Tax-Digest-Pakistan.pdf
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Tax Laws Pakistan...
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(v) COMPARATIVE TABLE OF SECTIONS
VOL-I
Contents List List of cases Digested in VOLUME-I
.....
Comparative Table of, Income-tax Act, VII of 1918, Income-tax Act, XI of 1922 & Income Tax Ordinance, 1979 Under Section 1.
Title
.....
(xxxiii) (cix)
Case No.
Page No.
1-460
1-272
1
35
Retrospective Legislation
35
58
Remedial and curative Legislation has retrospective effect
59
72
Principle of contemporary exposition
60
73
Action is deemed illegal, the whole superstructure built upon it is also illegal
62
74
Income cannot be taxed twice
63
74
One thing implies the exclusion of another
64
75
Application of rule generalibus specialia derogant
66
76
Interpretation of statutes / General Principles
67
77
Principles governing interpretation of financial liabilities
98
86
Principle of Equity
99
87
Powers of courts/administrative jurisdiction
102
88
Income / deeming provisions How to be construed
140
105
Distinction between direct and indirect taxes
146
108
Distinction between "tax" and "fee"
147
109
Distinction between actual liability in praesenti and a liability de futuro which for the time being, is only contingent
148
109
Short title, extent and commencement General Principles of Taxation / Rules of Interpretation - Legislative Powers
(vi) Income Tax Digest.
VOL-I
Under Section
Title
Case No.
Page No.
Theory of reading down as a rule of interpretation
149
110
Rule of evidence
150
111
Courts can strike down discriminatory and confiscatory provisions of fiscal laws
156
113
Scope of various words and expressions
157
113
Interpretation regarding words and expressions
227
145
Past and closed provision
231
147
Special law vs. income tax
232
148
Machinery provisions
234
150
Limitation period cannot be extended retrospectively
239
153
Rules of construction - Fiscal statutes
240
154
Rule of interpretation Two equal possible interpretations Exemption clauses
264
164
Rule of limitation
269
166
Redundancy should not be readily assigned by courts
279
170
Interpretation favourable to assessee is to be adopted
281
170
Rules when language is ambiguous
283
171
Non obstante provision overrides conflicting provision
304
180
Doctrine of binding precedent (Stare Decisis)
305
180
Doctrine of merger
314
184
Legal maxims
316
185
Doctrine of res judicata/estoppel
326
190
Natural justice/duties of court
334
194
Doctrine of mutuality
345
198
Non-application of federal tax laws to tribal areas
346
199
Rules relating to interpretation of amending provisions explained
347
200
(vii) COMPARATIVE TABLE OF SECTIONS
Under Section
2(1).
Title
VOL-I
Case No.
Page No.
Principles governing interpretation of financial liabilities
349
201
Interpretation leading to destructive ends should be avoided by courts
350
202
Terms and phrases used in one statute
351
204
Marginal notes to the section of an act cannot be referred to for the purpose of construing the act
352
205
Principle of literal interpretation
353
206
Doctrine of favourable interpretation
355
206
Department can go beyond a transaction
356
207
Application of tax rates through a finance act explained
357
207
Act is to be read as a whole
358
208
Statute should be read as a whole
359
208
Section vs. Rule
360
209
Principle of approbate and reprobate
361
210
High court is competent to entertain writ where interpretation of law is involved
362
211
General rules in respect of writ petition
363
211
Writ held maintainable
390
227
Writ held not maintainable
408
241
Miscellaneous
443
263
461-549
273-324
Scope of term `agriculture'
461
281
Land used for agricultural purposes
467
284
Agricultural process
472
287
Rent / revenue, connotation of
479
290
Land must be situated in Pakistan
480
290
Land must be assessed to land revenue
481
291
Dividends to shareholders out of `agricultural income'
483
291
Sale of trees of spontaneous growth - Not agricultural income
484
293
Definitions.-Agricultural Income.
(viii) Income Tax Digest.
VOL-I
Under Section
2(6).
2(7).
2(8).
Title
Case No.
Page No.
Interest on arrears of rent
491
298
Annuity
495
302
Commission
496
303
Salary / Remuneration
497
303
Rent
503
307
Income from mortgage
506
308
Lease rent
512
312
Salami (lumsump payment)
515
314
Maintenance allowance
517
314
`Forestry' and `agriculture' not synonymous
524
316
Tea manufacturers
541
321
Coffee manufacturers
542
322
Sugar Manufacturers
543
322
Reference to the high court
544
322
Definitions.-Assessee
550-553
325-328
Scope of definition
550
326
Assessee vis-a-vis Trust
553
328
Definitions.-Assessment
554
329-330
Words "assessment" and "re-assessment" explained
554
330
Definitions.-Assessment year
555-556
331-334
555
332
557-566
335-345
Adventure in the nature of trade
557
337
Definition of the word "business"
564
342
Purchase and sale of heavy shares with borrowed capital to sister concern at market rate
566
344
Definitions.-Capital Asset.
567
346-347
`Capital asset' - Scope of
567
347
568-595
348-363
568
351
Word `year' - How to be construed 2(11).
2(12). 2(14).
Definitions.-Business
Definitions.-Charitable purpose. General conditions for exemption
(ix) COMPARATIVE TABLE OF SECTIONS
Under Section
2(16).
2(20).
Title
Case No.
Page No.
Charitable vs. non-charitable trust
569
352
Mixed trusts
575
354
Relief of poor - Preference to relatives
578
356
Residuary head - Object of general public utility - Connotation of
583
357
Public- connotation of
587
359
Element of private gain
589
360
Illustrations
590
361
596-600
364-367
Word "form", meaning of
596
365
Expressions "by" and "under" explained
597
365
Body "corporate under the law" explained
598
366
Chamber of commerce
600
367
601-606
368-374
601
369
607-618
375-382
General - Connotations of word "income"
607
377
Criteria to determine taxable & tax free income
615
379
Definitions.-Income Tax Officer.
619
383-384
Definition of `income tax officer'
619
384
620-632
385-396
620
387
Can income year be of more than 12 months? 622
387
Word `year' explained
623
388
Expression "such period"
625
389
Expression "previous year"
626
390
Miscellaneous
632
396
Definitions.-Inspecting Additional Commissioner.
633
397-398
Powers of inspecting additional commissioner633
398
Definitions.-Company.
Definitions.-Dividend. Scope of term "dividend"
2(24).
2(25). 2(26).
Definitions.-Income.
Definitions.-Income Year. Change of year
2(27).
VOL-I
(x) Income Tax Digest.
VOL-I
Under Section 2(29). 2(32).
Title
Case No.
Page No.
Definitions.-Interest.
634
399-400
Expression "interest" - Scope of
634
400
635-716
401-442
Definition of "person"
635
409
Status of "local authority"
638
410
Status of "individual"
640
410
Status of "AOP"
644
412
Word "association" does not have technical meaning
652
416
Hindus - Connotation of
653
416
Hindu undivided family Connotation of
654
416
Hindu undivided family vs. Hindu coparcenary
656
417
Family - Connotation of
659
418
Junior member
660
419
Female members
661
419
Partition of HUF
664
421
Property of HUF
665
421
Ancestral properties'
668
422
Self acquired properties
671
423
Property of HUF
672
424
Business of HUF
676
427
Throwing of self-acquired property into family hotchpot
680
429
Impartible estate
681
429
Remuneration to karta-partner from firm
682
429
Benefits of contracts
684
430
HUF & Firm
685
430
Association of persons - Basic principles
686
430
HUF and AOP
689
431
Firm & AOP
690
432
Association of companies
691
432
Definitions.-Person.
(xi) COMPARATIVE TABLE OF SECTIONS
Under Section
2(34). 2(40).
2(43). 2(44). 3.
4.
Title
VOL-I
Case No.
Page No.
Co-owners [Position under the 1922 Act]
692
432
Co-heirs
698
434
Co-trustees
702
435
Co-executors
703
436
Mutual concern - General tests
704
436
Test as to distribution of surplus
705
436
Clubs
706
437
Companies
708
438
Co-operative society
711
439
Mutual insurance company
713
440
Definitions.-Principal officer.
717
443-444
Illustrations
717
444
718-745
445-462
Significance of residential status
718
448
`Year' as in `income year'
728
451
Individual
730
454
Test for "not-ordinarily resident"
732
455
Firm - General
733
456
Company
737
458
Control and management - Meaning of
740
459
Definitions.-Tax.
746
463-465
"Penalty" or "interest" on tax due
746
464
Definitions.-Total income.
747
466-469
Meaning of "total income"
747
467
748-750
470-474
Power of CBR
749
471
Income tax officer, whether a court
750
474
751-758
475-486
Authority
751
476
Comparison with Indian law
755
480
Jurisdiction
757
484
Removal
758
485
Definitions.-Resident.
Income tax authorities
Appointment of income tax authorities etc.
(xii) Income Tax Digest.
VOL-I
Under Section 5.
7.
Title
Case No.
Page No.
758-795
487-514
Jurisdiction
759
491
Transfer of jurisdiction
763
494
Tribunal was not legally justified in annulling the assessment on the point of jurisdiction
774
506
Jurisdiction in general
776
508
Jurisdiction of assessing officer
781
511
Objection as to income tax officer's jurisdiction
790
513
Opportunity of hearing
793
513
Scope and application of provision
794
514
796-802
515-519
796
516
803-813
520-527
Legality of CBR's orders, instructions & directions
803
522
Powers of CBR to give direction to ITO
812
526
Binding force of circulars
813
526
814-996
528-647
Charge of income tax, super tax and surcharge
814
545
Scope of article 165 vis-a-vis changeability in the case of provincial Governments
822
548
Liability to tax when arises
829
559
Concept of income
833
561
Scope of protection under the economic reforms protection act of 1992
846
569
Charge on benami transactions
849
572
Tests to determine whether a receipt is a revenue or capital receipt
850
574
Profit and loss appropriation account
869
584
Jurisdiction of income tax authorities
Guidance to Deputy Commissioners Guidance to assessing officers
8.
9, 10.
All Officers to follow the orders of the Central Board of Revenue
Charge of income, super tax and surcharge
(xiii) COMPARATIVE TABLE OF SECTIONS
Under Section
Title
VOL-I
Case No.
Page No.
Overriding title vs. Application of income
870
585
Devaluation gain
871
586
"Mercantile" and "cash system"
873
588
Applicability of 1922 Act to different Provinces/States
874
590
Applicability of act to rulers of erstwhile Indian states
877
591
Charging section - General
878
591
Charge is in respect of income of previous years
881
592
Exemption from tax
883
593
Double taxation
885
593
Finance acts - Relevance of
888
594
Tax avoidance / tax planning
891
595
English cases
893
596
Guiding principles
894
596
Burden of proof
901
599
Other factors
902
599
Allocation of payment between interest and principal sum due
904
599
Illustrations
911
607
Commission
915
608
Pension / annuity
916
609
Rent
918
610
Salami
921
611
Illustration
925
612
Subsidy / incentives
927
614
Gifts / voluntary payments
928
614
Share in business profits
930
615
Technical know-how
931
616
Patent / trade mark / copyright
932
617
Mining rights
933
617
Bonus shares
934
618
(xiv) Income Tax Digest.
VOL-I
Under Section
Title
Case No.
Page No.
Bonus debentures
935
619
Sale proceeds of trees
936
619
Sale proceeds of assets of money-lender
938
620
Receipts by partners from firm
940
621
Others
941
621
Application of income
946
623
Illustrations
947
624
Maintenance allowance
949
624
Royalties
954
627
Payments by executor to beneficiaries under testator's will / trust
955
628
Accrual of income - Connotation of
958
629
Time of accrual of income - Basic principles
960
630
Receipt/deemed receipt - Connotation of
962
631
Time of accrual of income - Illustrations
963
631
Interests
966
633
Commission
971
635
Underwriting commission
972
636
Profits of mortgage sale
973
637
Concept of real income
974
637
Disputed claims
975
638
Income forgone
976
638
Place of receipt / accrual of income - General 978
639
Accruing or arising in Pakistan - Meaning of 981
640
Illustrations : In case of buying and selling of goods 982
640
Illustrations : Relevance of place from where directions are issued for transactions/where contract is concluded
988
643
Illustrations : In case of agents
991
645
Illustrations : Where payment is made by posting of cheque
993
646
Illustrations : Commission
994
647
Illustrations : Interest
995
647
(xv) COMPARATIVE TABLE OF SECTIONS
Under Section 11.
12(1).
12(2).
12(3).
12(7). 12(9).
12(9A).
VOL-I
Title
Case No.
Page No.
997-1022
648-675
Scope of "total income"
997
651
"Accrue" and "arise", meaning of
998
651
Chargeability vis-a-vis deeming provisions
1001
656
Relevant date for accrual of income
1012
666
Receipt and accrual of income
1013
668
Scope of total income
Amount is `received' when income accruing outside is `set off' against liability in Pakistan1016
670
Transmission of funds is always bilateral
1017
671
Book entries
1018
671
Retrospective operation
1019
671
Unexplained income
1020
672
Liability
1021
673
1023-1024
676-678
Salary when deemed to accrue or arise in Pakistan
Receiving salaries from state exchequer is taxable no matter where paid
1023
677
Position under 1922 act
1024
678
1025-1050
679-697
Business connection - Connotation of
1025
682
Illustrations of business connection
1040
690
Source / property
1048
696
Business operations
1049
697
1051-1052
698-700
Interest
1051
699
Loan when deemed as income
1053
701-702
Scope of deemed income
1053
702
Dividend Paid abroad
1054
703-704
Dividend paid by a Pakistani company outside Pakistan
1054
704
1055-1066
705-715
1055
707
Business connection
Interest when deemed to accrue or arise in Pakistan
Undistributed profit when taxable Additional income tax on undistributed profits - Application of provision
(xvi) Income Tax Digest.
VOL-I
Under Section
12(11).
12(12).
12(18).
13(1)(a).
13(1)(aa).
Title
Case No.
Page No.
"Free reserve", meaning of
1058
708
Gratuity is an ascertained liability
1062
712
Definition "free reserve" and super tax
1063
714
General
1064
714
Smallness of profits - Tests for determination1066
715
Dividend Income - Basis of chargeability
1067-1072
716-722
Word "pay", meaning of
1067
717
Change in law
1068
717
Year of taxability of dividend income
1069
718
Difference between the fair market value of stocks and shares
1073
723-725
Deduction of liability towards the foreign loans
1073
724
Difference between the fair market value of stocks and shares
1074, 1075
726-728
Share deposit money is not "loan"
1074
727
Section 12(18) vis-a-vis section 66A
1075
728
1076-1092
729-746
Unlawful additions under section 13 are not sustainable
1076
731
Itat has a duty to correctly record the facts and give objective findings
1077
732
Cash credit
1078
732
Unexplained investments, etc., deemed to be income - Cash credit
"Income from undisclosed sources", meaning of1087
742
Nature of receipt
1088
744
Firm / partners
1089
745
Procedures followed
1090
745
Illustrations
1092
746
1093-1095
747-752
1093
748
Unexplained investments, etc., deemed to be income - Proof of income from other source Proof of income from other source
(xvii) COMPARATIVE TABLE OF SECTIONS
Under Section 13(1)(b).
Title
Case No.
Page No.
1096-1097
753-754
1096
754
1098-1099
755-757
1098
756
1100-1102
758-760
Valuation of land
1100
759
Valuation of assets - Property
1102
760
1103-1104
761-762
Explained source of expenditure
1103
762
Unexplained investments, etc., deemed to be income
1105
763-764
Status of law
1105
764
1106-1113
765-770
Exempt income, meaning of
1106
767
"Assessable" and "taxable" contain different meanings and applications
1108
767
Exempt incomes vis-a-vis charge of workers welfare fund
1110
768
1115-1117
771-774
Principles governing classification of income1114
772
Unexplained investments, etc., deemed to be income Excess stock declared with banks is deemed income
13(1)(c).
Unexplained investments, etc., deemed to be income General
13(1)(d).
13(1)(e).
13(2).
14.
15. 16.
VOL-I
Unexplained investments, etc., deemed to be income
Unexplained investments, etc., deemed to be income
Exemptions
Heads of income Salary
1118-1150
775-801
Compensation for loss of service is capital receipt 1118
779
Master servant relationship
780
1119
Compensation under golden handshake scheme1120
781
Salary v. professional income
1121
781
Salary vs. business income
1123
783
Contributions to pension funds
1124
784
Accrual of salary
1126
787
Illustrations of salary
1128
788
Perquisites - Allowances
1139
792
(xviii) Income Tax Digest.
VOL-I
Under Section
17.
19.
20.
Title
Case No.
Page No.
Car perquisites
1141
794
Shares allotment to employees
1143
795
Position under the 1979 Ordinance
1144
796
Position under 1922 act
1146
798
Managing director/director
1148
799
Position prior to 1979
1150
801
1151-1157
802-809
Place of accrual of income Interest on securities
1151
803
Purview of chargeability
1154
806
Interest on securities is taxable on receipt basis
1155
807
Impartible estate
1156
808
Deductions
1157
808
1158-1188
810-835
Ownership & chargeability
1158
813
Applicability of explanation with retrospective effect
1167
819
Distinction between "property tax" and "income tax"
1168
820
Owner
1169
820
Profits and gains of business or profession vs. income from house property - Letting of properties Annual value - General
1175 1178
828 831
Lessee Trustees
1181 1182
832 833
Official assignee
1184
833
Co-operative society
1185
834
In case of money-lender
1186
834
Zamindari
1187
834
Property used for business
1188
835
1189-1197
836-840
1189
837
Interest on securities
Income from house property
Deductions Wealth tax liability is an allowable expense
(xix) COMPARATIVE TABLE OF SECTIONS
Under Section
21.
22.
VOL-I
Title
Case No.
Page No.
Deductions - Repairs
1190
837
Annual charge
1191
838
Interest on borrowed capital
1194
839
Taxes
1195
840
Certain terms defined - Impartible estate
1197
840
1198-1202
841-845
Words "definite" and "ascertainable", explained
1198
842
Co-owners - Shares to be definite
1199
843
Tax as AOP
1201
844
Illustration
1202
845
1203-1343
846-957
Liability in the case of co-owners.
Income from business or profession
Revenue receipts vs. capital gains Section 22 & section 27 of the ordinance
1203
860
Profit motive, meaning & relevance of
1205
863
Isolated transaction when can constitute adventure in the nature of trade
1209
865
Business income - General principles
1217
872
Profits and gains, connotation of
1218
873
Business when deemed to be carried on
1225
876
Business income vs. income from other sources - Section 22 & section 30 of the Ordinance
1226
877
Income determined in the case of the trust
1230
880
Business income on purchase of share
1231
881
Business income in the nature of casual or non-recurring
1232
882
"Abandoned" and "discarded", meaning of
1234
884
Loss / forfeiture of deposit
1235
885
Disposal or remuneration of income is not admissible in law
1240
890
Income or capital receipts
1242
892
Business income - Tests to determine nature of transaction
1243
893
Veil of corporation can be lifted
1250
897
(xx) Income Tax Digest.
VOL-I
Under Section
Title
Case No.
Page No.
Profits derived from sale of shares and bonus shares
1252
898
Dealing in land when constitute business
1254
900
Compulsory acquisition of property
1257
903
In case of money-lender
1258
903
Other illustrations
1260
904
Dealers in shares
1261
905
Gold and silver transactions
1262
908
Other illustrations
1264
909
Concept of business - Connotation of
1266
910
Profession / occupation / vocation
1269
911
Illustrations
1272
913
Carrying on business / closure of business
1278
916
Same business - Connotation of
1280
916
Rental income - Hiring of business assets
1281
917
Rental income - Other illustrations
1282
917
Royalties
1284
919
Compensation
1287
920
Sale proceeds of business / business assets / stock-in-trade
1289
921
Exploitation of mining rights
1290
922
Share dealing
1292
923
Money-lending business
1293
923
Other illustrations
1297
926
Business loss / deduction - Allowability of loss and expenditure
1300
927
Conditions precedent
1302
928
Other concepts
1307
930
Distinction between `fixed capital' and `circulating capital' - Devaluation loss
1312
932
Payment of portion of profits
1315
940
Revenue or of capital loss - Test of
1316
941
Losses on sale of shares
1317
941
(xxi) COMPARATIVE TABLE OF SECTIONS
Under Section
23.
VOL-I
Title
Case No.
Page No.
Loss on sale of securities / benefits
1319
942
Loss on sale of assets / land, etc.
1320
943
Loss arising to money-lenders
1322
944
Deductions in case of partners
1328
946
Others
1329
947
Year in which deductible - General
1333
951
Others
1334
951
Trade / professional association `Specification services' - Connotation of
1336
952
Speculation business - Scope of provision
1337
953
Valuation of land
1339
954
Other illustrations
1341
956
Mutual benefit societies
1342
956
1344-1369
958-978
1344
961
Business expenditure - Scope of deductibility1353
967
Gratuity cannot be construed as a free reserve1355
969
Tests for capital or revenue expenditure
1356
970
Computation of profits - Basic principles
1359
974
Construction of documents
1360
974
Repairs to other premises
1361
974
Rent
1362
975
Depreciation - General
1363
975
Deductions. General principle
23(1)(iii).
Bonus or commission - Application of provision1364
976
Cases under 1922 act
1365
977
Rule 14 of schedule iv
1366
977
Animals - Application of provisions
1367
977
1370-1371
979-981
1370
980
1372-1388
982-1000
Depreciation in general
1372
984
Cost how to be determined
1380
992
Current repairs Expenditure on repairs
23(1)(v).
Depreciation allowance
(xxii) Income Tax Digest.
VOL-I
Under Section
23(1)(vii).
Title
Case No.
Page No.
Depreciation on buildings explained
1381
993
World depreciation pool Full depreciation in case of pre-dissolved and post reconstituted Depreciation is admissible on assets received as gift Depreciation on hotel building Depreciation of unregistered firm can be carried forward and set off against profits of registered firm Difference between original cost price and written down value
1382
993
1383
994
1384 1385
994 996
1387
999
1388
1000
1389-1421
1001-1025
1389
1004
Interest paid on borrowed capital General
23(1)(viii).
23(1)(x).
Interest on money borrowed when deductible1392
1006
Distinction between capital and revenue expenditure
1397
1009
Capital borrowed - Connotation of
1402
1014
Illustrations where interest is not deductible 1408
1020
Illustrations
1420
1024
1422-1427
1026-1033
Provision of bonus
1422
1027
Managing director is entitled for bonus being an employee
1423
1028
Reasonableness of bonus
1425
1031
Expenditure held to be inadmissible
1427
1033
1428-1488
1034-1068
Bad debts - Meaning and scope of
1428
1040
Bad debts - Connotation of
1434
1042
Incidental to business - General test
1437
1043
Embezzlement by employee
1438
1044
Managing agent
1439
1044
Money lender
1440
1044
Test for determining irrecoverability of debt or when the debt has become bad - Basic concepts
1447
1048
Bonus or commission paid to employees
Bad debts
(xxiii) COMPARATIVE TABLE OF SECTIONS
Under Section
23(1)(xiii).
Title
VOL-I
Case No.
Page No.
Onus to prove
1451
1049
Time to allow bad debts / powers of income tax authorities
1452
1049
Effect of period of limitation
1457
1053
Relevance of fact that debtor has become insolvent
1463
1056
Relevance of writing off of debt
1465
1057
Illustrations
1470
1059
Debt should become bad in relevant account year 1476
1062
Reference to high court
1480
1065
1489-1675
1069-1209
Disallowability - General
1489
1088
Wholly and exclusively - Meaning of
1499
1098
Wholly and exclusively for the purpose of business - Illustrations of allowability / non-allowability
1501
1098
Premium paid on annual basis
1520
1115
Devaluation of currency
1521
1115
"Penal interest and the penalty", meaning of 1525
1121
Liquidated damages are allowable expenditure1529
1125
Expenses incurred to raise capital or obtain loan or recover debts, etc.
1531
1125
Expenditures on running school for children of employees
1534
1128
Loss of stock-in-trade / spares, etc.
1535
1129
Loss or embezzlement of cash / robbery or theft
1539
1131
Rates / taxes
1543
1134
Reasonableness of remuneration
1545
1136
Capital or revenue expenditure
1553
1140
Tests for determining nature of expenditure 1557
1143
Interest and dividends earned by the assessee is an allowable deduction
1567
1151
Test of fixed or circulating capital
1568
1152
Business expenditure.
(xxiv) Income Tax Digest.
VOL-I
Under Section
Title
Case No.
Page No.
Relevance of character of receipt in recipient's hands
1569
1152
Travelling expenses for training abroad
1570
1153
Expenditure must be incurred in the character as a trader
1571
1154
Expenditure must be for carrying of business1572
1154
Quantum of expenditure
1574
1155
Relevance of benefit to third party
1576
1155
Relevance of production of income from expenditure
1577
1156
Business expenditure - Sharing of profits
1580
1157
Land / building, acquisition of
1583
1160
Benefit of contracts
1584
1160
Goodwill
1585
1162
Selling agency
1586
1162
Copyright
1587
1163
Electricity transmission lines / railway platforms, etc.
1588
1163
Expenditure to save business reputation
1589
1164
Brick manufacturers
1590
1164
Bidi manufacturer
1596
1167
Mining - Mining rights & mining expenses
1597
1168
Repairs / renovation
1602
1172
Illustrations : repairs to permises / furniture
1604
1173
Illustrations : repairs to machinery
1605
1173
Rent
1607
1175
Royalty
1609
1177
Forfeiture of security deposits
1611
1178
Contribution to provident fund
1612
1179
Other illustrations
1614
1180
Compensation to managing agents / selling agents
1615
1180
Managing agency commission
1617
1181
(xxv) COMPARATIVE TABLE OF SECTIONS
Under Section
Title
VOL-I
Case No.
Page No.
Others
1618
1181
Litigation expenses
1619
1181
Expenses incurred to protect business / business assets
1622
1185
Expenditure to protect profit / source of income1629
1187
Expenses peculiar to firms
1631
1187
Expenses peculiar to HUFs
1633
1188
Penalty / damages paid for breach of contract1635
1189
Estate duty
1636
1189
Excise duty / import duty
1637
1189
Others
1638
1190
Amount paid to ward off competition
1642
1191
Gifts and presents
1644
1192
Advertisement & sales promotion expenses / expenses for inaugural functions 1646
1196
Trade mark, charges for registration of
1647
1196
In case of profession
1648
1197
Expenses incurred by holding company for subsidiary company
1650
1195
Banking company
1651
1196
Insurance companies
1653
1197
In case of partner of a firm / firms Expenses by partner / firm
1659
1201
Payments to retiring partner
1660
1201
Expenditure incurred by HUF - Salary to coparcener
1662
1202
Others
1665
1203
`To effect or keep in force' - Connotation of
1670
1205
Contract of insurance, meaning of
1672
1206
Provident fund
1673
1206
Income of co-operative Societies - Co-operative bank
1675
1208
(xxvi) Income Tax Digest.
VOL-I
Under Section 23(2)). 24(a).
24(b).
24(c).
24(d).
24(h).
24(i).
Title
Case No.
Page No.
Deductions.
1676
1210-1211
General
1676
1210
Deductions not admissible.-Any cess, rate or tax levied on the profits or gains
1677
1212-1214
Profits or gains of business or profession - Connotation of
1677
1212
1678-1680
1215-1221
General
1678
1215
Commission paid to non-resident without deduction of tax at source
1679
1216
Deductions not admissible.-Services rendered, brokerage or commission or rent of house property
1681
1222-1223
In cases of directors
1681
1222
Deductions not admissible.-Interest, brokerage, commission, salary or other remuneration
1682
1224-1225
Interest
1682
1224
1683-1686
1226-1230
General
1683
1226
Deduction of tax at source
1684
1227
Pension fund was maintained in foreign country for foreign employees and was payable in foreign Country after retirement 1686
1228
Deductions not admissible.Payments to non-residents
Deductions not admissible.-Provident fund or other fund established for the benefit of employees of the assessee
Deductions not admissible.Expenditure incurred by an assessee on perquisites, allowances
1687-1692
1231-1235
Excess perquisites
1687
1231
Using the word `or' as disjunctive
1688
1231
Reimbursement on account of medical bills is a perquisite
1689
1232
Provident fund is not perquisite
1690
1233
(xxvii) COMPARATIVE TABLE OF SECTIONS
Under Section 24(j).
Title
VOL-I
Case No.
Page No.
1693-1695
1236-1240
1693
1236
1696-1702
1241-1247
Trading liability
1696
1241
Loss
1702
1245
Special provisions regarding business of insurance and production of oil and natural gas and mineral deposits
1703-1726
1248-1272
Assessment of insurance business
1703
1250
Powers of assessing officers under Fourth Schedule
1705
1252
Benefit of produced rate of tax to insurance companies
1721
1265
Position under 1922 act
1726
1268
1727-1735
1273-1281
1727
1275
Cost of bonus shares - Method of calculation 1728
1276
`Immovable property' is not a capital asset
1733
1280
Face value should be cost of bonus share
1734
1280
Immovable property vis-a-vis ownership and possession
1735
1281
Computation of capital gains
1736
1282-1283
Face value of bonus share constitutes its actual cost
1736
1283
1737-1747
1284-1291
General
1737
1286
Gratuity - Position prior to 1.7.1979
1742
1288
Zamindari
1733
1289
Income from house property vs. Income from other sources
1744
1290
Illustration
1745
1290
Deductions not admissible.Expenditure incurred on account of payment of a fine or penalty Penalty, fine and forfeiture are not admissible expense
25.
26.
27.
Amounts subsequently recovered in respect of deductions, etc.
Capital gains Bonus share - View's of Lahore High Court reversed
28.
30.
Income from other sources
(xxviii) Income Tax Digest.
VOL-I
Under Section 31.
Title
Case No.
Page No.
1748-1757
1292-1299
1748
1294
Any other expenditure, etc., paid out or expended wholly and exclusively for purpose of earning such Income - Basic principles 1750
1296
Interest
1751
1297
In case of company in liquidation
1755
1298
Others
1756
1299
1758-1845
1300-1375
Deductions Scope of the section
32.
34.
35.
Method of accounting
Rejection / acceptance of method of accounting1758
1309
Method of accounting and chargeability
1785
1337
System of accounting
1795
1346
Application of sub-section (3) and proviso
1802
1350
Power of assessing officer
1822
1361
General
1830
1366
Choice of method of accounting
1837
1372
Change of method of accounting
1841
1374
Others
1845
1375
1846-1851
1376-1381
General principles
1846
1377
Business loss could not be adjusted against free reserve
1850
1380
Losses in case of resident and ordinary resident
1851
1381
1852-1878
1382-1404
Words "in any other business", "such business", meaning of
1852
1385
Same business - General tests
1853
1386
In any other business - General tests
1862
1393
Intra business adjustment
1863
1395
Operation of provision
1864
1396
When loss arises
1868
1399
Losses of illegal business
1872
1401
Set-off of losses
Carry forward of business losses
(xxix) COMPARATIVE TABLE OF SECTIONS
Under Section
VOL-I
Title
Case No.
Page No.
1873 1874 1876
1401 1402 1403
1879-1881
1405-1408
1879
1406
1881-1888
1409-1418
Unabsorbed depreciation
1882
1411
Depreciation allowance can be carried forward without any time limit
1883
1412
Dissolution of registered firm
1885
1414
Unregistered firm converted into registered 1886
1414
Share of loss
1887
1416
Allowance for investment in Defence Savings and NIT Certificates, etc.
1889-1892
1419-1422
Deduction or rebate, meaning of
1889
1420
Allowance for purchase of books
1893
1423-1424
Exemption claimed on account of educational expenses of children of HUF
1893
1424
1894-1895
1425-1427
General
1894
1426
Expression "any sum paid"
1895
1427
1896-1902
1428-1434
1896
1429
1900 1903-1905
1432 1435-1437
Amended law and scope of Credit for tax deducted at source
1903 1904
1436 1436
Deduction of tax at source.-Interest / profit on deposit / account
1906
1438-1439
Pakistani banks having branches in the tribal areas
1906
1439
Income against which carried forward loss can be set off Losses of unregistered firm Illustrations 36.
Speculation losses Speculation losses are to kept distinct
38.
41.
42.
47.
48.
50(1).
50(2A).
Limitation as to set-off and carry forward of losses in the case of firms, partners, etc.
Allowance for donations for charitable purposes
Exemption from tax of newly established industrial undertakings Capital employed Provisions of section for the purpose of determination of total income Deduction of tax at source
(xxx) Income Tax Digest.
VOL-I
Under Section 50(2B).
Title
Case No.
Page No.
1907-1908
1440-1443
1907
1441
1909-1914
1444-1449
1909
1445
1915-1918
1450-1454
Banks have no right to claim or charge any commission or service charge from wapda
1915
1451
Expression "supplies" includes sales in section 50(4)
1916
1452
"Goods" do not include immovable property 1917
1453
Sale of land, building and other fixed assets 1918
1454
Deduction of tax at source.Certain banking instruments Special deposit receipts
50(3).
Deduction of tax at source.-`Certain payment to non-residents' "Assessee in default"
50(4).
50(5).
50(5A).
50(7A).
50(7BB).
Deduction of tax at source.-Payments on supply of goods / services / contracts
Deduction of tax at source.-Imports
1919-1925
1455-1463
Tests for question of law
1919
1456
Tax on imports
1922
1458
Calculation of duties & octroi
1924
1460
Words, "same manner" and "at the same time", meaning of
1925
1461
Deduction of tax at source.-Export proceeds
1926
1464-1466
Export of cotton yarn
1926
1465
1927-1933
1467-1479
Scope of section 50(7A)
1927
1460
Section 50(7A) is held to be valid law
1930
1470
Words, `sale', `property', explained
1932
1474
Auction of the right to collect export tax is not a sale
1933
1478
Deduction of tax at source.Cost of commercial buildings
1934
1480-1481
General
1934
1481
Deduction of tax at source.-Sale of certain properties, octrio right, toll fee etc.
(xxxi) COMPARATIVE TABLE OF SECTIONS
Under Section 52.
53.
54. 55.
56.
Title
VOL-I
Case No.
Page No.
1935-1939
1482-1486
Assessee in default cannot be a person who was not competent to deduct tax
1935
1483
Proceeding under section 52 held not maintainable
1936
1484
Advance payment of tax
1940-1955
1487-1500
Advance tax - General
1940
1489
Scope of "retained income"
1947
1494
Constitutional and legal issues relating to advance tax
1948
1494
Recovery notice after case has been set aside is illegal
1950
1496
Assessee in default
1951
1496
CBR's circular held violative of the provisions of section 53
1954
1498
Levy of additional tax
1955
1500
Payment of tax with return of income
1956
1501-1502
Full payment of tax with return
1956
1502
1957-1969
1503-1511
Return filed voluntarily, after service of notice, position prior to Income Tax Ordinance, 1979
1957
1505
Constitutional validity
1959
1507
Person liable to furnish return
1961
1507
Validity of return
1962
1508
Extension of time
1963
1508
Return under 1922 act
1964
1509
Defective return
1966
1510
Signing of return
1967
1510
1970-1975
1512-1520
Words `during the previous year' and `any' - Meaning of
1970
1513
Notice can be given for any year
1971
1514
Liability of persons failing to deduct or pay tax
Return of total income
Notice for furnishing return of total income
(xxxii) Income Tax Digest.
VOL-I
Under Section
57.
58.
Title
Case No.
Page No.
ITO can curtail the period for filing of return1973
1516
Profit and loss account
1974
1517
1976-1977
1521-1523
Remanding of case held illegal
1976
1522
Revised return filed before issuance of notice
1977
1523
1978-1979
1524-1526
1978
1525
1980-2006
1527-1552
Revised returns of total income
Wealth statement Statement of assets and liabilities
59.
59B.
59D. 60.
Self-assessment
Self-assessment scheme - Section 59 read with section 65 of the ordinance - General
1980
1530
Conditions for reopening of SAS cases
1982
1531
Registered firms not maintaining accounts - SAS was not applicable
1988
1534
Principle of res judicata does not apply to SAS cases
1989
1534
Scope of additions under SAS
1990
1534
Selection for total audit
1992
1535
Cases selected for detailed scrutiny
1996
1539
Enhancement of income vis-a-vis Self assessment scheme
1997
1540
Claim for immunity
1999
1542
Comparison of income where loss assessed
2000
1543
Assessee can file a revised return for availing the benefit of Self assessment scheme
2001
1544
Section 59 vis-a-vis writ petition
2002
1546
Assessment under the simplified procedure for assessment
2007
1553-1554
Assessee challenged the legality of notice through writ jurisdiction
2007
1554
Tax on undisclosed income
2008
1555-1556
Declaration of undisclosed income
2008
1556
Provisional assessment
2009
1557-1558
General
2009
1558
(xxxiii) COMPARATIVE TABLE OF SECTIONS
VOL-I
LIST OF CASES DIGESTED IN VOLUME-I Case No.
A A&B Food Industries Ltd. v. Commissioner of Income Tax/CST Karachi [1992] 65 TAX 281 (S.C.Pak)
70, 206
A.A. Thevar Bros. v. Commissioner of Income Tax 7 ITC 156 (Rangoon)
684, 977
A.C. Macnab, Retired Financial Commissioner, Punjab, In re. [1961] 4 TAX 143 (H.C.Lah.) = 1961 PTD 713
728
A.G. v. Aramago [1925] 9 TC 445 (HL)
319
A.H. Forbes v. Commissioner of Income Tax 6 ITC 208 (Pat.)
1669
A.H.Wadia v. Commissioner of Income Tax [1949] 17 ITR 63 (PC)
1052
A.Harvey v. Commissioner of Income Tax [1935] 3 ITR 311 (Mad.)
