LAHORE, July 3: The Lahore High Court on Friday fixed Oct 9 for final arguments on the petitions of tax department, seeking payment of additional income and wealth tax from PML-N president Shahbaz Sharif and his sister-in-law Begum Kulsoom Nawaz.
Justice Nasim Sikander, who had earlier admitted the petition for regular hearing, observed that court would hear both the parties at length after the summer vacation.
The tax authorities claimed that Shahbaz Sharif was liable to pay Rs6.1 million as additional income and wealth tax. The total additional tax liability of Kulsoom Nawaz was Rs3.7 million.
Both members of Sharif family had failed to deposit the tax regarding assessment years 1994-95, 1995-96, 1996-97, 1997-98 within the stipulated period.
It was further claimed that Mr Shahbaz and Begum Kulsoom were rightly penalised through additional tax demand following their failure to deposit the same on time.
The tax was paid on Aug 30, 2002, when both Shahbaz and Kulsoom had become liable for the payment of additional tax payment.
It was claimed that both the Sharifs were issued notices for the payment of their respective wealth tax liabilities. The penalty for the payment of additional tax was imposed under the law.
The recovery of the additional tax had already been stayed by the court till the disposal of the petition.
Sharifs counsel Tariq Aziz submitted that the orders for the payment of additional tax was unlawful and violative of Section 31(3) of the Wealth Tax Act, 1963.
Shahbaz claimed that he had paid the entire tax demand on Aug 30, 2002, for the assessment years 1997-98 and 1999-2000. The order claiming payment of Rs3.2 million as additional wealth tax for the four respective assessment years was passed on Sept 30, 2002, when no tax was due from him.
Begum Kulsoom Nawaz paid the tax demand due from her, prior to the service of additional tax notice asking her to pay the additional wealth tax demand for the four assessment years.
The two Sharifs jointly claimed that payment of entire tax demand on Aug 30, 2002, stood admitted by the tax authorities and the additional wealth tax penalty was unlawful.
“The impugned order is repugnant to Article 18 of the 1973 Constitution, and is confiscatory on its face since no demand of wealth tax stood outstanding on Sept 30, 2002,” the Sharifs counsel submitted. He also claimed that the tax authorities had not yet decided the two Sharifs’ appeals against the orders for the payment of additional income and wealth tax for the last one year despite the fact that payment was made on Aug 30, 2002.
He argued that under Section 31(3) of the Wealth Tax Act, 1963, the wealth tax officer, in exercise of his discretion, could treat an assessee as a defaulter as long as his appeal against the tax demand was pending.
The court was requested to set aside the order for payment of additional wealth tax passed under Section 31(B)(2) of the Wealth Tax Act, 1963.