D.J. BUILDERS AND DEVELOPERS VS FEDERATION OF PAKISTAN through Secretary, Ministry of Finance, Islamabad, 2016 PTD-KARACHI-HIGH-COURT-SINDH 1723 (2016)

(a) Income Tax Ordinance (XLIX of 2001)---

----Ss. 122, 124 & 129----Order of attachment of property---Notice/ opportunity of hearing---Requirement---Amendment of assessment---Assessment giving effect to an order---Decision in appeal---Appellant tax-payer, having taken different stance in the appeal contending that the undisclosed income was not his income but the same belonged to petitioner/company and its Directors---Commissioner (Appeals) confirmed the order and modified the same making the tax amount recoverable from the petitioner/Company and their Directors with direction that property of the petitioner be sold for recovery of the tax amount---Legality---Order of Commissioner (Appeals) was against law---Principles.

Appellant, in his replies to the notice issued under Section 122(5)(A) of Income Tax Ordinance, 2001, had never pleaded that the shares were in fact Benami in the name of another company and/or its Directors. Impugned order did not contain any findings regarding the petitioner. Entire allegations were against the petitioner and its Directors, and the appellant had not alleged that the petitioner had any concern whatsoever in respect of the transaction in question.

Petitioners had approached the Appellate Tribunal, Inland Revenue, with an appeal, which had not been entertained. Petitioners, therefore, being remediless, rightly approached the High Court through present petition under Article 199 of the Constitution. Present petition was maintainable, when the impugned order of the Commissioner was without any lawful authority and jurisdiction.

Under Section 129 of Income Tax Ordinance, 2001, mandatory notice had been provided before any modification order could have been passed by the Commissioner. Commissioner had directed sale of the property of petitioners against whom, there was no order for recovery or for passing of any amended assessment order in terms of Section 122(5)(A) of the Ordinance, which was against the spirit of law and the Constitution. No notice had ever been issued to the petitioner either by the Inland Revenue Department or by the Commissioner (Appeals), nor even a copy of adverse impugned order had been addressed or sent to the petitioners. In the circumstances, since power to remand the case to the Assessing Officer was no more vested with the Commissioner after the Finance Act, 2005, the Commissioner on his own could have confronted the petitioners by issuing a notice before passing the adverse order against them.

Commissioner, having come to a definite finding that new material had been placed before him, which the authorities below had failed to appreciate, was duty bound to issue a proper notice to the petitioners to defend themselves. No liability could have been created against a person who was not even party to the proceedings. Commissioner had travelled beyond the scope and mandate of the law by passing the impugned order, while creating liability against the petitioners and by further ordering sale of the property in question. Impugned order had seriously prejudiced the interest of the petitioners and could not sustain.

Commissioner had also directed the Assessing Officer for making the proper use of the information available in the body of impugned order in respect of the Benami account holders and the employees of the petitioners and its Directors and further to reopen the assessment order in accordance with law. Department had not given effect to said order/direction of the Commissioner under Section 124 of the Ordinance, for which no plausible justification or reason had been given. High Court directed that a copy of its judgment be sent to the Chairman FBR, Member (Inland Revenue) and Member (Legal), FBR for conducting an inquiry as to why after passing of the order by Commissioner, no further proceedings had been initiated and taking appropriate action against the responsible person.

Commissioner (Appeals) had directed sale of property of the petitioner for the reason that the appellant was a partner of 6 % share in the same. Appellant had already retired from the partnership before the impugned order of Commissioner (Appeals) and the order of attachment of the property had been passed. Sale of the property of petitioner, therefore, could not have been effected. Assessment order in question was in respect of the appellant only, and no proceedings had ever been initiated against the petitioners and/or its directors/partners, either individually or collectively; therefore, the property, which belonged to the petitioner, could not be attached for recovery of the alleged amount of tax evaded by the appellant. High Court set aside the impugned order to the extent of creating liability against the petitioner and the attachment order. Constitutional petition was allowed in circumstances.