1066
A.Hussain S. Mirza and Company, Dacca v. Commissioner of Income Tax, Dacca [1966] 13 TAX 1 (H.C.Dacca)
1702
A.J. Hartshorn v. Commissioner of Income Tax, West Karachi [1984] 49 TAX 198 (H.C.Kar.)
47, 177, 1125, 1141
A.Jainulabdeen Sahib v. Commissioner of Income Tax [1944] 12 ITR 285 (Mad.)
2567
A.L.A.R. Bros. v. Commissioner of Income Tax 3 ITC 209 (Mad.)
1394
A.M. Qureshi v. Commissioner of Income Tax [1987] 56 TAX 72 (H.C.Kar.)
1103
A.R. Hattiangadi, In re [1940] 8 ITR 85 (Bom.)
944, 1132
A.S.P.L.V.R. Ramaswami Chettiar v. Commissioner of Income Tax [1933] 1 ITR 389 (Mad.)
1166, 1295
A.Salam, A.Sattar, Dacca v. Commissioner of Income Tax, East Pakistan Dacca [1968] 17 TAX 179 (H.C.Dacca)
1070
Abbas S. Sharoff and another v. Income Tax Officer and Others [1998] 78 TAX 119 (H.C.Kar.) = 1998 PTD 2884
449
Abbot Laboratories Ltd. v. Commissioner of Income Tax, Central Zone, Karachi [1989] 60 TAX 75 (H.C.Kar.)
1522
Abdul Aziz and another v. Income Tax Officer And Another [1967] 15 TAX 235 (H.C.Kar.)
771
Abdul Hameed Awan v. Tax Recovery Officer-04 Coys Zone, Income Tax Building at Rawalpindi and 3 others [1997] 76 TAX 238 (H.C.Lah.) = 1998 PCTLR 440 = 1998 PTD 874 (H.C.Lah.)
374
Abdul Hamid, son of Mohammad Ismail, Azad Boot House, Mirpur, and others v. Deputy Collector, Excise & Taxation / Income Tax Officer, Commissioner of Income & others [1988] 57 TAX 14 (H.C.A.J.&K.)
373
(xxxiv) VOL-I
Income Tax Digest. Case No.
Abdul Hussain Moosaji v. Commissioner of Income Tax 10 ITC 255 (Sind)
1325
Abdul Majeed Awan v. Inspecting Additional Commissioner of Income Tax [1999] 80 TAX 115 (H.C.Lah.) = 1999 PTD 2910 = 2000 PCTLR 1046
124
Abdul Majeed Awan v. Inspecting Additional Commissioner of Income Tax [1999] 80 TAX 115 (H.C.Lah.) = 1999 PTD 2910 = 2000 PCTLR 1046
117
Abdul Rahman v. Commissioner of Income Tax [1944] 12 ITR 302 (Lahore)
1200
Abdul Rashid (c/o Union Traders GoIe Cloth, LyalIpur) v. Special Judge (Central), Lahore and another [1976] 34 TAX 199 (H.C.Lah.)
134, 168, 756, 766
Abdul Razzak v. Collectors of Customs 1995 CLC 1435 (H.C.Kar.)
309
Abdul Rehman & Another v. Income Tax Officer Mirpur & another [1993] 68 TAX 132 (S.C.AJ&K)
412
Abdul Sattar Noon Muhammad and others v. The Government of Balochistan [1999] 79 TAX 93 (H.C.Quetta) = 1998 PTD 3468 = PTCL 1999 CL. 252
1941
Abdul Sattar Noor Muhammad & Co. v. Government of Pakistan, etc. [1999] 80 TAX 49 (H.C.Qta)
1922
Abdul Sattar v. Commissioner of Income Tax, Karachi [l960] 2-TAX (Suppl.-114) (H.C.West Pakistan, Karachi Bench) = 1959 PTD 119 = 1958 PLD 220
773
Abdur Rehman v. Income Tax Officer [1981] 43 TAX 158 (H.C.Lah.) Abhey Ram Chunni Lal, In re [1933] 1 ITR 126 (All.)
1034 786
Adamjee & Sons v. Commissioner of Income Tax [1983] 47 Tax 211 (H.C.Kar.)
1227
Adamjee Insurance Co, Ltd. and Others v. Income Tax Officer and Others [1995] 71 TAX 164 (H.C.Kar.)
409, 1714
Aftab Medical Stores Dera Ghazi Khan v. Commissioner of Income Tax, Lahore [1976] 34 TAX 10 (H.C.Lah.)
52, 276
Afzal Construction Co. (Pvt.) Ltd. v. Chairman, Central Board of Revenue and others [1990] 62 TAX 91 (H.C.Lah.) = 1990 PTD 9/833
331
Agha Ice Factory, Sheikhupura v. Regional Commissioner Of Income Tax, Central Region, Lahore and 4 Others [1996] 74 TAX 215 (H.C.Lah.)
425
Ahmad Din Alla Ditta v. Commissioner of Income Tax [1934] 2 ITR 369 (Lahore)
968
Ahmadpur Katwa Railway Co. Ltd. In re [1935] 3 ITR 277 (Cal.) Ahmed Maritime Breakers Ltd. v. Central Board of Revenue etc. [1992] 65 TAX 268 (H.C.Kar.)
1409 333
(xxxv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Ahmed Steel (Pvt.) Ltd. v. Government of Balochistan, etc. [1998] 78 TAX 334 (H.C.Qta.) = PCTLR (Qta) 1361
1924
Al-Ahram Builders (Pvt.) Ltd. v. Income Tax Appellate Tribunal 1992 SCC 950 = [1992] 66 TAX 147 (S.C.Pak.) = 1992 PTD 167
798
Al-Hamza Ship Breaking Co. and Others v. Government of Pakistan through Secretary, Finance and Economic Affairs, Islamabad and Others [1996] 73 TAX 203 (H.C.Quetta)
1925
Al-Hilal Agencies Ltd. v. Income Tax Officer, Karachi and another [1980] 41 TAX 40 (H.C.Kar.)
1945
AL.VR. ST. Veerappa Chettiar v. Commissioner of Income Tax [1941] 9 ITR 56 (Mad.)
504, 975
AL.VR. V.P. Pethaperumal Chettiar v. Commissioner of Income Tax [1943] 11 ITR 532 (Mad.)
491, 493
Algemene Bank, Nederland N.V., Karachi v. Commissioner of Income, Central Zone `C', Karachi [1992] 65 TAX 306 (H.C.Kar.)
1152
Ali Davar Khan and 19 others v. Government of Pakistan and 54 others 1967 SCC 295 = [1968] 17 TAX 1 (S.C.Pak.)
751, 755
Ali Roberts (Bahawalpur) Limited v. Commissioner of Income Tax [1966] 13 TAX 188 (H.C.Lah.)
873
All India Spinners' Association v. Commissioner of Income Tax [1944] 12 ITR 482 (PC)
569, 584, 593
Allied Bank of Pakistan Ltd., Azad Kashmir Branches, Mirpur through Inam Elahi Azhar, EVP and Provincial Chief, PHQ (Punjab) v. Income Tax Appellate Tribunal, AJK Council, Muzaffarabad and others [2001] 83 TAX 404 (H.C.A&JK) = [2000] 82 TAX 417 (H.C.AJ&K) = 2000 PTD 2872
76
Allied Cans v. Income Tax Officer, Circle-8, Multan and others [1995] 71 TAX 216 (H.C.Lah.)
430
Alyani Cotton Ginning and Pressing Factory, Rahimyar Khan v. Assistant Commissioner of Income Tax and another [1974] 29 TAX 238 (H.C.Lah.)
277, 278
Ameer Bux Badhuddin, Sarraf, Hyderabad v. Commissioner of Income Tax, Karachi (West), Karachi [1984] 50 TAX 61 (H.C.Kar.)
1997
Amin Bricks Company. Faisalabad v. Commissioner of Income Tax (Pension) and Another [1996] 74 TAX 227 (H.C.Lah.) = 1997 PTD 76
151, 1762
Amin Textile Mills (Pvt.) Ltd. v. Commissioner of Income Tax and 2 others, PTCL 2000 CL. 316 (S.C.Pak)
408
Amir Nawaz Khan, etc. v. Government of Pakistan, through Secretary Finance, Islamabad, etc. [2001] 83 TAX 397 (H.C.Lah.)
414, 1927
Amrit Waman v. Commissioner of Income Tax [1937] 5 ITR 721 (Nag.)
1840
Amrita Bazar Patrika, In re [1937] 5 ITR 648 (Cal.)
1629
(xxxvi) VOL-I
Income Tax Digest. Case No.
Amritsar Produce Exchange Ltd., In re [1937] 5 ITR 307 (Lahore) Amulyadhan Addy, In re [1936] 4 ITR 164 (Cal.)
860, 939, 1249 1753
Anant Ram Khem Chand v. Commissioner of Income Tax [1937] 5 ITR 511 (Lahore)
932
Andhra Insurance Co. Ltd. v. Commissioner of Income Tax [1937] 5 ITR 697 (Mad.)
1726
Anglo-Persian Oil Co. (India) Lid. v. Commissioner of Income Tax [1933] 1 ITR 129 (Cal.)
1569, 1577, 1615
Anisa Rehman v. PInspecting Additional Commissioner [1994 SCMR 2232]
316
Arafat Woollen Mills Ltd. v. Income Tax Officer, Companies Circles E1, Karachi [1986] 54 TAX 1 (H.C.Kar.) = 1986 PTD 316
238, 436
Arnarchand Madhavjl & Co. v. Commissioner of Income Tax [1935] 3 ITI1 462 (Bom.)
1468
Arshad Mahmood v. Government of Pakistan through Secretary, Ministry of Interior and Narcotics Control, Islamabad and another 1998 PTD 370 (H.C.Lah.)
847
Asbestos Cement Ltd. v. Commissioner of Income Tax [1988] 58 TAX 80 (H.C.Kar.)
1494
Asiatic Agencies Limited, Karachi v. Commissioner of Income Tax [1967] 15 TAX 89 (H.C.Kar.)
1114
Asim Textile Mills Limited v. Central Board of Revenue & others [1999] 80 TAX 217 (H.C.Lah.)
1926
Aspro Ltd. v. Commissioner of Taxes [1936] 4 ITR 264 (PC)
1552
Assam Bengal Cement Co. Ltd. v. Commissioner of Income Tax East Pakistan, Dacca 1962 SCC 113 = [1962] 6 TAX 49 (S.C.Pak.)
1397
Assam Bengal Cement Co. Ltd. v. Commissioner of Income Tax, East Pakistan [19601 2-TAX (III-228) (H.C.Dacca) = 1960 PTD 379 = 1960 PLD 389
1554
Associated Cement Companies Ltd. v. Commissioner of Income Tax, Lahore Range, Lahore and others 1978 SCC 453 = [1978] 38 TAX 132 (S.C.Pak.)
184, 550
Ata Hussain Khan Limited v. Commissioner of Income Tax, Dacca [1968] 18 TAX 2 (H.C.Dacca)
1781
Ata Hussain Khan Ltd., Dacca v. Commissioner of Income Tax, East Pakistan, Dacca [1965] 11 TAX 335 (H.C.Dacca)
1548
Ata Hussain Limited v. Commissioner of Income Tax, East Pakistan Dacca 1969 SCC 335 = [1970] 21 TAX 1 (S.C.Pak.)
1501, 1545, 1546
Atherton v. British Insulated & Helsby Cables Ltd. [1925] 10 Tax Cas. 155 (HL)
1565
(xxxvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Attock Oil Co. Ltd. Rawalpindi, v. Commissioner of Income Tax, Rawalpindi Zone 1981 SCC 557 = [1982] 45 TAX 1 (S.C.Pak.)
1534
Augustine C. Paul & Co., Karachi v. Commissioner of Income Tax, South Zone, West Pakistan, Karachi [1967] 16 TAX 73 (H.C.Kar.)
1793
Augustine C. Paul And Company, Karachi v. Commissioner of Income Tax, South Zone, (West Pakistan), Karachi [1967] 15 TAX 94 (H.C.Kar.)
1782
Australasia Bank Ltd., Lahore v. Commissioner of Income Tax, North Zone (West Pakistan), Lahore [1962] 6 TAX 7 (H.C.Lah.) = 1962 PTD 575 = 1962 PLD 779
1535
Auto Stores, Dacca v. Commissioner of Income Tax, East Pakistan, Dacca [1963 7 TAX 1 (H.C.Dacca) = 1964 PTD 317 = 1964 PLD 433
1087
Azad Friends Company Limited v. Commissioner of Income Tax [1970] 21 TAX 75 (H.C.Kar.)
1244
Aziz Book Depot, Lahore v. Inspecting Additional Commissioner of Income Tax, Lahore and another [1995] 71 TAX 209 (H.C.Lah.)
1956
Azmat Farooq v. Regional Commissioner of Income Tax Central Region Lahore and another [1993] 68 TAX 74 (H.C.Lah.)
432
Aasia v. Income Tax Appellate Tribunal etc. 1978 SCC 446 = [1980] 41 TAX 1 (S.C.Pak)
150
B B.B. Jubb v. Commissioner of Income Tax [1938] 6 ITR 210 (Rangoon)
1208
B.C.G.A. (Punjab) Ltd. v. Commissioner of Income Tax [1937] 5 ITR 279 (Lahore)
966, 1449, 1461, 1484, 1837, 1870
B.D.Avari v. Commissioner of Income Tax [1989] 60 TAX 79 (H.C.Kar.)
1171
B.J. Heera v. Commissioner of Income Tax [1937] 5 ITR 591 (Lahore)
1674
B.K. Paul & Co. v. Commissioner of Income Tax 7 ITC 20 (Cal.)
1664
B.K. Paul & Co., In re [1938] 6 ITR 395 (Cal.)
1873
B.N. Elias, In re [1935] 3 ITR 408 (Cal.)
695
B.P. Australia Ltd. v. Commissioner of Taxation of the Commonwealth of Australia [1946] AC 224 (PC)
1562
B.P. Biscuit Factory Ltd., Karachi v. Wealth Tax Officer, II-Circle, Karachi & another [1982] 45 TAX 17 (H.C.Kar.) = 1981 PTD 217
438
B.R. Naik v. Commissioner of Income Tax [1945] 13 ITR 124 (Bom.)
741
Babra Srarif v. Commissioner of Income Tax [1993] 68 TAX 124 (H.C.Lah.)
1161
Babulal Kanji v. Commissioner of Income Tax [1946] 14 ITR 662 (Bom.)
1670, 1671, 1672
Babulal Raj Garhia, In re [1936] 4 ITR 148 (Cal.)
1179
(xxxviii) VOL-I
Income Tax Digest. Case No.
Baby-own v. Income Tax Officer [1997 PTD 47]
451
Bachu Bai F.E. Dinshaw, Karachi v. Commissioner of Income Tax [1967] 15 TAX 37 (H.C.Kar.) = 1967 PTD 170 = PLD 1067 Kar. 372
1172
Badri Shah Sohan Lal v. Commissioner of Income Tax [1936] 4 ITR 303 (Lahore)
1323
Badri Shah Sohan Lal v. Commissioner of Income Tax 10 ITC 1 (Lahore)
1431
BaIaji Rao v. Commissioner of Income Tax [1935] 3 ITR 461 (Mad.)
1128
Balkishan Nathani v. Commissioner of Income Tax [1923] 1 ITC 248 (Nagpur)]
58
Ballygunge Bank Ltd. v. Commissioner of Income Tax [1946] 14 ITR 409 (Cal.)
1177, 1181
Bank Bihari LaI v. Commissioner of Income Tax 10 ITC 461 (Lahore)
1127
Bank of Bahawalpur Ltd. v. Commissioner of Income Tax [1983] 47 TAX 173 (H.C.Kar.)
1454
Bank of Chettinad Ltd. v. Commissioner of Income Tax [1940] 8 ITR 522 (PC)
1046
Bank of Punjab v. Federation of Pakistan [2000] 81 TAX 390 (H.C.Lah.)
362, 1903
Banka Mal Niranjan Das v. Commissioner of Income Tax, Punjab and N.W.F.P. [1960] 2-TAX (Suppl.-118) (H.C.Lah.) = 1951 PLD 311
1858, 1876
Bansidar Podd v. Commissioner of Income Tax [1934] 2 ITR 20 (Pat.)
1460
Bansidhar Poddar v. Commissioner of Income Tax 7 ITC 117 (Pat.)
1462
Baramula Saw Mills Ltd., Baramula v. Commissioner of Income, Punjab and N.W.F.P. [1960] 2-TAX (Suppl.-104) (H.C.Lah.) = 1960 PTD 1225 = 1954 PLD 157
1039
Barnala Commission Shop, Chak-Jhumra v. Income Tax Officer, BWard, Lyallpur [1963] 7 TAX 153 (H.C.Lah.) = 1963 PTD 534 = 1963 PLD 311
355, 407, 556
Barry Brothers v. Commissioner of Income Tax [2001] 83 TAX 299 (H..C.Lah.)
1761
Basant Lal Thakat Singh v. Commissioner of Income Tax [1933] 1 ITR 141 (All.)
1192
Basant Rai Takhat Singh v. Commissioner of Income Tax 4 ITC 324 (All.)
1282, 1744
Basharat Ali and another v. Deputy Superintendent, Central Excise and Sales Tax, Mananwala Circle, Sheikhupura [1995] 72 TAX 218 (H.C.Lah.)
378
Bashir & Co., Lyallpur v. Income Tax Officer, B-Ward, Lyallpur & Another 1968 SCC 315 = [1968] 17 TAX 207 (S.C.Pak.)
760
(xxxix) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Bashir Ahmad v. The State [PLD 1960 Lahore 687]
312
Bashir Sons (Pvt.) Ltd. v. CBR [1993] 67 TAX 395 (H.C.Lah.)
457
Batala Engineering Ltd. v. Income Tax Officer Lahore 1973 SCC 403 = [1974] 29 TAX 190 (S.C.Pak)
446
Bayer Pharma Ltd., Karachi v. Commissioner of Income Tax `A' Range, Karachi [1993] 68 TAX 184 (H.C.Kar.)
1530
Beach Luxury Hotel Ltd. v. Commissioner of Income Tax (Central), Karachi 1981 SCC 546 = [1981] 44 TAX 40 (S.C.Pak.)
1380, 306
Beak (Inspector of Taxes) v. Robson [1942] 25 Tax Cas. 33 (HL)
856
Beak (Inspector of Taxes) v. Robson [1943] 11 ITR (Suppl.) 23 (HL)
1145
Bebari Lal Chatterji v. Commissioner of Income Tax [1934] 2 ITR 377 (All.)
1967
Beecham Pakistan Ltd. v. Commissioner of Income Tax [1995] 71 TAX 57 (H.C.Kar.)
1346
Begum Nusrat Bhutto v. Income Tax Officer, Circle V, Rawalpindi [1980] 42 TAX 59 (H.C.Lah.)
26, 214, 401, 635
Behari Lal Jhandu Mal, In re [1944] 12 ITR 209 (Lahore) Beli Ram & Bros. v. Commissioner of Income Tax [1935] 3 ITR 103 (Lah.) Benarisdas Jagannath, In re [1947] 15 ITR 185 (Lahore)
1262 319 1590, 1591
Bengal Coal Co. Ltd. v. Sri Janardan Kishore Lal Singh Deo [1938] 6 ITR 632 (PC)
880
Bengal-Burma Steam Navigation Co. Ltd. v. Commissioner of Income Tax, East Pakistan, Dacca [1960] 2-TAX (III-451) (H.C.Dacca) = 1960 PTD 765 = 1960 PLD 584
1007
Benoy Ratan Banerji v. Commissioner of Income Tax [1947] 15 ITR 98 (All.)
487
Beohar Singh Raghubir Singh v. Commissioner of Income Tax [1948] 16 ITR 433 (Nag.)
464, 526, 546
Bhagat Jiwan Das v. Commissioner of Income Tax 4 ITC 40 (Lahore)(FB)
985
Bhagwan Das Nanak Chand v. Commissioner of Income Tax 10 ITC 448 (Labore)
1464
Bhagwati Shankar, In re [1944] 12 ITR 193 (Lahore)
1129
Bhajan Lal Sanwal Das v. Commissioner of Income Tax 5 ITC 118 (All.)
678
Bharat Insurance Co. Ltd. v. Commissioner of Income Tax [1934] 2 ITR 63 (PC)
948, 1220, 1658
Bharat Insurance Co. Ltd. v. Commissioner of Income Tax 5 ITC 288 (Lahore)
1656
(xl) VOL-I
Income Tax Digest. Case No.
Bhikaji Vyankatesh Dravid & Co. v. Commissioner of Income Tax 2 ITC 355 (Nag.)
1310
Bhikamchand Laxmichand v. Commissioner of Income Tax [1935] 3 ITR 120 (Nag.)
967
Bhikamchand Laxmichand v. Commissioner of Income Tax 7 ITC 184 (Nag.)
865
Bhimji K. Naik v. Commissioner of Income Tax [1946] 14 ITR 334 (Bom.)
726, 735
Bhudarmull Chandi Prasad v. Commissioner of Income Tax 8 ITC 249 (Pat.)
1335
Biafo Industries v. Federation of Pakistan, PTCL 2000 CL. 384
147
Binjraj Hukamchand v. Commissioner of Income Tax 5 ITC 303 (Cal.) Bisheshar Prasad Parshotam Das v. Commissioner of Income Tax 7 ITC 74 (All.) Bisheshwar Nath & Co., In re [1942] 10 ITR 103 (All.)
1451 784 787, 788, 795, 989
Bishwanath Singh Sharma v. Commissioner of Income Tax [1941] 9 ITR 474 (Pat.)
1101
Bismillah and Co. v. Secretary, Government of The Punjab, Etc. [1997] 75 TAX 109 (H.C.Lah.) = 1997 PTD 747
1929
Bissendoyal Doyaram, In re [1938] 6 ITR 165 (Cal.)
1446
Board of Intermediate & Secondary Education v. Central Board of Revenue, etc. [1999] 79 TAX 28 (H.C.Lah.)
391
Board of Revenue v. Ramanathan Cheltian [1 ITC 244 (Madras)]
255
Bombay Cloth House, Lahore v. Income Tax Officer, Circle-I, Zone-A, Lahore and others [1993] 67 TAX 398 (H.C.Lah.)
775
Booz Allen & Hamilton International (P.R.) Inc. U.S.A. Commissioner of Income Tax, Lahore [1976] 33 TAX 189 (H.C.Lah)
v.
1006
Brentford Yousuf & Co. Ltd. v. Commissioner of Income Tax, Lahore [1966] 13 TAX 182 (H.C.Lah.)
1547
Brihan Maharashtra Sugar Syndicate Ltd. v. Commissioner of Income Tax [1946] 14 ITR 611 (Bom.)
473, 547, 548
Brilliant Farbics & Silk Factory, Karachi v. Income Tax Officer, West Zone, Karachi & others [1987] 56 TAX 24 (H.C.Kar.)
435
British Insulated & Helsby Cables Ltd. v. Atherton [1925] 10 TC 155, 198 (HL)
1499
British South Africa Co. v. Commissioner of Income Tax [1946] 14 ITR (Suppl.) 17 (PC)
1290
Brumby (H.M. Inspector of Taxes) v. Mimer 51 Tax Cas. 583 (HL)
1134
Bowman v. Secular Society Ltd. [1917] AC 406 (HL)
571
(xli) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Burhan Transport Service Ltd., Wah Cantt. v. Commissioner of Income Tax, Rawalpindi [1980] 41 TAX 182 (H.C.Lah.)
1370
Burma Corpn. Ltd. v. Commissioner of Income Tax 4 ITC 49 (Rangoon)
1613
Burma Railway Co. v. Secretary of State [1 ITC 140 (Burma)]
34, 210
C C.J.G. Saunders v. Commissioner of Income Tax 5 ITC 454 (All.)
958
C.Macdonald & Co. v. Commissioner of Income Tax 7 ITC 466 (Bom.)
1618
C.T.A.C.T. Nachiappa Chettiar v. Secretary of State [1933] 1 ITR 330 (Rangoon)
1057
C.W.T., Southern Region, Karachi v. Abid Hussain [1999] 80 TAX 89 (H.C.Kar.) = [1999 PTD 2895
329
Calcutta Stock Exchange Association Ltd. In re [1935] 3 ITR 105 (Cal.)
1180
Californian Copper Syndicate v. Harris [1904] 5 Tax Cas. 159
1289
Caltex Oil (Pakistan) Ltd., Karachi v. Commissioner of Income Tax, Central, Karachi [1985] 52 TAX 27 (H.C.Kar.)
1558
Cameron v. Prendergaat (Inspector of Taxes) [1940] 8 ITR (Suppl.) 75 (HL)
1144
Cannon Products Ltd., and others v. Incomu Tax Officer and others [1985] 51 TAX 114 (H.C.Kar.) = 1985 PLD 572
2000, 2001
Car Tunes v. Income Tax Officer etc. [1989] 59 TAX 115 (H.C.Kar.) = 1989 PLD 337
373
Carew And Company Ltd., Darsana v. Commissioner of Income Tax, East Pakistan, Dacca [1968] 17 TAX 133 (H.C.Dacca)
1405
Cbatturarn v. Commissioner of Income Tax [1947] 15 ITR 302 (PC)
1960
CBR & Another v. Sindh Industrial Trading Estate Limited 1984 SCC 604 = [1986] 53 TAX 47 (S.C.Pak.)
822
Cement Agencies Limited v. Income Tax Officer, Central Circle II, Karachi and another [1965] 11 TAX 216 (H.C.Kar.)
1012
Cement Agencies Ltd. v. Income Tax Officer, Central Circle II, Karachi & Another 1969 SCC 322 = [1969] 20 TAX 33 (S.C.Pak.) = (PLD 1969 S.C. 318)
157, 998
Central Exchange Bank Ltd., Lahore v. Commissioner of Income Tax, Lahore [1960] 2-TAX (Suppl.-121) (H.C.Lah.) = 1960 PTD 987 = 1954 PLD 439
1155
Central India Spg., Wvg. & Mfg. Co. Ltd. v. Commissioner of Income Tax [1943] 11 ITR 266 (Nag.)
1626
Central Insurance Co. & other, v. CBR, Islamabad etc. 1993 SCC 1049 = [1993] 68 TAX 86 (S.C.Pak.)
69, 106,179, 803, 1704, 1705
(xlii) VOL-I
Income Tax Digest. Case No.
Central Insurance Co. Ltd. v. Commissioner of Income Tax [1999] 79 TAX 1 (S.C.Pak.)
103
Central Insurance Company Ltd. v. Commissioner of Income Tax, Karachi and another [1992] 65 TAX 132 (H.C.Kar.) = 1992 PTD 32
1716
Central Provinces & Berar Provincial Co-operative Bank Ltd. v. Commissioner of Income Tax [1946] 14 ITR 479 (Nag.)
1157
Ch.Karamat Hussain v. Commissioner of Income Tax, Azad Jammu and Kashmir Council, Muzaffarabad and another [2001 PTD 1174 (S.C.AJ&K)
1802, 1822
Chairman, Central Board of Revenue v. Pak-Saudi Fertilizer Ltd. [2001] 83 TAX 119 (S.C.Pak.)
363, 1948
Chamber of Commerce v. Commissioner of Income Tax [1936] 4 ITR 397 (All.)
573, 704
Chanda Motors, Karachi v. Central Board of Revenue [1990] 62 TAX 67 (H.C.Kar.) = 1990 PTD 549
554
Chapal Builders v. Income Tax Officer and another [1990] 61 TAX 57 (H.C.Kar.)
2004
Chatturam v. Commissioner of Income Tax [1946] 14 ITR 695 (Pat.)
1963
Chatturam v. Commissioner of Income Tax [1947] 15 ITR 302 (PC)
1959
Chaturbhuj Vallabhdas v. Commissioner of Income Tax [1946] 14 ITR 144 (Bom.)
577
Chellaiah Pillai v. Commissioner of Income Tax [1948] 16 ITR 350 (Mad.)
513, 525
Chengalvaroya Chettiar v. Commissioner of Income Tax [1937] 5 ITR 70 (Mad.)
1597
Chhitar Mal Ram Dayal, In re. 3 ITC 54 (All.)
1645
Chhuna Mal Salig Ram v. Punjab NWFP [5 ITC 316]
162
Chibbett v. Joseph Robinson & Sons [1924] 9 Tax Cas. 48
864
Chief Secretary, Government of The Punjab Lahore v. Commissioner of Income Tax, Lahore Zone, Lahore [1976] 33 TAX 176 (H.C.Lah.) = PLD 1976 Lah. 258
137, 639
Chimanlal Rameswarlal v. Commissioner of Income Tax [1940] 8 ITR 408 (Cal.)
1467
Chinnaswamy Mudaliar v. Commissioner of Income Tax 8 ITC 126 (Mad.)
874
Chockalingam Chettiar v. Commissioner of Income Tax [1945] 13 ITR 122 (Mad.)
480, 481
Chouthmal Golapchand, In re. [1938] 6 ITR 733 (Cal.)
963
Charushila Dassi, In ne [1946] 14 ITR 362 (Cal.)
901
Charushila Dassi v. Commissioner of Income Tax 9 ITC 321 (Cal.)
666
(xliii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Charushila Dassi, In re [1937] 5 ITR 1 (Cal.) Chunnilal Nathmal v. Commissioner of Income Tax 5 ITC 361 (Nag.) Chunnilal Nathmal v. Commissioner of Income Tax 9 ITC 173 (Nag.)
952 1091 913
Ciba (Pakistan) Limited, Karachi v. Commissioner of Income Tax, Karachi [1985] 52 TAX 23 (H.C.Kar.)
1559
Ciba Laboratories (Pakistan) Ltd. v. Commissioner of Income Tax (East), Karachi [1984] 50 TAX 26 (H.C.Kar.)
1532
CIR v. A.S.A. Concern [1937] 5 ITR 456 (Rangoon)
1313
City Bank N.A., Karachi v. Commissioner of Income Tax, Central Zone-C, Karachi [1994] 70 TAX 159 (H.C.Kar.)
213, 1527
Colonel Malik Sir Umar Hayat Khan v. Commissioner of Income Tax 2 ITC 52 (Lahore)
531
Colony Textile Mills Ltd. Lahore v. Income Tax Appellate Tribunal (Pak) & another [1972] 25 TAX 140 (H.C.Lah.)
442
Colony Thal Textile Mills Limited v. Commissioner Of Income Tax, Lahore [1981] 43 TAX 9 (H.C.Lah.)
1737
Commercial Properties Ltd. v. Commissioner of Income Tax 3 ITC 23 (Cal.)
1177
Commissioer of Income Tax (Central Zone), Karachi v. Zamiruddin Ahmad [1986] 53 TAX 46 (H.C.Kar.)
1093
Commissiomer of Income Tax, Karachi v. A. Razak H. K. Dada [1980] 41 TAX 10 (H.C.Kar.)
560
Commissioner Income Tax v. Anantapur Gold Mines [1 ITC 133 (Madras)
313
Commissioner of Agricultural Income Tax v. BWM Abdur Rehman [1974] 29 TAX 212 (S.C.Pak.)
158
Commissioner of Income Tax (AJ&K Council), Muzaffarabad and 2 others v. Messrs Cade Creets Associates through Managing Partner, Diwan Ali Khan Ghughtai and another [2000] 81 TAX 371 (S.C.AJ&K.) = 2000 PTD SC 892
37, 1920
Commissioner of Income Tax (Central Zone) v. Monotype Corporation Ltd. [1986] 53 TAX 74 (H.C.Kar.)
1497
Commissioner of Income Tax (Central Zone), Karachi v. Esso Eastern Standard Inc. [1986] 54 TAX 38 (H.C.Kar.)
1453
Commissioner of Income Tax (Central Zone), Karachi v. Karachi Electric Supply Corporation Limited [1985] 52 TAX 98 (H.C.Kar.) = 1985 PTD 389
614, 1864
Commissioner of Income Tax (Central Zone), Karachi v. Pakistan Progressive Cement Industries Ltd. [1985] 51 TAX 199 (H.C.Kar.)
1399
Commissioner of Income Tax (Central Zone), Karachi v. Pakistan Security Printing Corporation Ltd., Karachi [1985] 51 TAX 137 (H.C.Kar.) = 1985 PTD 413
1062
(xliv) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax (Central Zone), Karachi v. Petroleum Institute of Pakistan Ltd., Karachi [1985] 52 TAX 25 (H.C.Kar.)
1056
Commissioner of Income Tax (Central Zone), Karachi v. Shahsons Fisheries Limited [1985] 52 TAX 107 (H.C.Kar.)
1951
Commissioner of Income Tax (Central Zonr), Karachi v. Beach Luxury Hotel Limited [1988] 57 TAX 150 (H.C.Kar.)
1060
Commissioner of Income Tax (Central) Karachi v. New Jubilee Insurance Co. Ltd. [1982] 46 TAX 125 (H.C.Kar.)
189
Commissioner of Income Tax (Central) v. Beach Luxury Hotel Ltd., [1983] 48 TAX 1 (H.C, Kar.)
1245
Commissioner of Income Tax (Central) Zone, Karachi v. Shahnawaz Ltd. [1985] 52 TAX 110 (H.C.Kar.) = 1985 PTD 498
1977
Commissioner of Income Tax (Central), Karachi v. Habib Insurance Co. Ltd., Karachi [1969] 19 TAX 229 (H.C.Kar.)
1717
Commissioner of Income Tax (Central), Karachi v. Khayam Theatre Karachi [1985] 51 TAX 109 (H.C.Kar.)
1848
Commissioner of Income Tax (Central), Karachi v. New Jubilee Insurance Co. Ltd. [1982] 46 TAX 125 (H.C.Kar.) = 1982 PLD 684
802
Commissioner of Income Tax (Central), Karachi v. Pakistan Insurance Corporation [1980] 41 TAX 183 (H.C.Kar.)
604
Commissioner of Income Tax (East) Karachi v. Forbes Campbell & Co. Ltd [1979] 39 TAX 21 (H.C.Kar.)
1242
Commissioner of Income Tax (East), Karachi v. International Computors & Tabulators, Ltd., Karachi [1982] 45 TAX 204 (H.C.Kar.)
1231, 1316
Commissioner of Income Tax (East), Karachi v. Volkmar Roeddes [1984] 49 TAX 110 (H.C.Kar.)
1531
Commissioner Of Income Tax (Investigation), Karachi v. Pakistan Transport Co. Ltd., Jhang [1973] 28 TAX 66 (H.C.Lah.)
762
Commissioner of Income Tax (Investigation), Karachi v. Vali Bhai Kamruddin (Sind) Limited [1973] 28 TAX 143 (H.C.Kar.)
1000
Commissioner of Income Tax (Investigation), Lahore v. Colony Textile Mill [1977] 35 TAX 121 (H.C.Lah.)
617, 1232
Commissioner of Income Tax (West Zone), Karachi v. Associated Products of Pakistan, Karachi [1984] 50 TAX 69 (H.C.Kar.)
1944
Commissioner of Income Tax (West), Karachi v. Jupiter Trading Corporation, Karachi [1979] 40 TAX 32 (H.C.Kar.) = 1979 PLD 207
1765
Commissioner of Income Tax / Wealth Tax v. Prime Dairies Ice Cream Limited [1999] 80 TAX 282 (H.C.Lah.)
1916
Commissioner of Income Tax AJK and another v. Asian D. Enterprises and other [2000] 82 TAX 518 ((S.C.AJ&K.)
37, 1920
(xlv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax Central Zone (A), Karachi v. Razak Ltd. [1989] 60 TAX 24 (H.C.Kar.)
1943
Commissioner of Income Tax Central Zone `A', Karachi v. S.M. Naseem Allawala [1991] 64 TAX 31 (H.C.Kar.)
1504
Commissioner of Income Tax Central Zone `B', Karachi v. Pfizer Laboratories Ltd., Karachi [1991] 63 TAX 32 (H.C.Kar.)
1683
Commissioner of Income Tax Central Zone B, Karachi v. Farrokh Chemical Industries 1991 SCC 805 = [1992] 65 TAX 239 (S.C.Pak)
326
Commissioner of Income Tax Central Zone Karachi v. United Liner Agencies, Karachi [1990] 62 TAX 31 (H.C.Kar.)
221
Commissioner of Income Tax Central Zone Lahore v. Gauher Ayub [1995] 71 TAX 271 (H.C.Lah.)
107
Commissioner of Income Tax Companies II, Karachi v. Sultan Ali Jeoffery & Others 1992 SCC 974 = [1993] 67 TAX 51 (S.C.Pak)
186, 187
Commissioner of Income Tax Companies III, Karachi v. Krudd Sons Ltd. 1992 SCC 1000 = [1993] 68 TAX 41 (S.C.Pak.)
1758
Commissioner of Income Tax Companies Zone Lahore v. Mst. Khursheed Begum [1995] 71 TAX 280 (H.C.Kar.)
270
Commissioner of Income Tax Companies Zone Lahore v. Naveed A. Sheikh [1992] 65 TAX 80 (H.C.Lah.)
245
Commissioner of Income Tax East Bengal v. Kumar Narayan Roy Choudhry and others 1959 SCC 68 = [1959] 1-TAX (111-207) (S.C.Pak.)
74, 161
Commissioner of Income Tax East Pakistan & 2 others v. Aswab Ali & others 1969 SCC 350 = [1975] 31 TAX 101 (S.C.Pak)
334
Commissioner of Income Tax Pakistan v. Fazlur Rehman & Sayeedur Rehman 1964 SCC 176 = [1964] 10 TAX 49 (S.C.Pak)
316, 335
Commissioner of Income Tax East Pakistan, Dacca v. Wahiduzzaman 1965 SCC 212 = [1965] 11 TAX 296 (S.C.Pak.)
1989
Commissioner of Income Tax Faisalabad v. Chief Glass House [1992] 65 TAX 205 (H.C.Lah.)
