DECISION/FINDINGS ' The Complainant, who is an Anesthetist in a Federal Government Hospital, alleges 'maladministration' inasmuch as reassessments for the years 1988-89 to 1994-95 though completed at a date when these had become time-barred, were antedated. He prays that the seven re-assessm ents "may be ordered to be cancelled". Moreover, the two Assessing Officers involved in this "criminal act of completion of post-dated assessments by tampering with the assessm ent record.. May kindly be directed to withdraw notices issued under section 140 of the Income Tax Ordinance 2001" (hereinafter called the Ordinance), whereby 50% salad of the Complainant stands attached, and a plot worth Rs,500,000 has already been attached.
2. Briefly the facts are that assessme nt for the year 1987-88 was framed under section 62 of the Income Tax Ordinance, 1979 (hereinafter called the repealed Ordinance) at an Income of Rs,1,023,551 against the declared Rs,19,511. The enhancement was due to inclusion of Teaching Allowance (Rs,4,000) besides an Addition under section 13 (Rs,1,000,000). The addition for "unexplained income" when restored by the Appellate Tribunal, after deletion by the CIT(A), is now pending under Reference before the Lahore High Court. Assessment for the succeeding seven years i,e, 1988-89 to 1994-95 were finally set-aside on 22-11-1999 by the Appellate Tribunal for de novo proceedings. This direction by the Appellate Tribunal was to be complied by (or before) 30-6- 2001 to save these from getting time-barred by operation of section 66(1)(c) of the repealed Ordinance. Allegedly proceedings for de novo reassessment were never taken up. In the meantime Ms. Yasmin Fatima, the ACIT was transferred and was succeeded by Mr. Khalid Khan (ACIT). The succeeding officer once again initiated recoved steps through notice under section 93(2) to the Administrator of the Hospital and the Manager, NBP's Hospital branch on 17-9-2002 attaching the Salad of the Complainant in addition to attachment of a plot of land owned by him. At this stage the AR of the Complainant requested for inspection of the file and discovered (on 19-9-2002) that assessm ents for the years, 1988-89 to 1994-95 having been set aside by ITAT on 22-11-1999 had become time-barred on 30-6-2001. He promptly apprised the ACIT of this reality of serious consequences. This was followed by a letter to the ACIT on 26-9-2002 inter alia informing him that assessm ents for 1988-89 to 1994-95 having become time-barred, tax deposited at Rs,469,395 for these years be refunded alongwith 15% compensation as per section 171 of the Ordinance. Yet another letter followed on 1-1-2002 informing that "the attachment of 1/2 salad was not lawful,". And requested that notice under section 140 be withdrawn. In response, the ACIT informed on 2-10-2002 that reassessm ents for these years had been completed on 30-6-2001 and that "after adjusting the demand very nominal refund is due" to the complainant. Surprisingly, neither the salary nor the plot were released from 'attachment'-hence the complaint.
3. Mr. Habibullah (Advocate) the learned Counsel for the Complainant submitted that TaxeS in respect of these years stood deposited on 29-671998, 7-9-1998 and 18-10-1998 aggregating at Rs,246,672 for which a 'clearance certificate' was later issued by the Department on 26-9-2000.
Ignoring this, the Complainant was required vide Recovery Notice dated 13-11-2000 to pay Tax demand aggregating Rs,804,867 for assessment years 1987-88 and 1988-89 to 1994-95. This was followed by a Notice under section 93(2) of the repealed Ordinance attaching the Salary of the Complainant. According to the AR, 'maladministration' thus committed was multiplied because after withdrawing this recoved step, notice under section 104 was once again issued on 17-9-2002 and when the Department conveyed that "after adjustment ved nominal refund is due," still the 'attachment' of Salad and Plot continues even today. This is in sharp contrast with the fact that:-
(a) as on the date (19-9-2002) of inspection of file there were not reassessment orders in respect of set aside assessm ents for the year 1988-89 to 1994-95 on record;
(b) nor any Demand Notice (etc) were ever served on the Complainant;
(c) this fact having been reported to the Department was altogether ignored and no response was made.
' Moreover, notices fixing the case for re-hearing of de novo proceedings were never served on the Complainant. By way of support for his arguments- following documents were brought on record:-
(i) Order sheet for assessm ent years 1988-89 to 1994-95.
(ii) Notice under section 61. Dated 3-5-2001 24-5-2001- and 7-6-2001 for assessment years 1988-89 to 1994-95.
(iii) Assessm ent orders for the above seven years together with IT-30s.
(iv) Demand Notice, dated 30-6-2001 .For the above seven years.