Mian Muhammad Latif v. Province of West Pakistan PLD 1970 SC 180; Hamid Husain v. Government of Pakistan and others 1974 SCMR 356; Akhlaque Hussain Memon and others v. Water and Power Development Authority 2015 PLC (C.S.) 596; Mrs. Anisa Rehman v. P.I.A.C. and another 1994 SCMR 2232 and Siemens Pakistan Engineering Co. Ltd. v. Pakistan and others 1999 PTD 1358 ref.

Julian Hoshang Dinshaw Trust v. Income Tax Officer 1992 SCMR 250; Khalid Mehmood v. Collector of Customs 1999 SCMR 1881 and Chief Commissioner, Karachi and another v. Mrs. Dina Sohrab Katrak PLD 1959 SC (Pak) 45 rel.

(b) Constitution of Pakistan---

----Art. 10-A----Right to fair trial---Maxim audi alteram partem ---Applicability---Nobody should be condemned unheard---Authority is under duty to confront the person against whom any adverse order is being passed, with proper notice detailing the reasons for taking any adverse action---No adverse order can be passed against a person without issuing notice and/or confronting the said person before passing any order---Spirit of Art. 10-A of the Constitution was premised on said proposition of law.

Chief Commissioner, Karachi and another v. Mrs. Dina Sohrab Katrak PLD 1959 SC (Pak) 45 rel.

Haider Waheed and Muhammad Ahmed Masood for Petitioners.

Muhammad Sarfaraz Ali Metlo for Respondent (in C. P. No.D-3360 of 2013).

Amjad Javed Hashmi for Respondent (in C.P. No.D-5188 of 2013).

Dates of hearing: 13th and 14th January, 2016.

JUDGMENT

MUHAMMAD JUNAID GHAFFAR, J.---Through C.P. No.D-3360 of 2013 the petitioners have impugned Order dated 19.07.2013, passed by the Collector (Appeals), whereby, while deciding the appeal of respondent No.5, certain liabilities have been created in respect of the alleged evaded income tax against the petitioners, and for recovery of such amount, sale of property bearing No.2/7, Block-3, Clifton, Karachi has also been directed. In C.P. No.D-5188 of 2013, the petitioner has challenged the attachment order of the said property. Since a common issue is involved in both these petitions, the same are being finally decided through this common judgment. For ease of reference the petitioner in C.P. No. 5188 of 2013 who is also petitioner No.2 in C.P. No. 3360 of 2013 would be hereinafter referred to as ("D.J. Builders"), whereas, petitioner No.1 in C.P. No. 3360 of 2013 as ("DJM Securities").

2.Briefly the facts as stated are that DJM Securities is a Private Limited Company and a registered brokerage firm with Karachi Stock Exchange, whereas, D.J Builders is a partnership concern mainly dealing in the business of construction and ancillary services. It is stated that respondent No.5 used to work as Commission Agent of DJM Securities since 2004, and in the year 2011, it was alleged against him that he had under-declared the income in his tax return for the year 2005. The respondent No.5 was issued a Show Cause Notice by respondent No.4 (Additional Commissioner-A, Audit-1, RTO-II, Karachi) on the ground that he had filed his tax return as a salaried person and had not declared his source of income wherefrom, he had purchased certain shares/securities. Thereafter being dissatisfied by his explanation an amended assessment order dated 30.6.2011 was passed under Section 122(5A) read with 122(4) of the Income Tax Ordinance, 2001 by respondent No.4 and a liability of tax amounting to Rs.111,339,752/- was created and thereafter penal proceedings under Section 182 of the Ordinance, 2001 were also initiated and a penalty at the rate of 100% of the evaded tax was also imposed upon respondent No.5. Such amended assessment order was impugned before the Commissioner (Appeals), (Respondent No.3), wherein, altogether a different stance was taken by respondent No.5, by alleging that the undisclosed income was not his income but of DJM Securities and their directors. On the basis of such information and without any input from respondent No.2, Commissioner Appeals passed the impugned order dated 19.07.2013, whereby, Assessment Order was though confirmed, but it was further directed that such recovery be made from DJM Securities and its director, who was allegedly using his employee as his own agent. It was further ordered that such recovery be made by selling the property of D.J Builders as referred to hereinabove. Insofar as C.P No.D-5188 of 2013 is concerned the same is only to the extent of attachment proceedings in respect of the said property.

