Income Tax (Case Laws)

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...

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...

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...

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...

Learned counsel for H.M. Extraction also submitted that over the years a huge sum of money (running into several crores of rupees) had accumulated in favor of Read More...

Learned counsel for H.M. Extraction also submitted that over the years a huge sum of money (running into several crores of rupees) had accumulated in favor of Read More...

We are reminded here of what was said by this Court in Pfizer Laboratories Ltd. v. Federation of Pakistan and others PLD 1998 SC 64 ("Pfizer case"). The facts Read More...

Whether on the facts and in the circumstances of the case learned ITAT was justified to cancel the assessments made under section 62 for the assessment years Read More...

In “Collector of Sales Tax and Central Excise, LTU, Karachi v. Messrs Pak Suzuki Co. Ltd., Karachi”(PTCL 2016 CL. 63), the Hon’ble Supreme Read More...

Whether on the facts and in the circumstances of the case learned ITAT was justified to cancel the assessments made under section 62 for the assessment years 1986-87 to 1991-92 Read More...

Liability of income tax on statutory bodies/entities---- Benefit of exemption of levy of income on Read More...

Notice under S.114(4) of the ITO, 2001 for filing of income tax return for relevant year was issued Read More...

Liability of income tax on statutory bodies/entities---- Benefit of exemption of levy of income on income of Federal and Provincial Governments and local authorities under S.49 of the ITO, 2001---Scope---Question before the High Court was whether certain statutory Read More...

Notice under S.114(4) of the ITO, 2001 for filing of income tax return for relevant year was issued to the taxpayer, but on due date neither anybody attended the office nor any application for adjournment was filed---Assessing authority made provisional assessment Read More...

The close perusal of section 148(8) of the Ordinance would unfold the situation as that Tax paid at the import stage is a minimum amount of tax and the importer Read More...

The close perusal of section 148(8) of the Ordinance would unfold the situation as that Tax paid at the import stage is a minimum amount of tax and the importer Read More...

The close perusal of section 148(8) of the Ordinance would unfold the situation as that Tax paid at the import stage is a minimum amount of tax and the importer Read More...

The close perusal of section 148(8) of the Ordinance would unfold the situation as that Tax paid at the import stage is a minimum amount of tax and the importer is subject to the payment of income tax under Read More...

From the plain reading of section 170 of the Ordinance, it is evident that the claim for refund has different para-meters and Read More...

From the plain reading of section 170 of the Ordinance, it is evident that the claim for refund has different para-meters and yardsticks. As stated above, Read More...

In other words, a complete tax return upon its filing becomes assessment order of the Commissioner Inland Revenue. Under the present dispensation, mere filing Read More...

In other words, a complete tax return upon its filing becomes assessment order of the Commissioner Inland Revenue. Under the present dispensation, mere filing Read More...

The close perusal of section 148(8) of the Ordinance would unfold the situation as that Tax paid at the import stage is a minimum amount of tax and the importer Read More...

---S. 12(9A) & Second Sched. Part IV, CI. (59)----Companies Ordinance (XLVII OF 1984), s. 245----Income deemed to accrue or arise in Read More...

Maintenance of accounts on mercantile system of accountancy--Interest on Government securities---Declaration of interest on cash basis. Assessing Officer pointed out that interest on Government securities as declared was less than that Read More...

Precedent---Each enactment has its own objectives, philosophy and mechanism and decisions made under it are not binding on the functionaries working under another enactment until and unless the Legislature specifically so directs, Read More...

Annual Letting Value---(ALV) assessed by Provincial and Taxation Department under Property Tax Act for the purpose of levying property tax was not binding on the Assessing Officer for the purpose of income-tax under Income Tax Ordinance, Read More...

Assessment, setting aside of Justification First Appellate Authority was not justified in setting aside the assessments second time when the Read More...

Instructions/directions issued by Central Board of Revenue---Binding on Assessing Officers and all other Tax Authorities performing administrative functions, but not on assessee and Appellate Authorities---Central Board of Revenue is an Read More...

