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No one be judge in his own cause!


Huzaima Bukhari & Dr. Ikramul Haq

In Karachi one Additional Commissioner in an order passed under section 122(5A) of the Income Tax Ordinance 2001 [hereinafter “the Ordinance”] declared the judgement of honourable Sindh High Court in Honda Shahra-e-Faisal v CIT 2005 PTR 63 (H.C. Kar.) as per incuriam in utter violation of Article 201 of the Constitution of Pakistan.

All judicial and quasi-judicial proceedings need to adhere to certain basic norms of justice. One of the cardinal principles of such basic norms is that one cannot be a judge in his own cause. Section 122(5A) of the Ordinance as it stands now makes the Commissioner of Inland Revenue (CIR) a judge in his own cause as first of all he delegates all his powers to a taxation officer and once an order is made by him, he may declare that the delegated officer applied the law incorrectly! What a mockery of ‘due process of law’ that in fact he is posing as judge in his own cause. How can he declare his own orders [though passed by somebody else on his behalf as envisaged in section 211] as incorrect? This would certainly be a wanton breach of the basic norm of justice. This breach certainly amounts to infringing ‘the right of access to justice’, which is an inviolable fundamental right enshrined in Article 4 of the Constitution. This right is equally founded in the doctrine of ‘due process of law’—New Jubilee Insurance Company Limited, Karachi v National Bank of Pakistan, Karachi PLD 1999 SC 1126.

The ‘right of access to justice’ includes the right to be treated according to law, the right to have a fair trial, proper opportunity of being heard and the right to have a just and impartial court/tribunal/authority. The term due process of law, as elaborated by the honourable apex court in the case of New Jubilee Insurance Company Ltd (supra) can be summarised as under:

  1. a person shall have notice of the proceedings which affect his rights;
  2. he shall be given reasonable opportunity to defend;
  3. that the tribunal, court of authority before which his rights are adjudicated is so appointed/constituted as to give reasonable assurance of its honesty and impartiality; and
  4. that it is a court/authority of competent jurisdiction.

These basic requirements of the doctrine of ‘due process of law’ are embodied inter alia in Articles 4 and 10A of the Constitution and is intrinsically linked with the right to have access to justice—a fundamental right. This right, inter alia, includes the right to have protection against abuse of powers. When the CIR under section 122(5A) assumes the role of a judge in his own cause, any action under this provision of the Ordinance amounts to a manifest and blatant violation of the due process of law. Needless to say that this provision as it stands now is unconstitutional in view of Articles 4. 10A and 25 of the 1973 Constitution.

The moot question is about jurisdiction under section 122(5A) of  the Ordinance that is pari materia  or analogous to section 66A of repealed Income Tax Ordinance, 1979 [hereinafter “the repealed Ordinance”] as held by the Apex Court in CIT v. Eli Lilly Pakistan (Pvt.) Ltd and other (2009) 100 TAX 81 (S.C. Pak.) as under:

“It may be observed that section 66A of the repealed Ordinance provided for revision of the assessment orders, hence generally speaking it was pari materia, not with section 122 but with section 122A of the Ordinance, which provided for revision of the proceedings under the Ordinance. Subsection (5) is pari materia with section 65 of the repealed Ordinance inasmuch as the grounds earlier provided for additional assessment were made the grounds for amendment or further amendment under that subsection while section 66A of the repealed Ordinance qua grounds for revision is pari materia with subsection (5A)

[Emphasis ours]

Harmonious interpretation, not destroying the scheme provided by the Legislature, is clear:

  1. Return filed under Universal Self-Assessment Scheme becomes assessment order the moment it is filed without any conscious application of mind [section 120(1)]. 
  2. If any return under section 120 is not acceptable for any reason on actual or alleged basis causing loss of revenue, section 120(1A) of the Ordinance authorizes the Commissioner to select the case for audit as recently held by this august Court in CIR v. Messrs Allah Din Steel & Rolling Mills and others (2019) 119 TAX 27 (S.C. Pak.):

In terms of section 177 of the Ordinance, the Commissioner can call for the record or documents for conducting the audit of the tax affairs of a person, provided he furnished reasons to do so.”

  1. If there is any error, action under section 221 of the Ordinance can be taken after giving notice.
  2. As a result of table/regular audit, assessment order can be passed as provided in section 177 or in case of non-compliance order can be passed under section 121 of the Ordinance.
  3. The revisional jurisdiction can only be exercised after an order made by conscious application of mind is passed and which is erroneous as well as prejudicial to the interest of revenue. This principle has been laid down by honourable Lahore High Court  in Sandal Engineer (Pvt.) Ltd v. IAC (2001) 83 Tax 551 (H.C. Lah.)as under:

“As a rule revisional jurisdiction is never exercised by the same authority.  The power to revise, be it suo motu or on the application or 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 act 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, on 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.”

Appeal against the above decision was dismissed by Supreme Court in CA No.1350, 1351 & 1352 of 2001 dated 27.04.2006 as it was withdrawn by FBR.

As in the repealed Ordinance, Legislature provides that only Additional Commissioner or Commissioner will exercise revisional jurisdiction under section 210(1A) of the Ordinance. If jurisdiction of a case is, however, assigned to an Officer of Inland Revenue below Grade-19 under section 209(2), only then the revisional jurisdiction can be directly exercised by Additional Commissioner as per section 210(1A) of the Ordinance. The department cannot invoke section 122(5A) as a routine, similar to notice under section 62 of the Repealed Ordinance as it would negate the very purpose of revisional jurisdiction which can be exercised if there is order by an officer of Inland Revenue that is erroneous and prejudicial to the interest of revenue as the department has no remedy to file appeal against its own order.

A person cannot be judge in his own cause—New Jubilee Insurance Company Ltd., Karachi v. National Bank of Pakistan, Karachi [PLD 1999 SC 1126], so therefore, after passing an order the same authority cannot revise it to that extent he/she becomes functus officio. There is nothing wrong in the Ordinance as far as revisional jurisdiction is concerned and the scheme prevalent in the repealed law has been retained, as was the case in the repealed Ordinance. The department is, therefore abusing it—contravening the law


The writers, lawyers and partners of Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences (LUMS), members Advisory Board and Visiting Senior Fellows of Pakistan Institute of Development Economics (PIDE)

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