3.Counsel for the petitioners has contended that the impugned order has been passed without any lawful authority and jurisdiction as neither the Commissioner (Appeals) has any such lawful authority to travel beyond the Assessment Order impugned before him, nor the same could have been passed without any input/assistance from the concerned department/respondent No.2. Learned Counsel has further contended that neither the petitioners were provided any opportunity of being heard nor were ever confronted with any such assertions/allegations of respondent No.5, and therefore, the impugned order dated 19.07.2013 and subsequent order of attachment, both are nullity in the eyes of law having been passed without any lawful authority. He has further submitted that though after having obtained the impugned order, the petitioners did try to approach the Appellate Tribunal, Inland Revenue, but such appeal was not entertained as they were not a party to the said order nor it was passed in respect of their tax returns. In support of his contention counsel has relied upon the cases of Mian Muhammad Latif v. Province of West Pakistan reported as PLD 1970 Supreme Court 180, Hamid Husain v. Government of Pakistan and others reported as 1974 SCMR 356, Akhlaque Hussain Memon and others v. Water and Power Development Authority reported as 2015 PLC (C.S.) 596, Mrs. Anisa Rehman v. P.I.A.C and another reported as 1994 SCMR 2232 and Siemens Pakistan Engineering Co. Ltd. v. Pakistan and others reported as 1999 PTD 1358.

4.Conversely, Mr. Muhammad Sarfaraz Ali Metlo, Counsel for the respondent-department in C.P. No.D-3360 of 2013 has contended that instant petition is not maintainable as an assessment order has been passed which has been confirmed by the Commissioner (Appeals) and the appropriate remedy lies before the Appellate Tribunal, Inland Revenue, and not before this Court. He has further submitted that the petitioners had also approached the Federal Tax Ombudsman, who has rejected their complaint vide Order dated 08.01.2013; therefore, petition is also barred under sections 29 and 32 of the FTO Ordinance, 2000. Similarly Mr. Amjad Javed Hashmi, Counsel for respondent in C.P. No.5188 of 2013 has contended that a proper Notice under section 140 of the Ordinance 2001, read with Rule 158 of the Income Tax Rules, 2002 has been issued for attachment of' the property in question, therefore, petitioners can approach the Appellate Tribunal, Inland Revenue, for redressal of their grievance. He has further submitted that the Commissioner (Appeals) in terms of Section 129 of Ordinance, 2001 is fully competent to pass the impugned order, whereby, certain liability has been created against the petitioners. Learned DAG has also supported the arguments of the Counsel for the respondent-department and has contended that since an alternate remedy is available in the shape of an appeal before the Appellate Tribunal, Inland Revenue, instant petitions are liable to be dismissed.

5.While exercising his right of rebuttal learned Counsel for the petitioners, has submitted that insofar as complaint before the F.T.O. is concerned, the same was not filed by any of the present petitioners, whereas, such complaint was made before passing of the impugned order and, therefore, these petitions are very much competent before this Court as the petitioners are left with no other remedy.

