Income Tax (Case Laws)

Application of Section 3B of the Punjab Agricultural Income Tax Act, 1997 is based upon the agricultural income as declared by the assesse himself in his income tax return under the Ordinance. In this context, it is worthy to reiterate Section 3(1) of the Punjab Read More...

Failure to pay tax collected or deducted----payment for goods, services and contracts----Scope----Case against taxpayer related to non-deduction/non-payment of withholding tax which surfaced violation of the provisions of Ss.153 & 161 of the ITO Read More...

Constitutional matter, decision of---Principle---Cardinal principle while exercising Constitutional jurisdiction is that courts should abstain from deciding a Constitutional question, if a case could be decided on other or narrower Read More...

Headings---Object, purpose and scope----Headings do not control meaning and do not define its scope---Headings may assist in interpretation of a section, if words appear to be doubtful, however, they cannot restrict plain words of the Read More...

Constitutional petition-Tax due-Recovery--- Reconciliation--- Dispute was with regard to notice of recovery of tax due issued under S.161 of Income Tax Ordinance, 2001--- Rational in S. 161 (1B) of ITO 2001, was that a tax liable to be Read More...

Sales tax at import stage-Exemption from income tax-Petitioners were running their manufacturing units in erstwhile Provincially Administered Tribal Areas, who sought tax exemption over raw material imported by them---Clause No. 146 of Read More...

Appeal to the Appellate Tribunal---Stay of proceedings--- Scope-Appellant/assessee sought stay of proceedings in consequence of an order passed by Commissioner Inland Revenue (Appeals)--- --Commissioner Inland Revenue (Appeals) had annulled the order of the Read More...

Tax demand-Record, maintenance of--Limitation- Failure to pay tax collected or deducted-Authorities issued notice for recovery of tax for the period beyond six years---Appellate Tribunal Inland Revenue set aside the demand created by tax Read More...

Assessment---Oral gift-Non-registration of gift declaration--Authorities were aggrieved of accepting unregistered oral gift of immovable property held by assessee---Gift deed executed under Transfer of Property Act, 1882, was required to be registered compulsorily Read More...

Super tax, vires of--Charging section-Retrospective effect Property rights-Petitioners / taxpayers sought striking down of S.4B of Income Tax Ordinance, 2001, on the plea that charging section could not be retrospective in Read More...

Amendment-Inconsistency--Scope-Law accepts that amendment becomes a part of original statute and both ought to be construed together-In case of any inconsistency, harmonization may be employed so as to impede an irreconcilable Read More...

Discrimination-Reasonable classification, principle of Scope-Provision of Art. 25 of the Constitution envisages equality between citizens, however it allows for differential treatment of persons not similarly placed under a reasonable Read More...

Selection of case for audit-Word reasons - Scope--Petitioner taxpayer was aggrieved of letter and notices issued by authorities selecting its case for audit----Word reason connotes an expression giving justification for an action, a ground to explain something, a Read More...

Reference---Redemption fine---Release of vehicle-- Tampered chasis number---Authorities were aggrieved of release of vehicle which was confiscated for smuggling of petrol---Customs Appellate Tribunal released the vehicle on deposit of 20% redemption fine---Vehicle Read More...

Tax exemption-Adventure in nature of trade---Scope---Taxpayer was an industrial unit and sold its land by converting it into a housing scheme and earned profit----For an adventure in nature of trade there had to be "indicia of trade" Read More...

Scope-Purpose of advance tax is collection of tax in advance and its adjustment at later stage but not charging or levy of tax-For collection of advance tax, certain persons are obliged, by the Statute, to collect and deposit the same in Read More...

Advance tax---Failure to pay tax deducted or collected---Default surcharge, recovery of-Scope-Provisions of S.162(2) of the Income Tax Ordinance, 2001 regarding imposition and recovery of default surcharge etc. are only attracted where failure to deduct tax is Read More...

Advance tax-Annual statement of tax collected or deducted-Scope--Practice of calling reconciliation, in absence of any statement, is against the spirit of R.44 of the Income Tax Rules, 2002-Rule 44 envisages, unequivocally, that Read More...

Advance tax---Failure to pay tax deducted or collected---Default surcharge, recovery of-Show-cause notice, issuance of---Principles and pre- requisites for issuing a show notice under Ss. 161 & 162 of the Income Tax Ordinance, 2001 Read More...

Reference--Appellate Tribunal Inland Revenue---Powers---Remanding of the matter---Object, purpose and scope-Taxpayer assailed assessment order and Commissioner Inland Revenue (Appeals) remanded the matter to Assessing Officer for de novo Read More...

Assessment on production of accounts, evidence, etc. Penalty for concealment of income---Scope---During the assessment proceedings, the taxation officer alleged that certain expenses claimed by the respondent were false and inaccurate Read More...

Penalty for concealment of income--Scope----Mens rea-----Scope----Existence of mens rea is a mandatory condition for levying any penalty under S.111 of the Income Tax Ordinance, 1979---Burden to prove such act of an assessee is also on Read More...

Assessment giving effect to an order---Rectification of mistakes--Scope---According to S.124 of the Income Tax Ordinance, 2001, the assessing officer must adhere to the directions given in the appeal effect order and cannot make any Read More...

Rectification of mistakes-Scope of rectification is limited to correcting mistakes that are easily identifiable on the surface of the order. 
Scope---Section 221 of the Income Tax Ordinance, 2001, is circumscribed to rectifying Read More...

International tax conventions, agreements or treaties-----Interpretation----Reasons as to why treaty interpretation rules differ from domestic tax rules stated.

International tax conventions or Read More...

Convention between the Kingdom of the Netherlands and the Islamic Republic of Pakistan for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income ("Convention"), Arts. 5 & Read More...

Constitutional petition-Audit Selection Regime--Petitioners / taxpayers were aggrieved of selection of their cases for Audit----Selection for audit under S. 177(1) of Income Tax Ordinance, 2001, by Commissioner Inland Revenue was not Read More...

Advance tax at the time of sale by auction---Royalty collection---Contractual liability---Petitioner were engaged in carrying out Read More...

Unexplained income or assets---Scope---Assessing authority while observing difference between the purchases declared in the Read More...

Question before Appellate Tribunal was whether the statues of taxpayer was of a Read More...

Minimum tax----Distributor---Fast moving consumer goods----Scope----Question before Read More...

First moving consumer goods---Scope----Definition of fast moving consumer goods reflects Read More...

Decisions of Supreme Court binding on other Courts---Decision of High Court binding on Read More...

Recovery of tax out of property and through arrest of taxpayer---Recovery of tax from persons holding Read More...

Resident of a Provincially Administered Tribal Area adjoining Mansehra District (the 'said tribal area')-Income tax refund, claim Read More...

Non-issuance of separate notice-Effect-Appellant was aggrieved of certain additions made by assessing officer in his income under Read More...

Taxpayer was a retailer who was treated as manufacturer for the purposes of taxation--- Taxpayer sought rectification of ex-parte Read More...

Amendment of assessment---Seeking information from assessee-Scope-In case, if Assessing Authority comes across any information or Read More...

Amendment of assessment---Opinion already formed Scope---Taxpayer company was aggrieved of show-cause notice issued by Read More...

Object, purpose and scope---Tax cannot be expropriatory or confiscatory, which takes away a citizen's property without Read More...

Tax, imposition of Amendment, vires of---Petitioners assailed amendment in S.236D of ITO 2001, fixing Rs.20,000 - as minimum slab for advance income tax to be collected of a person receiving services of or holding arranging functions in Read More...

Recovery---Refund, determining of-System generated notice, non-issuance of---Dispute was with regard to adjustment of Workers Read More...

Agriculture income---Late payment-Penalty, imposing of-Principle-Authorities sought recovery of tax under S.111 of Income Tax Read More...

Show- cause notice, assailing of---Exemption from deduction of withholding tax---Failure to pay tax, collected or Read More...