315
Commissioner of Income Tax Karachi (West), Karachi v. Habib Vali Muhammad, Karachi [1984] 49 TAX 23 (H.C.Kar.)
616
Commissioner of Income Tax Karachi v. Ashfaq Ahmad Khan & 10 others [1974] 29 TAX 149 (S.C.Pak.)
111
Commissioner of Income Tax Karachi v. Khatija Begum, partner Shakil Impex Karachi 1965 SCC 228 = [1965] 12 TAX 95 (S.C.Pak)
241
Commissioner of Income Tax Karachi v. Nisar Ahmad [1984] 50 TAX 187 (H.C.Kar.)
46
Commissioner of Income Tax Karachi v. Paracha Textile Mills Karachi [1973] 28 TAX 155 (H.C.Kar.)
217
(xlvi) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax Lahore v. Govt. Jallo Rosin and Turpentine Factory, Lahore [1976] 34 TAX 71 (H.C.Lah.)
136
Commissioner of Income Tax Lahore v. Noorani Calendaring and Finishing Mills, Lyallpur 1991 SCC 801 = [1991] 64 TAX 69 (S.C.Pak.)
620
Commissioner of Income Tax Lahore Zone Lahore v. Malik & Co. Lahore [1974] 29 TAX 165 (H.C.Lah.)
253
Commissioner of Income Tax Lahore Zone, Lahore v. Muhammad Allah Bux [1977] 35 TAX 74 (H.C.Lah.)
165
Commissioner of Income Tax North Zone, Lahore v. Lahore Central Iron and Hardware Machinery, Merchants [1973] 27 TAX 40 (H.C.Lah.)
223
Commissioner of Income Tax North Zone, Lahore v. Mst. Wazirunissa Begum [1972 SCC 395 = [1974] 29 TAX 188 (S.C.Pak.)
71
Commissioner of Income Tax North Zone, Lahore v. Waris Silk Weaving and Knitting Mills, Gujranwala [1973] 28 TAX 181 (H.C.Lah.)
190
Commissioner of Income Tax Peshawar Zone, Peshawar v. Siemen A.G. 1991 SCC 773
181
Commissioner of Income Tax Punjab, NWFP & Bahawalpur v. Mrs. E.V. Miller 1959 SCC 53 = [1959] 1 TAX (III-1) (S.C.Pak)
160, 173, 181
Commissioner of Income Tax Rawalpindi v. Noor Sugar Mills [1975] 32 TAX 273 (H.C.Lah.)
90, 202
Commissioner of Income Tax Rawalpindi v. Wolf Gang Matzke [1975] 32 TAX 176 (H.C.Pesh.)
138
Commissioner of Income Tax Rawalpindi Zone, Rawalpindi v. New Afza Hotel Rawalpindi [1973] 27 TAX 212 (H.C.Lah.)
342
Commissioner of Income Tax Sukkur Zone, Sukkur, through Deputy Commissioner of Income Tax v. Gatron (Industries) Ltd. [1999] 79 TAX 161 (H.C.Qut.)
271
Commissioner of Income Tax v. A. F. Ferguson And Company [1967] 15 TAX 205 (H.C.Kar.)
870
Commissioner of Income Tax v. A.V.P.MR.M. Lakshmanan Chettiar [1940] 8 ITR 545 (Mad.)
662
Commissioner of Income Tax v. Abdul Rauf [1944] 12 ITR 76 (Pat.)
889
Commissioner of Income Tax v. Abubakar Abdul Rahman [1936] 4 ITR 233 (Bom.) Commissioner of Income Tax v. Achrulal [1938] 6 ITR 255 (Nag.)
898, 1183 1814
Commissioner of Income Tax v. Adamji Sons [1966] 14 TAX 174 (H.C.Kar.)
29
Commissioner of Income Tax v. Adamji Sons [1984] 50 TAX 196 (H.C.Kar.)
1638
(xlvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax v. Aga Abbas Ali Shirazi [1944] 12 ITR 179 (Mad.)
575, 580
Commissioner of Income Tax v. Ahmedabad Millowners' Association [1939] 7 ITR 369 (Bom.)
691
Commissioner of Income Tax v. Al-Karam Lamps (Pvt.) Ltd. Peshawar and others [2000] 82 TAX 61 (H.C.Pesh.)
1113
Commissioner of Income Tax v. American Life Insurance Company [1967] 15 TAX 268 (H.C.Kar.)
1719
Commissioner of Income Tax v. Anwar Enterprises, Sialkot [1999] 79 TAX 283 (H.C.Lah.)
1786, 1795
Commissioner of Income Tax v. Anwar Textile Mills Ltd. [1992] 65 TAX 277 (H.C.Kar.)
1883
Commissioner of Income Tax v. AR.M.M. Firm [1945] 13 ITR 290 (Mad.)
1219
Commissioner of Income Tax v. Arif Latif [2000] 81 TAX 1 (H.C.Lah.) = 1999 PTD 4120
1344
Commissioner of Income Tax v. Asbestos Cement Industries Ltd. & Others 1992 SCC 904 = [1993] 67 TAX 174 (S.C.Pak.)
1940, 1947
Commissioner of Income Tax v. B.J. Fletcher [1937] 5 ITR 428 (PC)
1147
Commissioner of Income Tax v. Badridas Ramrai Shop [1939] 7 ITR 613 (Nag.)
1834
Commissioner of Income Tax v. Bai Nindhi Bai [1946] 14 ITR 600 (Sind)
930
Commissioner of Income Tax v. Basant Rai Takhat Singh [1933] 1 ITR 197 (PC)
1740, 1750
Commissioner of Income Tax v. Beach Luxury Hotel Ltd., Karachi [1971] 23 TAX 161 (H.C.Kar.)
1386
Commissioner of Income Tax v. Bhojraj Harichand [1946] 14 ITR 277 (Lahore)
1599
Commissioner of Income Tax v. Bombay Burma Trading Corpn. Ltd. [1941] 9 ITR 155 (Rangoon)
1581
Commissioner of Income Tax v. Bombay Burma Trading Corporation Ltd. [1933] 1 ITR 152 (Rangoon)
1131
Commissioner of Income Tax v. Buckingham & Carnatic Co. Ltd. [1935] 3 ITR 384 (PC)
1363
Commissioner of Income Tax v. Bufco Tanneries Limited [1966] 13 TAX 185 (H.C.Dacca)
1378
Commissioner of Income Tax v. C. Macdonald & Co. [1935] 3 ITR 459 (Bom.)
947
Commissioner of Income Tax v. CbuniIaI B. Mehta [1938] 6 ITR 521 (PC)
981
(xlviii) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax v. Central India Spg. & Wvg. Co. Ltd. [1939] 7 ITR 187 (Nag.)
1367, 1368, 1612
Commissioner of Income Tax v. Century Spg., Wvg. & Mfg. Co. Ltd. [1947] 15 ITR 105 (Bom.)
1647
Commissioner of Income Tax v. Chengalvaroya Mudallar [1934] 2 ITR 395 (Mad.)
1597
Commissioner of Income Tax v. Chhotalal Mohanlal [1940] 8 ITR 114 (Sind)
689
Commissioner of Income Tax v. Chowringhee Properties Ltd. [1947] 15 ITR 405 (PC)
1194
Commissioner of Income Tax v. ChuniIaI B. Mehta [1938] 6 ITR 521 (PC)
988, 1115
Commissioner of Income Tax v. CT. RM. N. Narayanan Chettiar [1943] 11 ITR 470 (Mad.)
911
Commissioner of Income Tax v. Currimbhoy Ebrahim & Sons Ltd. [1935] 3 ITR 395 (PC)
1035, 1048, 1050
Commissioner of Income Tax v. Dadabhoy Silk Mills Ltd., Karachi [1985] 51 TAX 222 (H.C.Kar.)
1850
Commissioner of Income Tax v. Darsanram [1945] 13 ITR 419 (Pat.)
682
Commissioner of Income Tax v. Dawood Cotton Mills Limited [1974] 29 TAX 123 (H.C.Kar.)
1901
Commissioner of Income Tax v. Dewan Bahadur Dewan Krishna Kishore [1941] 9 ITR 695 (PC)
1156, 1174, 1197
Commissioner of Income Tax v. Dhanomal Kewalram Aswani [1949] 17 ITR 568 (Sind)
723
Commissioner of Income Tax v. Dharamchand Dalchand [1 ITC 264 (Nagpur)]
57
Commissioner of Income Tax v. Diwan Bahadur S.L. Mathlas [1939] 7 ITR 48 (PC)
542, 941, 1264, 1275
Commissioner of Income Tax v. Eastern Bank Ltd. [1982] 46 TAX 56 (H.C.Kar.)
1865
Commissioner of Income Tax v. Eastern Federal Union Insurance Company 1981 SCC 572 = [1982] 46 TAX 6 (S.C.Pak.)
231
Commissioner of Income Tax v. Ekbal & Co. [1945] 13 ITR 154 (Bom.)
1963
Commissioner of Income Tax v. Farrokh Chemical Industries [1991 SCC 805 = 1992 SCMR 523]
314
Commissioner of Income Tax v. Faysal Islamic Bank of Bahrain, Karachi [2001] 83 TAX 376 (H.C.Kar.)
10
Commissioner of Income Tax v. G.D. Naidu Industrial Educational Trust [1942] 10 ITR 358 (Mad.)
574
(xlix) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax v. Gammon (Pak) Limited, Karachi [1966] 14 TAX 304 (H.C.Kar.)
1401
Commissioner of Income Tax v. Gangabishan Mohanlal [1945] 13 ITR 20 (Mad.)
743
Commissioner of Income Tax v. General Steel Industries [1989] 59 TAX 112 (H.C.Lah.)
1099
Commissioner of Income Tax v. Glaxo Laboratories (Pak.) Ltd. [1991] 65 TAX 164 (H.C.Kar.)
1492
Commissioner of Income Tax v. Gotnedalli Lakshmi Narayan [1935] 3 ITR 367 (Bom.)
662
Commissioner of Income Tax v. Govindrarn Seksaria [1938] 6 ITR 584 (Bom.)
990
Commissioner of Income Tax v. Great Eastern Life Assprance Co. Ltd. [1949] 17 ITR 173 (PC)
1726
Commissioner of Income Tax v. Great Eastern Life Assurance Co. Ltd. [1949] 17 ITR 13 (PC)
1722
Commissioner of Income Tax v. Guest Keen & Nettles Fold (Pak.) Ltd. [1985] 51 TAX 20 (H.C.Kar.)
1894
Commissioner of Income Tax v. Gurupada Dutta [1946] 14 ITR 100 (PC)
1544, 1637, 1677
Commissioner of Income Tax v. Habib Bank (Overseas) Ltd. [1976] 33 TAX 221 (H.C.Kar.)
1253
Commissioner of Income Tax v. Habib Bank Executors And Trustees Co. Ltd., Karachi [1967] 15 TAX 127 (H.C.Kar.)
565
Commissioner of Income Tax v. Habib Insurance Co. Ltd., [1975] 32 TAX 232 (H.C.Kar.)
837
Commissioner of Income Tax v. Hajee Abdul Gany Ayoob [1941] 9 ITR 339 (Rangoon)
1666
Commissioner of Income Tax v. Haji Gulzar & Sons. [1983] 47 TAX 222 (H.C.Kar.)
1880
Commissioner of Income Tax v. Harveys Ltd. [1940] 8 ITR 307 (Mad.)
895, 1414
Commissioner of Income Tax v. Hemraj Kanji [1933] 1 ITR 304 (Sind)
1321, 1644
Commissioner of Income Tax v. Hoosen Kasam Dada Karachi 1960 PTD 574 (H.C.Dacca)
359
Commissioner of Income Tax v. Hukum Chand Jagadhar Mal [1936] 4 ITR 140 (Lahore)
1474, 1484
Commissioner of Income Tax v. Hukum Chand Jagadhar Mal [1936] 4 ITR 380 (Lahore)
1474
Commissioner of Income Tax v. Hungerford Investrnent Trust Ltd. [1936] 4 ITR 270 (PC)
1741
(l) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax v. Hussaini Fund [1964] 9 TAX 278 (H.C.Kar.)
1071, 1072
Commissioner of Income Tax v. Ibrahimji Hakimji [1940] 8 ITR 501 (Sind)
1183
Commissioner of Income Tax v. Imam Bux Allah Dewaya, Leiah [1976] 34 TAX 85 (H.C.Lah.)
1958
Commissioner of Income Tax v. Indian Life Assurance Co. Ltd. [1941] 9 ITR 177 (Sind)
1726
Commissioner of Income Tax v. Indian Life Assurance Co. Ltd. [1946] 14 ITR 347 (Sind)
1725
Commissioner of Income Tax v. Indian Relief & Benefit Insurance Co. Ltd. (No. 1) [1939] 7 ITR 341 (Sind)
710, 715
Commissioner of Income Tax v. Indian Relief & Benefit Insurance Co. Ltd. (No. 2) [1939] 7 ITR 352 (Sind)
710, 715
Commissioner of Income Tax v. Jainaratn Jagannath [1945] 13 ITR 410 (Pat.)
1663
Commissioner of Income Tax v. Jhamandas Devkishendas [1946] 14 ITR 554 (Sind)
481
Commissioner of Income Tax v. Jug Sah Muni Lal Sah [1939] 7 ITR 522 (Pat.)
1836, 1839
Commissioner of Income Tax v. K.A.R.K. Firm [1934] 2 ITR 183 (Rangoon)
1326
Commissioner of Income Tax v. K.C. Manavikraman Rajah [1945] 13 ITR 174 (Mad.)
514
Commissioner of Income Tax v. K.H. Katrak [1937] 5 ITR 527 (Sind)
1136
Commissioner of Income Tax v. Kamruddin Fakhruddin [2001] 83 TAX 353 (H.C.Kar.)
1957
Commissioner of Income Tax v. Karimi Industries [1983] 47 TAX 184 (H.C.Pesh.)
1206
Commissioner of Income Tax v. Karirn Bros. Charity Fund [1943] 11 ITR 603 (Bom.)
582
Commissioner of Income Tax v. Karuppaswami Mooppanar [1934] 2 ITR 284 (Mad.)
1412
Commissioner of Income Tax v. Kathiawar CO-OP Housing Society [1985] 51 TAX 5 (H.C.Kar.)
1178
Commissioner of Income Tax v. Kathiawar Coopperative Housing Society [1985] 51 TAX 5 (H.C.Kar.)
162
Commissioner of Income Tax v. Katragadda Madhusudhana Rao [1944] 12 ITR 1 (Mad.)
475, 549
Commissioner of Income Tax v. Kesar Sugar Works Ltd. 2001 PTD 744
148
(li) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax v. Khan Bahadur Waliur Rahman [1946] 14 ITR 287 (Cal.)
541
Commissioner of Income Tax v. Khemchand Ramdas [1940] 8 ITR 159 (Sind)
750, 1811
Commissioner of Income Tax v. Khemchand Ramdas [1933] 1 ITR 309 (Sind)
1461, 1469
Commissioner of Income Tax v. King and Partridge 2 ITC 142 (Mad.)
1641
Commissioner of Income Tax v. Kyauktaga Grant Ltd. [1937] 6 ITR 580 (Rangoon)
1329
Commissioner of Income Tax v. L. Armstrong Smith [1946] 14 ITR 606 (Bom.)
1150
Commissioner of Income Tax v. Lachmi Narain Bhadani [1944] 12 ITR 355 (Pat.)
2607
Commissioner of Income Tax v. Lady Navajbai R.J. Tata [1947] 15 ITR 8 (Bom.)
1119, 1128, 1742
Commissioner of Income Tax v. Lal Suresh Singh [1935] 3 ITR 356 (Oudh)
517
Commissioner of Income Tax v. M. Jamal Mohamad Sahib [1941] 9 ITR 375 (Mad.)
579
Commissioner of Income Tax v. M.A.L. Chettiyar Firm [1935] 3 ITR 193 (Rangoon)
969
Commissioner of Income Tax v. Madhwa Siddhantha Onnahini Nidhi Ltd. [1934] 2 ITR 427 (Mad.)
708, 1342
Commissioner of Income Tax v. Madras & Southern Mahratta Railway Co. Ltd. [1940] 8 ITR 280 (Mad.)
996, 1052
Commissioner of Income Tax v. Madras Cricket Club [1934] 2 ITR 209 (Mad.)
1165
Commissioner of Income Tax v. Madras Provincial Co-operative Bank Ltd. [1942] 10 ITR 490 (Mad.)
1157, 1675
Commissioner of Income Tax v. Madura Hindu Permanent Fund Ltd. [1933] 1 ITR 46 (Mad.)
1410
Commissioner of Income Tax v. Mahaliram Ramjidas [1940] 8 ITR 442 (PC)
325
Commissioner of Income Tax v. Maharaja of Darbhanga [1944] 12 ITR 116 (Pat)
1444
Commissioner of Income Tax v. Maharajadhiraja Kameshwar Singh of Darbhanga [1933] 1 ITR 94 (PC)
896, 904, 1330, 1583, 1608, 1796
Commissioner of Income Tax v. Maharajadhiraja Sir Kameshwar Singh of Darbhanga [1938] 6 ITR 686 (Pat.)
1318
(lii) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax v. Maharajadhiraja Sir Kameshwar Singh of Darbhanga [1942] 10 ITR 214 (PC)
1533
Commissioner of Income Tax v. MaharaJadhlraja Kameshwar Singh of Darbhanga [1933] 1 ITR 94 (PC)
1807
Commissioner of Income Tax v. Makanji Lalji [1937] 5 ITR 539 (Bom.)
951
Commissioner of Income Tax v. Manager of Katras Encumbered Estate [1934] 2 ITR 100 (Pat.)
954
Commissioner of Income Tax v. Mathuradas Mannalal [1942] 10 ITR 95 (Nag.)
1354
Commissioner of Income Tax v. Mehran Associates Limited [1992] 65 TAX 223 (H.C.Kar.)
1169
Commissioner of Income Tax v. Mercantile Bank of India [1936] 4 ITR 239 (PC)
935
Commissioner of Income Tax v. Messrs Sadiq Traders [1990] 80 TAX 112 (H.C.Kar.)
1990
Commissioner of Income Tax v. Metro Goldwyn Mayer (India) Ltd. [1939] 7 ITR 176 (Bom.)
1036, 1045
Commissioner of Income Tax v. Mills Store Co. [1941] 9 ITR 642 (Sind)
857, 858, 902, 1137, 1299, 1745
Commissioner of Income Tax v. Mobanmal Chordia [1943] 11 ITR 352 (Mad.)
675
Commissioner of Income Tax v. Mohanlal Hargovind [1942] 10 ITR 84 (Nag.)
701
Commissioner of Income Tax v. Motiram Nandram [1940] 8 ITR 132 (PC)
1611, 1239
Commissioner of Income Tax v. Mrs. E. V. H. Miller / Mitchell R. (c/o The Colyana Estate, Okara) [1960] 2-TAX (Suppl.-49) (H.C.Lah.) = 1956 PLD 45 = 29 ITR 296
483
Commissioner of Income Tax v. Muhammad Aqeel And Company [1967] 16 TAX 51 (H.C.Kar.)
1885
Commissioner of Income Tax v. Muhammad Kassim [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280
81, 279, 281, 288
Commissioner of Income Tax v. Mushtaq Muhammad Ali [1987] 55 TAX 157 (H.C.Kar.)
747
Commissioner of Income Tax v. Muslim Commercial Bank Ltd [1975] 32 TAX 239 (H.C.Kar.)
1673
Commissioner of Income Tax v. Mutha Sarvarayudu 2 ITC 208 (Mad.)
887
Commissioner of Income Tax v. Muzaffar-ud-Din and Sons [1966] 13 TAX 214 (H.C.Lah.)
1377
(liii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax v. N.S.A.R. Concern [1938] 6 ITR 194 (Rangoon)
543
Commissioner of Income Tax v. Nagina Talkies (property) Karachi [1974] 29 TAX 115 (H.C.Kar.)
92
Commissioner of Income Tax v. Narayana Gajapati Raju Bahadur Garu [1934] 2 ITR 288 (Mad.)
657
Commissioner of Income Tax v. Nasir Ali and another [1999] 79 TAX 428 (S.C.Pak.)
284
Commissioner of Income Tax v. National Agriculture Ltd., Karachi [2000] 82 TAX 73 (H.C.Kar.) = [2000] 81 TAX 249 (H.C.Kar.) = 2000 PTD 254
304
Commissioner of Income Tax v. National Bank of Pakistan, Karachi [1976] 34 TAX 158 (H.C.Kar.) = 1976 PTD 237
1476
Commissioner of Income Tax v. New China Glassware Company [1974] 30 TAX 158 (H.C.Kar.)
165, 564
Commissioner of Income Tax v. New India Assurance Co. Ltd. [1938] 6 ITR 603 (Bom.)
995
Commissioner of Income Tax v. New Jubilee Insurance Company [1990] 61 TAX 1 (H.C.Kar.)
1567, 1657
Commissioner of Income Tax v. Nishat Cinema, Lyallpur [1979] 39 TAX 140 (H.C.Lah.)
145
Commissioner of Income Tax v. Official Liquidator of the Agra Spg. & Wvg. Mills Co. Ltd. [1934] 2 ITR 79 (All.)
717, 1961
Commissioner of Income Tax v. Olympia [1988] 57 TAX 46 (H.C.Kar.)
44, 458
Commissioner of Income Tax v. Olympia [1988] 57 TAX 71 (H.C.Kar.)
43
Commissioner of Income Tax v. P.L.S.M. Concern [1934] 2 ITR 417 (Rangoon)
1102, 1339, 1340, 1797
Commissioner of Income Tax v. P.R.A.L. Muthu Karuppan Chettiyar [1935] 3 ITR 208 (PC)
940
Commissioner of Income Tax v. P.V.R.M. Visalakshi Achi [1937] 5 ITR 448 (Rangoon)
1052
Commissioner of Income Tax v. Pakistan Industrial Engineering Agencies Ltd. 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562
327
Commissioner of Income Tax v. Pakistan Industrial Engineering Agencies Ltd. 1991 SCC 878 = [1992] 66 TAX 176 (S.C.Pak.)
1390
Commissioner of Income Tax v. Pakistan Insurance Corporation & others 1989 SCC 740 = [1997] 75 TAX 113 (S.C.Pak) = 1997 PTD 49
167, 601
Commissioner of Income Tax v. Pakistan Investment Ltd. [1988] 57 TAX 46 (H.C.Kar.) = 1988 PTD 532
1204
(liv) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax v. Pakistan Progressive Cement Industries [1985] 51 TAX 199 (H.C.Kar.)
1356
Commissioner of Income Tax v. Pakistan Tobacco Company Ltd. [1988] 57 TAX 118 (H.C.Kar.) = 1988 PTD 66
230, 225
Commissioner of Income Tax v. Pakistan Tobacco Company Ltd., etc. [1988] 57 TAX 113 (H.C.Kar.)
225
Commissioner of Income Tax v. Pandit Dhaneshwardhar Misra [1940] 8 ITR 416 (Pat.)
466
Commissioner of Income Tax v. Papammal [1942] 10 ITR 349 (Mad.)
724
Commissioner of Income Tax v. Paracha Textile Mills Ltd. [1993] 68 TAX 77 (H.C.Kar.)
1243
Commissioner of Income Tax v. Pfizer Laboratories Ltd. [1991] 63 TAX 52 (H.C.Kar.) = 1991 PTD 39
1691
Commissioner of Income Tax v. Poana Electric Supply Co. Ltd. [1946] 14 ITR 622 (Bom.)
927
Commissioner of Income Tax v. PR.PL. Palmuiappa Chettlar [1945] 13 UK 269 (Mmd.)
742
Commissioner of Income Tax v. Prasad Film Laboratories (P.) Ltd. [1999 PTD 325]
82
Commissioner of Income Tax v. Prime Dairies Ice Cream Limited [1999] 80 TAX 282 (H.C.Lah.)
222
Commissioner of Income Tax v. R. Johnstone [1934] 2 ITR 390 (Rangoon)
1128
Commissioner of Income Tax v. Raid Prayag Krnnarl Debt [1940] 8 ITR 25 (Pat.)
859
Commissioner of Income Tax v. Raja Bahadur Dhakeswar Prasad Narain Singh [1938] 6 ITR 476 (Pat.)
1752
Commissioner of Income Tax v. Raja Bahadur Kamakhaya Narayan Singh [1948] 16 ITR 325 (PC)
491, 918
Commissioner of Income Tax v. Raja Bahadur Kamakshya Narain Singh [1946] 14 ITR 738 (Pat.)
922, 924
Commissioner of Income Tax v. Raja Bahhadur Dhakeshwar Prasad Narain Singh [1938] 6 ITR 476 (Pat.)
1421
Commissioner of Income Tax v. Raja Sri Sri Kalyanl Prasad Deo [1945] 13 ITR 17 (Pat.)
1754
Commissioner of Income Tax v. Reckitt & Colman of Pakistan Ltd. [1985] 52 TAX 18 (H.C.Kar.)
1684
Commissioner of Income Tax v. Roneo Vicker Limited, Karachi [1991] 63 TAX 14 (H.C.Kar.)
1348
Commissioner of Income Tax v. S. Ramsay Unger [1947] 15 ITR 87 (Mad.)
1418
(lv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax v. S.A.S. Ramaswamy Chettiar [1946] 14 ITR 236 (Mad.)
1433
Commissioner of Income Tax v. S.M. Chitnavls [1932] 2 Camp. Cas. 464
1483
Commissioner of Income Tax v. S.N.A.S.A. Annamalai Chettiar [1944] 12 ITR 226 (Mad.)
960
Commissioner of Income Tax v. Salem District Urban Bank Ltd. [1940] 8 ITR 269 (Mad.)
688, 712
Commissioner of Income Tax v. Sarangpur Cotton Mfg. Co. Ltd. [1938] 6 ITR 36 (PC)
1806, 1835
Commissioner of Income Tax v. Sarwan Kumar [1945] 13 ITR 361 (All.)
661
Commissioner of Income Tax v. Satish Chandra Bhowmik 1960 PTD 1075 (H.C.Dacca) = 1960 PLD 713
633
Commissioner of Income Tax v. Seth Bhirdichand [1938] 6 ITR 367 (Nag.)
1484
Commissioner of Income Tax v. Seth Rarnakrisbna Ramnath [1944] 12 ITR 21 (Nag.)
1614, 1860, 1861
Commissioner of Income Tax v. Shabir & Company [1963] 7 TAX 202 (H.C.Kar.) = 1963 PTD 395 = 1963 PLD 481
1540
Commissioner of Income Tax v. Shahnawaz Ltd. and others 1992 SCC 920 = [1992] 66 TAX 125 (S.C.Pak.)
59
Commissioner of Income Tax v. Shaw Wallace & Co. 6 ITC 178 (PC)
841, 1223, 1278, 1287
Commissioner of Income Tax v. Siemen A.G. 1991 SCC 773 = PLD 1991 SC 368
443
Commissioner of Income Tax v. Sind Central Provident Funds Society Ltd. [1939] 7 ITR 333 (Sind)
710
Commissioner of Income Tax v. Sir Horni M. Mehta [1943] 11 ITR 142 (Bom.)
1589
Commissioner of Income Tax v. Sir Kameshwar Singh [1935] 3 ITR 305 (PC)
510, 845, 861
Commissioner of Income Tax v. Sir Purshottamdas Thakurdas [1946] 14 ITR 305 (Bom.)
1628
Commissioner of Income Tax v. Sir S.M. Chitnavis 6 ITC 453 (PC)
1459, 1475, 1484
Commissioner of Income Tax v. Smt. Singari Bai [1945] 13 ITR 224 (All.)
962, 1838
Commissioner of Income Tax v. Sri Talupuru Venkatasubhiah Chetty [1946] 14 ITR 227 (Mad.)
1443
Commissioner of Income Tax v. Steel Bros. & Co. Ltd. 2 ITC 119 (Rangoon)
986
(lvi) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax v. Subramanya Sastrigal 2 ITC 152 (Mad.)
508
Commissioner of Income Tax v. Surridge & Beecham [1968] 18 TAX 72 (H.C.Kar.)
205, 340
Commissioner of Income Tax v. Syed Akhtar Ali [1994] 69 TAX 38 (H.C.Kar.)
144
Commissioner of Income Tax v. Tata Sons Ltd. [1939] 7 ITR 195 (Bom.)
1617
Commissioner of Income Tax v. Tayab Moosa And Company [1967] 15 TAX 62 (H.C.Kar.)
1874
Commissioner of Income Tax v. Tehri-Garhwal State [1934] 2 ITR 1 (PC)
882
Commissioner of Income Tax v. Tejbhandas Motumal [1933] 1 ITR 202 (Sind)
1420
Commissioner of Income Tax v. Thai Airways International [1994] 69 TAX 120 (H.C.Kar.)
612
Commissioner of Income Tax v. Tika Ram & Sons Ltd. [1937] 5 ITR 544 (All.)
1594
Commissioner of Income Tax v. United Commercial Bank Ltd., Karachi [1969] 20 TAX 216 (H.C.Kar.)
1426
Commissioner of Income Tax v. United Insurance Co. of Pakistan Ltd. Karachi [1991] 63 TAX 141 (H.C.Kar.) = 1991 PTD 57
1653
Commissioner of Income Tax v. Usman Bhai [1967] 16 TAX 65 (H.C.Kar.)
851
Commissioner of Income Tax v. V.E.K.R. Savurniarnurthy [1946] 14 ITR 185 (Ma&)
730
Commissioner of Income Tax v. V.S.U.R. Firm [1935] 3 ITR 158 (Rangoon)
968
Commissioner of Income Tax v. V.T.S. Sevuga Pandia Thevar [1933] 1 ITR 78 (Mad.)
533
Commissioner of Income Tax v. VaIliammal Achi [1938] 6 ITR 720 (Mad.)
979
Commissioner of Income Tax v. Vali Bhai Kamruddin (Sind) Ltd. [1987] 56 TAX 30 (H.C.Kar.)
1061
Commissioner of Income Tax v. Valika Art Fabrics Ltd. [2001] 83 TAX 342 (H.C.Kar.)
1160
Commissioner of Income Tax v. Valliammal Achi [1938] 6 ITR 720 (Mad.)
888
Commissioner of Income Tax v. Venkatachalapathi 1 ITC 185 (Madras)
31
(lvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax v. Visweshwar Singh [1939] 7 ITR 536 (Pat.)
925
Commissioner of Income Tax v. Wali Bhai Qamaruddin [1967] 15 TAX 145 (H.C.Kar.)
1536
Commissioner of Income Tax v. Yousuf & Company [1967] 15 TAX 4 (H.C.Kar.) = 1967 PTD 161 = 1967 PLD 363
1886
Commissioner of Income Tax v. Zakia Siddiqui [1989] 59 TAX 79 (H.C.Kar.) = 1989 PTD 135
1350
Commissioner of Income Tax v. Zamindar of Singampalli 1 ITC 181 (Madras)
32
Commissioner of Income Tax, (Central Zone), Karachi v. Oxford University Press, Karachi [1984] 50 TAX 88 (H.C.Kar.)
1139, 1560, 1685
Commissioner of Income Tax, (Central) Karachi v. Habib Insurance Co. Ltd. Karachi [1969] 19 TAX 222 (H.C.Kar.)
198
Commissioner of Income Tax, (Central), Karachi v. Haji Jethabhoi Gokul & Co. [1983] 47 TAX 182 (H.C.Kar.)
1240
Commissioner of Income Tax, (East Zone), Karachi v. Mohammadi Rerolling Mills [1985] 52 TAX 161 (H.C.Kar.)
1699
Commissioner of Income Tax, (East) Karachi v. Ebrahim D. Ahmad & others [1982] 45 TAX 232 (H.C.Kar.)
25
Commissioner of Income Tax, (East), Karachi v. M. A. Toor [1984] 50 TAX 144 (H.C.Kar.)
1118
Commissioner of Income Tax, (Investigation), Lahore v. Ahmed Food Industries Ltd, Karachi [1984] 50 TAX 208 (H.C.Kar.)
1773
Commissioner Of Income Tax, (West Zone), Karachi v. Bhahawalpur Textile Mills Ltd., Hyderabad [1985] 51 TAX 71 (H.C.Kar.)
1788
Commissioner Of Income Tax, (West Zone), Karachi v. Bhahawalpur Textile Mills Ltd., Hyderabad [1985] 51 TAX 71 (H.C.Kar.)
1789
Commissioner of Income Tax, (West Zone), Karachi v. Fateh Textile Mills Ltd., Hyderabad [1984] 50 TAX 223 (H.C.Kar.)
1776
Commissioner of Income Tax, (West), Karachi v. Adamjee Sons, Karachi [1984] 50 TAX 196 (H.C.Kar.)
1403
Commissioner of Income Tax, Bengal Mufassil v. Burdhan Kuti Wards' Estate [1960] 2-TAX (Suppl.-1) (H.C.Dacca) = 1960 PTD 1050 = PLD 1960 Dacca 34
467
Commissioner of Income Tax, Burma v. Messrs Steel Brothers and Co., Ltd. [2 ITC 129 (Rangoon)]
203
Commissioner of Income Tax, Central `B', Karachi v. Philips Electrical Co. of Pakistan Ltd., Karachi [1991] 64 TAX 25 (H.C.Kar.) = 1991 PTD 672
1355
Commissioner of Income Tax, Central Karachi v. Mercantile Fire and Central Insurance Co. Ltd. [1989] 59 TAX 63 (H.C.Kar.)
1698
(lviii) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax, Central Zone `A' Karachi v. Karachi Electric Supply Corporation Ltd. [1991] 64 TAX 126 (H.C.Kar.)
1347
Commissioner of Income Tax, Central Zone `A', Karachi v. Chemdyes Pakistan Limited [1990] 61 TAX 149 (H.C.Kar.)
1422
Commissioner of Income Tax, Central Zone `A', Karachi v. Pakistan Oxygen Ltd. [1992] 65 TAX 138 (H.C.Kar.)
818
Commissioner of Income Tax, Central Zone `A', Karachi v. S. Mazhar Hussain [1988] 58 TAX 123 (H.C.Kar.)
1149
Commissioner of Income Tax, Central Zone `B', Karachi v. Cynamid (Pak.) Ltd., Karachi [1992] 65 TAX 130 (H.C.Kar.)
1690
Commissioner of Income Tax, Central Zone `B', Karachi v. Ebrahim Brothers Ltd., Karachi [1991] 63 TAX 64 (H.C.Kar.) = 1991 PTD 374
1732
Commissioner of Income Tax, Central Zone `B', Karachi v. Mackinnon Mackenzie & Co. of Pakistan (Pvt.) Ltd., Karachi [1993] 67 TAX 70 (H.C.Kar.) = 1993 PTD 46
1942
Commissioner of Income Tax, Central Zone `B', Karachi v. Tariq Siddiqui [1991] 63 TAX 90 (H.C.Kar.) = 1991 PTD 350
1665
Commissioner of Income Tax, Central Zone `C' Karachi v. Muhammad Amin Muhammad Bashir Limited [1990] 61 TAX 155 (H.C.Kar.)
1457
Commissioner of Income Tax, Central Zone `C', Karachi v. Agricultural Development Bank of Pakistan, Karachi [1992] 65 TAX 135 (H.C.Kar.)
1465
Commissioner of Income Tax, Central Zone `C', Karachi v. Algemence Bank of Netherland, Karachi [1992] 65 TAX 300 (H.C.Kar.)
1689
Commissioner of Income Tax, Central Zone `C', Karachi v. B.D. Avari [1991] 64 TAX 110 (H.C.Kar.) = 1991 PTD 839
1170
Commissioner of Income Tax, Central Zone `C', Karachi v. Grindlays Bank Limited, Karachi [1991] 64 TAX 7 (H.C.Kar.)
1452
Commissioner of Income Tax, Central Zone `C', Karachi v. M. Hussain Ahmad [1992] 65 TAX 129 (H.C.Kar.)
1189
Commissioner of Income Tax, Central Zone `C', Karachi v. Transoceanic Steamship Company Ltd. [1992] 65 TAX 212 (H.C.Kar.) = 1992 PTD 232
1730
Commissioner of Income Tax, Central Zone A, Karachi v. Phoenix Insurance Co. Ltd. 1991 SCC 842 = [1991] 64 TAX 173 (S.C.Pak.)
1709
Commissioner of Income Tax, Central Zone, Karachi v. Karachi Race Club Ltd. [1991] 63 TAX 49 (H.C.Kar.)
1505
Commissioner of Income Tax, Central Zone, Karachi v. Mushtaq Ahmed [1989] 59 TAX 20 (H.C.Kar.)
1162
Commissioner of Income Tax, Central Zone, Karachi v. Sandoz (Pak), Ltd. [1987] 56 TAX 58 (H.C.Kar.)
613
(lix) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax, Central Zone, Karachi v. United Liner Agencies, Karachi [1990] 62 TAX 31 (H.C.Kar.) = 1990 PTD 829
1058
Commissioner of Income Tax, Central Zone-A, Karachi v. Pakistan Investment Ltd. [1988] 57 TAX 46 (H.C.Kar.)
1237
Commissioner of Income Tax, Central Zone-B, Karachi v. Farrokh Chemical Industries 1991 SCC 805 = [1992] 65 TAX 239 (S.C.Pak)
107
Commissioner of Income Tax, Central Zone-B, Karachi v. Zakia Siddiqui [1989] 59 TAX 79 (H.C.Kar.)
293
Commissioner of Income Tax, Central, Karachi v. Alpha Insurance Co., Ltd., Karachi, Commissioner of Income Tax, Central, Karachi v. Home Insurance Co. Ltd., Karachi 1981 SCC 559 = [1981] 44 TAX 1 (S.C.Pak.)