6.We have heard all the Learned Counsel as well as Learned DAG and have perused the record. It appears that the facts as stated hereinabove are not in dispute that a Notice was issued under section 122(5)(A) of Ordinance, 2001, against respondent No.5 for having under declared his income and was confronted with certain information, which was obtained by the department from Central Depository Company Ltd., who manages sale and purchase of shares listed at Karachi Stock Exchange. The Respondent No.5 contested the issuance of notices through a Chartered Accountant and furnished reply, however, sought further time on more than one occasion to furnish details in respect of allegations of purchasing shares through CDC. Since he failed to respond any further despite several chances, the assessment order was passed as time for finalization of the proceedings was running out. Perusal of the Assessment Order dated 30.06.2011 reflects that though certain replies were furnished by respondent No.5 before the Departmental Authority, however, it was never pleaded that these shares were in fact benami in the name of DJM Securities and or its directors as contended subsequently by respondent No.5 before the Commissioner (Appeals). The only defence, which was put forth by respondent No.5, was in respect of certain exemptions for which he was entitled in terms of Section 111 of the Income Tax Ordinance, 2001 as he had received certain foreign remittances. The Assessment officer while passing the amended assessment order has accepted the same as valid remittances and has accordingly granted exemption to such extent. It further appears that pursuant to the assessment order an order of attachment dated 11.6.2012 was passed by the Deputy Commissioner, Inland Revenue, in respect of the property as referred to hereinabove, admittedly owned by the partnership concern Messrs D.J. Builders, in which Respondent No.5 had a 6% share until his retirement from the partnership. It also appears that when appeal was preferred by respondent No.5 against the Assessment Order, the Commissioner (Appeals) on the basis of written submissions of respondent No.5 came to the following conclusion, in the operative part of the impugned Order insofar as the grievance of the petitioner(s) before us is concerned and reads as under:--

"In support of his contention the appellant submitted his own affidavit and affidavit of Mr. Sadiq S/I Muhammad Saddique, who was an employee of Mr. Dawood Jan Mohammad in his firm namely Messrs DJ Builders. In their affidavits both the persons categorically state that Mr. Dawood Jan Mohammad and its company Messrs DJM Securities opened OD account in their name to carry out transactions of shares of listed companies with which they have no relation.

In view of the above circumstances of the case, the appellant has provided sufficient documentary evidence wherefrom it is evident that entire investment in shares actually belongs to DJM Securities (Pvt.) Limited. However, the impugned order passed by AC is completely silent over the above facts and he failed to appreciate and comprehend the serious nature of the case and transactions involved therein. The present case is a very peculiar case. The appellant, under the circumstances, was certainly used by M/s DJM Securities for their illegal transactions, but he cannot be absolved of his responsibility. It is clear that he was part of this "benami" arrangement in connivance with his employer company.

In view of above, the assessment order under question is hereby confirmed with directions that recovery be made from real owner of the investment namely M/s. DJM Securities (Pvt.) Limited and their director Mr. Dawood Jan Muhammad, who was running this company literally as an individual proprietorship and using his employees as his own agents. It is specifically directed that the recovery may be made through sale of the property No.2/7 Block-3 Sheme-5 Clifton which is owned by Ms. DJ Builders and Developers to which our appellant is a partner to the extent of 6% and the property already stands attached by the department.

It is also directed that the assessing officer should make proper use of the information available in the written arguments and also in the body of this order about the "benami" account holders who employees were working for Messrs DJM Securities and their director Mr. Dawood Jan Mohammad. The respective assessment should be re-opened forthwith as per provisions of the law."