Income from business of profession Crossing up the receipt of “tax on tax” Department treated the assessee’s tax liability Read More...

Assessee received gain from Bank earned from sale of shares of assessee in pursuance of S.14 of Securities and Exchange Ordinance. 1969-Authority found such receipt to be income Contention of assessee was that such receipt being of Read More...

Exemption Assessee had created immovable assets out of foreign remittances received and had claimed exemption- Assets were partially disposed Read More...

Assessment is an order through which the Revenue expresses itself on the income earned by or accrued to an assessee during a particular accounting period-Such an expression is generally based upon the declarations and affirmations made Read More...

Penalty for concealment of income etc. Addition Settlement Addition made under S. 13(1) (aa) of the Income Tax Ordinance, 1979 was reduced by Read More...

Additional assessment---Re-opening of agreed assessment---Agreed assessment though a settlement of contractual nature could not be declared to be a voluntary agreement between the Revenue and assessee fulfilling all the codal Read More...

Preamble set-off loss Foreign exchange gain and loss Assessee showed foreign exchange gain and loss Assessee showed foreign exchange gains as Read More...

Issue raised by the assessee at the Appellate stage without having the same agitated through specific grounds of appeal would not arise out of the orders of both the Authorities below, same could not be raised before the Tribunal in Read More...

Directors Deductions Admissibility- Salary paid in cash to the Directors of the company was disallowed by the Assessing Officer being not Read More...

----Profit and loss expenses---Disallowance of---History of the case---Relevance---Admissibility of claim of expenses under each head for every year is to be considered independently on the basis of facts available for that Read More...

Disposal of appeal by the Appellate Tribunal reported case of Income-Tax Appellate Tribunal in a reference application Rectification on the Read More...

Sale promotion and advertisement expenses --- Five per cent . disallowance of expenses by referring to history of the case without mentioning any other reason was confirmed by the First Appellate Authority --- Validity --- Such Read More...

Income Tax Act of 1922 Ss. 28 & 51 Penalty proceedings Nature Penalty proceedings both under the Income-Tax Act, 1922 or Income Tax Read More...

Extension of date for filing of return---Central Board of Revenue could not take away, by issuing a Circular, the powers of extending the date of filing of return vested in the Assessing Officer by S.55(3) of the Income Tax Ordinance, Read More...

Constitutional petition Pre-condition for filing appeal against assessment order to deposit 15% of the amount of tax assessed Petitioner Read More...

Powers of IAC Wealth Tax Officer's order---Net wealth---Liabilities not against any assets created by the assessee---Disallowance of---Inspecting Assistant Commissioner revised the assessment by adding the liabilities on the ground that Read More...

Payment of tax with return of income “Tax payable on the basis of assessment” Distinction Clear distinction exists between the Read More...

Salary and allowances --- Electricity expenses --- Tenant’s burdon borne by the property income and was not a business expenditure --- Salary of electrician was covered by the allownces of repair allowed against the property Income Read More...

Exemption-- Additional tax for failure to pay tax Claim of exemption Non-Payment of tax with return Assessment Rejection of exemption Levy of Read More...

Income from other source- Supply of electricity---Interest income on delayed payment of electricity bills---Taxability---Interest income is not to be considered as part and parcel of the business income and its assessment under S.30 of Read More...

Penalty Concealment of income Wrong claim of exemption –Effect-- Assessee, on the one hand had been allowed to claim exemption from tax Read More...

Fiscal statute---Exemption provision---Assessee has to prove himself to be within the four corners of the exemption provisions---Unlike charging provision when an exemption clause is interpreted the doubt is resolved in favour of the Read More...

Punjab Undesirable Cooperative Societies (Dissolution) Ordinance (XXXI of 1992), Preamble Constitution of Pakistan (1973), Art. 199 Read More...

Interest earned on delayed payment of electricity bills---Interest paid on borrowed capital---Deduction of interest Read More...

Appeal before High Court Limitation Appeals filed after more than four years from passing of orders by the Income-Tax Appellate Tribunal, Read More...

