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I.T.As. Nos. 46(PB) and 47(PB) of 1985‑86, decided on 28th February, 1986.

‑‑‑Ss. 57 & 111‑‑Expression "without prejudice to any liability incurred" occurring in S.57‑‑Meaning‑‑Provisions of S.57 are comprehensive and cannot be circumvented by restricted meaning‑‑ Assessee, any time, during course of proceedings, can revise his return to show his total income‑‑Imposing of penalty on revising return by assessee, held, would mean denial of permission allowed by statute.

Zulfiqar Ali, D.R., A.C. for Appellant.

Nemo for Respondent.

Date of hearing: 5th February, 1986.

These two appeals filed by the department are directed against the order of learned CIT (Appeals), dated 12‑5‑1985, whereby he remitted the penalty imposed on the assessee under section 111 of the Income‑tax Ordinance, 1979 for concealment of income relating to charge years 1980‑81 and 1981‑82.

The assessee filed a return for the charge year 1980‑81 'showing income at Rs.61,683. During the course of proceedings he filed a revised return, raising income to Rs.74, 283. Similarly, for the charge year 1981‑82 he revised his return to include hotel income amounting to Rs.12,800. The assessee explained that the amount included by revising returns represented hotel income, which had been separately assessed. The I. T. O. did not accept this explanation and finding that it was concealment on the part of assessee to have left out the amount from original returns. Accordingly, he penalized him under section 111 ibid. The assessee went in appeal disposing of which the learned C.I. T. (Appeals) remitted the penalty observing that it was legally permissible for the assessee to‑ revise his returns before finalization of the proceedings. Hence these appeals by the department.

The learned D.R. argued that the assessee had already incurred liability to suffer penalty and the benefit of section 57 would not extend to him. He referred to the words "without prejudice to any liability incurred" occurring in the said section. According to him, liability to be penalized remains even after revising of return. Once it is found that omission had occurred necessitating revision of return, penalty will have to be suffered, he submitted.

The learned D.R. has misconstrued the words. The same do not mean as understood by him. For revising return there is no penalty provided in the Ordinance. On the contrary, there is open permission to revise return during the course of proceedings. It will make no sense if permission was given as also penalty was imposed. Imposing penalty would mean denial of permission allowed by the statute. Accordingly, I am not inclined to go along to uphold the argument of the learned D.R. The provision of section 57 is comprehensive and cannot be circumvented by restricted meaning. Any time, during the course of proceedings, return can be revised to show total income. The assessee did the same and for it the Ordinance provides no penalty. Accordingly, no penalty was imposable on him and the learned C.1. T. (Appeals) rightly so held.

The result is that the appeals fail and are hereby dismissed.

M. B. A. Appeals dismissed.

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