Overriding title-Applicant/Trust sought exemption on the plea that its income was  diverted by virtue of overriding title of Read More...

Cooperative Society---Status---Society is a juristic person and body incorporated and formed under Read More...

In relation to “income from business as is expended in Pakistan for Read More...

Profit margin----Determination-----Taxation officer, discretion of----Scope----Taxation officer has no discretion to determine in Read More...

Pre-condition----For purpose of any tax year in relation to which either Income Tax Ordinance, 1979 or Read More...

Commissioner issued an exemption for the purposes of S. 152(5-A) allowing the respondent to make certain payments to a foreign Read More...

Rectification of mistakes--Doctrine of election-Scope---Against the order of the Appellate Tribunal, Read More...

Concealment of business income from sales-Amendment of deemed assessment Read More...

Unexplained income or assets-Stock-in-trade vis-à-vis Annex "F" of sales tax return (carry forward summary)--Scope--- Read More...

Language of S.129(1)(a) only empowers the Commissioner (Appeals) to confirm, modify or annul the Read More...

Decision in appeal---Remand--Scope---Where matter in issue is an assessment order then resort can Read More...

Decision in appeal-Remand-Scope--Order passed under S. 122 creating liability is an assessment order for all intents and purposes and can only be dealt under Cl. (a) of S. 129(1) and binds the Read More...

Unexplained income or assets---Stock-in-trade--- Purchasing excess stock; an investment or expenditure---Scope---If any difference of declared stock is found or is effectively unearthed through audit or otherwise, it cannot be added as Read More...

Stock-in-trade---Meaning-Stock-in-trade means anything produced, manufactured, purchased or otherwise acquired for manufacture, sale or exchange, and any material or supplies to be consumed in the production or manufacturing process, but does not include stocks and Read More...

Strict rule of interpretation-Scope-Strict rule of interpretation mandates that plain, clear and direct meaning is given to words Read More...

Dept., on taxpayer's failure to deduct withholding tax, created a certain tax demand---Appeal against such demand was dismissed---Officer Inland Revenue had failed to appreciate S. 161 of ITO 2001, in its true perspective-Since all the Read More...

Principle of natural justice---Order in writing---Requirements---Order in writing must fulfill requirements of a speaking decision / order----Essential that party against whom such order is being passed must be given a proper notice confronting relevant material and Read More...

Written order absence of----Authorities raised demand of tax on the amount payable to Fund on the ground that no written order was passed under S.4 of Worker’ Welfare Fund Ordinance, 1971----Appellate Tribunal Inland Revenue set Read More...

Payments to non-residents----Payments for goods, services and contracts---Scope----Taxpayer was imposed upon a liability for its failure to deduct tax at the time of making payment under Ss. 152 & 153 of Income Tax Ordinance, Read More...

Amendment of assessment----Pre-Conditions----Petitioner / assessee was aggrieved of show-cause notice issued by authorities to amend its assessment---Authorities objected to maintainability of petition against show cause Read More...

Appeal Effect Order, non-issuing of----Plea of rectification----Petitioner / taxpayer was aggrieved of non-issuance of Appeal Effect Order by authorities on the plea of pending rectification application----Inactions in discharge of Read More...

Final Tax Return. Turnover dispute was with regard final discharge of liability over turnover. Turnover excluded tax paid or payable as final discharge of tax liability. Explanation added through Finance Act, 2012 replicated exclusion of deemed income assessed as Read More...

Reference revised return, filing of amendment of assessment. Dispute was with regard to filing of revised return which was rejected by authorities. When revised return was furnished it was in conformity with S. 114 (6A)of Income Tax Ordinance, 2001, and Read More...

Quashing of proceedings. Prior approval of FBR. Petitioners were serving in FBR and Income Tax department. Federal investigating Agency initiated investigation against petitioners for committing criminal breach of trust, cheating, forgery and misconduct. Contention Read More...

Constitutional petition Change of opinion. Scope Dispute was with regard to concept of “change of opinion” as show cause notice issued under S. 65 of Income Tax Ordinance, 1979 (since repealed) was not applicable for a show-cause notice under S. 122 of Read More...

Assessment order Amendment Period of limitation Word “or” used after S. 122 (4) (a) of Income Tax Ordinance, 2001. Scope Two conditions, as provided in clauses (a) & (b) of S. 122(4) of Income Tax Ordinance, 2001, where Commissioner wants to further Read More...

Amendment of assessment order. Limitation Petitioner taxpayer was aggrieved of show cause notice issued by authorities to furnish reply warranting further amendment under S. 122 (5-A) of Income Tax Ordinance, 2001. Plea raised by petitioner/ taxpayer was that matter Read More...

Alternate dispute resolution. Recovery notice plea raised by Petitioner Company was that all orders passed by various forums had to be taken into account before initiating recovery proceedings. The liability to pay tax was relatable to assessment order or an order Read More...

Taxpayer can claim deduction of initial allowance for an eligible depreciable asset (such as a building) being put to use by the taxpayer for the first time in a tax year, irrespective of the fact that the said building had been in use in the past in the hands of Read More...

Ignorance of law and fact. Authorities sought review of judgment passed by High Court on the basis of conceding statement made in favour of taxpayer. The power to review in available in Constitutional jurisdiction, as provisions, of Civil Procedure Code, 1908, are Read More...

Repealed enactments Construction and references to Pricing for retail consumers for natural gas. Question was with regard to development surcharge as expense while computing income from business and expenditure under S. 20 of Income Tax Ordinance, 2001. The Proviso Read More...

Notice, issuance of Limitation Dispute was with regard to applying provision of S. 156 of Income Tax Ordinance, 1979, [since repealed]. Notice under S. 156 of Income Tax Ordinance, 2001, could not be issued within five years or beyond the period for which taxpayer Read More...

Best judgment assessment order under section 121(1)(d) of the Income Tax Ordinance, 2001 (“the Ordinance’) Such order cannot be made in cases where deemed assessment order has already been made under Section 120 of the Ordinance and, therefore, section Read More...

Salary Payment for goods, services and contracts. Scope Complainant was a temporary lecturer at a government college. College deducted income tax at the rate of 20% from salary of the complainant. Contention of complainant was that his salary was below the taxable Read More...

Person Import of drugs for personal use. Scope Petitioners imported finished pharmaceutical products, which at the relevant time required certification from Drug Regulatory Authority of Pakistan (DRAP) for claiming a reduced rate of deduction of Income tax under S. Read More...

Limitation dispute between parties was with regard to amended assessment order filed under S. 122 (5A) of Income Tax Ordinance, 2001. Respondent/taxpayer filed income tax return for year 2006 on 30-12-2006, which deemed to be an assessment in term of S. 120(1)(b) of Read More...

Amendment of assessments Audit Definite information. Non-consideration of taxpayer’s explanation. Effect Appellant/taxpayer assailed orders passed by Commissioner Inland Revenue (CIR) (Appeal) and assessing officer. The Assessing officer by considering the Read More...

Commissioner after completion of audit shall issue audit observations and findings and then after issuing audit report he may amend the assessment order after providing opportunity of hearing to the Read More...

Collective Bargaining Agent. Educational institution ‘Commercial basis’ meaning of Scope. Petitioner/Establishment was aggrieved of registration of private respondent as a Collective Bargaining Agent by the Registrar of Trade Unions. Petitioner was a Read More...

Tax credit for charitable organizations. Scope one of the persons to whom the provision of S. 100C, applies is a trust Subsection (2) of S. 100C, Income Tax Ordinance, 2001, provides the category of income which is eligible for tax credit and includes income from Read More...

Withholding tax, collection of Principal Royalty. Amended assessment order. Respondent taxpayer was manufacturer of soft drinks selling its product exclusively by chain of restaurants through their outlets. Dispute was with regard to collection of tax on amount paid Read More...