Income From encashment of foreign Exchange Bearer  Certificates --- Taxability in the hands of company or registered firm --- Validity --- Amount received on encashment of FEBCs was deemed to be an income under S. 80-B (1) read with  S.80 (2) (b)(b) of the Read More...

--- Second Sched., cl.(129)--- C.B.R. Circular No.20 of 1998 , dated 8-10-1998 --- Exemption --- words “subject to such conditions as may be specified therein” and where it is so specified” in cl (129), Second Sched. Of Read More...

--- Second Sched., cl.(129)--- C.B.R. Circular No.20 of 1998 , dated 8-10-1998 --- Exemption --- words “subject to such conditions as may be specified therein” and where it is so specified” in cl (129), Second Sched. Of Read More...

Books of account were neither denied nor produced Assessing Officer’s guess work was neither honest nor he relied upon the past history Read More...

--- Ss. 156, 14(1) & Second Sched ., cl. (129) --- C.B.R Circular No.20, dated  8-10-1998 --- Rectification application --- Calculation of export rebate --- Inclusion of wealth tax for determining the total income for purpose of Read More...

Refection of accounts Trading account Rejection of claim of profit and loss expenses on account of its being disproportionate to the quantum Read More...

Income from “ house property” --- Shop purchased by assesse was being used by his son for business --- Assessee did not disclose income from shop , but Assessing Officer added rental value thereof in his business income --- Read More...

Re-opening of assessment Assessee was initially assessed as public company entitled to 5% rebate of super tax Subsequently, it transpired Read More...

Tax Amnesty. Scheme, 2000 (C.B.R. Circular No.4, dated 1-3-2000), Para. 10(3) ---Words "issued" and "received" in para. 10(3), Tax Amnesty Scheme, 2000---Connotation---Word "issued"used in para. 10(3) of the Scheme with respect to Read More...

Petition to High Court for declaring the case fit for appeal to Supreme Court Essentials Such petition must contain all the grounds on which such certificate is sought Being an important document, which has to be ultimately treated as Read More...

Tax Amnesty Scheme, 2000 (C.B.R. Circular No.4, dated 1-3-2000), paras. 8 & 10---C.B.R. Circular No.9 of 2000, dated 31-5-2000, para. 2(c)---C.B.R. Circular No.1 of 2001, dated 29-2-2001, para. 2---Wealth Tax Act (XV of 1963), Read More...

Succession to business, otherwise than on death Assessment in the name of predecessor Validity Assessment in the name of predecessor was invalid, where the business was carried on by the successor and Return for that very year was also Read More...

Constitutional petitions challenging. orders of rejection of declarations filed under Tax Amnesty Scheme, 2000-Department's objection was that impugned orders were open to appeal under S. 129 of the Ordinance, thus, Constitutional Read More...

Income Tax Act (XI of 1922), S.4 (2D) Addition Value of property-- Approval of I.A.C. Two separate and independent approvals of the Read More...

No provision of a statute should be considered in isolation, until and unless any section/provision thereof is a complete code in itself Any Scheme contained in a statute or subordinate legislation should be considered in totality of the Read More...

Constitutional petition show-cause notice When Constitutional petition and show cause notice were put in just a position, then it brings the Read More...

Powers of IAC to revise Wealth Tax Officer’s order Assessment year 1991-92 Validity Section 17B of the Wealth Tax Act, 1963 enacted Read More...

Refund to assessee---Maladministration---Department's action of "deliberate withholding or non-payment of refund" was based on irrelevant grounds which fell under the definition of 'maladministration' as per S.2(3)(ii) of the Establishment of the Office of Federal Read More...

Interim order Interim order is part of working of judicial system and for that purpose no separate or specific provision is necessary to empower a Court to issue an Interim order Even in the absence of any such specific provision, a Read More...

Deemed income---If an assessee was able to prove that the amount paid by him was through cross cheque the other requirements i.e. to intimate the National Tax Number were not to be invoked---Language of relevant law is disjunctive and not Read More...

Reference to High Court Admission of additional evidence Nothing had been brought on record to show that objection against the admission of Read More...