7.Perusal of the aforesaid order reflects that contention of respondent No.5 has been accepted by the Commissioner (Appeals), whereby, he had sworn affidavit to the extent that all these transactions were in fact done by DJM Securities and its Directors and after coming to such conclusion, the Commissioner (Appeals) observed that the impugned order is completely silent in respect of said facts, whereas, the Assessing Authority had failed to appreciate and comprehend the serious nature of the case and the transactions involved therein. It may be of relevance to state that the impugned order has not recorded any findings insofar as D.J. Builders is concerned. It would not be out of place to observe that the entire allegations were against DJM Securities and its director(s), and at no point of time it was ever alleged by Respondent No.5 that D.J. Builders had any concern whatsoever in respect of such transactions. The Commissioner (Appeals) went on to further hold that respondent No.5 was part of this benami transaction with the connivance of his employer Company and though he has held that the amended assessment order was required to be confirmed, however, directed the department to recover the amount from the alleged real owner of the investment, i.e. DJM Securities and its directors by selling the property of M/s D.J. Builders as detailed hereinabove. There is no dispute and nor has it been controverted on behalf of the respondents that any notice was ever issued to the petitioners either by the Inland Revenue department or by the Commissioner (Appeals). Even Respondent No.4, who had passed the assessment order in appeal, was not before the Commissioner (Appeals). In fact perusal of the order of Commissioner (Appeals) reflect that even after passing of an adverse order against the petitioners, not even copy of the same was addressed or sent to them. In such circumstances, the objection in respect of maintainability of instant petition as raised by both the learned Counsel for the petitioners does not seem to be justifiable. It is trite law that nobody should be condemned unheard, whereas, before passing of any adverse order, it is incumbent upon the authority to confront the person against whom such order is being passed with a proper notice detailing the reasons for taking any adverse action. Though normally the Courts are not inclined to exercise the Constitutional jurisdiction in matters of fiscal nature wherein a complete mechanism of alternate remedy in the form of Quasi-judicial forums (like Commissioners/Collectors of Appeals) and Appellate Tribunals have been provided under the respective special laws concerning such fiscal matters. However, such rule is not absolute and Constitutional jurisdiction can be exercised in appropriate cases, involving fiscal rights and on the allegation of misapplication of law or abuse of power stepped in to examine whether or not public functionary concerned acted in accordance with the powers conferred on him by the statute (Julian Hoshang Hinshaw Trust v. Income Tax Officer 1992 SCMR 250), and of such alternative remedies also there are some, which would still leave the jurisdiction of the High Court virtually unaffected, if the order, complained of, is so patently illegal, void or wanting in jurisdiction that any further recourse to or prolongation of the alternative remedy may only be counterproductive and, by invocation of Article 199 the mischief can forthwith be nipped in the bud (Khalid Mehmood v. Collector of Customs 1999 SCMR 1881) Notwithstanding this, the petitioners have even approached the Appellate Tribunal, Inland Revenue, with an appeal but such appeal has not been entertained, therefore, the petitioners being remedyless have rightly approached this Court under Article 199 of the Constitution of Pakistan, 1973, and there cannot be any exception to this. In the circumstances when the order of Commissioner (Appeals) being without any lawful authority and jurisdiction insofar as the petitioners before us are concerned, whereas, even the attempt of the petitioners by filing an appeal and seeking such remedy has been refused and not being attended to, it is held that these petitions are very much maintainable before us.

8.After having perused the order of the Commissioner (Appeals), we are of the view that in the circumstances since the power to remand the case to the assessing officer vested no more with the Commissioner (Appeals), w.e.f. Finance Act, 2005, the Commissioner (Appeals) on his own could have confronted the petitioners by issuing a notice before passing any adverse order against them. The powers of Commissioner (Appeals) are governed by Section 129 of the Income Tax Ordinance, 2001, which reads as under:--

"129. Decision in appeal.-

(1)In disposing of an appeal lodged under section 127, the Commissioner (Appeals) may---

(a)make an order to confirm, modify or annul the assessment order, after examining such evidence as required by him respecting the matters arising in appeal or causing such further enquiries to be made as he deems fit;

(b)in any other case, make such order as the Commissioner (Appeals) thinks fit.

(2)The Commissioner (Appeals) shall not increase the amount of any assessment order or decrease the amount of any refund unless the appellant has been given a reasonable opportunity of showing cause against such increase or decrease as the case may be. (Emphasis supplied)