Reference High Court, exercise of jurisdiction. Question of law. Scope reference under S. 133 of Income Tax Ordinance, 2001, lies before High Court on question of law of law only and the Court is obliged to answer the same in accordance with a rule of law. Question Read More...

Amendment of assessment. Preconditions Amendment of assessment under S. 122(5-A) of Income Tax Ordinance, 2001 can be made only in cases where twin conditions namely, (i) Assessment order is erroneous; and (ii) it is prejudicial to the interest of revenue, are Read More...

Reference Amendment of assessment. Calculation of cash withdrawal and tax deduction. Erroneous and prejudicial order. Proof Authorities amended assessment order of respondent taxpayer on the plea that it was erroneous and prejudicial to the interest of revenue. Read More...

Petitioner assailed its selection for audit vide impugned notice on the premise that the selection did not fulfill the criteria of S. 177 (7) of the Income Tax Ordinance, 2001, Contention of Petitioner was that there were no reasonable grounds to call for the audit Read More...

Transactions between associates Recharacterisation of income and deductions. Scope Question before High Court was whether the Appellate Tribunal was justified to delete the addition made by Assessing Officer on account of interest on the advances/disbursement to a Read More...

Method of accounting and accrual –basis accounting Principles. Entry made in accounts, as per accounting system employed by a person regularly maintained by him is considered to be valid allowable, if it is not contrary to other provisions of law. In Read More...

Method of accounting and accrual-basis accounting. Principles. Entry made in accounts. Assessing Authority did not accept claim of loss suffered by taxpayer due to currency exchange rate and added the loss into total income of taxpayer. Appellate Authority deleted Read More...

Withholding tax. Exemption Certificate. Recovery of tax. Dispute between parties was that in absence of Certificate of exemption under S.159 of Income Tax Ordinance, 2001, applicant/ Tax payer was liable to recovery of tax under S. 161 of Income Tax Ordinance, 2001, Read More...

Appeal to the Commissioner (Appeals) Prescribed form of appeal to the Commissioner (Appeals) Scope Case of petitioner was that he was required to file an appeal under S. 127of Income Tax Ordinance, 2001; that R. 76 of the Income Tax Rules, 2000, provided but remedy Read More...

Suspension of judgment passed by High Court. Scope Applicant sought sixty days’ time to approach the Supreme Court and in the meanwhile Income Tax Department be restrained from recovery of the tax, the request was made on the basis of referred precedents. Read More...

Joint Venture Association of Persons (AOP). Filing of separate income tax return. Non-Resident status, determination of Dispute was with regard to treating Joint Venture Association of Persons as Non-Resident by imposing tax at the rate of 15% instead of 5%. Held, Read More...

Coercive measures. Mechanism Redressal of grievances. FBR  is endowed with duty to facilitate taxpayers and establish mechanism to address their grievances and complaints. Under fiscal laws, including Income Tax Ordinance, 2001, officials are conferred vast Read More...

Constitutional petition. Refunds Coercive measures Authorities recovered amount of tax from Bank account of petitioner/ taxpayer. Grievance of petitioner / taxpayer was that amount recovered from bank account was not due and it was illegal and unlawful. The Read More...

Failure to furnish return of income. Scope Appellant was imposed upon penalties for late filing of income tax returns for the tax years 2011 and 2012. The Federal Government through SRO No. 550(I)/2012 dated 23-05-2012 had allowed the steel melters to deposit the Read More...

Questions of law not raised before the Tribunal or High Court. Supreme Court is not a forum to raise fresh questions of law which have not been examined by the Tribunal or the High Court or do not even arise from the decision of the Tribunal. In numerous cases, a Read More...

Income from business, computation of Deductions not allowed. Contributions made by tax-payer Company to an unproved gratuity fund. Section 21(e) of the Income Tax Ordinance, 2001 clearly stipulates that the contributions to an unapproved gratuity fund cannot be Read More...

Representatives Appeal to Commissioner (Appeals) Bar of suits in Civil Courts. Scope Plaintiff challenged a show-cause notice issued under S. 172(5) of the Income Tax Ordinance, 2001 through a civil suit. The Order passed under S. 172(3)(f) of the Income Tax Read More...

Additional assessment/ reopening of previously completed assessment on basis of “Definite Information” Nature and meaning of term “definite information”. Scope. Question before High Court was whether assessment of taxpayer could be reopened Read More...

Rectification of mistakes. Appeal to the Appellate Tribunal. Decision in appeal. Oral order, legality of Scope. Appellate Tribunal while invoking its jurisdiction under S. 221 of Income Tax Ordinance, 2001 on its own observed that in an earlier order it had Read More...

Question was with regard to limitation of tax refund. Taxpayer was estopped from asserting a favorable refund order by default where it had statutory recourse against inaction of authorities, which it opted not to pursue. Taxpayer not filing an appeal under S. Read More...

Audit, selection for definite information. Pre- condition. Case of respondent/taxpayer was selected for audit by Commissioner Inland Revenue. The Adjudicating authority i.e. Commissioner Inland Revenue in violation to legal provision as it stood then on 07/07/2009 Read More...

Amendment of assessment. Audit ‘Definite information’. Failure to obtain taxpayer’s explanation on issued raised in the audit report. Effect department assailed officer amending the deemed assessment was set aside. Amended assessment was framed on Read More...

Amendment of assessment. Audit. Procedure Scope ‘Definite information’ Assessing Officer, after formulation of the audit report/audit observation/objections/charge sheet, ought to first confront the same to the taxpayer and secondly, after considering Read More...

Amendment of assessment. Scope Section 177 of Income Tax Ordinance, 2001, does not in itself provide any power or absolute empowerment to modify assessment or re-determine the income of taxpayer. Key point to be kept in mind is that it is not a return of income Read More...

Audit Amendment of assessment. Procedure. Scope selection for audit or even conducting and audit does not mean modification of assessment. Selection for audit and thereafter conducting of audit proceeding is just a process. Assessing officer, before invoking the Read More...

Expression ‘subject to this section’ Scope. Provisions of S. 122 of Income Tax Ordinance, 2001, start with the language “subject to this section”. Such language restricts all further proceedings for amendment of an assessment which means it Read More...

Audit Amendment of assessment. Procedure Scope. ‘Definite information’ Scope. Deemed assessment, if selected for audit, may be amended by invoking jurisdiction under S. 122(1), Income Tax Ordinance, 2001, subject to fulfillment of conditions as envisaged Read More...

Appeal to Appellate Tribunal. Limitation Successive appeals on the same cause of action. Scope. Appellant filed application for grant of stay along with supporting appeal for the third time against the same order of refusal to stay the recovery of tax demand by the Read More...

SRO 586(1)/91 dated: 30-06-1991---Failure to pay tax collected or deducted---Payments for goods, services and contracts---Exemptions and tax concessions-Scope---Department raised demand and imposed liabilities upon the appellant for its Read More...

Unexplained income or assets Separate notice, issuance of Words “the person offers no explanation” and “or the explanation offered by the person is not, in the Commissioner’s opinion, satisfactory” Scope Dispute was with regard to Read More...

Thing required by law to be done in a certain manner must be done in the same manner as prescribed by law or not at all. 
Art. 129(e)---Public documents---Presumption---Scope---Presumption of regularity and correctness is Read More...

Income Tax Ordinance (XLIX of 2001)-----Ss.174(3), 161 , 162---Records, information collection and audit---Maintenance of record by taxpayer---Statutorily required time-period for maintenance of such record----Maintenance of record after lapse of statutorily Read More...

Protection against double punishment and self-incrimination. Scope issuance of a notice regarding the same taxed amounts tantamount to double jeopardy which cannot be given legal credence but also offends and defies the fundamental rights set out in Art. 13 of the Read More...

"Services", meaning of Scope. Rendering of labour and carriage services. Whether income from labour and carriage services is liable to fixed tax regime. Held, that definition of ‘services’ in subsection (9) of section 153 of the Income Tax Ordinance, Read More...

