings had been completed, regular provisions of law came into operation automatically. The conclusions so drawn were supported by an earlier judgment which was referred to by the I.A.C. While rejecting the objection. In that judgment the Tribunal held the view that provisions of section 5(1)(c) and (cc) of the Income Tax Ordinance, 1979 were in the nature of special provisions and were applicable so long the power conferred on the D.C.I.T. And I.A.C. Were exercised by the I.A.C. And C.I.T. Respectively under clause (c) or by Income-tax Penal and Commissioner under clause (cc) respectively. Further that these provisions were applicable during the period there was a deviation from normal law and when the deviation 'came to an end the operation of special law also came to an end. In the view of the learned Tribunal the moment the deviation from general law ended, the provisions contained in general law become operative with the result that the original powers conferred on the income-tax authorities under the Income Tax Ordinance revived automatically.
4. After hearing the learned counsel for both the parties it is our considered opinion that the I.A.C.
Wrongly rejected the defence put forth before him. The judgment of the Tribunal on the subject also does not appear to have stated the law correctly. Section 5 of the Income Tax Ordinance details the jurisdiction of various Income-tax Authorities. Sub-clause (c) of subsection (1) of section 5 provides that I.A.C. And the D.C.I.T. Will perform their function in respect of such persons or classes of persons or such cases as the Commissioner to whom they are subordinate, may direct. The Commissioners are allowed to make a general or special order directing that the powers conferred on the D.C.L T. And I.A.C. Under the Ordinance in A respect of all or any proceedings relating to specified cases or classes of cases or specified persons or classes of persons, be exercised by the I.A.C. And the Commissioner respectively. The provision further goes to state that "for the purpose of any proceedings in respect of such cases or persons references in this Ordinance or in any rules made thereunder the Deputy Commissioner and Inspecting Additional Commissioner shall be deemed to be references to I.A.C. And Commissioner respectively". To this extent the learned Tribunal goes alongwith the, provisions of law and holds that in respect of all such proceedings the aforesaid reference interchanging one authority for the other holds good. However, the next part of their view is not correct. It is that once the proceedings or assessments for which a special direction had been made had come to an end the position will immediately revert to normal situation and general provisions of law will become applicable. In other words, if while framing an assessm ent an I.A.C. Working as D.C.I.T. In respect of a particular class of persons or cases intends to make an addition under section 13 of the Ordinance he would seek the approval of his Commissioner. To this extent we found no fault with the opinion of the learned Tribunal. However, their view that after completion of proceedings/assessments the position will automatically revert to general provisions does not appear correct. If special provisions were applicable during the continuation of the proceedings their coming to an abrupt end without reference to the circumstances and the legal background in which these were conducted cannot be readily accepted as correct. The provisions of section 5(1)(c) do not support this view. The use of word for the purpose of any proceedings in respect of such cases or classes or persons" therein does not in any manner mean or include, only the proceedings as long as they continued. The proceedings so contemplated include not only a pending assessment order but also a completed assessment order. Therefore, the reference to Deputy Commissioner and the Inspecting Additional Commissioner shall remain a reference to Inspecting Additional Commissioner and the Commissioner.
5. The provisions of section 66-A, detail the powers of an I.A.C. To "revise" Deputy Commissioner's order. As a rule revisional jurisdiction is never exercised by the same authority. The power to revise, be it suo motu or on the application of an aggrieved party, necessarily involves the consideration of the impugned order by a person or authority placed higher in the hierarchy to adjudge its legality and propriety. The jurisdiction so conferred normally has a colour of supervisory power to correct mistakes on administrative, side. Once an authority has passed an 'order it cannot sit in revision on the same order to pick up faults and to interfere with by taking a different view of the issues involved. The power to revise an order is clearly distinguishable from review and rectification. Besides other things, one common feature of them being that both review and rectification are normally made by the same authority which had earlier passed the order in question.
6. To us it also appears that the view adopted by the Tribunal on the basis of which the I.A.C. Had rejected the objection of the assessee is contradictory. Their conclusion that provisions of section 5(1)(c) interchanging the original and the revisional authority remain effective only during the assessm ent proceedings is not supported from the plain words of the statute. There can hardly be a doubt that to frame an assessm ent under the Ordinance is the privilege of Deputy Commissioner of the Income-tax. However, this privilege can for certain reasons and in respect of certain classes of persons or assessee be exercised by a person higher in the hierarchy of Tax Administration.
However, when such power is exercised by a person higher in authority the order so framed continues to be that of the higher authority. An I.A.C. Framing an assessment does not cease to remain an I.A.C. At best it can be said that he is both I.A.C. As well as Deputy Commissioner for a specific purpose and in respect of specific cases. An I.A.C. Is certainly a persona designata as far as the provisions of section 66A are concerned, to revise the order of a "Deputy Commissioner".
However, when an assessm ent or other order has been recorded by an I.A.C. And not a Deputy Commissioner, the power can only be exercised, with reference to provisions of section 5(1)(c) of the Ordinance by a Commissioner., It is simple enough to understand the purpose of section 66A which inter alia provides for calling and examining of record of any proceedings under the Ordinance if the conditions stated in the provisions are answered. Obviously an authority equal in status cannot "call for" the record and "examine" the same. An assessment framed by an I.A.C. Even though remains on the file of a D.C.I.T., still it continues to be the one framed by an I.A.C., and therefore, a person equal in authority cannot call for the same. The title of the provision supports our view that the power so conferred on I.A.C. Is "to revise the Deputy Commissioner's order". As observed earlier an order recorded by an I.A.C. On being authorized under section 5(1)(c) of the Ordinance continues to remain that of an I.A.C. Though acting as an Assessing Officer. It is not comparable nor it can be stated to be that of Deputy Commissioner of the Income-tax. The scheme of section 66-A also gives an exceptional situation when an I.A.C.
While revising the order of the Deputy Commissioner con himself pass an assessment order substituting the earlier order. This is in addition to his power to cancel the assessment and to direct a fresh assessm ent to be made by D.C.I.T. If the interpretation of the learned Tribunal is accepted then one will also acceptthe possibility that an I.A.C. Could exercise revisional powers for the second time in respect of his own orders which he had earlier under subsection (1) of section 66-A.
That situation simply appears anomalous and outside the four corners of the assessment and other proceedings contemplated in the Ordinance. Therefore, we will agree with the appellants that powers conferred under section 5(1)(c) of the Ordinance simultaneously substitute an I.A.C. For the Commissioner of Income-tax. That transfer or substitution remains intact till the possibility of exercise of any jurisdiction conferred on an I.A.0 in respect of completed assessment remains intact. It does not and with the completion of assessment or other proceedings undertaken by the I.A.C. As D.C.I.T.
7. The factual position as alleged at the bar also finds support from the record that I.A.C. Who framed the original assessm ent in this case was never designated as special officer. According to order, dated 23-8-095 passed by C.I.T. (Companies Zone), Faisalabad under section 5(1)(c) of the Ordinance, 1979 (with the prior approval of R.C.I.T. (Central Range) certain I.A.Cs. Including the gentleman who framed the assessment in the case of the present appellant were directed to exercise powers conferred on Deputy Commissioner of Income-tax in respect of the classes of persons specified in the Schedule. The notification so Made, it goes without saying did make the I.A.C., a D.C.I.T. Or an Assessing Officer but it did not divest him of his position in the hierarchy as an I.A.C. The power given is in addition to his status and not in its derogation.
8. Therefore, we will allow these appeals by holding that framing of an order under section 66-A in the three,assessm ent years involved in respect of the appellant on 29-6-1999 by the I.A.C. Was not in accordance with law. .