(3)*******

(4)********

(5)*******

(6)*******

(7)*******

Perusal of the aforesaid provisions reflects that even in case of a party who is an appellant before the Commissioner, the modification of the assessment order, whereby, the interest of the appellant is affected, a mandatory notice has been provided under the law before any such modification order could be passed by the Commissioner (Appeals). Whereas, in the instant matter the Commissioner (Appeals) has in fact made the order of assessment applicable on DJM Securities and its director and in addition he has also directed the department to recover the amount by selling the property owned by D.J. Builders against whom in effect there is no order for recovery or for passing of any amended assessment order in terms of Section 122(5)(A). This in our view is against the spirit of law as well as the Constitution which provides that nobody should be condemned unheard or without providing any opportunity of hearing. The Hon'ble Supreme Court in the case of Anisa Rehman (supra) has been pleased to observe that "it is evident that there is judicial consensus that the Maxim Audi Alteram Partem is to be read into as a part of every statute if the right of hearing has not been expressly provided therein". Similar view has been expressed by the Hon'ble Supreme Court in the case of Chief Commissioner, Karachi and another v. Mrs. Dina Sohrab Katrak (PLD 1959 SC (Pak) 45), that "It cannot be disputed that it is a principle of natural justice that no one should be dealt with to his material disadvantage or deprived of his liberty or property without having an opportunity of being heard and making his defence. That being so when a statute gives a right of appeal it should be understood as silently implying when it does not expressly provide that the appellant shall have the right of being heard..". Further the above provision also empowers the Commissioner (Appeals) after examining such evidence as required by him respecting the matters arising in an appeal or causing such further enquiries to be made as he deems fit, whereas, the learned Commissioner (Appeals) after having come to a definite finding that new material was placed before him which the authorities below had failed to appreciate, was duty bound to issue a proper notice to the petitioners to defend themselves. In fact in terms of Section 129(2) of the Ordinance, 2001, the Commissioner (Appeals) cannot even increase the amount of any assessment order or decrease the amount of any refund unless the appellant before him has been issued a proper notice for showing cause for such increase or decrease, as the case may be, then how can any liability be created against a person who is not even a party to the proceedings. This in our opinion is the minimum requirement under the law, as by now it is a settled proposition that no adverse order can be passed against a person without issuing notice and or confronting the said persons before passing any order. The spirit of Article 10-A of the Constitution is also premised on such settled proposition of law. However, it appears that the Commissioner (Appeals) has travelled beyond the scope and mandate of law by passing the impugned order while creating liability against the petitioners, and by further ordering sale of the property in question. In the circumstances, we do not see any reason, whereby, the impugned order to the extent of recovery of the alleged amount adjudged against the petitioners and sale of the property in question can be sustained. Therefore, we are of the view that insofar as this part of the impugned order of Commissioner (Appeals) is concerned which has seriously prejudiced the interest of the petitioners cannot be sustained and is hereby set aside.

9.Moreover, it further appears that the Commissioner (Appeals) had also directed the Assessing Officer for making the proper use of the information available in the body of the impugned order in respect of the benami account holders and the employees of the petitioner(s) and its directors, and further, to reopen the Assessment Order in accordance with law forthwith. On a query of this Court both the learned Counsel for the respondent/department have not been able to assist us as to whether, any such proceedings were initiated against the petitioner(s) and or their directors for amending their individual/Companies Assessment Orders as provided under Section 122 of the Ordinance, 2001. The Para-wise comments filed on behalf of respondents are also silent to this effect. This inaction on the part of the respondent/department is totally unjustified and no explanation has been given as to why the impugned order of the Commissioner (Appeals) was only implemented to the extent of attachment and not by making any efforts to pass amended Assessment Orders under section 122 of the Ordinance, 2001. The Ordinance, 2001 is very clear and specific for such an eventuality as provided under Section 124 of the Ordinance, 2001, which reads as under:--

"124. Assessment giving effect to an order.-

(1)Except where subsection (2) applies, where, in consequence of, or to give effect to, any finding or direction in any order made under Part Ill of this Chapter by the Commissioner (Appeals), Appellate Tribunal, High Court, or Supreme Court an assessment order or amended assessment order is to be issued to any person, the Commissioner shall issue the order within two years from the end of the financial year in which the order of the Commissioner (Appeals), Appellate Tribunal, High Court or Supreme Court, as the case may be, was served on the Commissioner.

(2)Where, by an order made under Part III of this Chapter by the Commissioner (Appeals), Appellate Tribunal, High Court, or Supreme Court, an assessment order is set aside wholly or partly, and the Commissioner is directed to make a new assessment order, the Commissioner shall make the new order within one year from the end of the financial year in which the Commissioner is served with the order:

Provided that limitation under this subsection shall not apply, if an appeal or reference has been preferred, against the order setting aside the assessment, passed by a Commissioner (Appeals), Appellate Tribunal or a High Court.