Dismissal of revision petition being barred by 16 days/Validity/Such delay was negligible/Commissioner instead of knocking out the petitioner on technicalities, ought to have considered his prayer on merits/Order of Commissioner refusing Read More...

Judiciary is respected not on account of its power to legalize injustice on technical grounds, but because it is capable of removing injustice and is expected to do Read More...

Judgment is an authority only in respect to what it decides, and only with regard to the proposition of law raised, in that case, and therefore point not argued before the Court cannot be considered to have been dealt with by its Read More...

Tax rebate, the entitlement of Authorities were aggrieved of the order passed by Appellate Tribunal Inland Revenue against tax rebate allowed to taxpayer who Read More...

Tax Relief Petitioners were civil servants who claimed tax relief in their salaries on the plea that they were also residents of erstwhile Provisionally Read More...

Petitioners/ taxpayers were aggrieved of notices of selection of their case for audit. Plea raised by petitioners/taxpayers was that Read More...

Records, information collection and audit---Maintenance of record by taxpayer---Statutorily required time-period for maintenance of such record. Maintenance Read More...

Reassessment principle limitation taxpayer was aggrieved of reassessment made by Assessing Officer beyond time limitation. It was Read More...

Taxpayer, a permanent employee of a Hospital Salary - Clinical supplements and incentives. Show-Cause notice, issuance of Taxpayers (assessees) were aggrieved of show-cause notice issued to them to include clinical supplements and incentives received by them from Read More...

Appellant assailed order passed by department as well as Commissioner (Appeals) whereby the amount of gross sales was held to be its income and was taxed accordingly.

Appellant had rightly availed Amnesty Scheme under the Voluntary Declaration of Domestic Read More...

Show cause notice was delivered to a person by an authority in order to get the reply back with a reasonable cause as to why a particular action should not be taken against him with regard to the defaulting act. By and large, it was a well-defined and Read More...

Tribal Areas Merger of Tribal Areas into settled areas Automatic applicability of Income Tax Ordinance, 2001 to areas that cease to be Tribal Areas by operation of Art. 247(6) of the Constitution. Question before High Court was whether after cessation of a District Read More...

FBR Circular No. 4 of 2000, dated 17-2-2000 (FBR Circular) Workers Welfare Fund. Adjustment, availing of Retrospective effect of Circular Scope. Petitioners/ companies were required to contribute towards their workers’ welfare as Workers’ Welfare Fund. Read More...

Apportionment of expenditure Amendment in tax return. Dispute was with regard to apportionment of expenditure incurred and adjustments claimed by taxpayer under R. 231 of Income Tax Rules, 2002. Plea raised by authorities was that apportionment of expenditures was Read More...

Loan to employee’s Factual controversy. Appellant/taxpayer was a Banking Company and dispute was with regard to amounts advanced to its employees as loan. Income Tax Appellate Tribunal ignored examination of factual aspect that whether any expenditure was Read More...

Appellant sought rectification of order passed by the Tribunal. Appellant had also filed an Income Tax Reference Application against the same order of the Tribunal before the High Court. Appellant could not have the best of both worlds, as seeking relief Read More...

Rectification of mistake. Review jurisdiction Scope Resolution of once decided issue tantamount to “review”, which is not allowed to the Tribunal and falls under the domain of Superior Courts.

Rectification of mistake Scope of rectification is Read More...

Adjudication by Appellate Tribunal---Scope---Petitioner taxpayer impugned order of Appellate Tribunal whereby interim relief already granted to taxpayer and extended subsequently five times by Appellate Tribunal was later declined during pendency of main appeal, Read More...

Amendment of assessments---Power of Commissioner to further amend / alter assessment in terms of Ss.122 (5A) & 122(5AA) of Income Tax Ordinance, 2001---Time Barred amendment in assessments not sustainable---Scope---Petitioner/Taxpayer impugned notice for further Read More...

Failure to confront specific provision in notice---Scope---Taxpayer assailed order passed by assessing officer whereby he had amended the demand assessment order and the dismissal of his appeal---Show cause notice issued to the taxpayer did not reflect the addition Read More...

Exercise of authority under S.65 of Income Tax Ordinance, 1979 for additional assessment of taxpayer---Inadmissible expenditures---Scope---Question before High Court was whether income tax assessment of taxpayer, which was an insurance company, could be reopened Read More...

Dividend in specie received by the taxpayer is income and taxable under S. 5 of the Income Tax Ordinance, 2001--Dividends constitute a separate block of income that is brought to tax in terms of S. 5 of the 2001 Ordinance---Dividends are to be taxed as a separate Read More...

Each tax year is a separate unit of account and taxation and the law has to be applied as it stood in respect of that tax year alone. Tax statute---Exemption clause---Retrospective effect---Scope---Exemption clause has a beneficial effect does not mean that it Read More...

Distinction---Section 5 speaks of the dividend being “received” by a person from a company, while S. 150 speaks of the dividend being “paid” by the latter---Former is a general expression , bringing to tax all that is received by way of Read More...

Commission/trade discount---Assessee in default---Determination---Sale agreement---Scope---Respondent-assessee claimed  that disputed amount was not commission rather it was trade discount, therefore no tax was deducted---Assessing Officer made assessment under Read More...

Failure to pay tax collected or deducted---Deduction of tax at source---Rectification of mistake---Scope---Assessing officer worked out tax liability under Ss. 161 & 205 of Income Tax Ordinance, 2001, for its failure to deduct or deposit withholding Read More...

Failure to pay tax collected or deducted---Deduction of tax at source---Rectification of mistake---Default surcharge, determination of---Scope---Assessing officer worked out tax liability under Ss.161 & 205 of Income Tax Ordinance, 2001, for its failure to Read More...

Deductions in computing income chargeable under head “Income from Business”---Composite business activities---Expenses common to income under Normal Business Income and Presumptive Tax Regime---Apportionment of deductions---Scope---Question before High Read More...

Minimum tax on the income of certain persons---Scope---Appellant/taxpayer adjusted tax under Cl. (c) of subsection (2) of S.113 of Income Tax Ordinance, 2001, For two years---Deputy Commissioner Inland Revenue (DCIR) adjusted such carried forward excess amount from Read More...

Minimum tax on the income of certain persons---Scope---Clause (a) of subsection (2) of S.113, Income Tax Ordinance, 2001, provides that the aggregate of the person’s turnover as defined in subsection (3) for the tax year shall be treated as the income of the Read More...

Scope---Courts are merely supposed to interpret the law as it is and have no authority to add, delete or subtract any word in or from the language used by the legislature and in a taxing statute, a tax on any person is to be levied by clear and unambiguous words and Read More...

Term ‘subject to adjustment’---Amendment of assessment---Scope---Authorities withdrew the advantages given to taxpayer company on account of its associated company and revised the assessment order by making an addition to its tax assessment---Appellate Read More...

Notice to obtain information or evidence---Offence of money laundering---Scope---Petitioners through constitutional petitions attempted to set the process at naught from initiating the proceedings as under took  by the Income Tax department in terms of Read More...

Unexplained income or assets---Offense of money laundering---Scope---Non-declaration of an asset by assessee under the Income Tax Ordinance, 2001, is not a scheduled offence, unless proved otherwise as required under the Anti-Money Laundering Act, Read More...

National Executive Committee to combat money laundering---Scope---Under the Anti-Money Laundering Act, 2010, a person is presumed to be guilty of offence of money laundering if he acquires, converts, possesses, uses or transfers property knowing or having reason to Read More...

Suit for declaration and injunction. Mala fide, proof of- Show-cause notice Plaintiff/ taxpayer assailed show-cause notice to conduct audit on the plea of mala fide and discrimination. Held. Mere allegation of mala fides was not enough to dislodge presumption of Read More...