' If was ephasized that Department's own record would show that Complainant always responded to the notices_ Had the present notices (fraudulently brought on record) ever been really served, surely cooperation would have been extended. The learned counsel submitted that in a state of panic, on realization that due to their lapse. The assessments have become time-barred, the two officers, Ms. Yasmin Fatima and Mr. Khalid committed (a) the illegality of farming antedated assessm ents, (b) placing these on record, and (c) manipulating entries in the relevant Register/Record: which are all acts of criminal nature falling in the definition of 'maladministration' for cognizance by the FTO.
4. Mr. Karamat Ullah (DCIT), accompanied by Ms. Yasmin Fatima (ACIT) and Mr. Khalid Khan (ACIT), attended for the Revenue. It was argued that notices fixing the case for hearing, supported by order sheet entries, were obtaining on record. These were dispatched and served in the normal course. It was admitted that these were not served on the Complainant personally but were delivered, as in the past, in his office expecting that these would be passed on to him in normal routine. Any manipulation or tampering with record/registers was vehemently denied and any malice or mala fide falling in the categod of `maladministration' was ruled out. Reference was in this connection made to the respondent's reply denying any wrong doing and reiterating that reassessments had been made in time.
5. The facts of the case have been considered as also the affidavit and counter-affidavit of the Assessing Officer and the complainant's A.R. Respectively. The scrutiny of record in the light of the rival arguments reveals the following discrepancies in the respondent's case:--
(i) It is admitted that the Complainant did not participate in the proceedings and denies service of any notices for reassessm ent, for the years 1988-89 to 1994-95; still the reassessments purportedly made on 30-6-2001 are not ex,parte under section 63 . But under section 62 of the repealed Ordinance.
(ii) Moreover, the Demand Notice (which bears no proof of service) was not on record when inspected by the AR. The proof now obtaining on file is on a separate paper giving rise to doubt about its genuineness.
(iii) Despite attachment of plot worth Rs,500,000 the salary of the Complainant continues to be attached even today on the date of present hearing. All the above infractions betray "arbitrad unreasonable, unjust, biased, oppressive and discriminatod" conduct falling in the categod of 'maladministration' as per. Clause (3) of section 2 of the Establishment of the Office of Federal Tax Ombudsman Ordinance, 2000.
6. As respects the issue of reassessm ents for 1988-89 to 1994-95 having become barred by time by operation of section 66(1)(c) of the repealed Ordinance, the validity of the stand by the Complainant is established by the following facts--
(i) The M PR (Monthly Progress Report) for the month of June, 2001 submitted to the IAC mentions the number of reassessm ent of set aside 'assessments at 4 and the inclusion of the Complainant's assessm ent would jump this figure to 11. This means these were entered after the closure of the month of June, 2001.
(ii) Similar is the position in respect of the demand/refund in the month of June, 2001 (as of (i) above) where the figures reported in various statements submitted to IACiCIT do not include figures in respect of Complainant's assessments.
(iii) As regard card - forward of the arrears for the year ending 30-6-2001 the last entd was 3050.
There are no page-wise totals, but Grand Total on the right side of the Register. For the arrears of the next year ending 30-6-2002, the first entry is S. No, 3051 on page 208. This shows that the entries relating to the Complainant at S. No, 3051, 3052 and 3053 and the arrears of fourth year, (1991-92) without number, were made after 30-6-2002 (while the assessment was, dated 30-6-2001, the last date of limitation).
(iv) After the seven set aside assessments said to have been framed on 30-6-2001, the Assessing Officer issued recoved certificates but the demand relating to these years were never considered for recoved and Complainant not even asked to pay the same. Now it is averred that there will be some refund due to the Complainant.
The above glaring flaws clearly demonstrate that the lapse resulting in the seven set aside assessm ents becoming time-barred was attempted to be covered up by 'ante-dating the reassessm ents necessitating the insertion of entries in the DCR, concocting entries in the Order Sheet, and fictitious service of notices thus one wrong lead to another multiplying `maladministration'.
7. The visualization, as above, leads to the Recommendation:--
(a) The Recoved Proceedings by way of notices under section 140 of the Ordinance be dropped by vacating the "attachment" of Salad (i) on the consideration that the plot worth Rs,500,000 already stands attached, will satisfy the arrears demanded, if any, and (ii) there is likely to be further refund after implementation of these recommendations.
(b) The reassessm ents, dated 30-6-2001 for the assessment years 1988-89 to 1994-95 be amended so as to restore the situation emerging as a result' of ITAT order, dated 22-11-1999, i,e, Returns, as filed, be accepted. The excess payments may be adjusted against the arrears in respect of assessm ent year 1987-88.
(c) The latest position of arrears/refund to be notified to the Complainant.
(d) Tax functionaries responsible of antedating assessments, forging entries in the record/register be identified and proceeded against under the Government Servants Efficiency and Discipline Rules, 1973.
(e) Compliance with recommendation No,7(a), (b), (c) be reported within 30 days while recommendation No,7(d) be complied within 60 days.