KARACHI: Hearing a bunch of appeals including Constitutional Petitions No.D-1359, 1360 and others filed by M/s. Sakrand Sugar Mills Limited: (in C.P. No.D-1359 of 2021)
M/s. Sakrand Sugar Mills Limited, Popular Sugar Mills Ltd, M/s. Matiari Sugar Mills Limited: (in C.P. No.D-1484 of 2021), M/s. Sanghar Sugar Mills Limited, M/s. Darya Khan Sugar Mills Ltd, M/s. Darya Khan Sugar Mills Ltd, Khairpur Sugar Mills Ltd, M/s. Digri Sugar Mills Ltd, M/s. Faran Sugar Mills Limited.
M/s. Ranipur Sugar Mills and M/s. Habib Sugar Mills Limited against In-Land Revenue (Income Tax), a tax appellate bench of High Court of Sindh disposed of the same with the directions to the petitioners to make proper reply to Show Cause Notice (SCN) issued to them by the department.
The bench heard Saleem Mangrio Advocate, counsel for the petitioners and counsel for respondents and after discussing the facts of the case held that proceedings for imposition of penalty, as stated above, are either criminal or quasi criminal in nature and burden in this regard is always upon the department to prove that the person has brought himself in the ambit of the penalty, as clearly spelt out under Sections 111 and 182 of the Ordinance, and simply on the ground that the assessee has failed to satisfactorily explain the amount/income would not/should not be considered as a valid reason warranting the department to impose the penalty. It may also be noted that in penalty proceedings the department has to establish independently, on the basis of the material available on record, the reasons for imposition of penalty.
“In view of the above discussion, we dispose of these petitions by directing the petitioners to give a proper/detailed reply to the department in respect of the SCNs issued by them, for imposition of penalty under Section 182 of the Ordinance, and the department in this regard is legally bound to consider the said reply and thereafter to pass a speaking order after granting opportunity of hearing to the petitioners strictly in accordance with law”.