Show cause notice Tax not paid Petitioner was income tax assessee, who called in question show-cause notices for tax period November 2013 to March 2018 and July 2013 to October 2013 respectively issued by Deputy Commissioner Inland Revenue. Plea raised by petitioner Read More...

Maxim: ‘actus curiae neminem gravabit’ Applicability Interim relief, extension in delay in disposal of appeal. Petitioners were tax payers who sought extension in interim relief. ----Maxim: ‘actus curiae neminem gravait’ could be involed only Read More...

Limitation for assessment Scope. Question before High Court was whether time imitation for an assessment also included the time consumed in service of order, whereas S. 64 of the Income Tax Ordinance, 1979, determined the time limitation for an assessment only. Read More...

Audit Selection of case. Commissioner and FBR , jurisdictions of Commissioner under S. 177 of Income Tax Ordinance, 2001, is required to apply his mind and provide reasons for selection, Whereas FBRunder S. 214C of Income Tax Ordinance, 2001, may select a person Read More...

Constitutional petition Audit, selection of case. Jurisdiction of commissioner. Judicial review. Directions of FBR Scope. Petitioners/ taxpayers were aggrieved of issuance of notices by Commissioner selecting there cases for audit on the basis of directions from Read More...

Books of account, documents and records to be maintained for a period of six years. Scope of section 174(3) of the Income Tax Ordinance, 2001. Taxpayer is obliged to maintain the record under section 174(3) of the Income Tax Ordinance, 2001 for a period of six years Read More...

Maximum tax Scope Dispute was with regard to applicability of proviso added to S. 153(6) of Income Tax Ordinance, 2001, Appellate Tribunal Inland Revenue set aside orders passed by two forums below. --- Turnover, in terms of reenacted S. 113(3)(b) of Income Tax Read More...

Assessment and penalty proceedings. Penalty, imposing of Particulars of income. Determination. Read More...

Customs General Order No. 11/2007, dated 28-08-2007. Amendment of assessment “Manufacturer” Meanings -- Failure to issue of show cause notice. Scope. Question before High Court was whether business of respondent regarding slitting/cutting of copper Read More...

Lease rental income. Scope Dispute was with regard to assessment of lease rental income under S. 12(19) of Income Tax Ordinance, 1979 on actual receipt basis and not on accrual basis. The Assessee could not claim depreciation, initial and normal and simultaneously Read More...

Preamble Revenue cases Lack of assistance provided by the counsel and officials of the FBR  and its Inland Revenue department. During the hearing before the Supreme Court, the copies of the show cause notice sent to the taxpayer, the audit report, the response Read More...

Altering/amending assessment order. Commissioner income tax. Jurisdiction. Assessment order based on statement of income furnished under S. 115(4) of Income Tax Ordinance, 2001 could be altered/ amended by Commissioner under S. 122 of Income Tax Ordinance, 2001. Read More...

Preamble Notifications SRO No. 1212(I)/2018 dated 5-10-2018 & SRO No. 1213(I)/2018 dated 5-10-2018 Constitution of Pakistan, Art. 19. Factual controversy Exemption from income tax Petitioners were industrialists who sought exemption from income tax charged in Read More...

Amendment of assessment---Alternate remedy, availability of---Scope---Petitioner assailed notice issue by department under S.122(9) read with S.122(4) of Income Tax Ordinance, 2001 whereby certain documents were sought from the petitioner---Validity---No adverse Read More...

Assessment---“Best judgment assessment”---Assessment of assessment---Scope---Assessment is made under Part II of Chapter X of the Income Tax Ordinance, 2001, which deals with the assessment under S.120 of Income Tax Ordinance, 2001 while the scheme of Read More...

Right of individuals to be dealt in accordance with law---Scope---Under Art.4 of the Constitution, it is an inalienable right of every citizen of Pakistan to be treated in accordance with law and no action detrimental to his/her life, liberty, reputation or property Read More...

Taxpayer, being rice mill, had a special tax year starting from 1st of September till 31st of August----Minimum tax was being paid on normal rates till issuance of SRO No.57(I )/2012, dated: 24-01-2012 and on its issuance the tax for the year 2012 was paid at Read More...

Purpose of remedial and curative legislation is to abridge superfluities, remove defects or mischief from an existing law to redress wrongs and injuries being impinged upon the existing rights---Such legislation can be applied retrospectively, if intention of the Read More...

General rule is that a notification cannot operate retrospective but in case it removes defects, superfluities or mischiefs from an existing notification to advance remedy for enforcement of existing rights, it can be applied retrospectively by the issuing authority Read More...

Franchisee of mobile company (franchisor) carrying out business in District Nowshera---Payment of commission by franchisor to the franchisee--- Exemption from deduction of advance tax on payment of commission for a period of three years Read More...

Despite payment of all duties and taxes levied by authorities, goods in question were not released by Customs Authorities---Validity---Authorities were only authorized to take action for issuance of detention notice in terms of S.202 of Read More...

Every judicial and quasi-judicial finding should be based on reasons containing justification for the finding in the order Read More...

Appellant was imposed upon penalties for its failure to furnish monthly statements in term 
of S.165 of Income Tax Ordinance, 2001---Appellant had reasonably explained the cause of its failure to file the statements by stating that it was facing problems in Read More...

Goods specified by Federal Government upon which registered person shall not be entitled to reclaim or deduct input tax paid---Nature of power conferred on Federal Government under S.8(1)(b) of Sales Tax Act, 1990-Scope- Petitioners/taxpayers impugned SRO Read More...

Appeal to commissioner--Opportunity of hearing-Maxim: audi alteram partem---Applicability--Scope---Nobody can be condemned unheard and no act or action which is detrimental, against the right and interest of a person can be passed without giving him prior notice and Read More...

No official of Directorate of PCA was empowered to conduct audit in the matter of Federal Excise and Income Tax without powers / justification---Any such audit was void ab-initio and coram non judice---Clearance Collectorates did not have authority to collect Read More...

No official of Directorate of PCA was empowered to conduct audit in the matter of Federal Excise and Income Tax without powers / justification---Any such audit was void ab-initio and coram non judice---Clearance Collectorates did not have authority to collect Read More...

Show-cause notice--- Jurisdiction--Valuation Ruling (VR)---Object, purpose and scope--- Importer was aggrieved of show-cause notice issued by Deputy Collector for recovery of taxes including sales tax and income tax, on the plea of Read More...

Question before Appellate Tribunal was whether the appellant was entitled to get set off/deduction of any expenses from his professional services receipts---Appellant had rightly claimed expenses-Tax returns were lawfully filed under normal tax regime which had to Read More...

Right of individuals to be dealt in accordance with law---Recovery of tax out of property and through arrest of taxpayer---Recovery of tax from persons holding money on behalf of a taxpayer--Scope-Petitioners assailed order of department regarding attaching their Read More...

Applicant sought rectification of the order passed by Appellate Tribunal on the ground that the details of payments on account of local purchases were over- sighted during the course of hearing of main appeal--Once the appellant had submitted the details of local Read More...

Non issuance of separate notice under S.111 of the Income Tax Ordinance, 2001 and failure to confront the taxpayer with the proposed addition in order to require him to explain his position before making addition in his income is Read More...

Unexplained gross inflow-Proof-Taxpayer was aggrieved of selection of his case for audit as his declared income was not accepted by authorities-- Validity---Deposits in question were explained but on the other hand were not subtracted from the total amount Read More...

Literal rule and grammatical construction Applicability---Judge, according to literal rule, must rely on exact wording of statute while describing the law Judge can deviate from such rule only when grammatical construction of statute gives some absurd meaning and it Read More...

Income from business---Deductible expenses---Burden of proof-Scope---Right has been vested in the taxpayer to claim deductible expenses for the purposes of computing his income---Onus to dispute the said expense, so claimed by a Read More...

