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MEHAR PERVAIZ AKHTAR versus DIRECTOR GENERAL EXCISE AND TAXATION, LAHORE

23 23, 24, 4, 10A and 7 - General Clause Act (X of 1897), Section 24AA The authority to impose and receive taxes Constitutional provision for the protection of property and property rights of citizens - Procedure and Assessment of the enforcement of natural justice taxation The non-cooperation of taxpayers in the assessment process as a violation of legitimate action tax The authority to impose tax was the primary and special feature of the State under Article 7 of the Constitution. However, the mandatory effect of tax enforcement and tax collection was to deprive a citizen of his property, which he was entitled to under Article 23 of the Constitution and Article 24 of the Constitution, not to deprive him of his property. Who was saved. Under the law, the assessment of any citizen's non-participation in the assessment process was not only a refusal to file a fair trial and to deal with the law against it, but was a gross violation of due process. The purpose was to protect the citizenry at its discretion. Use of executive power; used without following a specific course of law?

P L D 2017 Lahore 790

Before Shahid Jamil J

Mehar PERVAIZ AKHTAR—Petitioner

versus

DIRECTOR GENERAL EXCISE AND TAXATION, LAHORE and others—Respondents

Writ Petition No.3851 of 2017, heard on 24th May, 2017.

(a) Constitution of Pakistan—

—Arts. 23, 24, 4, 10A & 7—General Clauses Act (X of 1897), S.24-A—Power of State to impose and collect taxes—Constitutional provisions as to property of citizens and protection property rights— Due process and natural justice in imposition of taxes—Nonassociation of tax payer in assessment proceedings as a violation of due process—Scope—Power to impose tax was predominant and paramount attribute of the State under Art. 7 of the Constitution; however imposition and collection of tax necessarily had an effect of depriving a citizen from his property, to which he was entitled under Art.23 of the Constitution and Art. 24 of the Constitution bestowed a Fundamental Right that he shall not be deprived of his property which was saved under law—Non-association of any citizen in assessment proceedings, for charging of a tax not only amounted to denial of fair trial and dealing with him against the law, but was a sheer violation of due process which was meant to protect a citizen from arbitrary use of executive power; exercised without following exact course of law—

Such non-association in assessment proceedings also amounted to condemning a citizen unheard —Assessment of a tax, levied under a valid statute, was meant to determine the tax liability subject to conditions stipulated in law and a taxpayer, who fell within the mischief of a charging provision had Fundamental Right to defend himself from such levy or its charging as per the conditions under a statute—Any doubt in the charging provision had to be resolved in favour of the taxpayer because it deprived the taxpayer from his/her property, therefore, the same fell within the exception under Art. 24 of the Constitution—For providing opportunity to defend, issuance of show cause notice was mandatory, therefore, any assessment order without issuance and due service of the show-cause notice was a nullity in law and if a statute did not provide specifically for issuance of show cause notice, such procedure had to be prescribed by subordinate legislation under said statute—On receipt of reply to such show-cause notice, an assessing officer was bound to provide opportunity of being heard and pass a reasoned assessment order as required under S.24A of the General Clauses Act, 1897 and communication or service of such assessment order, as per law, was a necessary requisite of due process, absence of which denied the right of appeal or revision under the law and any demand of tax or coercive measures for its recovery, without due process was illegal, being violative of the Arts, 10A, 4 read with Arts, 23 & 24 of the Constitution, [pp. 795, 796] A & B

, Messrs Mustafa Impex v. The Government of Pakistan PLD

2016 SC 808 rel.

(b) Punjab Urban Immovable Property Tax Act (V of 1958)—

—Ss, 10, 4, 8, 9 14 & 15—Constitution of Pakistan, Art, 199— Punjab Urban Immovable Property Tax Rules, 1958, Rr, 7, 11 & 10— Recovery of property tax—Valuation of property—Objections of taxpayers*--Exemption—Adjudication of objections by authorities— Communication of reasons to taxpayers)—Scope—Petitioner impugned notice for sealing of his premises as well demand notice for property tax issued under the Punjab Urban Immovable Property Tax Rules, 1958, on the ground that the same were issued without following the process prescribed under the law and without associating petitioner in the assessment proceedings and the valuation of the property was done without confronting the petitioner about the same—Validity—Form P.T.l was an assessment order containing all the assessed infÓrm;ation regarding property to be taxed and duly authenticated by the assessing authority and R, 11 of Punjab Urban Immovable Property Tax Rules, 1958 was silent about communication of said fÓrm; to taxpayer and if S,10 of the Punjab Urban Immovable Property Tax Act, 1958 was

examined, it provided t. t ight of appeal and revision to a taxpayer— Person aggrieved by an order of appropriate authority upon which objections made before that authority under Ss. 8, 9, 14 or 15 Punjab Urban Immovable Property Tax Act, 1958 may file appeal against such order within thirty days, however, procedure for communication of the reasons for rejection of the objections was not provided under the Punjab Urban Immovable Property Tax Rules, 1958 and R.10(4) envisaged that the reasons for the disposed of objections shall be recorded in register and through said register, as well as, P.T.l is open to inspection, yet order in this regard was never communicated to the taxpayer—High Court observed that such practice or procedure could not be allowed to be continued and directed that the Provincial Government revise the Punjab Urban Immovable Property Tax Rules, 1958 accordingly and till such revision the Authorities shall communicate the reasons for rejection of the objections in writing to the taxpayer and shall also communicate a copy of Form P.T.l to the taxpayer on taxpayers' address, enabling Mm to seek his right of appeal or revision and limitation for same shall commence from the date of such communication—High Court held that impugned notices for sealing of property in the present case, the valuation list and assessment was completed without following mandatory provisions/procedure and were declared without lawful authority and set aside—Constitutional petition was allowed, accordingly, [pp. 798, 799, 801, 802] C, D, E, F & G

Muhammad Khalid Qureshi v. Province of Punjab through • Secretary Excise and Taxation Department, Lahore and another 2017 PTD 805 rel.

Ch. Shafat Ali and Mughees Aslam Malik for Petitioner.

Umar Farooq Khan and Malik Muhammad Bashir Lakhesir, Assistant Advocates General, Punjab for Respondents Nos. 1 to 4.

Mian Muhammad Ashfaq Hussain for Respondent No.5/Pakistan Railways.

Tariq Manzoor Sial, Amicus Curiae.

Qurban Ali Shahid, Excise and Taxation Officer, Vehari, Bashir Ahmad Kharal, Assistant Excise and Taxation Officer, Vehari, Rana Sakhawat Ali, Excise and Taxation Officer (Property Tax) Multan, and Munawar, Inspector Legal Excise and Taxation Department.

Date of hearing: 24th May, 2017.

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