Powers of Inspecting Additional Commissioner to revise Deputy Commissioner's order---Deemed income---Share deposit money was received through cross cheque---Inspecting Additional Commissioner cancelled the order of Assessing Officer on Read More...

Reference to High Court /Question of fact --- Question whether the assessee was  a manufacture Read More...

Concealment of Income ----Mere addition to Income at the instance of assessee would not warrant a finding of concealment of Income Penalty cannot be levied under S.271 (1)(c) --- Indian Income Tax Act, 1961 ,S.271(1) (c) 
In the Read More...

Cooperative Societies Act (VII of 1925), Preamble/Company/Status of Cooperative Society/Societies registered under the provisions of Read More...

Business---Expenditure---Disallowance---Expenditure on maintenance of residential accommodation in the nature of a guest house---Effect of S.37(4)---Section 37(4), would cover expenditure on purchase of provisions for giving refreshments Read More...

---Property --- Deduction --- Unrealised rent ---Institution of legal proceedings against tenant is sufficient---No obligation on assessee to prove decree Notice to tenant to vacate in March, 1972---Suit instituted during previous year. relevant to assessment year Read More...

Rectification of mistake--Purchase and sale of securities in course of business of banking---Securities held as stock-in-trade---Interest paid for broken period on purchase of securities---Deductible as business.
-Rectification to Read More...

Share deposit money---Deeming such sums as "loan" or "advance"---Show-cause notices were issued to assessees on the point that introduction of "share deposit money" over and above the authorised capital otherwise than by crossed cheques Read More...

Valuation of Read More...

-Assessee---Association registered under Bombay Public Trusts Act/Granted certificate under S.80G of Income Tax Act as established for Read More...

Revision---Assessment pursuant to order in revision/Assessing Officer/Whether can make addition of items not subject-matter of issue before Read More...

Test to determine definite nature of information---Requirements of S.65 of the Income Tax Ordinance, 1979.The phrase "definite information" refers to the information, which is sine qua non for the purpose of re-opening. That information Read More...

Reassessment/Fresh order of assessment of entire income of assessee/Effect/Original assessment order gets effaced/Indian Income Tax Act, Read More...

Head Office expenses----Assessee a non-resident company----Assessee claimed Head Office expenses in the computation chart and not in the profit and loss account---Admissibility----Assessee was not entitled to claim Head Office expenses Read More...

Assessee in default---Show-cause notice for recovery of advance income-tax not deducted at source---Failure to identify the names of the parties Read More...

Fiscal statute has to be construed in its true perspective and in respect of payment of tax, if it is found due, against a part, then such Read More...

---Welfare fund, levy of---Assessing Officer---Jurisdiction---Assessing Officer under S.4 of the Workers’ Welfare Fund Ordinance, 1971, Read More...

Concealment of income/Law applicable/Jurisdiction to levy penalty/Penalty proceedings pending before IAC on 31-3-1976/-Effect of omission of subsection (2) of S.274 with effect from 1/1976/-IAC competent to continue with proceedings and Read More...

Levy of workers’ Read More...

Income from undisclosed sources--Addition due to difference between value of stock as recorded in books and as found in declaration to bank for getting overdraft/Burden of proof on Revenue/-Could not be discharged by merely referring to Read More...

Levy of Workers’ Welfare Fund on income exempted under the Sched. II of the Income Tax Ordinance, 1979---Counsel for the assessee conceded Read More...

Acceptance of explanation of assessee by Tribunal-----Question of fact---The assessee’s income is to be assessed by the Income-tax Officer on the basis of the material which is required to be considered for the purpose of Read More...

Levy of Workers’ Read More...

Charitable purposes/Finding that income of trust had been accumulated and that balance had been applied for charitable purposes/Tribunal was justified in granting exemption to charitable trust/No question of law arose/Indian Income Tax Read More...

Workers’ Welfare Fund---Determination of---Assessing Officer under S.4(4) of the Workers’ Welfare Fund Ordinance, 1971, is under Read More...