Depreciable assets Unsold improved land---Structural improvements---Deduction was allowed for depreciation of the taxpayer's depreciable assets used in furtherance of his business in the said tax year--Term "depreciable assets", as explained in subsection (15) of S. Read More...

Deductible expenses---Scope- Depreciable assets- Unsold improved land- Structural improvements--Cost of land beneath a building-Whether the cost of land beneath a "building" would be included in determining the value of the rate of depreciation specified in the Read More...

Sale of constructed shops/offices on purchased land-Deductible expenses---Scope----Depreciable assets--Unsold improved land-Structural improvements----[Per Yahya Afridi, J (Majority view): While Read More...

Constitutional jurisdiction of High Court---Show---cause notice under S.182 of Income Tax Ordinance, 2001 for imposition of penalty for not furnishing return of Foreign Assets and Liabilities under S.116A of Income Tax Ordinance, 2001---Maintainability of Read More...

Wealth statement--Foreign income and assets statement---Penalty for failure to furnish foreign income and assets statement under S.116A of Income Tax Ordinance, 2001---Absence of prescribed format, effect of-Scope--Petitioners / taxpayers impugned show-cause notice Read More...

Issuance of income tax refunds Complaint against failure to provide taxpayer opportunity of hearing and unilateral reduction of refund amount with no compensation for delayed refund---Contention of Department was that said complaint was that not maintainable under Read More...

Deduction of tax at source--Scope-Assessee entered into different agreements with certain companies based in United Kingdom and United States and in that behalf made payments to them but no withholding tax was deducted under S.50(3) of the Income Tax Ordinance, Read More...

Wealth Tax Appeals filed by a company without a resolution from the Board of Directors, but duly signed by the Chief Executive Officer (CEO)--Sufficient compliance---Ratification of appeals--- Scope-Company was a juristic entity and it could duly authorize any Read More...

Issuance of income tax refunds---Assessment giving effect to an order---Complaint against failure of Department in giving effect to order of Appellate Tribunal whereby complainant / taxpayer was held entitled to tax refund---Validity---Department stated that after Read More...

Art. 199-Constitutional jurisdiction of High Court-Tax matters-Show-cause notice(s) seeking recovery of tax-- Alternate remedy--- Scope When revenue authority had already interpreted relevant provisions making statutory remedies illusory; and where petitioners Read More...

Fiscal statute---Construction of-Scope-Fiscal statute is to be strictly construed. Amendment in statutory provisions--Use and effect of word "substitute"---Scope--Term substitute may be defined as "taking place of another and it may be employed to signify Read More...

Capital gains on disposal of securities Amendment in rates of tax on capital gains on disposal of securities vide Finance Act, 2016 -Scope- Petitioners impugned show-cause notices issued to them regarding payment of tax on capital gains, inter alia, on ground that Read More...

Capital gains on disposal of securities Amendment in rates of tax on capital gains on disposal of securities vide Finance Act, 2016 Retrospective effect of such amendment--- Scope---Question before High Court was whether benefit of amendment in rates of tax on Read More...

Directorate General (Intelligence and Investigation), Inland Revenue ("DG I&I"), functions and powers of---Conferment of powers to officers of DG I&I without specifying functions and jurisdiction of DG I&I Scope-Petitioners impugned SRO No.115(1)/2015 Read More...

Members club (social club)---Tax payable---Levy of income tax on income generated from accommodation services provided by a members’ Read More...

Change of taxing jurisdiction---Scope---Petitioners impugned orders whereby their taxing jurisdiction was changed from Regional Tax Office (RTO) to the Large Taxpayers Office (LTO) at another city, on the ground that orders were made without jurisdiction and were Read More...

Recovery through electricity bills---Exemption---Petitioner (located in Federal Tribal Areas) was aggrieved of demand of authorities for collection of advance income tax and sales tax from petitioner through monthly electricity bills---Validity---Through Read More...

Rectification of mistake---Scope and amplitude of rectification powers available with Department under S.156 of Income Tax Ordinance, 2001---Mistake apparent on record not requiring any further evidence / investigation---Imposition of minimum tax on Read More...

State-owned Insurance Corporation---Special provisions for computation of income tax upon profits and gains of business of insurance under S.26 of Income Tax Ordinance, 1979---Imposition of minimum tax under S.80D of Income Tax Ordinance, 1979 on Read More...

Money Bill---Scope---Bypass of regular Legislative process by unmerited recourse to Money Bills-Tax on undistributed profits of public limited companies---Section 5A of Income Tax Ordinance, 2001, vires of---Petitioner’s impugned S.5A of Income Tax Ordinance, Read More...

Principle---Taxpayer assailed selection of its case for audit under S.177 of Income Tax Ordinance, 2001---Plea raised by taxpayer was that no opportunity was afforded before selecting its case for audit---Validity---Taxpayer was communicated by Commissioner Audit, Read More...

Expression ‘unless there is in force a certificate issued under subsection (1) of S.159 relating to the collection  or deduction of such tax,---Exemption or lower rate certificate---Applicability---Appellants-taxpayers claimed that they were registered Read More...

Amendment of assessments---Mandatory show-cause notice and opportunity for taxpayer to file reply to same---Credit entries in Bank accounts(s) of taxpayer---Computation of “net income’ / “total income” chargeable to tax---Obligation of Read More...

Unexplained income and assets---Nature of S.111 of Income Tax Ordinance, 2001---Charging to tax of unexplained income or assets under head of “income from other sources”---Legislative lapse in non-inclusion of “unexplained income or assets Read More...

17). Before parting with this judgment we may observe that: No tax shall be levied or collected except by authority of law. A tax can only be imposed by a legislative Act and not on executive order. It thus embodies the democratic Read More...

For taking any adverse action, affording of an opportunity is prerequisite. An order affecting the rights of a party cannot be passed without an opportunity of hearing to that party. There are certain basic norms of justice. One of the Read More...

The Hon’ble Lahore High Court in the judgment reported as 2013 PTD 1536  PLD 2013 Lah. 634 where their lordship observed as under:“Show cause notice is not a casual correspondence or a tool or license to commence a Read More...

The “fair trial” and “due process of law” as has been guaranteed by the Article 10-A of the Constitution of Islamic Republic of Pakistan. The fair trial consists issuance of notice by the competent authority and Read More...

The “fair trial” and “due process of law” as has been guaranteed by the Article 10-A of the Constitution of Islamic Republic of Pakistan. The fair trial consists issuance of notice by the competent authority and Read More...

Audi alteram partem - Principle of - We are, therefore, of the considered opinion that the impugned order was passed without providing/affording opportunity of being heard, hence violated the well know principle of “audi alteram Read More...

Right of access to justice - An order affecting the rights of a party cannot be passed without an opportunity of heaving to that party. There are certain basic norms of justice. One of the cardinal principles of such basic norms is that Read More...

ACIR passed orders for the amendment of deemed assessment u/s 120 of Ordinance without service of mandatory notice.Passing of order in haste with malafide intention of the officer - The above observations of the ADC-IR clearly depicts Read More...

ACIR passed orders for the amendment of deemed assessment u/s 120 of Ordinance without service of mandatory notice.Passing of order in haste with malafide intention of the officer - The above observations of the ADC-IR clearly depicts Read More...

ACIR passed orders for the amendment of deemed assessment u/s 120 of Ordinance without service of mandatory notice.Passing of order in haste with malafide intention of the officer - The above observations of the ADC-IR clearly depicts Read More...

The questions of Law involved in the cases arisen out of liability being enforced by the Revenue have not been attended to and dilated upon by the Appellate Tribunal.” These appeals are remanded to learned Income Tax Appellate Read More...

In view of the definition, it is admitted position that both the insurance companies are non-resident companies and having no permanent establishment in Pakistan, as per the definition in the aforementioned articles of the referred treaties. Both the insurance Read More...