1695
Commissioner of Income Tax, Central, Karachi v. Fakir Cotton Ginning and Pressing Industries Ltd. and another 1990 SCC 744 = [1991] 63 TAX 120 (S.C.Pak.) = 1991 PTD 573 = 1991 PLD 280
1225
Commissioner of Income Tax, Central, Karachi v. Habib Bank Executors & Trustees Co. Karachi 1984 SCC 594 = [1986] 53 TAX 59 (S.C.Pak.)
1203
Commissioner of Income Tax, Chittagong Zone, Chittagong v. Jagabandhu Saha and others [1968] 18 TAX 11 (H.C.Dacca)
1893
Commissioner of Income Tax, Companies II, Karachi v. General Tyre & Rubber Company of Pakistan 1993 SCC 1015 = [1993] 67 TAX 191 (S.C.Pak.)
1521
Commissioner of Income Tax, Companies-1, Karachi v. Premier Bank Limited, Karachi and another [1999] 79 TAX 589 (S.C.Pak) = 1999 PTD 3005 = 1999 SCMR 1213
1526, 1694
Commissioner of Income Tax, Companies-Il, Karachi v. Ciba Geigy (Pakistan) Ltd., Karachi [1994] 69 TAX 122 (H.C.Kar.)
611
Commissioner of Income Tax, Dacca v. B. S. Trading Company, Dacca [1966] 14 TAX 7 (H.C.Dacca)
1555
Commissioner of Income Tax, Dacca v. Suresh Prosad Lahiri Chowdhury, Mymensingh [1965] 12 TAX 136 (H.C.Dacca)
485
Commissioner of Income Tax, Dacca v. Tangail General Trading & Transport Corporation Ltd., Mymensingh [1961] 4 TAX 197 (H.C.Dacca) = 1961 PTD 1092 = 1962 PLD 86
1358
Commissioner of Income Tax, Dacca Zone, Dacca v. Amin Jute Bailing Company, Dacca [1969] 19 TAX 103 (H.C.Dacca)
1863
Commissioner of Income Tax, Dacca Zone, Dacca v. Eastern Aluminium Agency, Dacca [1968] 17 TAX 78 (H.C.Dacca)
1082
Commissioner of Income Tax, East Bengal v. Kumar Ram Narayan Roy Chaudhary & others 1959 SCC 68 = [1959] 1-TAX (III207)(S.C.Pak) = PLD 1959 SC 453
242, 461, 470, 484, 524
(lx) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax, East Pakistan Dacca v. Wahiduzzaman [1965 SCC 212 = [1965] 11 TAX 296 (S.C.Pak.) = PLD 1965 SC 171]
328
Commissioner of Income Tax, East Pakistan v. Aizuddin Gazi and others [1960] 2-TAX (III-474) (H.C.Dacca) = 1960 PTD 727 = 1960 PLD 535
358, 1974
Commissioner of Income Tax, East Pakistan v. Radhashyam Agarwala [1960] 2-TAX (III-157) (H.C.Dacca) = 1960 PTD 253 = 1960 PLD 233
630
Commissioner of Income Tax, East Pakistan, Dacca v. A. Khaleque (c/o Amin Agencies Ltd., Chittagong) [1968] 18 TAX 8 (H.C.Dacca)
1895
Commissioner of Income Tax, East Pakistan, Dacca v. A.K. Khan Plywood Co., Chittagong [1966] 13 TAX 271 (H.C.Dacca)
1388
Commissioner of Income Tax, East Pakistan, Dacca v. Engineers Limited, Dacca [1965] 11 TAX 181 (H.C.Dacca)
1570
Commissioner of Income Tax, East Pakistan, Dacca v. Engineers Limited, Dacca 1967 SCC 289 = [1967] 16 TAX 81 (S.C.Pak.)
66, 320, 1502
Commissioner of Income Tax, East Pakistan, Dacca v. Gulistan Cinema Company, Dacca [1968] 17 TAX 209 (H.C.Dacca)
1371
Commissioner of Income Tax, East Pakistan, Dacca v. Howrah Trading Co. Ltd., Calcutta [1960] 2-TAX (III-492) (H.C.Dacca) = 1961 PTD 900 = 1961 PLD 602
1680
Commissioner of Income Tax, East Pakistan, Dacca v. Liquidator, Khulna Bagerhat Railway Co. Ltd., Ahmadabad 1962 SCC 108 = [1962] 5 TAX 262 (S.C.Pak.)
1226
Commissioner of Income Tax, East Pakistan, Dacca v. Liquidator, Khulna-Bagerhat Railway Co. Ltd., Ahmadabad [1961] 3 TAX 48 (H.C.Dacca) = 1961 PTD 136 = 1961 PLD 108
1228
Commissioner of Income Tax, East Pakistan, Dacca v. Luxmi Narayan Cotton Mills Ltd., Dacca 1960 SCC 87 = [1960] 2-TAX (III-538) (S.C.Pak.)
817
Commissioner of Income Tax, East Pakistan, Dacca v. Noor Hussain 1964 SCC 195 = [1964] 10 TAX 206 (S.C.Pak.)
807
Commissioner of Income Tax, East Pakistan, Dacca v. Tangail General Trading & Transport Corporation Limited, Mymensingh 1966 SCC 282 = [1967] 15 TAX 1 (S.C.Pak.)
1557
Commissioner of Income Tax, East Pakistan, Dacca v. Wahidur Rahman, Income Tax Officer, Companies Circle IV, Chittagong [1961] 4 TAX 135 (H.C.Dacca) = 1961 PTD 1110 = 1962 PLD 104
357
Commissioner of Income Tax, East Zone, Karachi v. Iqbal Engineering Works and Haji Feroz-ud-Din 1986 SCC 641 = [1987] 55 TAX 1 (S.C.Pak.)
1846
Commissioner of Income Tax, East Zone, Karachi v. Sind Club, Victoria Road, Karachi [1987] 56 TAX 75 (H.C.Kar.)
1163
(lxi) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax, Karachi & other v. N.V. Philip's Gloelampenfabriaken, Karachi 1993 SCC 1022 = [1993] 68 TAX 35 (S.C.Pak.)
364
Commissioner of Income Tax, Karachi (East), Karachi v. Cogefar Astaldi Sidmail, Joint Venture, Karachi [1984] 50 TAX 133 (H.C.Kar.)
1678
Commissioner of Income Tax, Karachi (East), Karachi v. Millwala & Sons Limited, Karachi [1984] 49 TAX 118 (H.C.Kar.)
1676
Commissioner of Income Tax, Karachi (West), Karachi v. Manzoor Hussain Abdul Karim [1984] 49 TAX 1 (H.C.Kar.)
1998
Commissioner of Income Tax, Karachi (West), Karachi v. S. A. Rehman [1980] 42 TAX 147 (H.C.Kar.) = 1980 PTD 314
48, 1458
Commissioner of Income Tax, Karachi v. Arshad Javed [1989] 59 TAX 65 (H.C.Kar.)
1122
Commissioner of Income Tax, Karachi v. Crescent Star Insurance Co. Ltd. [1974] 30 TAX 111 (H.C.Kar.)
1655
Commissioner of Income Tax, Karachi v. Dalmia Cement Ltd., Karachi [1969] 20 TAX 15 (H.C.Kar.)
1515
Commissioner of Income Tax, Karachi v. Eddie Investment Company Limited [1967] 15 TAX 254 (H.C.Kar.)
1517
Commissioner of Income Tax, Karachi v. Instruments Krafts (Pvt) Ltd. [1995] 71 TAX 218 (H.C.Kar.)
1529
Commissioner of Income Tax, Karachi v. Moosa Omar & Co. Ltd. [1980] 41 TAX 19 (H.C.Kar.)
1510
Commissioner of Income Tax, Karachi v. N. Futeh Ally and Co., Karachi [1984] 50 TAX 189 (H.C.Kar.)
1404
Commissioner of Income Tax, Karachi v. New India Assurance Co., Karachi [1978] 37 TAX 273 (H.C.Kar.)
1514
Commissioner of Income Tax, Karachi v. Pak Thread Ball Manufacturers' Association, Karachi [1974] 29 TAX 179 (H.C.Kar.)
1246
Commissioner of Income Tax, Karachi v. Paracha Textile Mills, Karachi [1973] 28 TAX 155 (H.C.Kar.)
1425
Commissioner of Income Tax, Karachi v. Queensland Insurance Co., Ltd., Karachi 1991 SCC 853 = [1992] 65 TAX 229 (S.C.Pak.)
1706
Commissioner of Income Tax, Karachi v. Sadruddin [1985] 51 TAX 83 (H.C.Kar.)
314
Commissioner of Income Tax, Karachi v. Shabbir & Company, Karachi 1966 SCC 260 = [1966] 13 TAX 197 (S.C.Pak.)
1539
Commissioner of Income Tax, Karachi v. Shahennihon Steamship Co. Ltd., Karachi [1971] 23 TAX 121 (H.C.Kar.)
1376
Commissioner of Income Tax, Karachi, East Karachi v. Amsons Dairies Ltd., Karachi 1974 SCC 422 = [1975] 31 TAX 62 (S.C.Pak.)
1250
(lxii) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax, Karachi, Sind and Baluchistan v. The Netherlands Trading Society, Karachi [1960] 2-TAX (Suppl.-139) (H.C.West Pakistan, Karachi Bench) = 1960 PTD 758 = 1957 PLD 167
1051, 1686, 1914
Commissioner of Income Tax, Karachi, v. Majestic Cinema, Karachi 1965 SCC 220 = [1965] 12 TAX 15 (S.C.Pak.)
645
Commissioner of Income Tax, Lahore (Now at Multan) v. Five Star Calico, Printing Works, Lyallpur (Now Faisalabad) [1993] 67 TAX 227 (H.C.Lah.)
1383
Commissioner of Income Tax, Lahore v. Abdus Salam of Sialkot [1992] 65 TAX 204 (H.C.Lah.)
1105
Commissioner of Income Tax, Lahore v. Aziz Din [1976] 33 TAX 258 (H.C.Lah.)
352
Commissioner of Income Tax, Lahore v. Chief Secretary, Government of Punjab, Lahore 1980 SCC 477 = [1980] 42 TAX 179 (S.C.Pak.)
638
Commissioner of Income Tax, Lahore v. Colony Textile Mills Ltd., Lahore 1980 SCC 471 = 1990 PTD 834
1381
Commissioner of Income Tax, Lahore v. Colony Textile Mills Ltd., Lahore. [1976] 35 TAX 40 (H.C.Lah.)
1375
Commissioner of Income Tax, Lahore v. Government Jallo Rosin and Turpentine Factory, Lahore [1976] 34 TAX 71 (H.C.Lah.)
826
Commissioner of Income Tax, Lahore v. Kohinoor Industries Ltd., Lahore [1977] 35 TAX 42 (H.C.Lah.)
348
Commissioner of Income Tax, Lahore v. National Typewriter Co. [1992] 66 TAX 186 (H.C.Lah.)
1078
Commissioner of Income Tax, Lahore v. Pak Cinemas Ltd. Lahore [1977] 36 TAX 223 (H.C.Lah.)
1681
Commissioner of Income Tax, Lahore v. The Lyallpur Central Cooperative Bank Ltd., Lyallpur. [1959] 1-TAX (III-150) (H.C.West Pakistan, Lahore Bench) = 1959 PTD 639 = 1959 PLD 627
345
Commissioner of Income Tax, Lahore v. Umar Saigal [1976] 33 TAX 245 (H.C.Lah.)
107
Commissioner of Income Tax, Lahore v. Umar Saigol, Lahore [1973] 28 TAX 159 (H.C.Lah.)
1734
Commissioner of Income Tax, Lahore v. West Punjab Factories Limited, Okara [1966] 13 TAX 122 (H.C.Lah.)
1379
Commissioner of Income Tax, Lahore Zone v. Sh. Muhammad Ismail and Co. Ltd. Lyallpur [1985 SCC 637 = [1986] 53 TAX 122 (S.C.Pak)
107
Commissioner of Income Tax, Lahore Zone, Lahore v. Badar Ice Factory, Lahore [1981] 43 TAX 100 (H.C.Lah.)
311
Commissioner of Income Tax, Lahore Zone, Lahore v. Choudhri Brothers 1980 SCC 487 = [1980] 42 TAX 119 (S.C.Pak.)
1760
(lxiii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax, Lahore Zone, Lahore v. Mian Muhammad Allah Bux, Karachi [1972] 27 TAX 145 (H.C.Lah.)
1701
Commissioner of Income Tax, Lahore Zone, Lahore v. Mian Muhammad and Sons [1990] 62 TAX 111 (H.C.Lah.)
1015
Commissioner of Income Tax, Lahore Zone, Lahore v. Muhammad Allah Bux [1977] 35 TAX 74 (H.C.Lah.) = 1977 PTD 13
1164, 1176, 1739
Commissioner of Income Tax, Lahore Zone, Lahore v. Punjab Oil Expeller Co., Lahore [1979] 40 TAX 55 (H.C.Lah.)
1511
Commissioner of Income Tax, Lahore Zone, Lahore v. Shihana Perfumery Store 1980 SCC 483 = [1981] 43 TAX 14 (S.C.Pak.)
622
Commissioner of Income Tax, Lahore Zone, Lahore v. Umar Earooq C/o Sh. Fazal Rehman, Multan [1972] 27 TAX 139 (H.C.Lah.)
606
Commissioner of Income Tax, Lahore, Zone Lahore v. Universal Life & General Insurance Co. Ltd. [1977] 35 TAX 14 (Lah.)
1654
Commissioner of Income Tax, Madras v. Sri Krishna Chandra Gajapathi Narayan Deo, Raja of Parlakimedi [2 ITC 104 (Madras)]
207
Commissioner of Income Tax, Multan Zone, Multan v. Al-Makhdoom Industries, Multan [2001] 83 TAX 487 (H.C.Lah.) = 2001 PTD 1437
1098
Commissioner of Income Tax, Multan Zone, Multan v. Messrs Muhammad Saleem Muhammad Arif Contractors, Multan 2001 PTD 1371
1976
Commissioner of Income Tax, North Zone (West Pakistan), Lahore v. Colony Textile Mills Limited [1970] 22 TAX 170 (H.C.Lah.)
1898
Commissioner of Income Tax, North Zone (West Pakistan), Lahore v. Crescent Textile Mills Ltd., Lahore [1974] 29 TAX 242
1897
Commissioner of Income Tax, North Zone (West Pakistan), Lahore v. Khanewal Oil Mills Ltd., Khanewal [1962] 6 TAX 66 (H.C.Lah.) = 1962 PTD 611 = 1962 PLD 821
1524
Commissioner of Income Tax, North Zone (West Pakistan), Lahore v. Pakistan Standard Oil & Ginning Mills, Multan [1973] 28 TAX 9 (H.C.Lah.)
1387
Commissioner of Income Tax, North Zone (West Pakistan), Lahore. v. Sheikco Ltd., Ismailabad, Multan [1962] 6 TAX 75 (H.C.Lah.) = 1962 PTD 683 = 1962 PLD 870
1884
Commissioner of Income Tax, North Zone, West Pakistan, Lahore v. Mst. Wazirunnisa Begum 1972 SCC 395 = [1974] 29 TAX 188 (S.C.Pak.)
212, 1067, 1068
Commissioner of Income Tax, North Zone, West Pakistan, Lahore v. Owen Roberts & Co. Ltd., Lahore [1972] 27 TAX 95 (H.C.Lah.)
1424
Commissioner of Income Tax, Peshawar v. Ghulam Siddique [2001] 83 TAX 390 (H.C.Pesh.) = [2000] 82 TAX 426 (H.C.Pesh.) = 2000 PTD 2953
634
(lxiv) VOL-I
Income Tax Digest. Case No.
Commissioner of Income Tax, Peshawar v. Gul Cooking Oil and Vegetable Ghee (Pvt.) Ltd. and others [2001] 83 TAX 544 (S.C.Pak.) = 2001 PTD 778
1919
Commissioner of Income Tax, Peshawar Zone, Peshawar v. Siemen A.G. 1991 SCC 773 = [1991] 63 TAX 130 (S.C.Pak.)
602
Commissioner of Income Tax, Rawalpindi v. Amanat Ali [2001] 83 TAX 268 (H.C.Lah.)
2215
Commissioner of Income Tax, Rawalpindi v. Attock Oil Company Limited, Rawalpindi [1975] 32 TAX 57 (H.C.Lah.)
1543
Commissioner of Income Tax, Rawalpindi v. K.K. & Co. Ltd. [1980] 42 TAX 81 (H.C.Lah.)
211
Commissioner of Income Tax, Rawalpindi v. Noon Sugar Mills [1975] 32 TAX 273 (H.C.Lah.)
351, 1913
Commissioner of Income Tax, Rawalpindi v. Pak. Mineral Industries Ltd., Rawalpindi [1996] 73 TAX 240 (H.C.Lah.)
1345
Commissioner of Income Tax, Rawalpindi Zone v. M. Bahar Ahmad & sons 1981 SCC 567 = [1982] 45 TAX 134 (S.C.Pak.)
1353
Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi v. Batala Cotton Ginning Pressing and General Mills, Lyallpur [1977] 35 TAX 178 (H.C.Lah.)
1374
Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi v. Haji Maula Bux Corporation Ltd. Sargodha 1990 SCC 753 = [1990] 62 TAX 57 (S.C.Pak.) = 1990 PLD 990 (SC)
1096
Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi v. K.K. & Co. Ltd., Peshawar [1980] 42 TAX 81 (H.C.Lah.)
1427
Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi v. Lyallpur Cold Storage, Lyallpur 1975 SCC 426 = [1976] 34 TAX 14 (S.C.Pak.)
35
Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi v. Malik Abdul Karim Transport Co. Ltd., Gujrat [1973] 28 TAX 13 (H.C.Lah.)
769
Commissioner of Income Tax, Rawalpindi, now Gujranwala Zone v. Abdul Karim Transport Company Ltd. Gujrat 1985 SCC 630 = [1986] 53 TAX 67 (S.C.Pak.)
774
Commissioner of Income Tax, Sales Tax, North Zone, West Pakistan Lahore v. Manzur Qadir, Bar-at-law, Lahore 1971 SCC 376 = [1971] 23 TAX 280 (S.C.Pak.)
1785
Commissioner of Income Tax, South Zone, (West Pakistan), Karachi v. Manzur Qadir, Barrister-at-Law [1966] 13 TAX 149 (H.C.Lah.)
1831
Commissioner of Income Tax, South Zone, Karachi v. Noor Jehan S. All Bhai [1992] 66 TAX 163 (H.C.Kar.)
1890
Commissioner of Income Tax, South Zone, Karachi v. Radio Hotel, Karachi [1959] 1-TAX (III-407) (H.C.West Pakistan, Karachi) = 1959 PTD 707 = 1959 PLD 539
360
(lxv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Commissioner of Income Tax, South Zone, v. Haji Ferozuddin [1967] 16 TAX 26 (H.C.Kar.)
1887
Commissioner of Income Tax, v. Oriental Dyes and Chemicals Co. Ltd. 1991 SCC 891 = [1992] 65 TAX 254 (S.C.Pak.)
1489
Commissioner of Income Tax, West Karachi v. Excide Batteries of Pakistan [1978] 38 TAX 126 (Kar.)
1512
Commissioner of Income Tax, West Zone Karachi, & Others v. Khairpur Textile Mills Ltd. and others & Pakistan Progressive Cement Industries v. Commissioner of Income Tax, Karachi Ltd. 1988 SCC 702 = [1989] 60 TAX 55 (S.C.Pak.) = 1989 PTD 500, 1989 PTD 55
1392
Commissioner of Income Tax. North Zone (West Pakistan), Lahore v. Qazi Abdul Hamid, Advocate, Lahore [1974] 29 TAX 129 (H.C.Lah.)
618
Commissioner of Income Tax/CST (Central Karachi) v. A.B. Food Industries Ltd. Karachi [1984] 50 TAX 158 (H.C.Kar.)
87
Commissioner of Income Tax/CST Rawalpindi v. Pakistan Television Corporation Rawalpindi [1978] 38 TAX 181 (H.C.Lah.)
169
Commissioner of Income Tax/Wealth Tax v. Engineering Cooperative Housing Society, Lahore [2000] 82 TAX 52 (H.C.Lah.)
596, 597, 598
Commissioner of Income Tax/Wealth Tax, Companies Zone II, Lawrence Road, Lahore v. Sarfaraz Ali Sheikh [2000] 81 TAX 341 (H.C.Lah.) = 2000 PTD 374
1100
Commissioner of Income Tax/Wealth Tax, Companies Zone, Faisalabad v. Rana Asif Tauseef C/o Rana Hosiery & Textile Mills (Pvt.) Ltd., Faisalabad [2000] 81 TAX 7 (H.C.Lah.) = 2000 PTD 497
243, 268, 1148
Commissioner of Income Tax/Wealth Tax, Multan Zone, Multan v. Allah Yar Cotton Ginning & Pressing Mills (Pvt.) Limited, Multan Road, Vehari [2000] 82 TAX 433 (H.C.Lah.) = 2000 PTD 2958
65, 75, 267, 1106, 1108, 1110
Commissioner of Sales Tax (Central), Karachi v. Moosa Umer & Co., Karachi & 26 others [1985] 51 TAX 16 (H.C.Kar.)
1509
Commissioner of Sales Tax Lahore v. Lutfi & Co. Lahore [1973] 28 TAX 168 (H.C.Lah.)
265
Commissioner of Sales Tax Rawalpindi Zone, Rawalpindi v. Rashid Burner, Sialkot [1974] 29 TAX 221 (H.C.Lah.)
91
Commissioner of Sales Tax, Rawalpindi Zone, Rawalpindi v. Abdul Razaq Zia-ul-Qamar [1973] 27 TAX 99 (H.C.Lah.)
197
Commissioner of Wealth Tax (Central), Karachi v. Paracha Textile Mills Ltd., Karachi [1983] 48 TAX 145 (H.C.Kar.)
830
Commissioner of Wealth Tax v. Noor Rai Ibrahim [1992] 65 TAX 262 (S.C.Pak)
176
Commissioner of Wealth Tax, Lahore Zone, Lahore v. Mst. Fozia Mughis, Lahore [1975] 32 TAX 1 (H.C.Lah.)
176
(lxvi) Income Tax Digest.
VOL-I
Case No.
Commissioner Sales Tax v. Rizki Ink Company Ltd. [1991] 64 TAX 34 (H.C.Kar.)
293
Commissioner, Inland Revenue v. Wesleyan & General Assurance Society [1948] 30 TC 11
916
Commissioners of Inland Revenue v. John Blott [1921] 8 T.C. 101 (HL)
934
Continental Chemical Co. (Pvt.) Ltd. v. Pakistan and others [2001] 83 TAX 305 (H.C.Kar.)
11
Controller of Estate Duty, Lahore v. Muhammad Bashir Muhammad Nazir & others [1974] 29 TAX 91 (H.C.Lah.)
194
Coronet Paints & Chemicals Ltd., Karachi v. Commissioner of Income Tax, (Central), Karachi [1984] 50 TAX 115 (H.C.Kar.)
107, 1774
Cossimbazar Raj Wards Estate v. Commissioner of Income Tax [1946] 14 ITR 377 (Cal.)
855
Cowasjee Family Funds v. Commissioner of Income Tax Karachi [1984] 50 TAX 216 (H.C.Kar.)
1351
Crescent Sugar Mill v. Income Tax Officer [1999] 80 TAX 273 (H.C.Lah.) = NLR 1999 TAX 170
418
Crescent Sugar Mills & Distillery Ltd. Lahore v. Commissioner of Income Tax Lahore Zone, Lahore [1981] 43 TAX 1 (H.C.Lah.)
216, 248, 1955
Crescent Textile Mills Ltd. v. Commissioner of Income Tax, Lahore [1982] 45 TAX 47 (H.C.Lah.)
1826
Crown Bus Service Ltd. v. Commissioner of Income Tax, Lahore [1979] 39 TAX 53 (H.C.Lah.)
765
Crown Bus Service Ltd., Lahore v. Central Board of Revenue and others [1976] 34 TAX 54 (H.C.Lah.)
89, 252, 341, 350, 749, 757, 767
CST/Commissioner of Income Tax Rawalpindi v. Pakistan Television Corporation Ltd. [1978] 38 TAX 181 (H.C.Lah.)
154
Curtis v. J & G Oldfield Ltgd. 9 Tax Cas. 319
1434
D D.M. Vakil v. Commissioner of Income Tax [1946] 14 ITR 298 (Bom.)
1182
Dada Limited & Muhammad Ibrahim & Co. v. Commissioner of Income Tax 1974 SCC 407 = [1974] 30 TAX 91 (S.C.Pak.)
1970
Dada Sons, Hyderabad v. Commissioner of Income Tax (Central), Karachi [1986] 53 TAX 165 (H.C.Kar.)
1337
Dalmia Cement Ltd. v. Commissioner of Income Tax [1944] 12 ITR 50 (Pat.)
1292
Data Distribution Services v. Deputy Commissioner of Income Tax and another [2000] 82 TAX 156 (H.C.Lah.)
412
(lxvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Dawji Dadabhai & Co. v. Commissioner of Income Tax (West) Karachi [l982] 45 TAX 208 (H.C.Kar.)
1561
Dawn Sports v. Income Tax Officer [1993] 67 TAX 208 (H.C.Lah.)
1994
Day (H.M. Inspector of Taxes) v. Quick 51 Tax Cas. 583 (HL)
1134
Dayaldas Khushiram v. Commissioner of Income Tax [1943] 11 ITR 67 (Bom.)
782
Dayaldas Kushirarn v. Commissioner of Income Tax [1940] 8 ITR 139 (Bom.)
783, 794
Dbakesbwar Prasad Narain Singb v. Commissioner of Income Tax [1936] 4 ITR 71 (Pat.)
1799
De Beers Consolidated Mines Ltd. v. Howe [1906] 5 Tax Cas. 198 = [1906] AC 455 (HL)
737, 738
Delhi Cloth And General Mills Co. Ltd. v. Commissioner of Income Tax, Rawalpinidi [1977] 36 TAX 210 (H.C.Lah.)
1700
Deniti Prasad Singh v. Commissioner of Income Tax [1947] 15 ITR 165 (Pat.)
1442
Dewan Bahadur Ballbhdas & Son v. Commissioner of Income Tax 5 ITC 371 (Nag.)
961
Dhakeshwar Prasad Narain Singh v. Commissioner of Income Tax [1936] 4 ITR 71 (Pal.)
1800
Dhaniram Dharampal v. Commissioner of Income Tax [1936] 4 ITR 113 (Lahore)
1964
Dhanrajmal Mamnumal & Sons v. Commissioner of Income Tax, West Karachi [1985] 52 TAX 77 (H.C.Kar.)
107, 1094
Dibrugarh District Club Ltd. v. Commissioner of Income Tax 2 ITC 521 (Cal.)
706
Director Finance, Wapda v. Commissioner of Income Tax [2000] 82 TAX 127 (H.C.Lah.)
1915, 1936
Director Finance, Wapda, Gujranwala & another v. Commissioner of Income Tax, Gujranwala & another [2001] 83 TAX 8 (H.C.Lah.)
1935
Diwan Bahadur Sir T. Vijayaraghavacharya v. Commissioner of Income Tax [1936] 4 ITR 317 (Lahore)
1024
Diwan Chand v. Commissioner of Income Tax [1934] 2 ITR 382 (Lahore)
1818
Dma Nath Hernraj of Cawnpore v. Commissioner of Income Tax 2 ITC 304 (All.)
792
Dr. A. Razzak Kazi v. Commissioner of Income Tax [1990] 62 TAX 44 (H.C.Kar.)
1121
Dr. Col. Said Amman, Karachi v. Commissioner of Income Tax (Central), Karachi [1984] 49 TAX 24 (H.C.Kar.)
1790
Dr. Sir H.S. Gour v. Commissioner of Income Tax 3 ITC 346 (Nag.)
1746
(lxviii) Income Tax Digest.
VOL-I
Case No.
Dr. Sir Hari Singh Gour v. Commissioner of Income Tax 3 ITC 333 (Nag.)
1667
Dr. Urnar Baksh v. Commissioner of Income Tax 5 ITC 402 (Lahore)(FB)
578
Dreamland Cinema, Multan v. Commissioner of Income Tax Lahore [1977] 35 TAX 169 (H.C.Lah.)
50, 51, 99, 250, 294
Dublin Corporation v. M. Adam (Survey of Taxes) [1887] 2 Tax Cas. 387
1222
Dwarakanath Harishandra Pitale, In re [1937] 5 ITR 716 (Bom.)
698
E E.C. Danby v. Commissioner of Income Tax [1944] 12 ITR 351 (Pat.)
499, 1135
E.F.U. General Insurance Co. & others v. Federation of Pakistan & Others 1997 SCC 1174 = [1997] 76 TAX 213 (S.C.Pak) = 1997 PTD 1693 = PTCL 1997 CL. 478
179, 285, 1703, 1721
E.M.V. Muthappa Chettiar v. Commissioner of Income Tax [1945] 13 ITR 311 (Mad.)
876, 980, 1415
E.R. Chowdhury, Pro. Late Eklasur Rahman Chowdhury Commissioner of Taxes, Chittagong [1986] 53 TAX 80 (H.C.B.D.)
v.
1173
East Khas Jharia Colliery Co. Ltd. v. Commissioner of Income Tax [1943] 11 ITR 299 (Pat.)
1360
East Wing Indusiries, Sialkot v. Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi [1979] 40 TAX 62 (H.C.Lah.)
1639
Eastern Federal Union Insurance Co. Ltd. v. Central Board of Revenue And Muhammad Fareed [1983] 47 TAX 50 (H.C.Kar.)
754
Eastern Federal Union Insurance Co. v. Commissioner of Income Tax [1966] 14 TAX 211 (H.C.Kar.)
220
Eastern Poultry Services v. Govt. of Pakistan & others [1993] 68 TAX 171 (H.C.Kar.)
272
Eastern Poutry Services v. Government of Pakistan and others [1993] 68 TAX 171 (H.C.Kar.)
381
Eastern Textile Mills Ltd., Chittagong v. Commissioner of Income Tax, East Pakistan, Dacca / and / G. Merajuddin and another v. Commissioner of Income Tax, East Pakistan, Dacca [1966] 13 TAX 145 (H.C.Dacca)
353
Ebrahim Brothers (Pvt.) Ltd v. Commissioner of Income Tax, Central Zone "B", Karachi 1991 SCC 818 = [1991] 64 TAX 116 (S.C.Pak.) = 1992 PTD 1693
1731
Ebrahim Brothers (Pvt.) Ltd. v. Commissioner of Income Tax, Karachi 1992 SCC 926 = [1992] 66 TAX 6 (S.C.Pak.)
1727, 1728
(lxix) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Elahi Cotton Mills Ltd. & others v. Federation of Pakistan & others 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.)
1, 104, 140, 146, 149, 156, 198, 607
Ellahi and Company v. Commissioner of Income Tax 1963 PTD 395 (H.C.Kar.) = 1963 PLD 490
1086
Emperor v. Probhat Chandra Barua 1 ITC 284 (Cal.) = [1924] ILR 51 Cal. 504 = AIR (1924) Cal. 668 = 84 IC 31
30, 55, 56, 61, 139, 299, 320, 468, 532
Eruch Maneckji and others v. Income Tax Officer, Central Circle III, Karachi [1980] 41 TAX 25 (H.C.Kar.) = 1979 PTD 461
403, 1946
Eruck Maneckji and others v. Commissioner of Income Tax [1990] 62 TAX 1 (H.C.Kar.)
1252
Essential Industries, Dacca v. Commissioner of Income Tax, East Pakistan, Dacca [1969] 19 TAX 3 (H.C.Dacca)
233
Evershine Paints v. Commissioner of Income Tax [1995] 71 TAX 48 (H.C.Kar.)
1019
Executors of Sardar Narain Singh, In re [1943] 11 ITR 478 (Lahore) Executors of the Estate of LaIa Shankar Shah v. Commissioner of Income Tax [1945] 13 ITR 500 (Labore)
1630, 1757 703, 956
F F.E. Dinshaw v. Commissioner of Income Tax [1934] 2 ITR 319 (PC)
1473, 1480, 1481, 1486
F.M.C. United (Pvt.) Limited, Lahore v. The Federation of Pakistan through Secretary, Ministry of Finance, Islamabad and 2 others [2001] 83 TAX 500 (H.C.Lah.) = 2001 PTD 812
1950
Faisal Plaza v. Central Board of Revenue [1995] 71 TAX 282 (H.C.Lah.)
2003
Fatehchand Cbhakodilal v. Commissioner of Income Tax [1945] 13 ITR 198 (Nag.)
1798
Feroze Shah v. Commissioner of Income Tax 4 ITC 315 (Lahore)
1801, 1816
Firdaus Trading Corporation v. Commissioner of Income Tax, Karachi and others [l960] 2-TAX (Suppl.-114) (H.C.West Pakistan, Karachi Bench) = 1959 PTD 119 = 1958 PLD 220
773
First National City Bank, Karachi v. Income Tax Officer, Karachi and another [1976] 34 TAX 1 (H.C.Kar.) = PLD 1976 Kar. 552
405
Frasers Glasgow Bank Ltd. v. Commissioners of Inland Revenue 40 TC 698 (HL)
1651
Friends Construction Company v. Commissioner of Income Tax and Others [1989] 60 TAX 88 (H.C.Lah.) = 1989 PTD 843
2005
(lxx) Income Tax Digest.
VOL-I
Case No.
Frontier Ceramics v. Government of Pakistan & others 1999 PTD 4126 (H.C.Pesh.)
119
G Ganeshi LaI Chhappan LaI v. Commissioner of Income Tax [1941] 9 ITR 81 (All.)
1815
Ganeshilal Bhattawala, In re [1938] 6 ITR 489 (All.)
1369, 1593
Ganga Ram Balmokand v. Commissioner of Income Tax [1937] 5 ITR 464 (Lahore)
1809, 1813
Ganga Sagar Ananda Mohan Shaha v. Commissioner of Income Tax 4 ITC 55 (Bengal)
655, 668, 679
Gatron (Industries) Ltd. v. Government of Pakistan and others PTCL 1999 CL. 359 = 1999 SCMR 1072
373
Gaya Prasad Chhotey Lal v. Commissioner of Income Tax 8 ITC 64 (All.)
945
Gayaprasad and Chotey Lal, In re [1935] 3 ITR 177 (All.)
1265
GEC Avery (Pvt.) Ltd. v. Government of Pakistan through C.B.R., Islamabad and 2 Others [1995] 72 TAX 81 (H.C.Kar.)
394
General Bank of Netherlands Ltd. and 2 Others v. Commissioner of Income Tax, Central, Karachi 1991 SCC 784 = [1991] 63 TAX 149 (S.C.Pak.)
166, 1004, 1013, 1025, 1151
General Corpn. Ltd. v. Commissioner of Income Tax [1935] 3 ITR 350 (Mad.)
1572
General Tyre & Rubber Co. of Pakistan Ltd. v. Commissioner of Income Tax, Central Zone, Karachi [1989] 60 TAX 34 (H.C.Kar.)
1523
General Tyres and Rubber Co., Pakistan v. Commissioner of Income Tax (Central), Karachi [1985] 52 TAX 146 (H.C.Kar.) = 1986 PTD 52
1528
Ghilaf Gul v. Commissioner of Income Tax/Wealth Tax, Zone-B, Peshawar & 4 Others [1997] 75 TAX 298 (H.C.Pesh.) = 1997 PTD 849
1906
Ghulam Hyder Bundally v. Commissioner of Income Tax 10 ITC 141 (Sind)
1052
Ghulam Rasool v. Income Tax Officer, Rahimyarkhan and another [1975] 31 TAX 153 (H.C.Lah.)
440
Gillanders Arbuthnot & Co. v. Commissioner of Income Tax [1966] 13 TAX 163 (H.C.Lah.)
192, 1312
Girdhardas Hirivallabhdas v. Commissioner of Income Tax 3 ITC 83 (Bom.)
1432
Glaxo Laboratories Ltd. v. Inspecting Assistant Commissioner of Income Tax & others 1992 SCC 910 = [1992] 66 TAX 74 (S.C.Pak.) = 1992 PTD 932 = PLD 1992 SC 549
314
(lxxi) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Glenboig Union Fireclay Co. Ltd. v. Commissioner of Inland Revenue [1922] 12 TC 427 (HL)
868
Gloucester Railway Carriage & Wagon Co. Ltd. v. IRC [1925] 12 Tax Cas. 720 (HL)
1281
Golden Horse Shoe Ltd. v. Thurgood (Inspector of Taxes) [1933] 18 Tax Cas. 280
1568
Gomedalli Laxminarayan v. Commissioner of Income Tax 8 ITC 239 (Bom.)
658
Gopaldas Parsbottamdas v. Commissioner of Income Tax [1941] 9 ITR 130 (All.)
1965
Gopinath Biswambar Roy v. Commissioner of Income Tax, Dacca [1960] 2-TAX (Suppl.-174) (H.C.Dacca) = 1960 PTD 1079
1975
Gopinath Vir Bhan v. Commissioner of Income Tax [1938] 6 ITR 243 (Lahore)
1362, 1419
Gopiram Gobindram, In re [1936] 4 ITR 157 (Cal.)
907
Goud Saraswat Brahmin Co-operative Housing Society Ltd. v. Commissioner of Income Tax 10 ITC 422 (Bom.)
1185
Governors of the Rotunda Hospital v. Coman [1920] 7 Tax Cas. 517 (HL)
1260
Govindram Bros. Ltd. v. Commissioner of Income Tax [1946] 14 ITR 764 (Bom.)