Annual letting value/Basis for determination/Law applicable/-Effect of amendment of S.23 in 1975/-Actual rent will be deemed to be annual value if it is in excess of sum for which property might reasonably be expected to be let/-Indian Read More...

Workers’ Welfare Fund---Determination of---Assessing Officer under S.4(4) of the Workers’ Welfare Fund Ordinance, 1971, is under Read More...

Property/Finding that large building had been let out to an associate company on a very low rent/Tribunal justified in remanding matter for determination of reasonable rent/No question of law arose/Indian Income Tax Act, 1961, Ss. 22 Read More...

---Duties/obligations Read More...

Property/Finding that large building had been let out to an associate company on a very low rent/Tribunal justified in remanding matter for determination of reasonable rent/No question of law arose/Indian Income Tax Act, 1961, Ss. 22 Read More...

Constitutional Read More...

/Powers of Income Tax Authorities under S.131/Condition precedent for exercise of power/Proceedings under Income-Tax Act must be pending/No pending proceedings/No application of mind by ITO/Notice under S.131 was not valid/Indian Read More...

Permanent establishment”---Connotation---Term “permanent establishment” denotes a branch, management, factory or other fixed Read More...

-Concealment of income/Return income of about twenty five lakhs of rupees enhanced by nearly thirty eight lakhs/Tribunal deleting penalty without applying Expln. 1 to S.271(1)(c) for assessment year 1989-90/Question whether deletion of Read More...

Reference---Appeal---Argument neither raised in the grounds of appeal nor arising out of the order of the Income Tax Appellate Tribunal, has no Read More...

---Voluntary Disclosure of Income Scheme, 1997/Delay in payment of tax/Delay not a long one/Declarant having reasonable explanation for Read More...

Determination of value of land and building with fixtures and fittings---Principles---Rule 8(3) of the Wealth Tax Rules, 1963 prescribes the Read More...

Interest on borrowed capital/Assessee borrowing money for purpose of setting up a printing facsimile unit/-Interest paid allowable as revenue expenditure/Indian Income Tax Act, 1961, S.37.
The assessee established a printing facsimile Read More...

Foreign currency account in Pakistan---Exemption---allowed in respect of foreign currency account in Pakistan from the charge of wealth tax by Read More...

Income/Pronote seized during search operations/-Pronote providing for payment interest/-Evidence from books of account of M that such interest had been paid to assessee/-Interest was assessable as income of assessee/Indian Income Tax Read More...

Immunity granted to Foreign Currency Accounts---Intention of Legislature---By enacting subsection (2) of S.5, Protection of Economic Reforms Read More...

Held, that the pronote stipulated payment of interest. The entries in the account books of M in the normal course of business revealed the payment of interest of Rs.67,790 to the assessee-company. The mere fact that the correct Read More...

---Fiscal statutes to be strictly interpreted and in case of substantial deficiencies in the wordings, such statute is to be interpreted Read More...

Delay of 26 days in filing application---Section 256 allows condonation of delay up to 30 days after time limit/Provision for condonation of delay to be liberally construed/Finding that delay was due to mistake of counsel/Delay condoned/-Indian Income Tax Act, 1961, Read More...

“The amendment made in subsection (1) clarifies that the instrument of partnership shall be in writing. Subsection (4) has also been Read More...

Cooperative society/Special deduction/Scope of Cooperative society engaged in banking business/Interest arising from investment made out of reserve fund to enable it to carry on banking business/-Is income from banking Read More...

Deemed concealment under Explanation/Notice for imposition of penalty--Specific reference to Explanation dealing with deemed concealment not necessary/Indian Income Tax Act, 1961, S.271(1)(c). Expln. 1. cl. (B)-[ CIT, v. P.M. Shah (1993) Read More...

Development Authority constructing flats and allotting them to buyers/Interest paid to buyers for period of delay/Failure to deduct tax at source/Notice of demand for tax and recovery.--Development Authority an "assessee"- Appellate Read More...

Interest----Delay in filing return----Deficiency in paying advance tax-----Assessment order Direction for charging interest for delay and Read More...