In view of the definition, it is admitted position that both the insurance companies are non-resident companies and having no permanent establishment in Pakistan, as per the definition in the aforementioned articles of the referred Read More...

Petitioner was an international company having its permanent office in Pakistan and was awarded a contract for which supplies and services were sought from both foreign and domestic sources- Petitioner sought issuance of tax exemption Read More...

Petitioner was an international company having its permanent office in Pakistan and was awarded a contract for which supplies and services were sought from both foreign and domestic sources- Petitioner sought issuance of tax exemption Read More...

In case titled The Secretary, Ministry of Defence and others v. Prabhash Chandra Mirdha (AIR 2012 S.C. 2250) it has been held as under: “Ordinarily a writ application does not lie against a charge sheet or show-cause notice for the Read More...

In case titled M/s. Siemens Ltd. v. State of Maharashtra and others (2006) 12 SCC 33 it has been held as under: ‘’Although ordinarily a writ Court may not exercise its discretionary jurisdiction in entertaining a writ Read More...

In case titled M/s. Siemens Ltd. v. State of Maharashtra and others (2006) 12 SCC 33 it has been held as under: ‘’Although ordinarily a writ Court may not exercise its discretionary jurisdiction in entertaining a writ Read More...

In another case titled State of Uttar Pradesh v. Brahma Datt Sharma and others (AIR 1987 SC 943 = 1987 SCR (2) 444) it has been held as follows: “The High Court was not justified in quashing the show-cause notice. When a show-cause Read More...

In another case titled State of Uttar Pradesh v. Brahma Datt Sharma and others (AIR 1987 SC 943 = 1987 SCR (2) 444) it has been held as follows: “The High Court was not justified in quashing the show-cause notice. When a show-cause Read More...

In light of the above principles, what needs to be examined is whether the instant petitions are maintainable. The sole ground agitated by the petitioner is that since the question involved and/ or raised in the impugned notices is Read More...

Principles of taxation of association of persons - Filing of individual returns of income by the partners of firm of their total income - Amount received by a partner from the firm in hand of partner - Exemption - Firm and its partners - Read More...

Undeniably respondent-taxpayer recorded the lease key money as liability to be adjusted as a sale proceeds at the expiry of lease period, therefore, there is no justification to tax the security deposit under Section 12(19), considering Read More...

Undeniably respondent-taxpayer recorded the lease key money as liability to be adjusted as a sale proceeds at the expiry of lease period, therefore, there is no justification to tax the security deposit under Section 12(19), considering Read More...

It is the contention of counsel for the applicant Department that as the invoices issued from those sellers, who were subsequently declared as blacklisted or de-registered; therefore, no refund can be allowed to the respondent. In Read More...

It is the contention of counsel for the applicant Department that as the invoices issued from those sellers, who were subsequently declared as blacklisted or de-registered; therefore, no refund can be allowed to the respondent. In Read More...

So far as the Question No. 1 is concerned, the same pertains to pecuniary jurisdiction of the officer, who has passed Order-in-Original. In a case involving contravention on the part of a registered person with respect of assessment of Read More...

FACTS: the respondent is running the business of departmental stores. The respondent e filed return of income by declaring loss of Rs.15,734,624/- for tax year 20l4. Respondent selected for audit, deemed assessment was amended under Read More...

Whether gift amounts received by one partner from other partners in the firm/AOP could be added by the tax officer under S. 12(18) of the erstwhile Income Tax Ordinance, 1979---Held, that plain reading of S. 12(18) of the Ordinance Read More...

Income Tax Ordinance (XLIX of 2001)- Ss. 174(3) & proviso- Records, information collection and audit- Maintenance of record by taxpayer- Statutorily required time-period for maintenance of such record- Maintenance of record after lapse of statutorily required Read More...

Complainant was a Non-Resident/Overseas Pakistani who was aggrieved of deduction of tax on his remittances exceeding fifty thousand rupees.

The Complainant, who was Non-Resident working abroad and who Read More...

Import of a vehicle under a fake Proceed Realization Certificate (PRC)---Allegedly, accused, Clearing Agent, was an instrumental in the entire rip-off for illegally importing a vehicle with intention to cause loss to Read More...

In view of the definition, it is admitted position that both the insurance companies are non-resident companies and having no permanent establishment in Read More...

8. A plain reading of section 12(18) of the Ordinance shows that the said provision is attracted when loans, advances, and gifts are received in cash. However, Read More...

Petitioner / taxpayer sought direction of High Court under Constitutional jurisdiction to set aside order of Appellate Tribunal whereby taxpayer’s application under O.XXXIX Rr. 1 & 2, C.P.C was rejected---Contention of Read More...

Taxpayer filed normal returns for the tax year 2013 which was deemed to have been assessed under S. 120(1), ITO 2001---Assessing authority observed that the taxpayer was engaged in the business of supply of medicines, therefore, normal Read More...

Taxpayer himself had declared income under normal tax regime as well as under final tax regime which stood subjected to withholding provisions of 153(1)(a) of ITO 2001---Assessing authority without any basis presumed that all sales were Read More...

Application of S. 221 ITO 2001 is only permissible if the error is apparent, Read More...

Section 33, ST Act, 1990 contains penal clauses and can only be invoked for contravention of respective provisions of ST Act, 1990---Section 148 ITO  2001 prescribes the procedure for collection of income tax at import stage by the Read More...

Penalty, imposition of---Taxpayer was aggrieved of confirmation of additions to value of property as well as foreign remittances made by the authorities.
Stance of taxpayer was not properly adjudicated as required under Read More...

Principle of consistency---Object, purpose and scope---Object of principle of consistency is to maintain uniformity and consistency of views/decisions in different Benches of Court/Tribunal and is aimed at to foster, develop and Read More...

Where rectification application dismissed by Appellate Tribunal, the Reference application before Court is not maintainable because the order of the Tribunal on application does not merge into final order--- Where the rectification Read More...

Review petition filed against (tax) Reference decided by the High Court-Power of High Court to convert review petition into an application for correction of clerical error---Scope---In the exercise of its Reference jurisdiction under S. Read More...

Conversion of one type of proceedings into another---No fetters or bar could be placed on the High Court and or the Supreme Court to convert and treat one type of proceedings into another Read More...

Taxpayer's declaration of its income was disputed by the Taxation Officer while placing reliance on the deposits made in the Bank accounts maintained by the taxpayer, on the basis whereof show- cause notice was issued which culminated in Read More...

Payment for consultancy/technical services provided by foreign non-resident company---Exemption from deduction of withholding tax---In terms the consultancy agreement executed between the parties, the foreign company was to provide Read More...

Privileged information---Fishing inquiry--- Petitioner Bank assailed notice issued by income tax authorities regarding providing of details in connection with debit/credit card machines installed by petitioner to different commercial Read More...

Findings of facts---Scope---Dept. assailed order passed by Appellate Tribunal on the ground that it ignored the provisions of S.88A of ITO 2001 while holding that share from Association of Persons (AOP) was not liable to be charged in Read More...

Scope only substantial legal questions can be examined which may arise from an order passed by the Appellate Tribunal whereas questions requiring no interpretation of any provision of law, rules or regulations or its application on Read More...

Dept. assailed order passed by Appellate Tribunal whereby it had re-fixed the case for hearing and adjudication despite the fact that it had already decided the appeal. 

The Appellate Tribunal Read More...

Appellant assailed orders passed by Deputy Commissioner Inland Revenue whereby he had charged penalty under serial No. (1A) of S. 182(1) ITO 2001 for delay in filing statements under S. 165 ITO 2001--- Contentions of appellant were that Read More...

Section 182,  ITO 2001is not a charging section, rather it is penal in nature---Intention of legislature in enacting S.182 is not to generate revenue---Section 182 cannot be used as a source of resource mobilization or collecting Read More...

Reasons for decision---Scope---Dept. assailed order passed by Appellate Tribunal whereby it had remanded the matter to the Commissioner (Appeals)---Appellate Tribunal had not determined the core issue whether HS Code of diaper was Read More...