1338, 1877
Green v. J. Gliksten & Sons Ltd. [1929] 14 TC 364 (HL)
1288
Gresham Life Assurance Society v. Styles [1892] 3 Tax Cas. 185
1218
Griffiths (Inspector of Taxes) v. J.P. Harrison (Watford) Ltd. [1965] 58 ITR 328 (PC)
1261
Grindlays Bank Ltd. v. Commissioner Of Income Tax (Central), Karachi [1983] 47 TAX 39 (H.C.Kar.)
1851
Grindlays Bank Ltd., Karachi v. Commissioner of Income Tax, (Central), Karachi [1985] 51 TAX 102 (H.C.Kar.) = 1985 PTD 329
1238
Guarantee Engineers (Pvt.) Ltd. v. Federation of Islamic Republic of Pakistan through Secretary, Ministry of Finance, Islamabad and another [2000] 82 TAX 131 (H.C.Lah.)
361, 412
Gulberg Textile Mills v. Commissioner of Income Tax, Karachi [1978] 37 TAX 125 (H.C.Kar.)
1679
Gulistan Textile Mills Ltd. v. Central Board of Revenue, etc. [1994] 70 TAX 272 (H.C.Kar.)
373, 379, 431
Gunda Subbayya v. Commissioner of Income Tax [1939] 7 ITR 21 (Mad.)
1812
(lxxii) Income Tax Digest.
VOL-I
Case No.
H H.M. Abdullah v. Income Tax Officer Circle V, Karachi & 2 others 1993 SCC 1018 = [1993] 68 TAX 29 (S.C.Pak.)
365, 412, 796
H.M. Abdullah v. Income Tax Officer, Circle-V, West Zone, Karachi [1991] 63 TAX 113 (H.C.Kar.) = 1991 PTD 217 = 1991 PTD 217
801
H.T. Conville v. Commissioner of Income Tax [1936] 4 ITR 137 (Lahore)
496, 500, 503, 1395
Habib & Sons v. Commissioner of Income Tax [1947] 15 ITR 132 (Bom.)
1963
Habib Bank Safe Deposit Vault v. Commissioner of Income Tax [1967] 15 TAX 212 (H.C.Kar.)
852
Habib Insurance Co. Ltd. & another v. Commissioner of Income Tax 1989 SCC 736 = [1990] 61 TAX 88 (S.C.Pak.)
1711
Hafiz Muhammad Arif Dar v. Income Tax Officer 1988 SCC 710 = [1989] 60 TAX 52 (S.C.Pak.)
368, 410
Haider Ali Rajab All & Company v. Commissioner of Income Tax [1980] 41 TAX 158 (H.C.Kar.) = 1980 PTD 1
1804
Haideria Transport Company Limited v. Government of Pakistan and Income Tax Officer, Companies Circle [1979] 39 TAX 147 (H.C.Lah.)
1241
Hajee Cassim Tayoob Surty v. Commissioner of Income Tax 6 ITC 41 (Rangoon)
494
Hajee Mohamed Hajee Oosman v. Commissioner of Income Tax 10 ITC 330 (Rangoon)
1047
Haji Abdul Qayum v. Commissioner of Income Tax 1963 PTD 410 = 1963 PLD 496
1857
Haji Ali Jan v. Commissioner of Income Tax [1934] 2 ITR 452 (Lahore)
1818
Haji Ghulam Hussain v. Commissioner of Income Tax [1942] 10 ITR 405 (Peshawar)
699, 1224, 1277, 1747
Haji Gula Khan v. Special Officer, Income Tax and Others [1997] 75 TAX 117 (H.C.Pesh.) = 1997 PTD 7
424
Haji Ibrahim Ishaq Johri v. Commissioner of Income Tax (West), Karachi [1982] 45 TAX 263 (H.C.Kar.) = 1982 PTD 46 = 1990 PTCL 954 = 1982 PLD 266
24, 346, 721
Haji Ibrahim Ishaq Johri v. Commissioner of Income Tax (West) Karachi 1992 SCC 991 = [1992] 66 TAX 275 (S.C.Pak.)
718, 719
Haji Ismail Ibrahim v. Incons Tax Officer, Circle W-II, West Zone, Karachi and 2 others [1992] 65 TAX 153 (H.C.Kar.)
1987
Haji Muhammad Shafi & others v. Wealth Tax Officer & others [1992] 65 TAX 315 (S.C.Pak)
8
(lxxiii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Haji Mushtaq Ahmad v. Commissioner of Income Tax [1978] 38 TAX 1 (H.C.Kar.) = PLD 1978 Kar. 414
1881
Haji Taj Mohammad Haji Abdul Rahman & Co. v. Commissioner of Income Tax 6 ITC 240 (All.)
789
Haji Thread Manufacturing Co. Ltd., Korbaniganj, Chittagong v. Commissioner of Income Tax, East Pakistan, Dacca [1966] 13 TAX 32 (H.C.Dacca)
1832
Haji, Muhammad Zakaria & Faruqui Flour Mills v. Commissioner of Income Tax, Karachi [1962] 5 TAX 147 (H.C.Kar.) = 1962 PTD 101 = 1962 PLD 136
651
Hakeem Muhammad Saeed v. Commissioner of Income Tax [1989] 59 TAX 102 (H.C.Kar.)
1230
Hakim Ram Prasad, In re [1936] 4 ITR 104 (Lahore)
1607
Hamdard Dawakhana (Waqf) Pakistan v. Commissioner of Income Tax Central Zone, `B' Karachi and another [1990] 62 TAX 98 (H.C.Kar.)
395
Hamdard Dawakhana (Waqf) v. Commissioner of Income Tax etc. [1987] 56 TAX 78 (H.C.Kar.)
107, 384
Hamdard Dawakhana v. Commissioner of Income Tax Karachi [1980 SCC 497 = [1980] 42 TAX 1 (S.C.Pak)
218
Hamdard Thread House, Karachi v. Commissioner of Income Tax (East), Karachi [1984] 49 TAX 91 (H.C.Kar.)
1000
Hamiduddin Samiuddin v. Commissioner of Income Tax [1976] 33 TAX 209 (H.C.Lah.)
1891
Hanmantram Ramnath v. Commissioner of Income Tax [1946] 14 ITR 716 (Bom.)
1416
Hansraj Gupta v. Dhera Dun Mussorai Electric & Tramway Co. Ltd. [AIR 1933 PC 63, 65]
317
Hanutram Bhuramal v. Commissioner of Income Tax [1938] 6 ITR 290 (Pat.)
1477
Hari Krishna Das v. Commissioner of Income Tax, UP [5 ITC 275 (Allahabad)
295
Haripur Rosin & Turpentine Factory Ltd., Lahore v. Commissioner of Income Tax, North Zone (West Pakistan), Lahore [1974] 29 TAX 248 (H.C.Lah.)
1209
Haripur Rosin & Turpentine Factory Ltd., Lahore v. Commissioner of Income Tax, North Zone (West Pakistan), Lahore [1972] 27 TAX 149 (H.C.Lah.)
1211
Harjina & Company (Pak) Limited, Karachi v. Commissioner of Income Tax [1964] 8 TAX 1 (H.C.Kar.) = 1963 PTD 867 = 1963 PLD 996
54
Haridas Purshottam, In re [1947] 15 ITR 124 (Bom.)
683
(lxxiv) VOL-I
Income Tax Digest. Case No.
Harnand Rai Harbhagat Rai v. Commissioner of Income Tax [1936] 4 ITR 366 (Lahore)
1471
Hasan Ali Karabhai v. Commissioner of Income Tax [1974] 30 TAX 203 (H.C.Kar.)
1900
Hashmi Can Company Ltd. v. Commissioner of Income Tax, Karachi [1989] 60 TAX 8 (H.C.Kar.) = 1989 PTD 570
1506
Hatz Trust of Simla v. Commissioner of Income Tax, Punjab & NWFP [5 ITC 8 (H.C.Lah.)
297
Havell Shah Sardari Lal v. Commissioner of Income Tax [1936] 4 ITR 297 (Lahore)
1157
Hazoor Bakhsh v. Senior Superintendent of Police, Rahimyar Khan and 12 others PLD 1999 Lahore 417
126, 373
Heaton (H.M. Inspector of Taxes) v. Bell 46 Tax. Cas. 211 (HL)
1142
Helal Jute Press Limited v. Commissioner of Income Tax, Dacca Zone, Dacca and another [1970] 22 TAX 157 (H.C.Dacca)
1855
Hemraj Kanji v. Commissioner of Income Tax 6 ITC 354 (Sind)
1871
Henarsidas Jagannath, In re [1947] 15 ITR 185 (Lahore)
1563
Highland Manufacturer (Pak) Ltd. v. Commissioner of Income Tax (West) Karachi [1985] 51 TAX 66 (H.C.Kar.)
293, 459, 1423
Highway Petroleum Service (Regd.), Lahore v. Islamic Republic of Pakistan and another [1977] 36 TAX 8 (H.C.Lah.) = 1977 PTD 183 = 1977 PLD 797
98, 135, 249, 349, 387
Himalaya Assurance Co. Ltd., In re [1939] 7 ITR 402 (PC)
1726
Himatlal Motilal and Ramanlal Lallubhai v. Commissioner of Income Tax 6 ITC 159 (Bom.)
1324
Hira Lal Phoolchand v. Commissioner of Income Tax [1947] 15 ITR 205 (All.)
1538, 1587
Hira Mills Ltd. v. Income Tax Officer [1946] 14 ITR 417 (All.)
983, 1043, 1049
Hirala Kalyanmal, In re [1943] 11 ITR 128 (Bom.)
1280, 1861
Hiranand Jairam Singh v. Commissioner of Income Tax [1935] 3 ITR 309 (Lahore)
1319
Home Insurance Company, Limited, Karachi v. Commissioner of Income Tax, Companies-III, Karachi [1992] 66 TAX 33 (H.C.Kar.)
1715
Hon'ble Mr. Justice Iqbal Ahmad, In re [1942] 10 ITR 152 (All.)
812
Hotel Methopole Ltd. v. Commissioner of Income Tax (Central), Karachi [1984] 50 TAX 179 (H.C.Kar.)
615
Hotel Metropole Ltd., Karachi v. Commissioner of Income Tax (Central), Karachi [1973] 28 TAX 96 (H.C.Kar.)
821
Hotz Trust of Simla v. Commissioner of Income Tax 5 ITC 8 (Lahore)
702
(lxxv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Howrah Trading Co. (Pvt.) Ltd. v. Commissioner of Income Tax, East Pakistan 1963 SCC 150 = [1963] 8 TAX 59 (S.C.Pak.)
1028, 1393
Hudabiya Engineering (Pvt.) Ltd., Lahore v. Pakistan through Secretary, Ministry of Interior, Government of Pakistan, Islamabad [1997] 76 TAX 302 (H.C.Lah.)
175, 195, 452, 848
Hughes (Inspector of Taxes) v. Bank of New Zealand [1938] 6 ITR 636 (HL)
1578
Hughes v. Utting (B.G.) & Co. Ltd. [1940] 8 ITR (Suppl.) 57 (HL) Hulasilal Ramdayal, In re [1941] 9 ITR 635 (All.)
965, 1283 1450, 1869
Hukumchand Jagadharmal v. Commissioner of Income Tax [1935] 3 ITR 211 (Lahore)
1484
Hussain Ebrahim Agencies Ltd., Karachi v. Commissioner of Income Tax (Central), Karachi [1984] 50 Tax 226 (H.C.Kar.)
1095
Hussain Sugar Mills v. Islamic Republic of Pakistan [1981] 44 TAX 59 (H.C.Kar.)
373
Hussain Sugar Mills v. Islamic Republic of Pakistan and others [1981] 44 TAX 93 (H.C.Kar.)
400, 1952
Hydri Construction Co. Ltd., Karachi v. Commissioner of Income Tax, Central, Karachi [1967] 15 TAX 21 (H.C.Kar.)
563
I I.T.Assessments of the Estate of F.E. Dinshaw 1959 PTD 176 (H.C.Sind) = 1958 PLD 270
1735
Ibrablmbhai Mulla Badruddin v. Commissioner of Income Tax 5 ITC 302 (Nag.)
1575
Ibrahim Sons v. Commissioner of Income Tax, Karachi West, Karachi [1979] 39 TAX 127 (H.C.Kar.)
1766
ICC Textiles Limited v. Federation of Pakistan and others [1999] 79 TAX 77 (H.C.Lah.)
15
Imperial Chemical Industries India Ltd., In re [1935] 3 ITR 21 (Cal.)
1566, 1616
Imperial Tobacco Co. of India Ltd. v. Commissioner of Income Tax, South Zone, Karachi 1958 SCC 37 = [1959] 1-TAX (III-284) (S.C.Pak.)
73
Imperial Tobacco Company of India Ltd. v. Commissioner of Income Tax, South Zone, Karachi 1958 SCC 37 = [1960] 2-TAX (Suppl.-308) (S.C.Pak)
9
Imperial Tobacco Company of India v. The Secretary of State for India in Council [1 ITC 169 (Calcutta)]
96
Income Tax Appellate Tribunal, Pakistan v. Imperial Tobacco Co. of India Ltd. [1960] 2-TAX (Suppl.-79) (H.C.West Pakistan, Karachi) = 1960 PTD 747 = 1957 PLD 300
729
(lxxvi) VOL-I
Income Tax Digest. Case No.
Income Tax Assessment of Premier Tobacco Industries Ltd., in re [1986] 53 TAX 35 (H.C.Kar.)
1771
Income Tax Assessments of the Estate of F.E. Dinshaw 1959 PTD 176 (H.C.Sind) = 1958 PLD 270
567
Income Tax Commissioner v. Chitnavia [1932] LR 59 IA 290 (PC)
1429
Income Tax Officer & another v. Chappal Builders 1993 SCC 1026 = [1993] 68 TAX 1 (S.C.Pak.)
231, 1982
Income Tax Officer & others v. Suleman Bhai Jiwa & others [1970] 21 TAX 62 (Income Tax Digest Feb. 1970)
53
Income Tax Officer & two others v. Shaikh Ghulam Shah 1991 SCC 823 = [1991] 64 TAX 91 (S.C.Pak.)
1988
Income Tax Officer (Investigation) Circle III, Karachi and Another v. Sheikh Nasim Anwar Dacca 1966 SCC 276 = [1966] 14 TAX 1 (S.C.Pak.)
752, 761
Income Tax Officer v. Rev. J.C. Manry [1942] 10 ITR 205 (All.)
1140
Income Tax Officer, Investigation Circle & others v. Sulaiman Bhai Jiwa & Others 1969 SCC 354 = [1970] 21 TAX 62 (S.C.Pak.)
36, 239
Income Tax Officer, Mardan v. Sanaullah Khan & Co. 1976 SCC 430 = [1977] 35 TAX 1 (S.C.Pak.)
1014, 1026
Income Tax Officer, Mirpur & 2 others v. Ch. Muhammad Bashir [1994] 69 TAX 109 (S.C.AJ&K)
456, 763
Indian Radio and Cable Communication Co. Ltd. v. Commissioner of Income Tax [1937] 5 ITR 270 (PC) = AIR 1931 PC 165
1301, 1315, 1562, 1582
Indian Turpentine & Rosin Co. Ltd. v. Commissioner of Income Tax 3 ITC 219 (All.)
1610
Indus Steel Pipes Ltd. v. Commissioner of Income Tax, Companies-II, Karachi and others [1999] 79 TAX 410 (H.C.Kar.)
14
Indus Valley Construction Co. v. Commissioner of Income Tax (East), Karachi [1984] 51 TAX 55 (H.C.Kar.)
850
Industrial Management Ltd., Karachi v. Commissioner of Income Tax, Karachi [1978] 38 TAX 5 (H.C.Kar.) = PLD 1978 Kar. 673
561, 566
Inland Revenue Commissioners v. Duke of Westminster [1939] A.C. 1 = 19 Tax Cas. 490
879
Inland Revenue Commissioners v. Wesleyan General Assurance Society [1948] 16 ITR Suppl. 101 (HL)
1307
Inspecting Additional Commissioner & others v. Pakistan Herald Ltd. 1996 SCC 1093 = [1997] 76 TAX 131 (S.C.Pak) = 1997 PTD 1485
179
Inspecting Additional Commissioner v. Chotabhai Javerbhai [1941] 9 ITR 604 (Mad.)
1968
International Beverages Ltd. v. Commissioner of Income Tax, Karachi [1984] 50 TAX 1 (H.C.Kar.)
811
(lxxvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
International Body Builders v. Sales Tax Officer, Lahore [1980] 41 TAX 60 (H.C.Kar.)
373
International Traders Ltd., Karachi v. Commissioner of Income Tax [1967] 16 TAX 46 (H.C.Kar.)
1254
IRC v. Anglo Brewing Co. Ltd. [1925] 12 Tax Cat 803
1571
IRC v. Fraser [1942] 24 Tax. Cas. 498 (HL) IRC v. Gardner Mountain & D'Ambrumenil Ltd. [1947] 29 Tax Cas. 69 (HL) IRC v. Livingston [1926] 11 Tax Cas. 538
1213, 1215 972 1214
Irfan Gul Magsi v. Haji Abdul Khaliq Soomro and others 1999 PTD 1302
178
Irum Ghee Mills Limited v. Income Tax Appellate Tribunal and another [2000] 82 TAX 3 (S.C.Pak)
264
Isabella Coal Co. v. Commissioner of Income Tax 2 ITC 87 (Cal.)
1640
Ishar Das Dharam Chand, In re 2 ITC 12 (Lahore)
1430
Islam Jewellers, Gujranwala v. Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi [1978] 38 TAX 71 (H.C.Lah.)
1020
Islamuddin and 3 others v. The Income Tax Officer and 4 others 2000 PTD 306
371, 416
ITAT v. Chhaganmal Mangilal [1946] 14 ITR 206 (Nag.)
1627
J J.A. Textile Mills Ltd. v. CBR [2000] 81 TAX 88 (H.C.Lah.) = 1999 PTD 4138
290
J.L. Wei & Co. v. Commissioner of Income Tax [1989] 59 TAX 108 (H.C.Kar.)
144
J.M. Casey v. Commissioner of Income Tax 4 ITC 259 (Pat.) Jamal v. The State [PLD 1960 Lahore 1962]
472, 476 312
Jamat-i-Islami Pakistan through Syed Munawar Hassan, Secretary General v. Federation of Pakistan through Secretary, Law, Justice and Parliamentary Affairs PLD 2000 S.C. 111
67, 283, 318
Jamshed Marker Brothers Ltd. v. Commissioner of Income Tax, Central Zone, Karachi [1991] 64 TAX 14 (H.C.Kar.)
1503
Jardine Henderson Ltd., Calcutta v. Commissioner of Income Tax, Dacca [1970] 22 TAX 61 (H.C.Dacca)
1040
Jeffrey (H.M. Inspector of Taxes) v. Rolls-Royce Ltd./Commissioner of Inland Revenue v. Rolls-Royce Ltd. 40 TC 443 (HL
931
Jewan Shah Maya Shah v. Commissioner of Income Tax [1934] 2 ITR 343 (Lahore)
1808
(lxxviii) Income Tax Digest.
VOL-I
Case No.
Jitumal Chamanlal v. Commissioner of Income Tax [1944] 12 ITR 296 (Lahore)
674, 677
John Emery & Sons v. Lord Advocate [1936] 4 ITR 8 (HL)
1297
John Smith & Son v. Moore [1921] 2 AC 13 (HL)
1584
Jones v. Leeming [1930] AC 415 (HL)
1216
Jugal Kishore Mukat LaI, In re [1938] 6 ITR 494 (All.)
636
Julian Hoshang Dinshaw Trust & others v. Income Tax Officer Circle XVIII, South Zone, Karachi South 1991 SCC 777 = [1992] 65 TAX 102 (S.C.Pak.) = 1992 SCMR 250
806, 1733
Julian Hoshang Dinshaw Trust v. Income Tax Officer, Circle XVIII, South Zone, Karachi and two others [1981] 43 TAX 92 (H.C.Kar.) = 1981 PTD 53
386, 778
Jullundur Cooperative Transport Society Ltd. v. Income Tax Officer 1977 SCC 442 = [1977] 36 TAX 7 (S.C.Pak.)
640
Jupudi Kesava Rao v. Commissioner of Income Tax 8 ITC 217 (Mad.)
970
Jutharam Jankidas v. Commissioner of Income Tax [1944] 12 ITR 344 (Pat.) Jyotirindra Narayan Sinha Chowdhury, in re [1945] 13 ITR 263 (Cal.)
1632, 1659 515
K K.AR.S.T. Arunachalam Chettlar v. Commissioner of Income Tax [1946] 14 ITR 61 (Mad.) K.H. Mody, In re [1940] 8 ITR 179 (Bom.) K.K.G.B.U.G.M.S.S.A. Mohammad Abdul Kareem & Co. v. Commissioner of Income Tax [1948] 16 ITR 412 (Mad.) K.M. Mody, In re [1940] 8 ITR 179 (Bom.) K.M.N.N. Swarninathan Chettiar v. Commissioner of Income Tax [1947] 15 ITR 418 (Mad.) K.T.M.T.M. Abdul Kayum Sahib Hussain Sahib v. Commissioner of Income Tax [1939] 7 ITR 652 (Mad.) Kahan Chand & Klshan Chand v. Commissioner of Income Tax [1944] 12 ITR 472 (Lahore) Kaiser Jehan Begum v. Commissioner of Income Tax, (East), Karachi [1984] 50 TAX 168 (H.C.Kar.) Kalyanji Vithaldas v. Commissioner of Income Tax [1937] 5 ITR 90 (PC) Kamran Industries, Karachi v. Collector of Customs (Exports) Karachi and Others [1995] 72 TAX 223 (H.C.Kar.) Kangra Valley Slate Co. Ltd. v. Commissioner of Income Tax 7 ITC 375 (Lahore)
938 1279 686 1256 731 1597 1247, 1255 1090 637, 656, 665, 672, 673 377 1624
(lxxix) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Kaniram Ganpat Rai v. Commissioner of Income Tax [1941] 9 ITR 332 (Pat.) Kantisen Mohanji Ganjawalla & Bros. v. Commissioner of Income Tax 10 ITC 445 (Bom.) Kanwalnen Hamir Singh v. Commissioner of Income Tax [1938] 6 ITR 675 (All.) Karachi Gymkhana, Club Road, Karachi v. Commissioner of Income Tax, (East), Karachi [1986] 53 TAX 1 (H.C.Kar.) Karachi Hospital Ltd. v. Commissioner of Income Tax [2001] 83 TAX 383 (H.C.Kar.) Karachi Industrial Corporation & 3 others v. Commissioner of Income Tax 1974 SCC 424 = [1975] 32 TAX 170 (S.C.Pak) Karachi Sind Development Corporation v. Commissioner of Income Tax, West Zone, Karachi [1989] 59 TAX 104 (H.C.Kar.) Karachi Steam Navigation Co., Ltd., v. Commissioner of Income Tax [1967] 15 TAX 73 (H.C.Kar.) Karachi Textile Dyeing & Printing Works, Karachi v. Commissioner of Income Tax (Central) Karachi [1984] 49 TAX 18 (H.C.Kar.) Karachi, Textile Dyeing and Printing Works, Karachi v. Commissioner of Income Tax (Central), Karachi [1984] 49 TAX 18 (H.C.Kar.) Karim Aziz Industries Ltd. v. Commissioner of Income Tax Rawalpindi Zone [1997] 75 TAX 90 (H.C.Lah.) Kashmir Cap. House, Lahore v. Commissioner of Income Tax, Lahore Zone, Lahore [1979] 39 TAX 6 (H.C.Lah.) Kashmir Feeds (Pvt.) Ltd. v. Central Board of Revenue through Chairman, Government of Pakistan, Islamabad and another [1999] 80 TAX 24 (H.C.Kar.) = 1999 PTD 1655 Kassam Haji Abbas Patel v. Income Tax Officer, Contractors Circle, Karachi & Another [1983] 47 Tax 162 (H.C.Kar.) Kawther Grain (Pvt.) Ltd. v. Deputy Commissioner of Income Tax Gujranwala [1999] 80 TAX 262 (H.C.Lah.) Kedar Narain Singh v. Commissioner of Income Tax [1938] 6 ITR 157 (A1l.) Khairati Lal Babu Lal, In re [1941] 9 ITR 627 (All.) Khairpur Textile Mills Ltd., Karachi v. Commissioner of Income Tax, Karachi [1978] 38 TAX 120 (H.C.Kar.) Khan Muhammad Yakub Khan & Khan Muhammad Aslam Khan v. Commissioner of Income Tax 3 ITC 308 (Lahore) Khawaja Textile Mills Ltd. v. Deputy Commissioner of Income Tax & 2 others [1998] 77 TAX 1 (H.C.AJ&K) Kheraj Obbeya v. Commissioner of Income Tax 10 ITC 419 (Bom.) Khurram Saghir Industries, Lahore v. Commissioner of Income Taxx, Zone-A, Lahore [2001] 83 TAX 489 (H.C.Lah.)
1478, 1484 696 992 1175 1490 109, 764 1005 1021, 1302, 1619 1777 337 129 1662, 1767 143
399 193, 372, 1917, 1918, 1937 839, 843, 883 908 1513 509 450 693 287
(lxxx) Income Tax Digest.
VOL-I
Case No.
Killing Valley Tea Company v. Secretary of State [1 ITC 54 (Calcutta)] Kishandas Sakuio v. Commissioner of Income Tax, & others [1987] 56 TAX 35 (H.C.Kar.) Kohinoor Industries Ltd. v. Government of Pakistan etc. [1994] 70 TAX 11 (H.C.Lah.) Kohinoor Industries Ltd. v. Government of Pakistan through C.B.R., Islamabad [2001] 83 TAX 17 (H.C.Lah.) Kohinoor Industries Ltd., Lahore v. Commissioner of Income Tax, Lahore Zone, Lahore [1973] 27 TAX 253 (H.C.Lah.) Kohinoor Raiwaind Mills Limited and others v. Central Board of Revenue through Member, Income Tax, Government of Pakistan, Islamabad and 2 others [2000] 82 TAX 539 (H.C.Lah.) = 2000 PTD 3351 Kohinoor Textile Mills Ltd. v. Commissioner of Income Tax 1974 SCC 416 = [1974] 30 TAX 138 (S.C.Pak.) Kokine Dairy v. Commissioner of Income Tax [1938] 6 ITR 145 (Rangoon) Kruddsons Limited, Karachi v. Commissioner of Income Tax `A' Zone, Karachi [1933] 57 TAX 134 (H.C.Kar.) Kumar Deba Prosad Garga v. Commissioner of Income Tax [1943] 11 ITR 546 (Cal.)
302 777 322 413 1400 809
234 544 1769 491, 492
Kumar Jagadish Chandra Sinha v. Commissioner of Income Tax [1955] 28 ITR 732 (Cal.)
481
Kunjamal & Sons, In re [1941] 9 ITR 358 (All.) Kunwar Bishwanath Singh v. Commissioner of Income Tax [1942] 10 ITR 322 (All.) Kunwar Kartar Singh v. Commissioner of Income Tax [1937] 5 ITR 569 (Lahore)
964, 1682 535, 877 519, 681
L L.Bani Mal DaIal v. Commissioner of Income Tax [1941] 9 ITR 222 (Lahore) L.Hira Lal, In re [1945] 13 ITR 512 (Lahore)
1451, 1463, 1484 949
L.N. Gadodia & Co. v. Commissioner of Income Tax 7 ITC 398 (Lahore)
1542
L.Pitamber Prasad, In re [1942] 10 ITR 370 (All.)
1962
L.R.M.S.T. Firm v. Commissioner of Income Tax 3 ITC 416 (Rangoon) Lachhman Das Brijballabh Das, In re [1942] 10 ITR 186 (All.)
1417 914, 1623
Lachhman Das v. Commissioner of Income Tax [1948] 16 ITR 35 (PC)
685
Lahore Ice Factories Association v. Commissioner of Income Tax [1934] 2 ITR 362 (Lahore)
643
Laidler v. Perry (H.M. Inspector of Taxes)
1133
(lxxxi) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Lakhshmi Insurance Co. Ltd., Lahore v. Commissioner of Income Tax, Punjab and N.W.F.P. [1960] 2-TAX (Suppl.-274) (H.C.Lah.) Lakshmi Narain Gadodia & Co., In re [1943] 11 ITR 491 (Lahore)
1154 680
Lakshmi Narayan Sen & Sons Ltd., In re [1936] 4 ITR 255 (Cal.)
1359, 1519, 1550, 1551, 1574
Lakshmi Insurance Co. Ltd. v. Commissioner of Income Tax [1950] 18 ITR 984 (Lahore)
1057, 1341
Lakshmi Narain Gadodia & Co., In re [1943] 11 ITR 491 (Lahore)
654
Lal Jagmohandas Rastogi v. Commissioner of Income Tax 3 ITC 274 (Oudh)
866
Lal Mohammed Sardar Mohammad v. Commissioner of Income Tax [1934] 2 ITR 358 (Lahore)
1966
Lal Muhammad Abdul Sattar & Co. v. Commissioner of Income Tax, Hyderabad [1996] 71 TAX 156 (H.C.Kar.)
1696
Lal Suresh Singh v. Commissioner of Income Tax 9 ITC 35 (Oudh)
523
Lala Indra Sen, In re [1940] 8 ITR 187 (All.)
1269, 1274
Latilla v. IRC [1943] AC 377/25 TC 107 (HL)
893
Laxmidas Devidas & Vannji Ruttonsey v. Commissioner of Income Tax 10 ITC 414 (Bom.)
692, 693
Leather Connections (Pvt) Limited v. The Central Board of Revenue Govt. of Pakistan, Islamabad through its Chairman [2000] 82 TAX 42 (H.C.Lah.)
236, 412
Leather Connections (Pvt.) Ltd. v. Central Board of Revenue, Islamabad [2001] 83 TAX 1 (H.C.Lah.)
235, 1934
Leeming v. Jones (Inspector of Taxes) [1930] 15 Tax. Cas. 333 (HL)
1207
Lever Brothers Pakistan Limited v. Commissioner of Income Tax [1988] 58 TAX 48 (H.C Kar.)
1495
Linga Reddi v. Commissioner of Income Tax 2 ITC 363 (Mad.)
529
Lokamanya Tilak Jubilee National Trust Fund, In re. [1942] 10 ITR 26 (Bom.)
592
Lowry (Inspector of Taxes) v. Consolidated African Selection Trust Ltd. [1940] 8 ITR Suppl. 88 (HL)
1331
Loyal Motor Service Co. Ltd. v. Commissioner of Income Tax [1946] 14 ITR 647 (Bom.)
1364
Ludlow Pakistan Co. Ltd., Dacca v. Commissioner of Income Tax, Dacca [1969] 20 TAX 21 (H.C.Dacca)
1856
Lungla (Sylhat) Tea Co. Ltd. Sylhat v. Commissioner of Income Tax Dacca Circle Dacca 1970 SCC 366 = [1975] 31 TAX 64 (S.C.Pak.)
110
(lxxxii) Income Tax Digest.
VOL-I
Case No.
M M.A.L. Chettyar Firm v. Commissioner of Income Tax 8 ITC 182 (Rangoon)
969
M.C.B. v. Federation of Pakistan [1998] 77 TAX 79 (H.C.Lah.)
1907
M.E.J. Hazari and Sons v. Commissioner of Income Tax, Karachi [1985] 52 TAX 115 (H.C.Kar.)
1772
M.H.Hogg v. Commissioner of Income Tax, North Zone, Lahore [1975] 31 TAX 156 (H.C.Lah.)
1126
M.Rehman, Income Tax Officer, and others v. Narayanganj Company (Pvt.) Ltd. 1970 SCC 370 = [1971] 23 TAX 223 (S.C.Pak.)
63, 644, 836
M.S. Hameed Masood and Associates, Multan v. Commissioner of Income Tax, Lahore [1979] 39 TAX 176 (H.C.Lah.)
1830
M.T.T.K.M.M.S.M.A.R. Somasundaram Chettiar v. Commissioner of Income Tax 2 ITC 505 (Mad.)
1365
Mabarajah of Plthapuram v. Commissioner of Income Tax [1945] 13 ITR 221 (PC)
881
Macnabb v. Commissioner of Income Tax [1936] 4 ITR 306 (Lahore)
1751, 1366
Macneill & Barry Limited v. Commissioner of Income Tax, East Pakistan, Dacca 1969 SCC 340 = [1970] 21 TAX 8 (S.C.Pak.)
1027
Macneill & Barry Ltd., Calcutta v. Commissioner of Income Tax, East Pakistan, Dacca [1961] 4 TAX 147 (H.C.Dacca)
1041
Madan Mohan Muflick & Bros., In re [1938] 6 ITR 315 (Cal.)
953
Magniram Bangor & Co., In re [1941] 9 ITR 573 (Cal.)
1621
Mahabir Prasad Munna Lal v. Commissioner of Income Tax [1947] 15 ITR 393 (All.)
853, 1088, 1625
Mahanth Sah Thakur Dayal Sah v. Commissioner of Income Tax 6 ITC 188 (Pat.)
1634
Maharaj Bag Club Ltd. v. Commissioner of Income Tax 5 ITC 201 (Nag.)
707
Maharaj Kuinar of Vizianagaram, In re [1934] 2 ITR 186 (All.)
664, 669
Maharaj Sir Pateshwari Prasad Singh v. Commissioner of Income Tax [1947] 15 ITR 181 (Oudh) Maharaja Guru Mahadeo Ashram Prasad Commissioner of Income Tax 2 ITC 281 (Pat.)
Sahi
Bahadur
487
v.
530, 1396
Maharaja Kainakhya Narain Singh v. Commissioner of Income Tax [1942] 10 ITR 177 (Pat.)
976
Maharaja Kumar of Vizianagaram, In re [1934] 2 ITR 186 (All.)
518
Maharaja of Kapurthala v. Commissioner of Income Tax [1945] 13 ITR 14 (Oudh)
936
(lxxxiii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Maharaja of Kapurthala v. Commissioner of Income Tax [1945] 13 ITR 74 (Oudh)
487, 897
Maharaja of Patiala v. Commissioner of Income Tax [1943] 11 ITR 202 (Bom.)
1963
Maharajadhiraj of Darbhanga v. Commissioner of Income Tax 1 ITC 303 (Pat.)
60, 537
Maharajadhiraj of Darbhanga v. Commissioner of Income Tax 3 ITC 158 (Pat.)
516
Maharajadhiraj Sir Bijay Chand Mahtab Bahadur of Burdwan, in re [1940] 8 ITR 378 (Cal.)
512, 545
Maharajah of Pithapuram v. Commissioner of Income Tax [1945] 13 ITR 221 (PC)
890
Maharajhumar Gopal Saran Narain Singh v. Commissioner of Income Tax [1935] 3 ITR 237 (PC)
495, 844, 917
Maharani Janki Kuer v. Commissioner of Income Tax 5 ITC 42 (Pat.)
527, 920
Maharani of Bardwan v. Krishna Kamini Dasi [14 ILR PC 365] Mahmeed (Private) Ltd. v. Collector of Customs, Quetta and Another [1990] 61 TAX 12 (H.C.Quetta) Major A.U. Johit, In re [1938] 6 ITR 434 (All.)
255 1923 915
Major Conville v. Commissioner of Income Tax [1935] 3 ITR 404 (Lahore)
498, 1138
Malik Mir Hassan Khan v. Commissioner of Income Tax, Karachi [1978] 37 TAX 204 (H.C.Kar.)
1079, 1080
Malik Muhammad Akram Khan & Co. v. Income Tax Officer, Jhelum [1977] 36 TAX 216 (H.C.Lah.)
619, 820
Mallalieu v. Drummond (H.M. Inspector of Taxes) 57 TC 330 (HL)
1649
Manager, Radhika Mohan Roy Wards Estate, In re [1940] 8 ITR 460 (Cal.)
491, 492
Mandviwalla Motors Limited, Karachi v. Commissioner of Income Tax, Central Zone `B', Karachi [1991] 64 TAX 19 (H.C.Kar.)
42
Manufacturers' Life Insurance Co. of Canda v. Commissioner of Income Tax [1938] 6 ITR 321 (Bom.)
1726
Maqsudal Hossain v. Government of Pakistan 1967 SCC 295 = [1968] 17 TAX 1 (S.C.Pak.)
751, 755
Mask & Co. v. Commissioner of Income Tax [1943] 11 ITR 454 (Mad.)
1635
Maulana Mohammad Ibrahim Riza Malak v. Commissioner of Income Tax 4 ITC 486 (PC)
576
Maulvi Brothers, Lyallpur v. Commissioner of Income Tax, Rawalpindi [1980] 42 TAX 33 (H.C.Lah.)
849
(lxxxiv) VOL-I
Income Tax Digest. Case No.
Megna Industries Ltd., Gujranwala v. Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi [1980] 41 TAX 148 (H.C.Lah.)
1828, 1829
Mehran Associates Ltd. v. Commissioner of Income Tax, Karachi 1992 SCC 980 = [1992] 66 TAX 246 (S.C.Pak)
286, 1158
Mehran Flex International Industries (Pvt.) Ltd. v. Federation of Pakistan through Secretary Finance, Islamabad and 3 Others [1997] 75 TAX 192 (H.C.Lah.)
1921
Mela Mal Shiv Dayal v. Commissioner of Income Tax 10 ITC 126 (Lahore)
632, 1334
MeIa Mal Shiv Dayal v. Commissioner of Income Tax [1937] 5 ITR 329 (Lahore)
813
Melamal Shib Dayal v. Commissioner of Income Tax [1936] 4 ITR 206 (Lahore)
631
Memoona Ahmad v. Assistant Commissioner of Income Tax [1998] 78 TAX 299 (H.C.Quetta)
1971
Meraj Sons, Contractors v. Income Tax Officer Contarctors Circle-Il, Lahore [1982] 45 TAX 2 (H.C.Lah.)
