MARI PETROLEUM COMPANY LTD. VS APPELLATE TRIBUNAL INLAND REVENUE, 2016 PTD-ISLAMABAD 2406 (2016)

Income Tax Ordinance (XLIX of 2001)---

----S. 122(5-A) & (9)---Coercive measures, restraining of---Authorities issued show cause notice and rejected objections taken by taxpayer---Notice of demand raised by authorities was assailed by taxpayer before appellate authority---Grievance of taxpayer was that neither any interim relief was granted nor appeal was decided within a period of thirty days---Validity---Appeal filed by taxpayer was not taken up for hearing and Appellate Tribunal was not functioning---Appeals were being adjudicated only under directions passed by High Court in exercise of Constitutional jurisdiction---Plea raised by taxpayer was that if interim reprieve was not granted, taxpayer would be subjected to coercive measures by authorities---Validity---High Court directed authorities to decide appeal of taxpayer expeditiously, preferably within a period of sixty days and granted temporary relief to taxpayer, as stopgap measures---High Court further directed that until decision on taxpayer's appeals, no coercive measures will be taken against it---Constitutional petition was allowed accordingly.

Messrs Pearl Continental Hotel, Lahore v. Customs, Excise and Sales Tax Appellate Tribunal, Lahore and another 2005 PTD 1368, Karachi Shipyard and Engineering Works Limited, Karachi v. Additional Collector, Customs, Excise and Sales Tax (Adjudication-III), Government of Pakistan, Karachi and 2 others 2006 PTD 2207 and Sun-Rise Bottling Company (Pvt.) Limited v. Federation of Pakistan and 4 others 2006 PTD 535 ref.

Jawad Hassan, Barrister Umar Malik and Umair Saleem for Petitioner.

ORDER

MIANGUL HASSAN AURANGZEB, J.---Through the instant Writ Petition, the Petitioner, Mari Petroleum Company Ltd., is seeking the issuance of a Writ, primarily to respondent No.1 (Appellate Tribunal Inland Revenue), for the expeditious disposal of its appeal and application for interim relief against the order dated 18.04.2016, passed by respondent No.2 (The Commissioner Inland Revenue), Islamabad.

2.The record shows that on 02.03.2015, a Show Cause Notice was issued to the petitioner, under Section 122 (5A) read with Section 122(9) of the Income Tax Ordinance, 2001, for tax year 2014. On 24.03.2015, the petitioner sent a reply to the said Show Cause Notice. The objections taken by the petitioner in its reply to the said Show Cause Notice were turned down by the Additional Commissioner, Inland Revenue. Consequently, on 15.06.2015, notice of demand was issued to the petitioner for an amount of Rs.648,837,532/-. The petitioner impugned the said notice of demand dated 15.06.2015, before respondent No.2, who did not grant any interim relief to the petitioner. This necessitated the petitioner to approach respondent No.1 for interim relief, who vide order dated 16.07.2015, directed respondent No.2 to decide the petitioner's appeal within a period of 30 days and during the said period, the department was restrained from adopting coercive measures against the petitioner. As respondent No.2 did not decide the petitioner's appeal within a period already fixed by respondent No.l, the petitioner approached this Court through Writ Petition No.195/2016, primarily to seek interim relief for the period during which the adjudication of its appeal was to take place. This Court, vide order dated 19.01.2016, disposed of the said petition with the direction to respondent No.2 to decide the petitioner's appeal within a period of 60 days. Furthermore, until the decision on the petitioner's appeal, the department was restrained from initiating recovery proceedings against the petitioner. Paragraph 6 of the order dated 19.01.2016, is reproduced hereinbelow:-

" In view of the above, respondent No.2 is directed to decide the appeal of the petitioner within a period of 60 days, till then the recovery proceedings shall not be initiated against the petitioner. The petitioner is directed to appear and argue its case without seeking any adjournment as and when the appeal is fixed. The respondents are further directed not to adopt coercive measures for seven days after the decision of the appeal by respondent No.2, in case the petitioner's appeal is dismissed."

3.As the petitioner's appeal was not decided within the said stipulated period, the petitioner, once again approached this Court through Writ Petition No.1293/2016, for the same relief as in the earlier Writ Petition. The petitioner's second Writ Petition was also disposed of vide order dated 11.04.2016, with the direction to respondent No.2 to decide the petitioner's appeal within a period of 60 days. This Court also restrained the department from initiating any recovery proceedings against the petitioner during the pendency of the appeal. Paragraph 6 of the order dated 11.04.2016, is reproduced hereinbelow:--

"In view of the above, respondent No.2 is directed to decide the appeal of the petitioner within a period of 60 days, till then the recovery proceedings shall not be initiated against the petitioner. The petitioner is directed to appear and argue its case without seeking any adjournment as and when the appeal is fixed."

4.The orders dated 19.01.2016 and 11.04.2016 were passed by this Court without issuing notices to the respondents in the said Writ Petitions.

5.Vide order dated 11.04.2016, respondent No.2 dismissed the petitioner's appeal.

6.Learned counsel for the petitioner submitted that the petitioner has already filed an appeal before respondent No.1 which appeal, till date, has not been taken up for hearing. Learned counsel for the petitioner further submitted that as the Chairman of respondent No.2 has, till date, not been appointed, the Appellate Tribunal is not functional and is adjudicating upon appeals only under the directions issued by Constitutional Courts. He further submits that if interim reprieve is not granted, the petitioner shall be subjected to coercive measures by the department. He further submits that relief prayed for in this petition may be granted in the same way as earlier granted by this Court in Writ Petitions Nos.195 and 1293 of 2016. He places reliance of the judgments on the cases of Messrs Pearl Continental Hotel, Lahore v. Customs, Excise and Sales Tax Appellate Tribunal, Lahore and another (2005 PTD 1368), Karachi Shipyard and Engineering Works Limited, Karachi v. Additional Collector, Customs, Excise and Sales Tax (Adjudication-III), Government of Pakistan, Karachi and 2 others (2006 PTD 2207) and Sun-Rise Bottling Company (Pvt.) Limited v. Federation of Pakistan and 4 others (2006 PTD 535).

7.In view of the facts of the case, as stated herein above, and taking into consideration the law laid down by the Superior Courts in the cases referred to above, as well as orders dated 19.01.2016 and 11.04.2016, passed by this Hon'ble Court in Writ Petitions Nos.195 and 1293 of 2016, I am inclined to grant, as a stop gap measure, temporary relief to the petitioner by directing respondent No.1 to decide the petitioner's appeal expeditiously, preferably within a period of 60 days from today. Until the decision on the petitioner's appeal, no coercive measures shall be taken against the petitioner. In consistency with the orders of this Court referred to above, this petition is disposed of in the above terms without the issuance of notices to the respondents.

MH/106-IslOrder accordingly.