P L D 1990 SC 399




Pre Abdul Kadir Shaik, J.(a) Constitution of Pakistan (1973), Art.185(3)—
r/w Income-Tex Ordinance (XXXI of 1979)—S. 65—

That the Income-tax Officer in seeking to reopen the past assessments for the last 9 years under section 65 of the Income-tax Ordinance, 979 acted beyond his jurisdiction because all material facts were already on the record of the Income-tax Department on the basis of which his predecessors had held that the petitioner was liable to be assessed as a property holding company i.e. a Company not carrying on the business of buying and selling properties. There was no suppression or concealment of any facts but merely a change of opinion by the respondent, Income-tax Officer, as to the inference to be drawn from the same facts. There was, thus, no legal basis for proceeding under section 65 of the Income-tax Ordinance.
That the High Court erred in law in considering that the petitioner had an adequate remedy under the Income-tax Act against the proceedings initiated against it. There is, in fact, no remedy in the Income-tax Act against the issuance of a wrongful notice. The Constitutional petition could not, therefore, have been dismissed as premature but deserved to be decided on merits.

That the assessment orders passed by the Income-tax Officer on 26-12-1982 are not valid and legal, because they were passed after the issuance of the stay order by this Court (on 23-12-1982). In so far as a stay order is operative and takes effect as soon as it is passed, vide 1974 S C M R 509, the circumstance that it might have been communicated to the respondent Income-tax officer after he had passed his assessment
order on 26-12-1982, would not make any difference because this Court had passed the order of stay three days earlier on 23-12-1982.
Appeal allowed.

Advocate for the appellants:
Khalid Anwar, Advocate SC & S.M. Abbas, Advocate-on-record.

Advocate for the Respondent:
Mansoor Ahmed Khan, Advocate SC, M.S.Ghaury & Muzaffar Hassan, Advocate-on-Record.

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