439, 2012
Mercantile Bank of India (Agency) Ltd., In re [1942] 10 ITR 512 (Cal.)
581
Messrs Neelam Textile Mills Ltd. v. State Bank of Pakistan and 2 others [PLD 1999 Kar. 433]
344
Messrs Octavious Steel & Company Ltd. v. Commissioner of Income Tax, Dacca [1960] 2-TAX (III-88) (H.C.Dacca) = 1960 PTD 1 = 1959 PLD 907
1008
Metro Shipsreakers and another v. Pakistan through the Secretary, Ministry of Finance, Islamabad, etc. [1996] 73 TAX 85 (H.C.Queeta)
376, 454
Metro Theatre Bombay Ltd. v. Commissioner of Income Tax [1946] 14 ITR 638 (Bom.)
1193, 1408, 1573
Mian Abdul Qayyum v. Commissioner of Income Tax, Rawalpindi Zone [1981] 43 TAX 149 (H.C.Lah.)
1827
Mian Aftab Ijaz v. Commissioner of Income Tax, Lahore Zone Lahore [1977] 36 TAX 82 (H.C.Lah.)
1738
Mian Anwar-ul-Haq Ramay v. Federation of Pakistan [1993] 67 TAX 195 (H.C.Lah.)
132
Mian Aziz A. Sheikh v. Commissioner of Income Tax Investigation Lahore 1989 SCC 718 = [1989] 60 TAX 106 (S.C.Pak)
444
Mian Aziz Ahmad, Lahore v. Commissiiner of Income Tax, Lahore [1979] 39 TAX 1 (H.C.Lah.)
316, 1991
Mian Aziz S. Sheikh v. Commissioner of Income Tax Investigation Lahore 1980 SCC 474 = [1981] 43 TAX 105 (S.C.Pak)
108
Mian Channu Factories Union v. Commissioner of Income Tax [1936] 4 ITR 203 (Lahore)
690, 1407
(lxxxv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Mian Ghulam Murtaza v. Commissioner of Income Tax, Lahore Zone, Lahore [1982] 45 TAX 21 (H.C.Lah.)
1764
Mian Muhammad Allah Buksh v. Commissioner of Income Tax 1962 PTD 603 (H.C.Lah.)
356
Mian Muhammad Bashir v. Commissioner of Income Tax [1989] 59 TAX 68 (H.C.Kar.)
1748
Mian Muhammad Khalil v. Income Tax Officer Company Circle, Faisalabad and 2 others [1979] 40 TAX 113 (H.C.Lah.)
49
Mian Muhammad Mansha v. Commissioner of Income Tax, Central Zone `C' Karachi [1990] 62 TAX 20 (H.C.Kar.) = 1990 PTD 240
1349
Micropak (Pvt.) Ltd., Lahore v. Income Tax Appellate Tribunal, Lahore and 2 others [2001] 83 TAX 451 (H.C.Lah.) = 2001 PTD 1180
64, 266, 1074, 1075
Millat Bottles Store, Faisalabad v. Assistant Commissioner of Income Tax [1998] 78 TAX 173 (H.C.Lah.)
1992
Millowners Mutual Insurance Association Ltd. v. Commissioner of Income Tax 6 ITC 7 (Bom.)
716
Minister of National Revenue v. Catherine Spooner [1933] 1 ITR 299 (PC)
863
Minsararasam Co. Ltd. v. Commissioner of Income Tax 6 ITC 65 (Mad.)
1586
Miran Bux Karam Bux Ltd. v. Income Tax Officer, Company Circle 12, Karachi and 2 others [1975] 31 TAX 125 (H.C.Kar.)
629
Mirza Book Agency v. Commissioner Of Income Tax, Zone-B, Lahore [1996] 73 TAX 247 (H.C.Lah.)
1889
Mitchell and Edon (H.M. Inspectors of Taxes) v. Ross 40 TC 11 (HL)
1648
Muhammad Aslam v. Commissioner of Income Tax [1936] 4 ITR 412 (All.)
694
Mobanpura Tea Co. Ltd., In re [1937] 5 ITR 118 (Cal.)
978
Modern Silk Mills Ltd. Lahore v. Commissioner of Income Tax Lahore [1979] 39 TAX 14 (H.C.Lah.)
134
Muhammad Asghar, etc. v. Central Board of Revenue, etc. [1986] 53 Tax 109 (H.C.Lah.)
2006
Muhammad Ayub Mohammad Jamil of Cawnpore, In re [1941] 9 ITR 610 (All.)
1089
Muhammad Din And Sons, Lahore v. Income Tax Appellate Tribunal (Pakistan), Lahore And Another [1973] 27 TAX 229 (H.C.Lah.)
1081
Muhammad Younas v. Chairman Municipal Committee, Sahiwal [1986] 53 TAX 93 (H.C Lah.)
1932
Muhammadi Textile Mills Ltd. v. Commissioner of Income Tax (East), Karachi [1982] 45 TAX 140 (H.C.Kar.)
1825
(lxxxvi) VOL-I
Income Tax Digest. Case No.
Mohanlal Hargovind of Jubbulpore v. Commissioner of Income Tax [1949] 17 ITR 473 (PC) Mohanpura Tea Co. Ltd., In re [1937] 5 ITR 118 (Cal.)
1556, 1596 482
Mohini Mills Limited v. Commissioner of Income Tax, East Pakistan, Dacca [1965] 12 TAX 64 (H.C.Dacca)
1406
Moin Sons (Pvt.). Ltd., Rawalpindi v. Capital Development Authority, Islamabad [1998] 78 TAX 168 (H.C.Lah.)
330
Morgan v. Perry (H.M. Inspector of Taxes) 42 Tax Cas. 351 (HL)
1133
Morris Jacob And Company v. Commissioner of Income Tax, Karachi [1967] 15 TAX 261 (H.C.Kar.)
1083
Moss Empires Ltd. v. IRC [1937] AC 785
1191
Motamal Jehumal v. Commissioner of Income Tax [1947] 15 ITR 155 (Pat.)
1537
Mothay Camp Rem v. Commissioner of Income Tax [1939] 7 ITR 149 (Mad.)
1445
Mothay Gangaraju v. Commissioner of Income Tax [1935] 3 ITR 58 (Mad.)
1212
Motichand & Devidas, In re [1946] 14 ITR 534 (Bom.)
1845
Motor Union Insurance Co. Ltd. v. Commissioner of Income Tax [1945] 13 ITR 272 (Bom.)
1052
Mrs. Qudsia Begum, Dacca v. Commissioner of Income Tax, East Pakistan, Dacca [1968] 18 TAX 13 (H.C.Dacca)
1069
Mrs. Samina Ayub Khan v. Commissioner of Income Tax, Rawalpindi 1980 SCC 527 = [1981] 43 TAX 18 (S.C.Pak.)
833
Mrs. Sooniram Poddar v. Commissioner of Income Tax [1939] 7 ITR 470 (Rangoon)
1248, 1263
Mrs. Tahmina Daultana v. Hafiz Naeem-ud-Din [1997) 75 TAX 261 (H.C.Lah.) = 1997 PTD 821]
373
Mst. Fatima Bibi C/o Crown Bus Service, Lahore v. Commissioner of Income Tax, North Zone (West Pakistan), Lahore [1962] 6 TAX 1 (H.C.Lah.) = 1962 PTD 625 = 1962 PLD 809
295
Mst. Fazal Be and 6 Others v. Commissioner of Income Tax [1996] 74 TAX 141 (H.C.AJ&K)
107, 392, 1199, 1201
Mst. Pannabal v. Commissioner of Income Tax [1943] 11 ITR 154 (Nag.)
663
Mst. Saeeda & others v. Govt. of Pakistan & another [1977] 35 TAX 180 (H.C.Kar.)
27
Mst. Sarju Bai v. Commissioner of Income Tax [1947] 15 ITR 137 (All.)
923
Mst. Tasneem Kausar v. House Building Finance Corporation [PLD 1999 Lahore 462]
125
(lxxxvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
MTT. AR.S.AR. Arunachalam Chettiar v. Commissioner of Income Tax [1945] 13 ITR 184 (Mad.)
1186
Mufti Mohammad Aslam Khalifa Mandi v. Commissioner of Income Tax 10 ITC 26 (All.)
687, 697
Muhammad Amjad v. Commissioner of Income Tax, Zone `A' Karachi [1992] 65 TAX 176 (H.C.Kar.) = 1992 PTD 513]
163
Muhammad Ansar etc. v. Administrator Town Committee Kabirwala District Khanewal and 4 others [2000] 81 TAX 60 (H.C.Lah.)
415, 1928, 1930
Muhammad Aslam v. Commissioner of Income Tax [1936] 4 ITR 412 (All.)
687
Muhammad Azim v. Commissioner of Income Tax East Zone Karachi [1991] 63 TAX 143 (H.C.Kar.) = 1991 PTD 658
62
Muhammad Bashir v. Income Tax Officer, Lahore [1983] 47 TAX 16 (H.C.Lah.)
1104
Muhammad Hanif and 21 others v. Government of Pakistan and 4 others. 2001 PTD 795
1167
Muhammad Hanif Monnoo v. Income Tax Officer Central Circle 1, Lahore [1984] 50 TAX 37 (H.C.Lah.) = PLJ 1984 Lah. 423
133, 385
Muhammad Hayat Haji Mohammad Sardar v. Commissioner of Income Tax, Punjab & NWFP [5 ITC 159 (H.C.Lah.)
296
Muhammad Ismail v. Income Tax Officer, Mirpur and 2 others [1992] 66 TAX 226 (H.C.AJ&K)
382, 2007
Muhammad Jameel and another v. Commissioner of Income Tax, Zone-B, Lahore [2001] 83 TAX 158 (H.C.Lah.) = 2001 PTD 1474
1168
Muhammad Jameel Khan v. Miss Azra Feroz Bakhat and 78 others 1967 SCC 295 = [1968] 17 TAX 1 (S.C.Pak.)
751, 755
Muhammad Jameel v. Income Tax Officer [1995] 72 TAX 1 (H.C.Lah.)
429
Muhammad Khan and Others v. Ghazanfar Ali & Others [AIR 1920 Lahore 247]
316
Muhammad Khan v. Shamsuddin and others 1969 SCC 319 = [1975] 31 TAX 94 (S.C.Pak.)
369
Muhammad Naseem Ahmad and 18 others v. Miss Azra Feroz Bakht and 58 others 1967 SCC 295 = [1968] 17 TAX 1 (S.C.Pak.)
751, 755
Muhammad Saleem Chotia, Advocate v. Zafar Iqbal Owasi, Advocate, Bahawalnagar and 4 others [PLD 1999 Lahore 446]
324
Muhammad Saleem v. Deputy Director FIA/CBC, Multan and another, PTCL 2000 CL. 465
80
Muhammad Younus v. Chairman Municipal Committee, Sahiwal [1986] 53 TAX 93 (H.C.Lah.)
224, 247
Muhammad Yousuff v. Commissioner of Income Tax, East Pakistan [1960] 2-TAX (Suppl.-146) (H.C.Dacca) = 1960 PTD 280 = 1960 PLD 298
1805
(lxxxviii) Income Tax Digest.
VOL-I
Case No.
Muhammadi Oil Trading Co. through Partner, Karachi v. Regional Commissioner of Income Tax, Southern Region, Karachi and Other [1994] 70 TAX 204 (H.C.Kar.)
1986
Muhammadi Steamship Company Ltd. v. Commissioner of Income Tax, (Central) Karachi 1966 SCC 266 = [1966] 14 TAX 281 (S.C.Pak.) = PLD 1966 S.C. 828
72, 254, 265, 1896
Muhammadi Steamship Company v. Commissioner of Income Tax 1963 PTD 271 (H.C.Kar.) = 1963 PLD 385
1899
Mujibar Rahman, Prop. Shamim & Co., Dacca v. Commissioner of Income Tax, East Pakistan, Dacca [1966] 13 TAX 141 (H.C.Dacca)
732
Mujibur Rehman v. Commissioner of Income Tax [1966] 13 TAX 141
93
Mukund Sarup v. Commissioner of Income Tax 2 ITC 495 (All.)
506
Multan Electric Supply Co. Ltd., In re [1945] 13 ITR 457 (Lahore)
910
Multiline Associates v. Ardeshir Cowasjee [PLD 1995 S.C.Pak 423]
305
Munir Ahmad & Others v. Federation of Pakistan [1998] 78 TAX 217 (H.C.Lah.) = 1998 PTD 3900]
447
Musammat Radha Kuer v. Commissioner of Income Tax [1942] 10 ITR 229 (Pat.)
667
Mustafa Prestressed R.C.C.Pipe Works Ltd. Karachi v. Commissioner of Sales Tax (Investigation), Karachi [1990] 62 TAX 119 (H.C.Kar.)
84, 246, 336
Mustafa R.C.C. Pipe Works, Karachi v. Commissioner of Income Tax, Karachi [1974] 29 TAX 125 (H.C.Kar.)
768
Muttahida Qaumi Movement (MQM) through Deputy Convener, Senator Aftab Ahmad Sheikh v. Federation of Pakistan through Secretary, Ministry of Interior PLD 2000 S.C. 111
67, 283, 318
N N.A.S. Gilani & Co. Ltd., Quetta v. Commissioner of Income Tax [1967] 16 TAX 107 (H.C.Kar.)
1357
N.C. Kelkar & D.V. Vidwans, Trustees of the Kesari & Mahratta Trust v. Commissioner of Income Tax 10 ITC 65 (Bom.)
591
N.V. Philips Glocilin Peufabrikan v. Income Tax Officer & others [1990] 61 TAX 159 (H.C.Kar.)
62
Nagina Dal Factory through Allah Ditta, Partner v. Income Tax Officer, and another 1968 SCC 316 = [1968] 18 TAX 1 (S.C.Pak.)
411
Nagina Silk Mills, Lyallpur v. Income Tax Officer, A-Ward, Lyallpur and Another 1963 SCC 167 = [1963] 7 TAX 442 (S.C.Pak.)
113, 226, 229, 555, 623
Nagpur Electric Light & Power Co. Ltd. v. Commissioner of Income Tax 6 ITC 303 (Nag.)
1668
Nand Lal Bhoj Raj, In re [1946] 14 ITR 181 (Lahore)
1600
(lxxxix) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Nand Ram Chhotey Lal v. Commissioner of Income Tax [1947] 15 ITR 121 (All.) Nandlal Bhandari Mills Ltd., In re [1939] 7 ITR 452 (All.)
1441 1037, 1044
Narain Das Bhagwan Das v. Commissioner of Income Tax 7 ITC 135 (Lahore)
974
Narayan Atmaram Patkar v. Commissioner of Income Tax [1934] 2 ITR 486 (Bom.)
1820
Naseer A. Shaikh & 4 others v. Commissioner of Income Tax (Investigation) Lahore & others 1992 SCC 894 = [1992] 66 TAX 55 (S.C.Pak.) = 1992 PTD 621
557
Naseer A. Sheikh v. Commissioner of Income Tax [1976] 33 TAX 121 (H.C.Lah.)
562, 1229, 1251
Naseer Mughis Ltd. v. Commissioner of Income Tax, Lahore [2001] 83 TAX 40 (H.C.Lah.)
1055
Nasir Industries, Karachi v. Commissioner of Income Tax, South Zone, West Pakistan, Karachi [1967] 15 TAX 84 (H.C.Kar.)
1783
Nasir Mahmood Dar, etc. v. Federation of Pakistan and Others [1998] 78 TAX 1 (H.C.Lah.) = 1998 PCTLR 1382
128, 1120
Nathu Sao v. Commissioner of Income Tax [1934] 2 ITR 463 (Nag.)
653, 662
National & Grindlays Bank Ltd. v. Commissioner of Income Tax (Central), Karachi [1985] 51 TAX 37 (H.C.Kar.)
1153
National Beverages (Pvt.) Ltd. v. Federation of Pakistan and others [2001] 83 TAX 359 (H.C.Kar.) = PTCL 2001 CL. 250
164
National Cooperative Supply Corporation Ltd. through Mr. Islam Madni, General Manager v. Federation of Pakistan through Secretary Finance, Islamabad [2000] 81 TAX 352 (H.C.Lah.)
599, 711
National Electric Co. (Pvt.) Ltd. Gujranwala v. Commissioner of Income Tax Gujranwala Zone [1996] 74 TAX 89 (H.C.Lah.)
453, 810
National Food v. Commissioner of Income Tax [1991] 64 TAX 60 (H.C.Kar.)
41
National Mutual Life Association of Australasia Ltd. v. Commissioner of Income Tax 5 ITC 238 (Bom.)
713
National Mutual Life Association of Australasia Ltd. v. Commissioner of Income Tax [1936] 4 ITR 44 (PC)
1726
National Petroleum Co. Ltd. v. Commissioner of Income Tax [1945] 13 ITR 336 (Bom.)
1435
Native Share & Stock Brokers' Association v. Commissioner of Income Tax [1946] 14 ITR 628 (Bom.)
1336
Navab Sons, Lahore v. The Assistant Commissioner Tax etc. 1999 PCTLR 387
419
(xc) Income Tax Digest.
VOL-I
Case No.
Nawab Habibullah v. Commissioner of Income Tax [1943] 11 ITR 295 (PC)
501
Nawab Nawazish Ali Khan v. Commissioner of Income Tax [1946] 14 ITR 356 (Oudh)
478, 487
Nawabzadi Mehar Bano Khanum v. Commissioner of Income Tax 2 ITC 99 (Cal.)
540
Nawaz Agencies, Lahore v. Income Tax Officer, M-Circle, Lahore [1978] 37 TAX 199 (Lah.)
1778
Nazar Muhammad v. The State [1982] 45 TAX 52 (H.C.Kar.)
1938
Nazir Ali M.H. Ganji v. Commissioner of Income Tax Companies I, Karachi [1994] 69 TAX 71 (H.C.Kar.)
107
Neelarnegham Pillai v. Secretary of State for India [1937] 5 ITR 424 (Mad.)
758
New Asiatic Insurance Co. Ltd. v. Commissioner of Income Tax [1973] 90 ITR 243 (Delhi)
1724
New India Assurance Co. Ltd. v. Commissioner of Income Tax [1946] 14 ITR 809 (Bom.)
1723
New Jubilee Insurance Company Ltd., Karachi v. National Bank of Pakistan, Karachi [PLD 1999 S.C. 1126]
323, 343
New Samanbagh Tea Co. Ltd., Calcutta v. Commissioner of Income Tax, East Pakistan, Dacca 1960 PTD 1121 (H.C.Dacca) = 1960 PLD 823
1205, 1352
New Snow White Dry Cleaners, Karachi v. Commissioner of Income Tax (East), Karachi [1984] 51 TAX 11 (H.C.Kar.)
1824
New York Life Insurance Co. v. Styles (Surveyor of Taxes) [1889] 2 Tax. Cas. 460 (HL)
714
Nirala and Co. v. Commissioner of Income Tax [1990] 61 TAX 71 (H.C.Lah.)
1973
Nishat Talkies Karachi v. Commissioner of Income Tax [1989] 60 TAX 45 (H.C.Kar.) = PTCL 1989 CL 660
310, 1217
Nishat Textile Mills Ltd. v. Commissioner of (Investigation), Karachi [1974] 29 TAX 143 (H.C.Kar.)
Income
Tax
1210
Nizam-ud-Din Amir-ud-Din of Lahore, In re [1943] 11 ITR 443 (Lahore)
700, 1202
Noon Sugar Mills Ltd. v. Commissioner of Income Tax, Rawalpindi 1990 SCC 759 = [1990] 62 TAX 74 (S.C.Pak.)
202, 227, 240, 829, 1909, 1910, 1911, 1912
Noor Hussain, Dacca v. Commissioner of Income Tax, Dacca [1963] 7 TAX 113 (H.C.Dacca) = 1963 PTD 161 = PLD 1964 Dacca 373
354
(xci) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Nooruddin Moosaji v. Commissioner of Income Tax [1972] 25 TAX 156 (H.C.Kar.)
1749
North British & Mercantile Insurance Co., In re [1937] 5 ITR 349 (Cal.)
1726, 1905
Novitas International v. Income Tax Officer and others 1991 SCC 819 = [1991] 64 TAX 86 (S.C.Pak.)
1980
Nrisinga Chandra Nandy, In re [1936] 4 ITR 428 (Cal.)
1549
O O.R.M.O.M.S.P. Lashmanan Chettiar v. Commissioner of Income Tax 4 ITC 200 (Mad.)
1293
O.RM.OM.RM.PL. Muthukaruppan Chettiar v. Commissioner of Income Tax [1943] 11 ITR 540 (Mad.)
1320
Octavius Steel & Co. Ltd, v. Commissioner of Income Tax, Dacca 1960 SCC 93 = [1961] 4 TAX 1 (S.C.Pak.)
816, 1032
Odbams Press Ltd. v. Cook [1941] 9 ITR (Suppl.) 92 (HL)
1650
Official Assignee for Bengal (Estate of Jnanendra Nath Pramanik), In re [1937] 5 ITR 233 (Cal.)
1184
Oppenheim v. Tobacco Securities Trust Co. Ltd. [1951] AC 291 (HL)
587
P P.C. MaIlick & D.C. Aich, In re [1940] 8 ITR 236 (Cal.) P.C. MulIick v. Commissioner of Income Tax [1938] 6 ITR 206 (PC)
955 957, 1904
P.L.S.M. Chettyar Concern v. Commissioner of Income Tax 9 ITC 82 (Rangoon)
1333, 1868
P.M. Hutheesingh & Sons Ltd. v. Commissioner of Income Tax [1946] 14 ITR 653 (Bom.)
1065
P.R.M. Abdul Rahman & Co. v. Commissioner of Income Tax [1939] 7 ITR 662 (Mad.)
1420
P.S. Varier v. Commissioner of Income Tax [1940] 8 ITR 628 (Mad.)
1867
Packages Ltd. v. Commissioner of Income Tax 1993 SCC 1073 = [1993] 68 TAX 19 (S.C.Pak.)
1389
Pak Company, Sargodha v. Commissioner of Income Tax, Rawalpindi Zone 1985 SCC 620 = [1985] 51 TAX 181 (S.C.Pak.)
2155, 2401
Pak Industrial Development Corporation v. Federation of Pakistan, through the Secretary, Ministry of Finance 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562
8, 198
Pak Industrial Development Corporation v. Pakistan through Secretary, Ministry of Finance [1984] 49 TAX 76 (H.C.Kar.)
20, 397, 398, 437
(xcii) VOL-I
Income Tax Digest. Case No.
Pak Packages Ltd. v. Commissioner of Income Tax, Central Central Zone-A, Karachi [1991] 64 TAX 105 (H.C.Kar.)
1398
Pak Services Ltd. v. Commissioner of Income Tax (Revision) Karachi 1993 SCC 1029 = (1993) 68 TAX 49 (S.C.Pak)
180
Pak-Arab Fertilizers (Pvt.) Ltd. v. Deputy Commissioner of Income Tax and Others [2000] 81 TAX 224 (H.C.Lah.) = 2000 PTD 263
412
Pak-Saudi Fertilizer Ltd. through Managing Director v. Federation of Pakistan through Secretary Finance, Islamabad and 4 others [2000] 81 TAX 119 (H.C.Kar.) = 1999 PTD 4061
121, 390, 1949
Pak. Educational Society Karachi v. Govt. of Pakistan through Chairman & Secretary Revenue Division Islamabad [1993] 67 TAX 311 (H.C.Kar.)
204
Pakistan Burma Shell Ltd., Etc. v. Federation of Pakistan through Secretary Ministry of Finance, Government of Pakistan, Islamabad, etc. [1998] 78 TAX 234 (H.C.Kar.) = PTCL 1998 CL. 690
17
Pakistan Cement Pipe Construction Company v. Commissioner of Income Tax [1973] 28 TAX 115 (H.C.Lah.)
748, 1235
Pakistan Educational Society, Karachi v. Government of Pakistan, through Chairman & Secretary, Revenue Division, Islamabad and others [1993] 67 TAX 311 (H.C.Kar.) = [1993 PTD 804]
1996
Pakistan Electric Fittings Manufacturing Co. Ltd. through Directors v. Commissioner of Income Tax and 2 others [2000] 82 TAX 135 (H.C.Lah.)
370
Pakistan Gum Industries Ltd. v. Commissioner of Income Tax (East), Karachi [1983] 47 TAX 155 (H.C.Kar.)
1063
Pakistan Hardcastle Wand (Pak) v. Federation of Pakistan etc. [PLD 1967 SC 1]
321
Pakistan Industrial Credit and Investment Corporation Ltd. v. Commissioner of Income Tax (East), Karachi. [1980] 42 TAX 122 (H.C.Kar.)
1233
Pakistan Industrial Development Corp. v. Federation of Pakistan through the Secretary, Ministry of Finance 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562
608, 814, 885, 997, 1001
Pakistan Industrial Development Corporation, Karachi Commissioner of Income Tax [1980] 41 TAX 44 (H.C.Kar.)
v.
825
Pakistan Industrial Engineering Agencies Ltd. v. Commissioner of Income Tax (Central), Karachi [1987] 55 TAX 59 (H.C.Kar.)
1402
Pakistan International Airlines Corporation v. Commissioner of Income Tax [1975] 32 TAX 225 (H.C.Kar.)
838
Pakistan International Airlines Corporation v. Commissioner of Income Tax, Karachi [1978] 37 TAX 130 (H.C.Kar.)
869
(xciii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Pakistan International Airlines Corporation v. Commissioner of Income Tax (Central Zone), Karachi [1985] 52 TAX 90 (H.C.Kar.)
1073
Pakistan Lyallpur-samundri Transport Co. Ltd. Lahore v. Commissioner of Income Tax, Lahore Zone, Lahore [1982] 46 TAX 143 (H.C.Lah.)
23, 280, 1372
Pakistan Petroleum Limited, Karachi v. Commissioner of Income Tax, (Central), Karachi [1984] 50 TAX 130 (H.C.Kar.)
1692
Pakistan Seamen Contributory Welfare Fund Karachi v. Income Tax Appellate Tribunal & 2 Others [1993] 67 TAX 400 (H.C.Kar.)
170, 568
Pakistan Services Limited v. Commissioner of Income Tax (Revision), Karachi [1986] 54 TAX 150 (H.C.Kar.)
1234
Pakistan Services Ltd. Karachi v. Commissioner of Income Tax (Revision), Karachi 1993 SCC 1029 = [1993] 68 TAX 49 (S.C.Pak.)
1520
Pakistan Services Ltd., Karachi v. Commissioner of Income Tax, Central Zone `C' (COS-1) [1999] 80 TAX 106 (H.C.Kar.) = 1999 PTD 2901
209
Pakistan Services Ltd., Karachi v. Commissioner of Income Tax, Central Zone, Karachi [1990] 62 TAX 34 (H.C.Kar.)
1385
Pakistan Services Ltd., Karachi v. Commissioner of Income Tax, Central Zone `C' (COS-1) [1999] 80 TAX 106 (H.C.Kar.) = 1999 PTD 2901
1688
Pakistan through Commissioner of Income Tax Karachi v. Majestic Cinema 1965 SCC 220 = [1965] 12 TAX 15 (S.C.Pak.)
112
Pakistan Tobacco Co. Ltd. v. Government of Pakistan through Secretary Finance & 3 others 1992 SCC 946 = [1993] 67 TAX 222 (S.C.Pak.)
1687
Pakistan Tobacco Co. Ltd. v. Income Tax Officer Salary Circle and others, Karachi [1984] 49 TAX 205 (H.C.Kar.)
1124
Pakistan Tobacco Co. Ltd. v. Pakistan through The Secretary, Ministry of Finance, Islamabad and 4 others [1991] 63 TAX 163 (H.C.Kar.) = 1991 PTD 359
1384
Pakistan Tobacco Company Ltd. v. Commissioner of Income Tax, Central Zone `A', Karachi [1992] 65 TAX 98 (H.C.Kar.)
1493
Pan Islamic Steamship Co. Ltd. v. Commissioner of Income Tax, Karachi [1982] 46 TAX 31 (H.C.Kar.)
1373
Pandit Pandurang v. Commissioner of Income Tax, Central Provinces [2 ITC 69 (Nagpur)]
159, 867
Paramount Electric Company, Lahore v. Commissioner of Income Tax, Lahore Zone, Lahore [1976] 34 TAX 92 (H.C.Lah.) = PLD 1976 Lah. 1147
1979
Parashram Chintaman Joglekar v. Commissioner of Income Tax 6 ITC 74 (Nag.)
1257
(xciv) VOL-I
Income Tax Digest. Case No.
Parma Nand Haveli Ram, ln re [1945] 13 ITR 157 (Lahore) Partington v. Attorney-General [1896] 4 HL 100
1598 878
PD. Khosla, In re [1945] 13 ITR 436 (Lahore)
1146
Peragon Silk Mills Limited v. Commissioner of Income Tax, Central Zone `C', Karachi [1992] 65 TAX 323 (H.C.Kar.)
1077
Perfume Supply Co., Mitford, Dacca v. Commissioner of Income Tax, Dacca [1968] 17 TAX 116 (H.C.Dacca)
1892
Pettison (H.M. Inspector of Taxes) v. Marine Midland Ltd. 57 TC 219 (HL)
872
Pfizer Laboratories Ltd. v. Federation of Pakistan [1998] 77 TAX 172 (S.C.Pak)
269
Pheroz Ali v. Commissioner of Income Tax (West), Karachi [1979] 40 TAX 109 (H.C.Kar.)
1853
Philips Electrical Co. Ltd. v. Commissioner of Taxes (South) Zone, Dacca [1993] 68 TAX 149 (H.C.Dacca)
776
Phra Pbraison Salarak v. Commissioner of Income Tax 3 ITC 237 (Rangoon)
959
Pimpa (Pvt) Limited v. Commissioner of Income Tax [1993] 68 TAX 193 (H.C.Kar.)
1787
Pioneer Bank Ltd. (In Liquidation), Dacca [Official Liquidator, Stale Bank of Pakistan, Dacca] v. Commissioner of Income Tax, East Pakistan, Dacca [1968] 17 TAX 214 (H.C.Dacca)
1849
Pioneer Sports Ltd. v. Commissioner of Income Tax [1933] 1 ITR 216 (Lahore)
1817, 1819
Pioneer Sports Ltd. v. Commissioner of Income Tax [1934] 2 ITR 305 (Lahore)
1821
Poibani Dolls v. Commissioner of Income Tax [1995] 71 TAX 224 (H.C.Kar.)
1491
Pokardas Dwarkadas, Karachi v. Commissioner of Income Tax, Sind and Bluchistan [1960] 2-TAX (Suppl.-14) (H.C.West Pakistan, Karachi Bench) = 1960 PTD 786 = 1957 PLD 68
1009
Pondicherry Railway Co. Ltd. v. Commissioner of Income Tax 5 ITC 363 (PC)
831, 946, 991, 1300
Pondicherry Railway Co. Ltd. v. Commissioner of Income Tax AIR 1931 PC 165
1308
PR.AL.M. Mutbukaruppan Chettiar v. Commissioner of Income Tax [1939] 7 ITR 76 (Mad.)
1447, 1784, 1810
PR.AL.M. Muthukaruppan Chettiar v. Commissioner of Income Tax [1943] 11 ITR 38 (Mad).
1304
Prag Naraln v. Commissioner of Income Tax 6 ITC 110 (Mad.)
1470
(xcv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Pramatha Nath Mullick v. Pradhyumna Kumar Mullick AIR 1925 PC 139
642
Premier Construction Co. Ltd. v. Commissioner of Income Tax [1948] 16 ITR 380 (PC)
463, 497
Premier Insurance Company of Pakistan Ltd., Karachi v. Commissioner of Income Tax, Companies-Ill, Karachi [1995] 72 TAX 67 (H.C.Kar.)
1713
Premier Sugar Mills and Distillery Co. Ltd., Mardan In re. [1965] 12 TAX 8 (H.C.Lah.)
1022
Prime Commercial Bank and others v. Assistant Commissioner of Income Tax [1997] 75 TAX 1 (H.C.Lah.) = 1997 PTD 605 = PTCL 1997 CL. 29]
318, 1908
Printers Combine (Mercantile) Ltd., Karachi v. Commissioner of Income Tax, Karachi (West), Karachi [1984] 50 TAX 183 (H.C.Kar.)
1803
Probynabad Stud Farm, In re [1936] 4 ITR 114 (Lahore)
536, 553, 572
Provident Investment Co. Ltd. v. Commissioner of Income Tax 6 ITC 21 (Bom.)
1268
Province of Bihar v. Maharaja Pratap Udai Nath Sahi Deo of Ratugarh [1941] 9 ITR 313 (Pat.)
538
Province of Bihar v. P.C. Lal Choudhury [1945] 13 ITR 309 (Pat.)
491
Province of East Pakistan v. Dr. Azizul Islam [PLD 1963 S.C.Pak 296]
307
Punjab Co-operative Bank Ltd. v. Commissioner of Income Tax [1938] 6 ITR 355 (Lahore)
912
Punjab Co-operative Bank Ltd. v. Commissioner of Income Tax [1940] 8 ITR 635 (PC)
1291, 1296
Punjab National Bank Ltd. v. Commissioner of Income Tax 2 ITC 184 (Lahore)
1652
Punjab Small Industries Ltd. v. Deputy Commissioner of Income Tax, Lahore [1995] 71 TAX 220 (H.C.Lah.)
18, 824
Q Qasim Ali and others v. Commissioner of Income Tax, Zone VI, Karachi [2000] 81 TAX 458 (H.C.Kar.) = 2000 PTD 1288
1198
Queensland Insurance Company Ltd., v. Commissioner Of Income Tax [1967] 16 TAX 112 (H.C.Kar.)
1718
R R.B. Bansilal Abirchand v. Commissioner of Income Tax 6 ITC 318 (Nag.) R.B. Seth Bansilal Abirchand v. Commissioner of Income Tax 5 ITC 338 (Nag.)
1314, 1541 1327
(xcvi) VOL-I
Income Tax Digest. Case No.
R.B. Seth Ganga Sagar Jatia v. Commissioner of Income Tax 5 ITC 458 (All.) R.B. Seth Ganga Sagar v. ITAT [1947] 15 ITR 16 (All.)
1361 1455, 1484, 1487
R.S. Munshi Gulab Singh & Sons v. Commissioner of Income Tax [1946] 14 ITR 66 (Lahore)
950, 1643, 1646
Radhashyam Agarwala v. Commissioner of Income Tax, East Pakistan 1960 SCC 80 = [1960] 2-TAX (III-211) (S.C.Pak) = PLD 1960 S.C. 187
626
Radhey Lal Balmukand, In re [1942] 10 ITR 131 (All.)
1963
Rafhan Maize Products Co. Ltd. v. Commissioner of Income Tax [1988 SCC 663 = 1988 PTD 571]
216
Raghunath Das Govind Das v. Commissioner of Income Tax 10 ITC 98 (All.)
1633
Rahmat Jan Muhammad Haji Dossal & Sons v. Assistant Income Tax Officer, Mirpurkhas and 3 others [1978] 38 TAX 117 (H.C.Kar.)
2008
Rais Ghazi Muhammad Khan v. Commissioner of Income Tax, Lahore [1982] 45 TAX 9 (H.C.Lah.)
1852
Rais Pir Ahmad Khan (Partner of Shabbir Cotton Factory Walhar, Tehsil Sadiqabad) v. Commissioner of Income Tax, Lahore Zone, Lahore [1975] 32 TAX 22 (H.C.Lah.)
1866
Raj MaI-Pabar Chand v. Commissioner of Income Tax [1938] 6 ITR 577 (Lahore)
1479
Raja Babadur Kamakshya Naraln Singh v. Commissioner of Income Tax [1946] 14 ITR 673 (Pat)
937
Raja Bahadur Kamakshya Narain Singh of Ramgarh v. Commissioner of Income Tax [1943] 11 ITR 513 (PC)
842, 900, 919, 926, 1284, 1285
Raja Bahadur Kamakshya Naraln Singh v. Commissioner of Income Tax [1946] 14 ITR 683 (Pat.)
889
Raja Bahadur Major Raja Durga Narain Singh v. Commissioner of Income Tax [1947] 15 ITR 235 (All.)
487, 490, 532
Raja Bejoy Singh Dudhuria v. Commissioner of Income Tax [1933] 1 ITR 135 (PC)
949
Raja Habib Ahmad Khan v. Income Tax Officer 1972 SCC 400 = [1974] 29 TAX 208 (S.C.Pak.)
412, 759
Raja Mustafa Ali Khan v. Commissioner of Income Tax PLD 1948 PC 259 = [1948] 16 ITR 330 (PC)
465, 471, 486, 511, 539
Raja Pratap Bikram Shah v. Commissioner of Income Tax [1946] 14 ITR 788 (Oudh)
488, 489
(xcvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Raja Probhat Chandra Barua v. Commissioner of Income Tax 5 ITC I (PC)
942, 1116, 1187, 1743
Raja Raghunandan Prasad Singh v. Commissioner of Income Tax [1933] 1 ITR 113 (PC)
894, 905, 973
Raja Rajendra Narayan Bhanja Deo v. Commissioner of Income Tax 4 ITC 15 (Pat.)(FB)
477, 479, 540
Raja Shiva Prasad Singh v. Commissioner of Income Tax [1942] 10 ITR 249 (Pat.)
949
Rajah Inuganti Rajagopala Venkata Narasimha Rayanim Bahadur Varu v. Commissioner of Income Tax 6 ITC 63 (Mad.)
491
Rajendra Narayan Bhanja Deo v. Commissioner of Income Tax [1937] 5 ITR 111 (Pat.)