Reduction of a taxpayer’s claim for deduction. Worker’s Welfare Fund. Reference to High Court. Findings of facts. Scope Applicant-Dept. assailed the order of Appellate Tribunal wherein it had given findings of facts that the Read More...

Return of Income for non-residents. Suo motu investigation against systemic maladministration by Dept. as non-residents were being required to file return of income by Banks before opening a foreign currency account. Scope. Federal Tax Read More...

Findings of facts. Scope. Applicant-Dept. assailed the order of Appellate Tribunal wherein it had given findings of facts that the assessing authority had treated the credit entries appearing in the Bank accounts as business Read More...

Appellant attacked the order-in-original on the ground that mandatory show-cause notice was posted one day after the date fixed for appearance of appellant. 

Section 122 of ITO, 2001provided that Read More...

Constitution of Pakistan, Art. 10-A, Amendment of assessment. Right of fair trial. Opportunity of being heard. Scope Fair trial and due process of law are guaranteed by the Constitution. Fair trial means issuance of notice by the Read More...

Delay in issuance of refunds. Scope. Complaint against non-issuance of refund and for compensation under Ss. 170 and 171 of the ITO 2001. Complaint sought findings against Dept. for inordinate delay in issuance of refund on account of Read More...

Petitioners were permanent residents of erstwhile provincially Administered Tribal Areas (PATA) and they were aggrieved of deduction of advance income tax by Provincial Government from their work bills and they were asked to seek Read More...

Taxpayer assailed orders passed by Assessing Officer and Commissioner (Appeals) whereby they had made additions in his declared income.

Taxpayer, at first, was issued notice under S. 177 of the ITO Read More...

Where the statute requires a particular act to be done in a particular manner then the act must be performed in that manner alone and all other manners of doing that act would not be permissible under the Read More...

The complainant, an overseas Pakistani/non-resident (NR) is working in Saudi Arabia. According to the complainant, he remits money from abroad through proper banking channel. However, at the time of withdrawal, the Bank deducts tax when the transaction exceeds fifty Read More...

10). Read More...

Applications for recalling of order passed by Appellate Tribunal-Taxpayer had sought recalling of order earlier passed by Appellate Tribunal; wherein dept.al appeals were accepted and order passed by Commissioner Inland Revenue (Appeals) was reversed- Grievance of Read More...

Special exemptions for Power Company-Interest or profit derived on deposits--Scope---Question before the High Court was whether "term deposits" held with Banks by Power Company fell within the purview of the exemption provided for in Item 76-A of Part-1 of the Read More...

-Words “and” & “or”---Statutory construction---Words “and” & “or” were interchangeable and the word  “and” could be construed as “or” and vice versa; if such change was necessary to Read More...

Refund of tax amount, delay in-Taxpayer was aggrieved of delay in process of his tax refund- Indeed--Objections raised under S.9(2)(b) of Federal Tax Ombudsman Ordinance, 2000 was misconceived as taxpayer had already availed legal remedy of appeal for non-passing of Read More...

Inherent jurisdiction--Applicability-Principle-Statutes normally do not provide for each and every conceivable eventuality---Court, in respect of some unforeseen events arising in any case for which no provision has been made, are deemed to have inherent Read More...

Amendment of assessment---Show-cause notice to taxpayer-Reference to High Court-Jurisdiction of High Court under S. 133 of the ITO, 2001---Scope---Grounds for amendment of assessment of taxpayer --Addition of new ground/ allegation for amendment of assessment at Read More...

Jurisdiction of High Court under S. 133 of the ITO, 2001---Questions of law Scope-Under S. 133 of the ITO, 2001 High Court had jurisdiction to decide any question of law arising out of an order of the Appellate Tribunal even if such matter had not been argued or Read More...

Taxable income”-----Scope----Contributions made by employers to Khyber Pakhtunkhwa Employees Social Security Institution (“the Institution”)---Term ‘income’ used in S. 2(24) of the Income Tax Ordinance, 1979 was of the widest Read More...

Assessing Officer, disregarding the stay granted by Appellate Tribunal, made recovery from the taxpayer---Taxpayer filed application against said recovery, being illegal, high handed tantamounted to contempt of court--- Dept.al representative regretted the recovery Read More...

Taxable income---Exemption-----Contributions made by employers to Khyber Pakhtunkhwa Employees Social Security Institution (“the Institution”)----Whether income received by the Institution in the form of contributions was Read More...

Contributions made by employers to Khyber Pakhtunkhwa Employees Social Security Institution----Tax assessment year falling under the Income Tax Ordinance, 1979 (“the 1979 Ordinance”)----Plea that benefit of exemption from tax Read More...

Framing of fresh assessment on remand of case---Taxpayer, who filed income tax returns allegedly failed to discharge his responsibilities under the law to act as withholding agent---Show-cause notice issued to taxpayer—Tax payer filed reply, which was not Read More...

Super tax for rehabilitation of temporarily displaced persons----Tax to be levied by law only----Procedure with respect to Money Bill----Bill not deemed to be a money bill----Specific purpose of tax mentioned in the taxing Read More...

Expression completed tax year---Scope-Expression completed tax year cannot be construed to enlarge limitation period beyond twelve months ending on 30th day of June of relevant calendar Read More...

Taxpayer assailed show-cause notice issued by authorities on grounds that it was time barred due to conclusion of tax year well before issuance of notice---Indeed---Relevant tax year could not be considered complete, for purposes of S. 114(5) of ITO, 2001 on last Read More...

Assessing Officer, disregarding the stay granted by Appellate Tribunal, made recovery from the taxpayer---Taxpayer filed application against said recovery, being illegal, high handed tantamounted to contempt of court--- Dept.al Read More...

Assessing Officer, disregarding the stay granted by Appellate Tribunal, made recovery from the taxpayer---Taxpayer filed application against said recovery, being illegal, high handed tantamounted to contempt of court--- Dept.al Read More...

Internally Displaced Persons Tax (IDPT), imposition of---Applicability---Taxpayer was aggrieved of calculation of taxable income by assessing officer and charging Internally Displaced Persons Tax (IDPT) at 5% on tax payable---Commissioner Inland Revenue (Appeals) Read More...

Amendment of assessment for non-furnishing of return---Procedure and verification by dept.--- Taxpayer impugned order passed by dept. under S. 122C of the ITO, 2001 inter alia, on the ground, that the same had been passed without taking into consideration response Read More...

Adjudication to determine whether tax was chargeable on receipt of revenue / fee by taxpayer--- Burden of proof---Scope---Anything which was not income could not be treated as income and receipt was not sole test of chargeability of tax--- Initial burden to show Read More...

Non-competition fee-Nature of receipt of non- competition fee-"Revenue receipt" and "capital receipt"--Distinction- Onus on Dept. to establish chargeability of income tax on capital receipt-Scope-Question before the High Court was whether "non- competition fee" Read More...

Taxing statute---Charges upon subject of a taxation statute must be imposed by clear and unambiguous language, since in some degree the same operated as penalties --Such subject was not to be taxed unless language of a statute clearly imposed such obligation and Read More...

Taxpayer was aggrieved of assessment order passed by appellate authorities for not providing record for audit by the taxpayer---Taxpayer assailed that said notice and true copy was never received by him and that such proceedings were not in his Read More...

Failure of taxpayer to produce the record of documents on receipt of first notice-Board selected the case of taxpayer for audit of his tax affairs-Deputy Commissioner Inland Revenue imposed penalty on failure of taxpayer to join audit proceedings---Commissioner Read More...

Certificates issued under subsection (3) (since omitted) of S.159 of the ITO, 2001-Certificates to remain in force until rescinded by FBR despite omission of subsection (3) of S.159 of the ITO, 2001 by the Legislature--Scope-Question before High Court was whether Read More...