(3)Where an assessment order has been set aside or modified, the proceedings may commence from the stage next preceding the stage at which such setting aside or modification took place and nothing contained in this Ordinance shall render necessary the re-issue of any notice which had already been issued or the re-furnishing or re-filing of any return, statement, or other particulars which had already been furnished or filed.

(4)Where direct relief is provided in an order under section 129 or 132, the Commissioner shall issue appeal effect orders within two months of the date the Commissioner is served with the order.

(5)Where, by any order referred to in subsection (1), any income is excluded -

(a)from the computation of the taxable income of a taxpayer for any year and held to be included in the computation of the taxable income of the taxpayer for another year; or

(b)from the computation of the taxable income of one taxpayer and held to be included in the computation of the taxable income of another taxpayer,

the assessment or amended assessment relating to that other tax year or other taxpayer, as the case may be, shall be treated as an assessment or amended assessment to be made in consequence of, or to give effect to, a finding or direction contained in such order.

(6)Nothing in this Part shall prevent the issuing of an assessment order or an amended assessment order to give effect to an order made under Part III of this Chapter by the Commissioner (Appeals), Appellate Tribunal, High Court, or Supreme Court.

(7)The provisions of this section shall in like manner apply to any order issued by any High Court or the Supreme Court in exercise of original or appellate jurisdiction.

As discussed hereinabove, nothing has been placed on record before us as to suggest that the respondent department had in fact given effect to the order of the Commissioner (Appeals) under Section 124 of the Ordinance whereby the Commissioner (Appeals) had directed them to reopen the assessment orders of the petitioners and or its Directors. We fail to understand as to why such proceedings were not initiated after passing of the impugned order. It would not be out of place to observe that there are certain limitations for initiating such proceedings and we are afraid that perhaps such time has already lapsed whereas, no plausible justification or reason has been given neither in the comments nor by the learned Counsel appearing for the respondent department. In the circumstances though we have set aside the impugned order dated 19.7.2013, to the extent of creating liability against the petitioners, however, we are left with no option but to send a copy of this judgment to Chairman FBR as well as Member, (Inland Revenue) and Member (Legal), FBR, Islamabad, for conducting an appropriate inquiry as to why after passing of the order by the Commissioner (Appeals) no further proceedings were initiated and to hold responsible such delinquent officers, if any, and further to take appropriate action against them in accordance with the Service rules, if deemed appropriate.

10.Insofar as the issue that respondent No.5 was a partner of 6% share in D.J. Builders is concerned, perusal of the record reflects that respondent No.5 had retired from the partnership concern on 25.08.2011, which was duly recorded before the Registrar on 11.10.2011, whereas, the impugned order of the Commissioner (Appeals) as well as the Order of attachment under section 140 of the Ordinance 2001, were passed subsequently, therefore, in all fairness for recovery of the alleged amount of tax from respondent No.5, the property in question, which belongs to a partnership concern, in which he was no more a partner and had retired since long cannot be effected. It is also pertinent to observe that insofar as the Assessment Order is concerned, as observed earlier, it was in respect of respondent No.5 only, whereas, no proceedings were ever initiated against the petitioners and or its directors/partners individually or collectively, therefore, the property which belongs to them cannot be legally attached for recovery of alleged amount of tax evaded by respondent No.5.

11.In view of hereinabove facts and circumstances of the case we are of the view that insofar as the impugned order dated 19.7.2013, to the extent of creating liability against the petitioners without providing any opportunity of being heard and even without any notice of whatsoever nature is concerned, cannot be sustained, being without any lawful authority and justification, therefore, is hereby set aside. Resultantly petition bearing C.P. No. 3360 of 2013 is allowed to that extent, however, subject of observations at Para 9 above. Insofar as C.P. No. 5180 of 2013 is concerned, since the same is in respect of attachment of property pursuant to impugned order dated 19.7.2013, which stands set aside as above, this petition is also allowed by setting aside the attachment order dated 11.6.2012 to the extent of petitioner, whereas, the same shall not affect the recovery proceedings insofar as respondent No.5 is concerned.

12.Both the petitions are allowed as above.

SL/D-7/SindhPetitions accepted.