884
Rajnagar Tea Co. Ltd., Calcutta v. Commissioner of Income Tax, East Pakistan, Dacca 1960 PTD 1121 (H.C.Dacca) = 1960 PLD 823
1205, 1352
Rajput Metal Works Ltd., Gujranwala v. Commissioner of Income Tax, Rawalpindi [1976] 33 TAX 1 (H.C.Lah.) = PTD 1976 Lah. 223
1498
Raleigh Investment Co. Ltd. Governor-General in Council [1947] 15 ITR 332 (PC)
1054
Raleigh Investment Co. Ltd. v. Commissioner of Income Tax (East) Karachi [1983] 47 TAX 214 (H.C.Kar.)
172
Ram Chandra Munna Lal v. Commissioner of Income Tax [1949] 17 ITR 394 (Punj.)
1272, 1305, 1306
Ram Khelawan & Sahu Thakur Das, In re [1939] 7 ITR 607 (All.) Ram LaI Bechairam v. Commissioner of Income Tax [1946] 14 ITR 1 (All.) Ram Narain Lal v. Commissioner of Income Tax 10 ITC 292 (All.)
1845 892, 899, 984 891
Ram Rakha Mal & Sons Ltd. v. Commissioner of Income Tax [1937] 5 ITR 137 (Lahore)
1309
Ramji Das Saint & Co., In re. [1945] 13 ITR 430 (Lahore)
1660
Ramkinkar Banerji v. Commissioner of Income Tax [1936] 4 ITR 108 (Pat.)
671, 1609
Ramkola Sugar Mills & Co. Ltd., Nawanshahr v. Commissioner of Income Tax, Punjab N.W.F.P., Province [1960] 2-TAX (Suppl.-41) (Judicial Commissioner, Peshawar) = 1952 PLD 28
1010
Ramkola Sugar Mills Ltd. v. Commissioner of Income Tax, Punjab and NWFP, Lahore. 1955 SCC 1 (Federal Court) = [1960] 2-TAX (Suppl.29) (Federal Court of Pakistan) = 1960 PTD 994 = 1955 PLD 418
308, 1016, 1017, 1018
Ramkumar Kedarnath v. Commissioner of Income Tax [1937] 5 ITR 261 (Bom.)
971, 1800, 1841
Rangoon Electric Trarnway & Supply Co. Ltd. v. Commissioner of Income Tax 6 ITC 374 (Rangoon)
1123
(xcviii) VOL-I
Income Tax Digest. Case No.
Rani Amrit Kunwar v. Commissioner of Income Tax [1946] 14 ITR 561 (All.)
840, 843, 903, 928, 929, 1117
Rani Anand Kuuwar v. Commissioner of Income Tax [1943] 11 ITR 235 (Oudh)
660
Rani (Miss) v. Commissioner of Wealth Tax Lahore [1992] 68 TAX 89 (H.C.Lah.)
153
Rani Bhubneshwari Kuar v. Commissioner of Income Tax [1940] 8 ITR 550 (Pat.)
505, 841, 921
Rani Tara Kumari Devi v. Commissioner of Income Tax [1946] 14 ITR 787 (Oudh)
487
Rao Bahadur Mothay Gangaraju v. Commissioner of Income Tax 8 ITC 76 (Mad.)
1259
Rao Bahadur S. Ramanatha Reddlar v. Commissioner of Income Tax 3 ITC 10 (Rangoon)
1564
Rao Saheb A.S. Alaganan Chetty v. Commissioner of Income Tax 3 ITC 44 (Mad.)
1642
Rarnratan Das and Madan Gopal, In re [1935] 3 ITR 183 (All.)
1057
Rashid Akhtar & Sons v. Commissioner of Income Tax Lahore [1980] 42 TAX 168 (H.C.Lah.) Ratan Singh v. Commissioner of Income Tax 2 ITC 294 (Mad.)
200 1602, 1606
Rathan Singh, Proprietor, Rathan Singh Motor Service, Madura v. Commissioner of Income Tax, Madras [2 ITC 107 (Madras)]
94
Rathna Tea Estate, Dacca v. Commissioner of Income Tax, Dacca [1965] 11 TAX 176 (H.C.Dacca)
1794, 1833
Rawji Dhanji & Co., In re [1940] 8 ITR 1 (Bom.) Rayalu Ayyar & Co. v. Commissioner of Income Tax [1937] 5 ITR 727 (Mad.)
1872 1631, 1661
Regent Oil Co. Ltd. v. Strick (Inspector of Taxes) [1946] AC 295
1562
Rehman Corporation v. Income Tax Officer, Circle `A', Mirpurkhas & another [1985] 52 TAX 169 (H.C.Kar.) = 1985 PLD 787
1933
Rehmania Hospital v. Government of Pakistan through Ministry of Finance, etc. [1997] 76 TAX 138 (H.C.Pesh) = 1997 PTD 1805
421, 2002
Republic Motors Ltd. v. Income Tax Officer & Others [1990] 62 TAX 8 (H.C.Kar.) = 1990 PTD 889
433
Reyaz-o-Khalid & Co. v. Pakistan & others [l960] 2-TAX (Suppl.-114) (H.C.West Pakistan, Karachi Bench) = 1959 PTD 119 = 1958 PLD 220
773
Rhodesia Railways Ltd. v. Income Tax Collector [1933] 1 ITR 227 / AC 368 (PC)
1190, 1588, 1603
Rijaz (Pvt.) Ltd. v. Wealth Tax Officer Circle-III Lahore [1996] 74 TAX 9 (H.C.Lah.)
83, 293
(xcix) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Rivoli Theatres, Karachi v. Commissioner of Income Tax, South Zone, Karachi and another 1971 SCC 388 = [1975] 31 TAX 55 (S.C.Pak.)
1882
RM. AR. AR. RM. Arunachalam Chettiar & Son v. Commissioner of Income Tax [1935] 3 ITR 464 (Mad.)
1286
RM. AR.AR.RM. Arunachalam Chettiar v. Commissioner of Income Tax [1936] 4 ITR 173 (PC)
1328, 1440, 1875
RM.AR.AR.RM. Arunachalam Chettiar v. Commissioner of Income Tax 9 ITC 282 (PC)
1871
Robert Addle & Sons' Colleries Ltd. v. IRC [1924] 8 Tax Cas. 671
1500
Roberts Cotton Association Ltd. v. Commissioner of Income Tax, North Zone, Lahore 1982 SCC 584 = [1982] 46 TAX 133 (S.C.Pak.)
1428
Roger Pyatt Shellac & Co., v. Secretary of State [1 ITC 363 (Calcutta)]
298
Roshan Cloth House v. Commissioner of Income Tax (East), Karachi [1983] 47 TAX 148 (H.C.Kar.)
1791
Rowe & Co. v. The Secretary of State for India [1 ITC 161 (Burma)]
33, 100, 258, 301
Royal Exchange Assurance, Karachi v. Commissioner of Income Tax, Central Zone, Karachi [1989] 59 TAX 37 (H.C.Kar.)
1236
Royal Insurance Co. Ltd., In re [1941] 9 ITR 589 (Cal.)
1726
Rulia Mal-Ratinak Ram v. Commissioner of Income Tax [1934] 2 ITR 329 (Lahore)
1456, 1485, 1809
Rustam F. Cousjee & 2 others v. CBR & 2 others [1985] 52 TAX 123 (H.C.Kar.)
44
S S.A.S.S. Chellappa Chettiar v. Commissioner of Income Tax [1937] 5 ITR 97 (Mad.)
1391
S.C. Cambatta v. Commissioner of Income Tax [1946] 14 ITR 748 (Bom.)
1064
S.L.S.L. Firm v. Commissioner of Income Tax 7 ITC 398 (Rangoon)
1413
S.M. Abdullah v. Commissioner of Income Tax [1966] 14 TAX 161 (H.C.Kar.)
332
S.M. Yousuf and Brothers v. Commissioner of Income Tax [1974] 29 TAX 120 (H.C.Kar.)
1792
S.Marimuthu Pillai v. Commissioner of Income Tax [1945] 13 ITR 186 (Mad.)
745
S.N.A.AL.CT. Chidarnbaram Chettiar v. Commissioner of Income Tax [1945] 13 ITR 177 (Mad.)
1878
S.N.A.S.A. Annamalai Chettiar v. Commissioner of Income Tax [1944] 12 ITR 254 (Mad.)
1166
(c) VOL-I
Income Tax Digest. Case No.
S.R. Mittra, In re [1942] 10 ITR 259 (Pat.)
1130
S.R.M.S. Subrahmanyam Chettiar v. Commissioner of Income Tax 7 ITC 297 (Mad.)
1258
S.R.M.S. Subrahmanyan Chettiar v. Commissioner of Income Tax [1934] 2 ITR 295 (Mad.)
1294
S.S.S. Chockalingam Chettiar & Sons v. Commissioner of Income Tax [1941] 9 ITR 278 (Mad.)
909, 1311, 1332
S.V.K.L. Somasundaram Chettyar v. Commissioner of Income Tax 6 ITC 88 (Mad.)
886
S.V.M.Moharned Jamaluddeen & Bros. v. Commissioner of Income Tax [1942] 10 ITR 484 (Mad.)
736
S.Warwick Smith v. Commissioner of Income Tax 5 ITC 451 (Rangoon)
933
Sachindra Mohan Ghosh v. Commissioner of Income Tax 5 ITC 396 (Pat.)
1755
Sadar Anjuman-i-Ahmedia, Rabwa v. Commissioner of Income Tax Rawalpindi [1977] 36 TAX 117 (H.C.Lah.)
171
Sadhucharan Roy Chowdhry, In re [1935] 3 ITR 114 (Cal.)
1756
Sadiq Traders Limited v. Commissioner of Income Tax [1987] 56 TAX 98 (H.C.Kar.)
1847, 1879
Saif Nadeem Electro Ltd. v. Collector of Customs and Central Excise/Commissioner of Sales Tax, Peshawar and 3 Others [1995] 72 TAX 274 (H.C.Pesh.)
428
Saifuddin Ghulam Ali and Sons v. Commissioner of Income Tax [1990] 61 TAX 76 (H.C.Kar.)
1999
Sainrapt & Et. Brice, Karachi v. Commissioner of Income Tax (West), Karachi [1979] 40 TAX 116 (H.C.Kar.) = PLD 1979 591
88, 347, 1862
Saleem and Co. v. Income Tax Authorities [1993] 68 TAX 173 (H.C.Lah.)
380
Saleem Automotive Industries (Pvt.) Ltd. v. Central Board of Revenue etc. [1999] 80 TAX 9 (H.C.Lah.)
420
Saltanat Begum, in re [1933] 1 ITR 379 (Oudh)
521
Sameer Electronics v. Assistant Commissioner of Income Tax, CircleB, Zone `A' Lahore [1996] 73 TAX 106 (H.C.Lah.)
427, 1978
Sanaullah Khan etc. v. Province of Balochistan etc. [1995] 71 TAX 45 (H.C.Quetta)
455, 1023
Sante International (Pvt.) Ltd. and Another v. Commissioner of Income Tax, Zone-B, Lahore and Another [1997] 75 TAX 259 (H.C.Lah.) = 1997 PTD 819
423
Sardar Bahadur Sardar Singar Singh & Sons v. Commissioner of Income Tax [1944] 12 ITR 504 (Oudh)
1592, 1595
(ci) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Sardar Saheb Sardar Singar Singh & Son v. Commissioner of Income Tax [1942] 10 ITR 441 (Oudh)
676
Sarfraz Khan, Karachi v. Commissioner of Income Tax [1967] 15 TAX 59 (H.C.Kar.)
1084
Sarupchand Hukamchand, In re [1945] 13 ITR 245 (Bom.) Sarupchand v. Commissioner of Income Tax [1936] 4 ITR 420 (Bom.)
725, 733, 734 1842, 1843
Sarwar & Co. v. C.B.R. & Others [1997] 76 TAX 1 (H.C.Lah.)
188
Scates v. George Thompson & Co. Ltd. [1927] 13 Tax Cas 83
1859
Schazoo Laboratories Ltd. v. Commissioner of Income Tax, Lahore [1977] 35 TAX 15 (H.C.Lah.) = 1976 PTD 361
1953
Searle Pakistan (Pvt.) Ltd. v. Government of Pakistan through Secretary Ministry of Finance & Another [1994] 69 TAX 79 (H.C.Kar.)
292
Secretary of Commissioner Salt v. Ramanathan Chetti, minor by guardian [1 ITC 37 (Madras)]
260
Secretary of State for India v. V.M. Meyyappa Chettiar [1936] 4 ITR 341 (Mad.)
727
Secretary of State v. Seth Khemchand Thaoomal [1 ITC 26 (Sind)
97, 101
Secretary to Commissioner Salt v. Ramanathan Chetti, minor by guardian [1 ITC 37 (Madras)]
303
Secretary to the Board of Revenue (Income Tax) v. North Madras Mutual Befit & Co [1 ITC 172 (Madras)]
257
Mahammad Faruq, In re [1938] 6 ITR 1 (All.) Seth Adam Haji Peer Mohammad v. Commissioner of Income Tax [1966] 14 TAX 203 (H.C.Kar.) Seth Ganga Sagar, In re [1934] 2 ITR 155 (All.)
1267 871 1273, 1317
Seth Gurmukh Singh v. Commissioner of Income Tax [1944] 12 ITR 393 (Lahore)
255
Seth Ismail Jamal Budhani v. Commissioner of Income Tax, Karachi [1963] 7 TAX 209 (H.C.Kar.) = 1963 PTD 413 = 1963 PLD 499
1888
Seth Kaluram Kankaria, In re [1947] 15 ITR 209 (All.) Seth Kanhaiya Lal Goenka, In re [1941] 9 ITR 25 (All.)
793, 1622 779
Seth Kanhaiyalal v. Commissioner of Income Tax [1937] 5 ITR 739 (All.)
781, 790
Seth Mathra Parshad v. Commissioner of Income Tax [1941] 9 ITR 244 (Lahore)
670, 1298
Seth Nathusa Pasusa Lad v. Commissioner of Income Tax 7 ITC 129 (Nag.)
653, 662
Seth Sheolal Ramlal v. Commissioner of Income Tax 4 ITC 375 (Nag.)
474
(cii) VOL-I
Income Tax Digest. Case No.
Seths Basant Rai & Takhat Singh v. Commissioner of Income Tax 5 ITR 442 (All.)
1196
Sh. Abdul Hakeem v. Centeal Board of Revenue, etc. [1975] 31 TAX 105 (H.C.Lah.)
441
Sh. Diwan Mohammad Mushtaq Ahmad, Karachi v. CBR & others [1969] 19 TAX 198 (H.C.Kar.)
339, 460
Sh. Ihsan Ilahi & Co., Lyallpur v. Commissioner of Income Tax, Rawalpindi Zone (West Pakistan) [1974] 29 TAX 64 (H.C.Lah.) = 1974 PTD 28 = 1974 PLD 59N22
552
Shafqat Rasool v. Islamic Republic of Pakistan through Secretary Finance, Islamabad and others [1992] 66 TAX 85 (H.C.Lah.)
1995
Shagufta Begum v. Income Tax Officer, Circle XI, Zone B Lahore 1989 SCC 715 = [1989] 60 TAX 83 (S.C.Pak.)
366, 412
Shahid Hameed, Gulberg, Lahore v. Income Tax Officer, Film Circle, Lahore and another [1976] 34 TAX 31 (H.C.Lah.)
404, 1768
Shaikh Naseem Anwar v. Income Tax Officer (Investigation), Circle III, Dacca and another [1963] 7 TAX 358 (H.C.Dacca) = 1967 PTD 774 = 1964 PLD 304
772
Shamim Ali and others v. Govt. of Pakistan and another [1973] 27 TAX 51 (H.C.Lah.)
442
Shamsher Ali Abdul Hussein v. Commissioner of Income Tax [1945] 13 ITR 240 (Nag.)
1488
Shankar Shambhaji Gangla v. Commissioner of Income Tax 9 ITC 350 (Bom.)
1601
Sheikh Akhtar Ali v. Federation of Pakistan and 4 others [1980] 42 TAX 47 (H.C.Lah.)
338, 402
Sheikh Miran Bux Karam Bux Ltd. Karachi v. Income Tax Officer, Company Circle 12, Karachi [1976] 33 TAX 99 (H.C.Kar.)
215, 551, 625, 627
Sheikh Mohammad Amin, Lyallpur v. Income Tax Officer, Jhang and another [1968] 18 TAX 105 (H.C.Lah.)
770
Sheosheyamal HiralaI v. Commissioner of Income Tax [1938] 6 ITR 485 (Pat.)
1472
Sher Muhammad and 2 others v. Miss Azra Feroz Bakhat and 80 others 1967 SCC 295 = [1968] 17 TAX 1 (S.C.Pak.)
751, 755
Shib Lal Ganga Ram v. Commissioner of Income Tax 2 ITC 425 (All.)
528
Shirin Ayub Khan, Lahore v. Commissioner of Income Tax, Lahore [1976] 33 TAX 227 (H.C.Lah.)
605, 1736
Shoaib Bilal Corporation, Faisalabad v. Commissioner of Income Tax, Faisalabad and anohter [1993] 67 TAX 233 (H.C.Lah.)
1981, 1993
Shyam Chambers Ltd. v. Commissioner of Income Tax [1941] 9 ITR 224 (Lahore)
1466
(ciii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
Siddique Trust v. Income Tax Officer and another [1987) 56 TAX 120 (H.C.Kar.)
383
Sidheshwar Prasad Narayan Singh v. Commissioner of Income Tax [1942] 10 ITR 344 (Pat.)
906
Siemens A.G. & Halske v. Commissioner of Income Tax [1983] 47 TAX 132 (H.C.Pesh)
181, 196, 201, 603
Siemens Pakistan Engineering Ltd. v. Federation of Pakistan & Other [1999] 79 TAX 605 (H.C.Kar.) = 1999 PTD 1358]
316
Simplex Rubber Manufacturing Co. Ltd. v. Commissioner of Income Tax (Central Zone) [1988] 57 TAX 24 (H.C.Kar.)
1770
Sind Industrial Trading Estate Ltd., Karachi v. Central Board of Revenue and 3 others [1975] 31 TAX 114 (H.C.Kar.)
174, 406, 827
Sind Trading Company v. Commissioner of Income Tax [1967] 15 TAX 53 (H.C.Kar.)
183, 1553
Singer Sewing Machine Co. v. Commissioner of Income Tax and others [1964] 9 TAX 273 (H.C.Kar.) = 1964 PTD 554
282, 389, 1902
Sir Chinnubhai Madhavlal v. Commissioner of Income Tax [1937] 5 ITR 210 (Bom.)
1322
Sir Kameshwar Singh v. Commissioner of Income Tax [1947] 15 ITR 246 (Pat.)
1438
Sir Sarupchand Hukamcband v. Commissioner of Income Tax 5 ITC 108 (Bom.)
994
Sir Sobha Singh v. Commissioner of Income Tax [1950] 18 ITR 998 (Punj.)
993
Sir William Roberts Timber Co. Ltd., Baramula v. Commissioner of Income Tax, Punjab and N.W.F. Provinces, Lahore [1960] 2-TAX (Suppl.-90) (H.C.Lah.) = 1960 PTD 1235 = 1951 PLD 413
1011, 1042
Siva Pratab Bhattadua v. Commissioner of Income Tax [1 ITC 323 (Madras)
155
Sobhagmal Nemicband v. Commissioner of Income Tax 7 ITC 100 (Bom.)
875
Som Chand Maluk Chand v. Commissioner of Income Tax [1936] 4 ITR 382 (Lahore)
1448, 1482
South Indian Industrials Ltd. v. Commissioner of Income Tax [1935] 3 ITR 11 (Mad.)
1861, 1870
Souvenir Tobacco Co. Ltd. v. Income Tax Officer, Companies Circle XIII, Karachi And Another [1983] 47 TAX 158 (H.C.Kar.)
819
Sovaram Jokhiram v. Commissioner of Income Tax [1944] 12 ITR 110 (Pat.)
1092
Sri Hardeo Bengal Salt Co. v. Commissioner of Income Tax [1942] 10 ITR 13 (Pat.)
987
(civ) VOL-I
Income Tax Digest. Case No.
Sri Rajah Ravu Venkata Mahipathi Gangadhara Rama Rao Bahadur, Yuvarajah of Pithapuram v. Commissioner of Income Tax [1949] ITR 445 (PC)
486
Sriman Madhwa Siddhanta Onnahini Nidhi Ltd. v. Commissioner of Income Tax 7 ITC 317 (Mad.)
1343
Star Rolling Mills v. Commissioner of Income Tax [1974] 30 TAX 27 (H.C.Kar.)
208, 1779
Star Vaccum Bottle Manufacturing Co., Ltd. v. Commissioner of Income Tax (Central), Karachi [1986] 53 TAX 169 (H.C.Kar.)
1763
State Cement Corporation of Pakistan (Pvt.) Ltd. v. Commissioner of Income Tax [1997] 76 TAX 110 (H.C.Lah.) = 1997 PTD 1104= 1998 PCTLR 520 (H.C.Lah.)
422
Steel Brothers and Company Ltd., London v. Commissioner of Income Tax, Dacca 1968 SCC 313 = [1969] 19 TAX 97 (S.C.Pak.)
412
Strong and Company of Romsey Ltd. v. Woodifield [1906] 5 Tax. Cas. 215 (HL)
1303
Sudalaimani Nadar v. Commissioner of Income Tax [1940] 8 ITR 619 (Mad.)
982
Sui Southern Gas Company Ltd. v. Commissioner of Income Tax, Companies-V, Karachi [2001] 83 TAX 113 (S.C.Pak.)
1525, 1693
Sultan Textile Mills Limited v. Commissioner of Income Tax (Investigation), Karachi [1970] 22 TAX 163 (H.C.Kar.)
1780
Sun Newspapers Ltd. and the Associated Newspapers Ltd. v. Federal Commissioner of Taxation 61 Corn. LR 337
1579
Sundar Das v. Collector of Gujrat [1 ITC 189 (Lahore) Sundrabai Saheb v. Commissioner of Income Tax 5 ITC 493 (Bom.)
95, 219, 256 520
Sutlej Cotton Mills Limited, Okara v. Commissioner of Income Tax, North Zone (West Pakistan), Lahore [1973] 28 TAX 185 (H.C.Lah.)
1620
Syed Akhtar Ali v. Commissioner of Income Tax Hyderabad [1994] 69 TAX 38 (H.C.Kar.)
152, 559, 1053
Syed Bhaies Pvt. Ltd. v. Government of Punjab [NLR 1999 Tax 176]
16
Syed Guulam Abbass Shah v. Income Tax Officer, Mirpur and 3 others [1985] 51 Tax 157 (H.C.AJ&K)
396
Syed Mahmood Shah v. Commissioner of Income Tax and another [2001] 83 TAX 132 (H.C.Lah.)
1076
Syed Mohainmad Mehdi v. Commissioner of Income Tax 8 ITC 210 (Lucknow)
1969
Syed Mohammad Isa v. Commissioner of Income Tax [1942] 10 ITR 267 (All.)
502
(cv) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
T T.K.E. Ibrahimsa Ravuttar v. Commissioner of Income Tax 3 ITC 33 (Mad.)
507
T.O. Foster v. Commissioner of Income Tax 3 ITC 435 (Rangoon)
1844
Tahlia Ram Amir Chand v. Commissioner of Income Tax 8 ITC 345 (Lahore)
1436
Taimur Shah v. Commissioner of Income Tax [1976] 34 TAX 151 (H.C.Kar.)
177, 251
Taj Din Maula Bux, Lahore v. Sales Tax Officer D-Circle Lahore [1972] 25 TAX 145 (H.C.Lah.)
442
Talchar Sabai Grass Trading Co. Ltd. v. Commissioner of Income Tax [1947] 15 ITR 455 (Pat.)
791
Tanveer Textile Mills Ltd. v. Commissioner of Income Tax, Central Zone `C', Karachi [1990] 61 TAX 4 (H.C.Kar.)
1697
Tapal Energy Ltd. v. Federation of Pakistan and others 1999 PTD 4037 (H.C.Kar.)
118, 122, 417
Tar Mohammad And Company v. Commissioner of Income Tax, Karachi [1967] 15 TAX 199 (H.C.Kar.)
1605
Tarak Nath Bagchi v. Commissioner of Income Tax [1946] 14 ITR 319 (Cal.)
780
Tariq Sultan & Co. v. Government of Pakistan, etc. [1999] 80 TAX 62 (H.C.Qta.)
244
Tata Hydro-Electric Agencies Ltd. v. Commissioner of Income Tax [1937] 5 ITR 202 (PC)
1518, 1580
Tejpal Jamna Das v. Commissioner of Income Tax 10 ITC 234 (All.) TetIey, In re [1923] 1 Ch. 258 (Ch.D)
1195 570
Thakar Datt Sarma v. Commissioner of Income Tax [1939] 7 ITR 154 (Lahore)
1255
Tharparkar Sugar Mills Ltd. v. Federation of Pakistan through Secretary, Revenue Division and Chairman, C.B.R., Islamabad and another [1996] 73 TAX 215 (H.C.Kar.)
130, 375, 393
The Bharat Insurance Company Ltd. v. Commissioner of Income Tax, Punjab & NWFP [5 ITC 288 (H.C.Lah.)
217
The Bhikanpur Sugar Concern In re: [1 ITC 29 (Patna)]
263
The Central Board of Revenue, Islamabad and others v. Sheikh Spinning Mills Limited, Lahore and others [1999] 80 TAX 79 (S.C.Pak) = 1999 PTD 2174]
102
The Imperial Tobacco Co. of India Ltd. v. Commissioner of Income Tax, South Zone, Karachi 1958 SCC 37 = [1960] 2-TAX (Suppl.-308) (S.C.Pak.) = PLD 1959 S.C. 125
720
(cvi) Income Tax Digest.
VOL-I
Case No.
The Provincial Library & Others v. Commissioner of Income Tax East Pakistan 1957 SCC 34 = [1959] TAX (III-290) (S.C.Pak)
115
The Punjab National Bank Ltd. v. Commissioner of Income Tax, Punjab & NWFP [2 ITC 184 (Lahore)]
191
The Punjab Province v. The Federation of Pakistan 1955 SCC 13 (Federal Court) [1960] 2-TAX (Suppl.-3) (S.C.Pak.) = PLD 1956 F.C. 72
114, 199, 641, 648, 649, 652, 823
The State v. Amir Ali [1978] 38 TAX 191 (H.C.Kar.)
1939
Thomas v. Richard Evans & Co. Ltd. [1926] 11 Tax Cas 790
705
Tri Star Industries (Pvt.) Ltd. & 8 others v. Commissioner of Income Tax Companies-I, Karachi & 5 others [1999] 79 TAX 255 (H.C.Kar.) = 1998 PTD 3923]
373
Trichinopoly Tennore Hindu Permanent Fund Ltd. v. Commissioner of Income Tax [1937] 5 ITR 703 (Mad.)
709, 1411
Trustees of the `Tribune', In re [1939] 7 ITR 415 (PC)
583, 585, 586, 588, 589, 590
Trustees of the Port of Karachi v. Central Board of Revenue and another [1990] 61 TAX 30 (H.C.Kar.)
85, 1931
Tyrer v. Smart (H.M. Inspector of Taxes) 52 Tax. Cas. 533 (HL)
1143
U U.C. Rekhi v. Income Tax Officer [1950] 18 ITR 618 (Punj.)
388
U.Chengalvaroya Mudaliar v. Commissioner of Income Tax 7 ITC 323 (Mad.)
1597
Ujala Cotton Mills Ltd. v. Income Tax Officer etc. [1985] 51 TAX 237 (H.C.Lah.)
1972
Union Bank Ltd. v. Federation of Pakistan [1998] 77 TAX 127 (H.C.Lah.)
127, 1954
Union Bank of Bijapur & Sholapur Ltd., In re [1942] 10 ITR 21 (Bom.)
943
Union Jute Company Ltd, Narayanganj, In re. [1960] 2-TAX (Suppl.265) (H.C.Dacca) = 1960 PTD 1036
1038
Unique Enterprises, Lahore v. Assistant Commissioner of Income Tax and 2 others [1995) 71 TAX 139 (H.C.Lah.)
131
United Bank of India Ltd., v. Commissioner of Income Tax, Dacca [1960] 2-TAX (III-454) (H.C.Dacca) = 1960 PTD 768 = 1960 PLD 621
740
United Builders Corporation Mirpur, v. Commissioner of Income Tax Muzzafarabad [1984] 49 TAX 34 (H.C.AJ&K)
185, 1775
United Licence Agency v. Commissioner of Income Tax [1986] 54 TAX 155 (H.C.Kar.)
1507
(cvii) COMPARATIVE TABLE OF SECTIONS
VOL-I Case No.
United Liner Agencies of Pakistan Ltd. Karachi and others v. Commissioner of Income Tax, Central Zone, Karachi [1988] 57 TAX 160 (H.C.Kar.)
19, 1496
United Liner Agencies, Ltd., Karachi v. Commissioner of Income Tax, Karachi [1988] 57 TAX 155 (H.C.Kar.)
1059
United Lines Agency Pakistan Ltd. v. Commissioner of Income Tax (Central), Karachi [1986] 53 TAX 137 (H.C.Kar.)
1508
United Netherlands Navigation Co. Ltd. v. Commissioner of Income Tax, South Zone (West Pakistan), Karachi 1965 SCC 240 = [1965] 12 TAX 57 (S.C.Pak.)
808, 1382
Universal Engineering Co., Karachi (in the matter of) v. Commissioner of Income Tax [1963] 7 TAX 184 (H.C.Kar.) = 1963 PTD 401 = 1963 PLD 487
1085
Upper India Chamber of Commerce v. Commissioner of Income Tax [1947] 15 ITR 263 (All.)
600, 1188, 1266, 1270, 1271, 1276
Usher's Wiltshire Brewery Ltd. v. Bruce [1915] AC 433, 469 (HL)
1576
Usher's Wiltshire Brewery, Ltd. v. Bruce [1914] 6 TC 399 (HL)
1604
V V.G. Every, In re [1937] 5 ITR 216 (Cal.)
1024
V.Ramaswamy Ayyangar v. Commissioner of Income Tax [1943] 11 ITR 597 (Mad.)
1636
V.S.A.R. Firm v. Commissioner of Income Tax 8 ITC 171 (Rangoon)
969
V.S.K.S. Somasundaram Chettiar v. Commissioner of Income Tax 6 ITC 96 (Mad.)
744
Vadilal Lallubhai Mehta v. Commissioner of Income Tax [1935] 3 ITR 152 (Bom.)
659
Vallabhdas Karsondas Natha v. Commissioner of Income Tax [1947] 15 ITR 32 (Bom.)
594, 595
Vallabhdas Murlldhar v. Commissioner of Income Tax 4 ITC 318 (Bom.)
1451
Vallambrosa Rubber Co. Ltd. v. Farmer [1910] 5 Tax Cas. 529
1563
Van den Berghs Ltd. v. Clark [1935] 3 ITR 17 (HL)
862
Vedathannl v. Commissioner of Income Tax [1933] 1 ITR 70 (Mad.)
662
Vellanki Lakshmi Narasayamma Rao Bahadur (Sree Raja) Zamindarini of Tiruvur v. Commissioner of Income Tax 3 ITC 428 (Mad.)
522
Vir Bhan Bansi Lal v. Commissioner of Income Tax [1936] 4 ITR 111 (Lahore)
1963
(cviii) Income Tax Digest.
VOL-I
Case No.
Vissonji Sons & Co. v. Commissioner of Income Tax [1946] 14 ITR 272 (Bom.)
1437, 1439
Vithaldas Thakordas & Co. v. Commissioner of Income Tax [1946] 14 ITR 822 (Bom.)
1585
W Wali Traders v. Income Tax Officer, etc. [1988] 58 TAX 29 (H.C.Kar.)
2295
Wallace Bros. & Co. Ltd. v. Commissioner of Income Tax [1943] 11 ITR 559 (Bom.)
722, 785
Wallace Bros. & Co. Ltd. v. Commissioner of Income Tax [1948] 16 ITR 240 (PC)
739, 832, 881
Wallem & Co. (Pak.) Ltd., Karachi v. Commissioner of Income Tax [1974] 30 TAX 34 (H.C.Kar.)
1854
Wealth Tax Officer & Other v. Shaukat Afzal & 4 Others [1993] 68 TAX 145 (S.C.Pak)
412
West Pakistan Road Transport Board, Lahore v. Commissioner of Income Tax, Lahore [1974] 29 TAX 53 (H.C.Lah.)
828
Western India Life Insurance Co. Ltd., In re. [1938] 6 ITR 44 (Bom.) Westminster Bank Ltd. v. Riches [1947] 28 Tax Cas. 159 (HL) Willingale (H.M. Inspector of Taxes) v. International Commercial Bank Ltd. 52 TC 242 (HL)
1720 854 1221
Y Yagappa Nadar v. Commissioner of Income Tax 2 ITC 470 (Mad.) Yasin (East Pakistan) Ltd., Chittagong v. Commissioner of Income Tax, East Pakistan, Dacca [1968] 17 TAX 126 (H.C.Dacca)
534 1516
Z Zafar Saleem Bros. Ltd., Karachi v. Commissioner of Income Tax, (Central), Karachi [1984] 50 TAX 233 (H.C.Kar.) Zafar Usman v. Income Tax Officer etc. [1989] 59 TAX 86 (H.C.Kar.) Zahur Textile Mills Limited v. CBR through Chairman, Government of Pakistan, Islamabad and 2 others [2000] 82 TAX 275 (H.C.Lah.) = 2000 PTD 303
1823 434 232, 846
Zam Zam Traders v. Income Tax Officer [1996] 74 TAX 21 (H.C.Lah.)
426
Zeenat Textile Mills (East Pakistan) Ltd. v. Commissioner of Income Tax, Dacca Zone and another [1969] 20 TAX 44 (H.C.Dacca)
746
(i) COMPARATIVE TABLE OF SECTIONS
VOL-I
Comparative Table of Income-tax Act, VII of 1918, Income-tax Act, XI of 1922, Income Tax Ordinance, 1979 & Income Tax Ordinance, 2001 Following is a comparative list of Sections and Provisions of Income Tax Act, 1918, Income Tax Act, 1922, Income Tax Ordinance, 1979 and Income Tax Ordinance, 2001. I.T.A. 1918 1
2(1)(2)
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
1(1)
1(1)
1(1)
1(2)
1(2)
1(2)
1(3)
1(3)
1(3)
2(1)
2(1)
41(2)
2(3)
2(2)
2(4)
2(3)
2(5)
2(4)
2(2)
2(6)
2(66)
2(3)
2(2)
2(3A)
Omitted
1
2(1)(2)
2(7)
2(5)
2(8)
2, (5A), 2(68) read with 2(26)
2(10)
2(7)
2(4)
2(11)
2(9)
2(4A)
2(12)
2(10) read with
(ii) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001 37(5)
2(4B)
2(3)
2(4)
2(5)
2(13)
2(11)
2(14)
2(11A)
2(5)
2(15)
2(13) read with 209
2(5A)
2(16)
2(12) read with 80
2(5B)
2(17)
2(14)
2(17A)
2(65)
2(18)
2(22)(a)
2(6)
2(19)
2(6A)
2(20)
2(19)
2(20) Exp.
2(1)
2(6AA)
Omitted
2(6AAA)
Otiose 2(21A)
2(25)
2(6B)
2(22)
2(26) read with 80
2(6BB)
Otiose
2(6C)
2(24), 12(12)
2(29)
2(26)
2, (29A), 2(68) & 74
2(6D)
2(27)
2(6E)
2(28)
2(3) and 63(1) &
(iii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
I.T.A. 1922
VOL-I
I.T.O. 1979
I.T.O. 2001
(2) 2(6)
2(4)
2(7) to (13)
2(7) to (13) 2(7)
2(25) 2(29)
2(46)
2(29A)
2(34), (35)
2(30)
2(37) read with 81
2(9)
2(32)
2(42) read with 80
2(10)
2(33)
2(44)
2(11)
2(26) Rev.
2(12)
2(34)
2(13)
2(36)
2(44A)
2(37)
2(48)
2(37A)
2(48A)
2(13A)
2(38)
2(13AA)
Omitted 2(40)
2(50) to (53) read with 81, 82 & 83
2(42)
2(59)
2(14)
2(43)
2(63)
2(14A)
Omitted
2(15)
2(44)
2(69), 9, 10
(iv) Income Tax Digest.
VOL-I
I.T.A. 1918
3
I.T.A. 1922
I.T.O. 1979
2(16)
2(45)
2(16A)
2(46)
2(17)
2(8) Rev.
I.T.O. 2001
3(1A)
207(2)
4A
177, 222
5
209
5(3)
210(3)
3
9(1) Rev.
3 Pr. (a)
Omitted
3 Pr. (b)
9(2)
3A
Otiose
3B(1)
10(1)
3B(2)
10(3)
4 4(1)
11(1)
11(5) & (6)
4(1) Pr. 1
11(2), 16(1) Pr.
11(5), (6), 73(1)
4(1) Pr. 2
Omitted
4(1) Ex. 1
Omitted
4(1) Ex. 2
12
2(40)
12(1)
101(1)
12(4)
101(8)
12(4) Exp.
2(54)
(v) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
12(5)
101(12)
12(5) Exp.
2(23)
4(1) Ex. 3
12(10)
101(6)
4(1) Ex. 4
12(9)
4(1) Ex. 6
Otiose
4(1) Ex. 7
12(8)
72
4(1) Ex. 8
12(7)
72(b)
12(13)
16(1)
12(14)
16(2)
12(15)
16(3)
12(16)
39(2)
12(18)
39(3), (4)
4(2A)
13(1)(a)
111(1), (2)
4(2B)
13(1)(b)
111(1), (2)
4(2C)
13(1)(c)
111(1), (2)
4(2D)
13(1)(d)
111(1), (2)
4(2E)
13(1)(e)
111(1), (2)
4(2F)
13(2)
4(3) 4
VOL-I
13(2A)
111(4)
13(3)
111(5)
14(1) & II Sch.
53(1)
4(3)(viii) 4A
2(40)
(vi) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
4B
Omitted
5(1)
3(1)
5(1A)
4(1), 5(1)(a)
5(2)
4(1), 5(1)(b)
5(3)
4(1)
208(1)
5(3A)
4(2), 4(4)
208(2)
5(4)
5(1)(b) Rev.
5(5)
5(1)(c), 5(2)
5(5A)
5(1)(c), (d) & 3(3), (4)
5(6)
5(1)(b), (c)
5(7)
3(2), 3(3)
5(7A)
5(1)
210(1)
5(7B)
7
213
5(7C)
Omitted
5(7D)
Omitted
5(8)
8
5(8) Pr.
8 Pr.
5A
133
130
5
6
15
11(1)
6
7 16(1)
12(1)
16(1)(a), (b)
2(55)
7(1)
I.T.O. 2001
207(1)
210(2)
206(1), 214
(vii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
7
8
VOL-I
I.T.A. 1922
I.T.O. 1979
7(1) Pr. 1
40(a)
7(1) Pr. 2
Otiose
7(1) Pr. 3
46
7(1) Pr. 4
Omitted
7(1) Ex. 1
16(2)(b)(i)
12(2)
7(1) Ex. 2
16(2)(c)
12(2)
16(2)(e)
2(21)
16(2)(e)
2(20)
7(1) Ex. 2 Pr.
2nd Sch
8
17(1)
8 Pr. 1
18(1)
8 Pr. 2
17(2)(a)
8 Pr. 3
17(2)(b)
I.T.O. 2001
9 9(1)
19(1), (2)(a)
4(1) & 15(1),(2)
9(1)(i)
20(1)(a)
17(1), 23
9(1)(ii)
Omitted
9(1)(iii)
20(1)(b)
17(1), 23
9(1)(iv)
20(1)(c), (d), (f)
17(1), 23
9(1)(iv) Pr.
Omitted
9(1)(iv) Ex.
20(1)(c)
17(1), 23
9(1)(v)
20(1)(e)
17(1), 23
9(1)(vi)
20(1)(g)
17(1), 23
(viii) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
9(1)(vii)
20(1)(h)
17(1), 23
9(1)(vii) Pr.
20(2)
17(5)
20(3)
17(6)
20(4)
17(3)
19(2)(b)
15(4)
19(3) Exp.
15(5)
9(2)
9
9(2) Pr. 1
Omitted
9(2) Pr. 2
Omitted
9(3)
21
66
10 10(1)
22(a) 22(1)
18(1)
22 Exp.
19(1)
10(2)(i)
23(1)(i)
10(2)(ii)
23(1)(iii)
10(2)(iii)
23(1)(v)
10(2)(iii) Pr. 1
Omitted
10(2)(iii) Pr. 2
Omitted
10(2)(iiia)
23(1)(ix)
10(2)(iiia) Pr.
23(1)(vii) Pr.
10(2)(iv)
23(1)(iv)
10(2)(v)
23(1)(iii)
22(1), (2), (11)
(ix) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
VOL-I
I.T.A. 1922
I.T.O. 1979
10(2)(va)
Omitted
10(2)(vi)
23(1)(v) & 3rd Sch.
10(2)(via)
Otiose
10(2)(vii)
3rd Sch.
10(2)(viii)
23(1)(vi)
10(2)(ix)
23(1)(ii)
10(2)(x)
23(1)(viii)
10(2)(xi) Pr. 1
Omitted
10(2)(xi) Pr. 2
Omitted
10(2)(xi) Pr. 3
25(a)
34(5A) & 70
25(b)
34(5A)
25(c)
34(5)
25 proviso
34(6)
23(1)(x)
29
10(2)(xii)
23(1)(xii)
26(1)
10(2)(xiii)
23(1)(xi)
10(2)(xiv)
23(1)(xii) 23(1)(xiii), (xiv)
10(2)(xiv) Pr. 1
Omitted
10(2)(xiv) Pr. 2
Omitted
10(2)(xiv) Ex.
Omitted
10(2)(xiva)
23(1)(xvii) 23(1)(xxi), (xxii)
I.T.O. 2001
28
27
30
(x) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
23(1)(xix)
31
10(2)(xivb) Pr. 14
Omitted
10(2)(xv)
23(1)(xv)
10(2)(xvi)
23(1)(vii)
10(2)(xviii)
27
23(1)(viidd)
2(39), (57)
23(1)(viidd) Exp.
2(60)
23(1)(xvi) 23
20
10(2A)
25
10(2A) Pr.
25 Pr.
10(3)
23(2)
10(3A)
3rd Sch.
10(3B)
Omitted
10(3BB)
3rd Sch, Rule 8(8)(b)
10(4)
24(a)
21
10(4)(a)
24(c)
21
10(4)(b)
24(d)
21
10(4)(bb)
24(b)
21
10(4)(c)
24(h)
21
10(4)(d)
24(i)
21
10(4)(d) Ex. 1
24(1) Ex. (i)
21
10(4)(d) Ex. 2
24(1) Ex. (ii)
21
(xi) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
VOL-I
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
10(4)(e)
24(f)
21
10(5)
23(1) Ex. (b) and 3rd Sch. Rule 8(7)
10(5A)
Omitted
10(6)
22(b)
10(7)
26(a)
99 & 100
10(8)
26(b)
99 & 100
10(8) Pr.
26(b) Pr.
99 & 100
10(9)
26(c)
99 & 100
10(9) Pr.
Otiose
10(10)
Omitted
10
11
11
12 12(1)
30(1) and (2)
39(1)
12(2)
30(1) and (2)
39
31(1)
39(5), 40(1),(3)
31(2)
40(4)
31(3)
40(5)
12(2A)
Otiose
12(3)
3rd Sch.
12(4)
3rd Sch.
12(5)
30(2)(a)
15(3)
30(2)(e)
39
(xii) Income Tax Digest.
VOL-I
I.T.A. 1918
12
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
12(6)
Omitted
12A
Omitted
12AA
33
89
12B(1)
27(1)
37(1)
12B(1) Pr. 1
27(2)(b)
37(5), 75 to 79
12B(1) Pr. 2
Omitted
12B(2)
28(1)
37(2)
12B(2) Pr. 1
29(2)
37(4A)
12B(2) Pr. 2-4
Omitted
12B(3)
29(1)
37(4A)
29(3)
68
12B(4)
Omitted
13
32(1)(Rev.)
32(1), 174
13 Pr.
32(3)
174
13 Pr. 2
32(2)
32(3), 174
13 Ex.
Omitted
13A
32A
14
2nd Sch. Cl. (103) & (109) to (111)
14 and 15 15(1)
39(1)(a), 40(b)
15(1) Pr.
39(2)(b)
15(2A)
39(2)(a)
174, 177
(xiii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
VOL-I
I.T.A. 1922
I.T.O. 1979
15(3)
45
15(3) Pr. 1 & 2
Omitted
15(5)
39(3)
15A
Omitted
15AA(1)
41(1)(a), (b), (d)
15AA(3)
41(2)
15AA(3) Pr. 1
41(2) Rev.
15AA(3) Pr. 2
Omitted
15AA(4)
41(3)
I.T.O. 2001
41A
62
44
63
44A
63
44AA
63
44AAA
64
15B(1)
48(1)
15B(2)
48(2)
15B(3)
48(3)
15B(4)
48(5)
15B(5)
48(6)
15B(6)
Omitted
15B(7)
48(7)
15BB
Omitted
15C(1)
41(1)(f)
(xiv) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
15C(2)
Omitted
15C(2A)
Omitted
15C(3)
41(1)(f) Ex.
15C(5)
41(5)
15CC(1)
41(1)(e)
15CC(2)
Omitted
15CC(2) Ex.
Omitted
15CCC
43
15D(1)(a)
47(1)(a)
61
15D(1)(b)
47(1)(b)
61
15D(1)(c)
47(1)(c)
61
15D(1)(d)
47(1)(d)
61
15D(1)(e)
Omitted
15D(1) Pr. 1
Omitted
15D(2)
47(3)
61
15D(2) Pr.
47(4) Rev.
61
15D(4)
2(14)
15D(5)
47(4)
15E
Omitted
15F
42
15FF
106
15G(1) to (5)
105(1) to (5)
61
(xv) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
13
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
15GG
107 Rev.
172 & 173
16 16(1)(a)
49
16(1)(b)
69(4)
16(1)(b) Pr.
Omitted
16(1)(c)
83(1) & (3)
90(1) & (3)
83(2)
90(2)
83(4)
90(4),(5),(6),(7)
83(5)(a)
90(8)
83(5)(b)
90(8)
83(5)(e)
2(33)
16(1)(c) Pr. 1 16(1)(c) Pr. 2
14
VOL-I
93(6)
16(2)
12(11)
16(2) Pr. 1 & 2
Otiose
16(3)(a)(i)
69(3)(a)
16(3)(a)(ii)
69(3)(a)
16(3)(a)(iii)
83(4)(a)
16(3)(a)(iv)
83(4)(b) & 83(5)(c)
90(4)
16(3)(b)
83(4)(c)
90(4)
16(3)(b) Pr.
83(4)(a), (b)
90(4)
3 and 17 17(1)
1st Sch. Pt. IV(3)
17(2)
1st Sch. Pt I,
(xvi) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
Para A. Pr. (d) 17(5)
1st Sch. Pt IV, Para A. (4)
17(6) 14A
Otiose
18 18(2)
50(1)
149(1)
18(2) Pr.
50(1)
149(1)
18(2A)
Omitted
18(2B)
50(3)
152(2), (3)
18(2B) Pr.
50(3)
152(2), (3)
18(3)
50(2) 50(2A)
151
18(3) Pr.
50(3) Pr.
152(2), (3)
18(3A)
50(3)
152(2), (3)
18(3A) Pr.
Omitted
18(3B)
50(3)
152(2), (3)
50(3.1)
152(4)
50(3.2)
152(5)
50(3.3)
152(6)
50(3A)
152(1)
18(3B) Pr. 1
Omitted
18(3B) Pr. 2
Omitted
(xvii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
VOL-I
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
18(3BB)
50(4)
153
50(4A)
233
18(3BBB)
50(6)
234
18(3C)
Otiose
18(3CC)
50(5)
148
50(5A), (5AA)
154(1) to (3)
50(6A)
150
18(3D)
50(7) 50(7B)
155(1), (2)
50(7C)
156
50(7E)
235(1), (2)
50(7F)
236
50(7H)
157(1)
18(3F)
Otiose
18(4)
50(8)(a)
168(1)(a)
18(5)
50(8)(b)
168(1)(b)
18(5) Pr. 1
Omitted
18(5) Pr. 2
Omitted
18(6)
50(8)(c)
158, 160
18(7)
52, 86
161
18(8)
Omitted
18(9)
51
164
18(9) Ex.
50(9)
155(3)
(xviii) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
18(10)
Omitted 52A
162
18A(1)
53(1)
147(2), (3) & (4)
18A(1) Pr. 1 to 3
Omitted
18A(2)
53(2)
18A(2) Pr.
Omitted
18A(3) & (4)
Omitted
18A(5)
53(4) 53(5)
18A(5A)
15
I.T.O. 2001
147(5) & (6)
147(8), (9), (10) & (11)
Omitted 83A
91
86
205(3), (4)
18A(6)
87(2)
205(1) & (2)
18A(7)
87(1)(b)
205(1) & (2)
18A(7) Pr.
Omitted
18A(8)
87(2)
205(1) & (2)
18A(9)(a)
87(1)(a), (b)
205(1) & (2)
18A(9)(b)
87(1)(a)
205(1) & (2)
18A(9) Pr.
Omitted
18A(10)
53(3)
18A(11)
53(1)
19 and 20
147(2), (3) & (4)
(xix) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
16
VOL-I
I.T.A. 1922
I.T.O. 1979
19
Omitted
19A
140
20
Otiose
20A
139
21 Pr.
Omitted
21A
Omitted
I.T.O. 2001
165
165
22 22(1)
55(1)
114(1),(2) & 118(1)
55(1) 1st Pr.
115(1)
55(1) 3rd Pr.
115(3)
55(1) 2nd Pr. & 143B
115(4)
55 2nd Pr.
116(2)
55 4th Pr.
118(6)
22(1) Pr.
Omitted
22(1A)
55(2)
118(2), (3)
55(2) Exp.
118(4)
55(3)
119(1) to (4)
55A
118
22(2)
56
114(5)
22(3)
57
114(6)
22(4)
61
176 & 239(2)
22(4) Pr.
61 Pr.
176 & 239(2)
22(1A) Pr. 1 & 2
(xx) Income Tax Digest.
VOL-I
I.T.A. 1918
17
18
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
22(4A)
58(1)
116(1)
22(4A) Pr.
58(2)
36
58 Proviso
115(2)
22(5)
Omitted
22A
54
137(1)
23(1)
59(1), (2)
120
23(2)
61
176 & 239(2)
23(2A)
67(1)
23(3)
62 62A
124(3)
62BB
124A
23(4) and 24
63
121
23(4) Pr. 1
Otiose
23(4) Pr. 2
Otiose
23(5)
69(1)
23(6)
69(2)
23(7)
7
23B
60 60A
123
24(1)
34
11(4), 56
24(1) Pr. 1
36(1)
58
24(1) Pr. 2
38(4)
59A, 93(2), 94
(xxi) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
VOL-I
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
24(2)
35, 36(2)
58
36(2) Exp.
2(61)
36 Exp.
19(2)
24(2) Pr. (b)
38(7)
59A, 93(2), 94
24(2) Pr. (c)
38(2) & (5)(a)
59A, 93(2), 94
24(2) Pr. (d)
38(3)
59A, 93(2), 94
24(2) Pr. (e)
38(5)(b)(c)
59A, 93(2), 94
24(2) Ex. 1
36(2) Ex.
58
24(2) Ex. 2
Omitted
24(2A)
34
56
24(2B)
37
38, 59
24(2B) Pr. 1 & 2
37 Pr. 1 & 2
59
24(2C)
Otiose
24(3)
Omitted
24A(1)
81(3)
24A(1) Pr.
Omitted
24A(2)
81(2)
114(3), 145
24B(1)
74(1), (3), (4), (5)
87, 114(3)
24B(2)
74(2)(b)
87, 114(3)
24B(3)
74(2)(a)
87, 114(3)
25(1)
72(2)
114(3), 117(2) & (4)
25(2)
72(1), 112
114(3), 117(1)
114(3)(c)
(xxii) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
25(3) to (5)
Omitted
25(6)
72(3)
25A(1)
75(1)
25A(2)
75(2)
25A(3)
Omitted
26(1) Pr. 1&2
70
98A
26(2)
73(1)
98C
26(2) Pr.
73(2), (3)
98C, 118(5)
26A(1)
68(1)
26A(2)
68(3)
26A(3)
68(4)
26A(4)
68(5)
26A(5)
68(2) 81(1), (4)
26A(5) Pr. 19
Omitted
20
28
I.T.O. 2001
114(3), 117(3), 118(5)
114(3), 145
Omitted
28(1)(a)
108(a), (b)
182(1), (2)
28(1)(b)
110
186
28(1)(c)
Omitted
28(1) Pr.
Omitted
28(1A)
109, 111(1)
(xxiii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
I.T.A. 1922
28(1A) Pr. 1
VOL-I
I.T.O. 1979
I.T.O. 2001
109
185
Otiose 112
28(1A) Pr. 2
28(1A) Ex.
28(1B), (2), (2A)
21
22
188
113 111(1)
184(1)
111(2)
184(2)
111(2A)
184(3)
Omitted 114
188
28(3)
116(b)
190(2)
28(5)
111(3)
184(4)
28(6)
116(a)
190(1), (2)
29
85
29 and 30 30(1)
129(1)
127(1)
30(1) Pr. 1
129(2)
127(2)
30(1) Pr. 2&3
Omitted
30(1A)
Omitted
30(2)
130(2), (3)
127(5), (6)
30(3)
130(1)
127(3), (4)
30A
Omitted
31 31(1)
131(1)
128(1), (2)
(xxiv) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
31(2)
131(3)
128(4)
31(3)
131(2)
128(3)
31(4)
131(4)
128(5)
31(5)
132(1)(a)(ii)
129(1)
31(6)
132(1), (2)
129(1), (2)
31(7)
132(3)
129(3)
31(8)
132(4)
129(4)
132(5)
129(5), (6)
132(6)
129(7)
132(7)
130(1)
23
32
24
33 33(1)(a)
134(1), (3)
33(1)(b) & (c)
Omitted
33(1)
134(1)
33(2)
134(2), (3)
33(2A)
134(4)
131(4)
33(3)
134(5)
131(2), (3)
33(3A)
135(1)
132(1)
33(4)(a)
135(2)
132(2)
33(4)(b)
135(3)
33(4)(c)
135(4)(a)
131(1)
132(3)
(xxv) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
33(4)(d)
135(4)(b)
132(3)
33(4)(e)
135(4)(c)
132(3)
33(4)(f)
135(5)
132(6)
33(4)(g)
135(8)
132(4)
33(5)
135(7)
132(5)
135(7A)
132(8), (9)
135(8)
132(7)
33(6)
135(9)
132(10)
33(7)
Otiose
33A(1)
138(1)
122A
33A(2)
138(2)
122A
33A(2) Pr. 1
138(2)
122A
33A(2) Pr. 2
138(5)(a)
122A
33A(2A)
138(3)
122A
33A(3)
138(4)
122A
138L
228
138N
229
138O
230
138P
231
33A(4) 25
VOL-I
Omitted
34 34(1)
65(1)
122(1)
34(1) Pr. 1
65(1) Pr. 1
122(1)
(xxvi) Income Tax Digest.
VOL-I
I.T.A. 1918
26
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
34(1) Pr. 2
65(2) Rev.
122(5)
65(2) Exp.
122(8)
34(1A)
65(1) Pr., 65(3)
122(2)
34(2)
64, 65(3)
34(2) Pr. (i)
Otiose
34(2) Pr. (ii)
64 Pr. Rev.
34(2) Pr. (iv)
66(1) Rev.
34(2) Pr. (v)
Omitted
34(2) Ex. 1
66(2)(i)
124(5)
34(2) Ex. 2
66(2)(ii)
124(5)
66(3)
125
124(1) & (2)
34(2A) & (2B)
Otiose
34(2C), (2D)
Omitted
34A
66A
122(5)(a)
35(1), (2)
156(1), (4)
221(1), (4)
35(1) Pr.
156(2)
221(2)
156(3)
221(3)
35
35(3), (4)
Otiose
35(5)
Omitted
35(6)
Otiose
35(8)
Omitted
(xxvii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
27
VOL-I
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
36
152
219
37 37(1)
148(1) & 158 148(1)
37(1) Pr.
Omitted
37(2)
149
38
144
38A(1)
146(2)
38A(2)
146(1)
38A(2) Pr.
144(c) Pr.
38B(1)
145
38B(2)
146(3)
29
39
Omitted
30
Omitted.
31
40
32
41
28
33
176(1) & (4)
215 & 176(1)
175(1)
175(2)
78 Rev.
172 & 173
41(1)
78 Rev.
142
41(1) Pr. 1 & 2
Omitted
41(2)
78(4)
42 42(1)
12(2)
42(1) Pr. 1
Omitted
42(1) Pr. 2
78(3)
101(2), (3), (5)
(xxviii) Income Tax Digest.
VOL-I
I.T.A. 1918
34
35
I.T.A. 1922
I.T.O. 1979
42(1) Pr. 3
Omitted
42(2)
79
42(3)
12(2) Pr.
43
78(3) Ex.(4)(a)
43 Pr. 1
78(3) Pr. (a)
43 Pr. 2
78(3) Pr. (b)
43 Ex.
Otiose
43A
77(3)
139(4)
43B
77(1), (2)
139(1),(2) & (3)
43C(1)
76(1)
141(1)
43C(2)
76(2)
141(2)
43C(3)
76(3)
141(3)
43C(4)
76(4)
141(5)
43C(5)
Omitted
43C(6)
76(5)
141(7)
44
71
98B
44A
80(1)
7, 143(3)
44B(1)
80(2)
7, 143(1)
44B(2)
80(3)
7, 143(2)
44B(3)
80(3), (5)
7, 143(3), (5)
80(4)
143(4)
80(6) Rev.
7
44C
I.T.O. 2001
108
(xxix) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
36
I.T.A. 1922
VOL-I
I.T.O. 1979
I.T.O. 2001
80A(1)
144(3)
80A(2)
144(1)
80A(3)
144(2)
80A(4)
144(4), (5)
80AA
6
80AAA
6
80B
5, 8 & 169
80C
153(6),(7) 169
80C(2)(iv)
157(2)
80CC
154(1) to (3), 169
80D(1)
113(1)
44D
Omitted
44E
84 Rev.
44F
Omitted
44G
82(1)
145
44G(1) Pr.
82(2)
145
44G(2)
82(3)
145
44G(3)
82(3)
145
44G(4)
165
44G(4) Ex.
82(4)
145
84(1)
112(1)
45
85
(xxx) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
85(1)
137(2)
85(2)
137(4)
45 Pr. & Ex.
Omitted
45A(a)
89 Rev.
205(1) & (2)
45A(b)
88 Rev.
205(1) & (2)
45A Pr. 1
89
205(1) & (2)
45A Pr. 2
90
205A
46(1)
91(1)
183, 205A
46(1A)
91(2)
183, 205A
46(2)
94
46(2) Pr.
94 Pr.
46(2A), (3) to (5)
Omitted
46(5A)
92(1), (2), (3)
140(1), (3), (6) & (10)
92(4), (5)
55 & 80D
92(2A)
140(5)
46(5A) Ex. 1 & 2
Omitted
46(8) to (10)
Omitted
46A(1)
93(1), (2), (5)
138
93A
146
46A(1A), (2)
Omitted
46B
Omitted
46C(1)
95(c)
146A
(xxxi) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
37
VOL-I
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
46C(2)
95(d)
146A
46C(3)
Omitted
46D
Omitted
47
85
48(1)
96
48(2)
100
48(3)
97(1) 98(a), (b)
48(4) 38
170(1)
12(7), (8)
101
49 142, 143, 143A & 143B
115(4), 118 & 165
143D
181
49AA(1)
163(1)
107
49AA(2)
163(2)
107
49AA(3)
163(3)
107
49AA(4)
Otiose
49AA(5)
163(4)
49B & C
Otiose
49D(1)
164
49D(1) Pr. 1
Otiose
49D(1) Pr. 2
Omitted
49D Ex.
Omitted
107
102 & 103
(xxxii) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
49E
104
170(3)
49F
97(2)
49G
102 102(1)
171(1)
102(2)
171(2)
99
170(2), (3), (4)
51(1)(a)
117(a)
191(1)
51(1)(aa)
117(b)
191(1)
51(1)(b)
117(c)
191(1)
51(1)(c)
Omitted
51(1)(d)
117(d)
191(1)
117(e)
196
39
50
40
51
41
42
51(1A)
Omitted
51(2)
119
51(3)
115 (Rev.)
189
51(4)
121
197
52
118
192, 195
52A
120
199
53 53(1)
125
53(1A)
124 (Rev.)
201
(xxxiii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
VOL-I
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
53(2)
126
202
53(3)
Omitted
54(1)
150(1), (2)
216(1), (2)
54(2)
122
198
123
200
54(3)
150(3)
216(3)
54(4)
150(4)
216(4)
54(4A)
150(5) Rev.
216(5)
150(5A)
216(6)
150(6)
216(7)
54(5)
150(7) Rev.
216(8)
54A(1)
127(1)
203(1)
54A(2)
127(2)
203(2)
54A(3)
Otiose
55(1)
10(1)
55(1) Pr. 1 & 2
Omitted
55(1) Pr. 3
1st Sch. Pt. IV, 2B
55(1) Pr. 4
Omitted
56
10(2)
43
58
44
58 58(1)
10(3)
58(2)
Omitted
(xxxiv) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
58A-58V
6th Sch.
58W
44
63
59(1)
165(1)
237(1)
59(2)
165(2)
237(2)
59(3)
165(3)
59(4)
165(4)
59(5)
Omitted
60(1)
14(2)
53(2)
14(2) Proviso
53(3)
60(2) 45
I.T.O. 2001
237(3)
98
61 128(1)
204(1)
128(2)
204(2)
128(3)
204(3)
61(1)
157(1)
223(1), (11)
61(2)
157(2)
223(2)
61(3)
157(3), (a), (b), 157(4), (5)
223(3), (4), (5)
61(4)
157(3)(b)
223(3)
157(6)
223(6)
157(7)
223(7)
157(8)
223(8)
157(9)
223(9)
(xxxv) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918
46
47
I.T.A. 1922
VOL-I
I.T.O. 1979
I.T.O. 2001
157(10)
223(10)
62
153
220
63(1)
154(1)
218(1)
63(2)
154(2)
218(2)
63(3)
154(6)
218(3)
154(4)
218(4)
154(6)
218(5)
64(1)
5(3)(a)
64(2)
5(3)(b)
64(3)
5(4)
64(3) Pr. 1
Omitted
64(3) Pr. 2
5(5)
64(3) Pr. 3
Omitted
64(4)
5(6)
64(5)
Omitted
48
65
161
167
49
Omitted
50
Omitted
51
66 66(1)
136(1)
133(1),(2) & (3)
66(2)
136(2)
133(4), (5)
66(3)
Omitted
66(4)
136(3)
210(4)
210(5)
210(6)
133(7), (8)
(xxxvi) Income Tax Digest.
VOL-I
I.T.A. 1918
I.T.A. 1922
I.T.O. 1979
I.T.O. 2001
66(5)
136(5)
133(10)
66(6)
136(6)
133(11), (12)
66(7)
136(7)
133(13)
66(7) Pr.
Omitted
66(7A)
136(8)
133(14)
136(9)
133(15)
136(10)
133(16)
66(8)
Otiose
66A(1)
136(4)
133(9)
66A(2)
137(1)
134(1)
66A(3)
137(2)
134(2)
66A(3) Pr. 1 & 2
Omitted
66A(4)
137(3)
134(3)
137(4)
134(4)
151
55
155
126(2)
158
50(8), 224
66BB
147
178
67
162
227
67A
160
226
67AA
159
225
67B
Otiose
66B
52
(xxxvii) COMPARATIVE TABLE OF SECTIONS
I.T.A. 1918 53
I.T.A. 1922
VOL-I
I.T.O. 1979
I.T.O. 2001
164A
180
165A
212
166(1)
44(1), 238
166(2)
44(1), 239(2) to (11)
167
240
68
(xxxviii) COMPARATIVE TABLE OF SECTIONS
VOL-I
SCHEDULES Income Tax Act, 1922
Income Tax Ordinance, 1979
1st Sch., rules
4th Sch., rules
1
1
2
2
2A
Omitted
3(a)
3(a) Rev.
3(a) Pr. 1
3(a) Pr. 1
3(a) Pr. 2
3(a) Pr. 2
3(b)
3(b)
3(b) Pr.
3(b) Pr.
3(c)
3(c)
4
4
5
7
6(1)
5
6(2)-(5)
Omitted
7&8
Omitted
9
6
2nd Sch., rules
5th Sch. Pt. I, rules
1
1
2(i)
2(1)(2)
2(i)(a)
2(3)(a)
2(i)(b)
2(3)(b)
2(i)(b) Pr.
Omitted
2(ii)
2(4)
(xxxix) COMPARATIVE TABLE OF SECTIONS
Income Tax Act, 1922
VOL-I
Income Tax Ordinance, 1979
2(iii)
2(5)
2(iii) Pr. 1 & 2
2(5) Pr.
2(iv)
2(6)
3
3 & Pr.
4(1)
4(1) & Pr.
4(2)
6(5)
5
4(2)
6
4(3)
6 Pr.
4(3) Pr.
6A
Omitted
7&8
Omitted
III Sch., rules
5th Sch. Pt. II, rules
1
1
2
2(2)
3
2(3)
4
2(4)
4 Pr.
Omitted
4A(a)
2(1)
4A(b)
3(1)
4A(c)
3(2)
4A(d)
3(3)
5(a)
4(1)
5(b)
4(2)
5(c)
4(3)
5(d)
Omitted
(xl) Income Tax Digest.
VOL-I
Income Tax Act, 1922
Income Tax Ordinance, 1979
5(e)
4(4)
5(f)
4(5)
6
Otiose
IV Sch., rules
VII Sch., rules
1(1)
7(1)
1(2)
7(2)
1(3)
7(3)
2(1)
1(1)
2(2)
Otiose
2(3)
Omitted
3
2 Rev.
4
Otiose
5(1)
3
5(2)
Omitted
6(1)
4(1)
6(2)
4(2) & Ex.
6(3)
4(3)
6(4)
4(4)
6(5)
4(5)
7
5(1)
8
5(3) Impl.
9(1) & (2)
Otiose
10
5(2)
11(1)
6(1)
11(2)
6(2)
(xli) COMPARATIVE TABLE OF SECTIONS
Income Tax Act, 1922
VOL-I
Income Tax Ordinance, 1979
11(3)
6(3)
11(4)
6(4), (5)
11(5)
6(6)
12
Otiose
(xlii) COMPARATIVE TABLE OF SECTIONS
VOL-I
Following is a comparative list of rules of the Income Tax Rules, 1962 and Income Tax Rules, 1982. Income Tax Rules, 1962
Income Tax Rules, 1982
1-2
1-2
3-5
204
6-7
Omitted
8
Omitted (now S. 20(I)(g))
9
III Sch.
10
Otiose
11
27, 29, 31 & 32
11A
34
12
Otiose
13
49 & 50
14
52
15
53 & 54
16
55
17
57
18
59
19
58
20
50
21
203
22
62
23
62
24
63
25
Otiose
26
199
27
Otiose
28
200
29(1)
56(2)
29(2)
20(2)
(xliii) COMPARATIVE TABLE OF SECTIONS
Income Tax Rules, 1962
VOL-I
Income Tax Rules, 1982
29(3)
197
29(4)
201
30
190
31
191
32
192
33
Otiose
34
194
35
195
36
196
37
25
38
Otiose
39
3-18
40
24
41
24
42
193
43 & 44
209-210
45
205(2) & 206
46
Otiose (Now S. 59)
47 & 48
Otiose
49
21
SRO 1041(K)/61, dated 31.10.1961
19
Notif No. 36, dated 22.6.1956
43
SRO 406 dated 22.8.1959
43
Notif. No. 4 dated 14.3.1952
37
SRO 884(I)/74 dated 1.7.1974
46
SRO 714(I)/72 dated 12.9.1972
211-215
SRO 57(R)/69 dated 7.4.1969
Income Tax Recovery Rules, 1961
99-189 Notif. No. 6 dated 10.3.1950
Otiose
(xliv) Income Tax Digest.
VOL-I
Income Tax Rules, 1962
Income Tax Rules, 1982
SRO 353(K)/62 & SRO 354(K)/62 dated 27.3.1962
69-84
SRO 982(I)/75 dated 12.9.1975
41
SRO 349(I)/76 dated 12.4.1976
39
1 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1
Section 1 Short title, extent and commencement
PAGE NO
GENERAL PRINCIPLES OF TAXATION / RULES OF _ INTERPRETATION LEGISLATIVE POWERS
1. 2.
3. 4. 5. 6. 7. 8.
9. 10.
Legislature enjoys wide powers in framing _ laws. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.)
fiscal
Taxing rights of legislature are unlimited as long as these _ are not confiscatory. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) Parliament is competent to levy presumptive _ taxation. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) _ Levy of minimum tax held constitutional. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) Power to levy taxes is an attribute of sovereignty of a state. _ [1997 SCC 1097 = (1997] 76 TAX 5 (S.C.Pak) _ Restrictions on power to levy tax. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) The principle of “equality” applies equally to fiscal _ enactments. [1997] 76 TAX 5 (S.C.Pak.) _ Double Taxation is prerogative of legislature. [1992] 65 _ TAX 315 (S.C.Pak); 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562
35
35 36 38 40 40 41
41
The scope of powers of legislature to tax non-residents. _ 1958 SCC 37 = [1960] 2-TAX (Suppl.-308) (S.C.Pak)
42
Definition of word/expression “income” would mean “net income” after making all permissible allowances, deductions, depreciation etc as appearing in section 2(24) of the Ordinance. The said definition cannot be assigned to the word/expression “income” as used in section 23 of the Ordinance as the very purpose of section 23 of the Ordinance _ would be defeated. [2001] 83 TAX 376 (H.C.Kar.)
42
2 Section 1
Income Tax Digest. PAGE NO
11.
12.
13.
14.
15. 16. 17. 18.
19.
CBR circular No 19 of 1991 dated 8.7.1991, assessee was under no obligation to deduct tax at source in relation to purchases on which tax at import stage had been deducted and which constituted final discharge of liability. Jurisdiction to apply provisions of Ordinance in any manner was not restricted to proceedings for assessment or recovery of final income tax liabilities, but also related with force in respect of advance tax, be it under section 50(4) or section 53 or any other provision of the Ordinance. Proviso to section 50(4)(a) categorically confirmed that substantive provision of said section was also to be applied to non_ residents. [2001] 83 TAX 305 (H.C.Kar.)
43
Under the Indian Income Tax Act, 1961 presumptive tax regime has been made applicable to limited number of items but the deduction made at source has been made liable for adjustment against the tax demand created on regular _ assessment. [2001] 83 TAX 305 (H.C.Kar.)
45
The question of retrospective operation of the explanation of section 25 of the Ordinance would have arisen only if it has the effect of imposing new liability or obligation on the taxpayer or had affected any existing rights either by taking _ them away or curtailing them. [2001] 83 TAX 305 (H.C.Kar.)
45
Scope of Article 165 & 165A of Constitution; corporations created by provincial statutes are not “governments”. _ [1999] 79 TAX 410 (H.C.Kar.)
47
Levy of Corporate Asset Tax is constitutionally valid. _ [1999] 79 TAX 77 (H.C.Lah.)
48
Constitutional powers of levying taxes by Federation and _ provinces. [NLR 1999 Tax 176] _ Personal interest must yield to larger interest. [1998] 78 TAX 234 (H.C.Kar.) = PTCL 1998 CL. 690
48 49
Powers of Federal Government to levy income tax on any property or income, including that of Provincial _ Government. [1995] 71 TAX 220 (H.C.Lah.)
51
Parliament can introduce a new change of tax either by incorporating that change in the Income Tax Act or by _ Finance Act. [1988] 57 TAX (H.C.Kar.)
52
3 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
20.
21.
22. 23. 24.
25. 26. 27. 28. 29. 30. 31.
32.
33. 34.
Levy of tax on free reserves which had already suffered tax held not to be ultra-vires of the powers of Legislature under _ the Constitution. [1984] 49 TAX 76 (H.C.Kar.)
52
Words occurring in a constitutional provision relating to _ legislative power should be liberally construed. [1984] 49 TAX 76 (H.C.Kar.)
53
Rule of interpretation of the word “income” occurring in _ Constitutional explained. [1984] 49 TAX 76 (H.C.Kar.)
53
Redundancy cannot be readily attributed to the legislature. _ [1982] 46 TAX 143 (H.C.Lah.)
54
“Resident” of taxable territories is liable to tax on total world income including any income accruing or arising in nontaxable territories of Pakistan. _ [1982] 45 TAX 263 (H.C.Kar.) = 1982 PTD 46 = 1990 PTCL 954 = 1982 PLD 266
54
Legislature has the power to enact curative legislation. _ [1982] 45 TAX 232 (H.C.Kar.)
55
Charging section and subsequent provisions only enable the _ liability to be quantified. [1980] 42 TAX 59 (H.C.Lah.)
55
Power to make and promulgate Ordinance includes the _ power to levy tax. [1977] 35 TAX 180 (H.C.Kar.)
55
Authority to legislate includes authority to legislate with _ retrospective effect. [1977] 35 TAX 180 (H.C.Kar.)
56
Rules can‟t be made by subordinate delegate authority _ unless expressly permitted. [1966] 14 TAX 174 (H.C.Kar.)
56
Charging section cannot be overlooked on hypothesis of _ history of exemption. [1 ITC 284 (Calcutta)]
56
Modification of exemption from taxation must be express _ and not in general terms or by implication. 1 ITC 185 (Mad)
56
Subsequent general enactment does not interfere with _ special provisions unless expressed clearly. 1 ITC 181 (Mad) _ Court cannot make up for any deficiency of Legislature. [1 ITC 161 (Burma)] Fair and reasonable construction for taxing statutes. _ [1 ITC 140 (Burma)]
57 57 57
4 Section 1
Income Tax Digest. PAGE NO
RETROSPECTIVE LEGISLATION
35. 36. 37.
38.
39.
40.
41. 42. 43.
44. 45.
46. 47.
48.
Retrospective application of law must be by explicit words. _ 1975 SCC 426 = [1976] 34 TAX 14 (S.C.Pak.) _ Scope of retrospective legislation. 1969 SCC 354 = [1970] 21 TAX 62 (S.C.Pak.) _ Fiscal laws and theory of retrospectivity. [2000] 81 TAX 371 (S.C.AJ&K.) = 2000 PTD SC 892; [2000] 82 TAX 518 (S.C.AJ&K.) _ Retroactivity of the law upheld. [2000] 81 TAX 371 (S.C.AJ&K.) = 2000 PTD SC 892; [2000] 82 TAX 518 ((S.C.AJ&K.)
58 58
59
60
Amendment in law which is neither clarificatory nor _ declaratory cannot be applied retrospectively. [2001] 83 TAX 451 (H.C.Lah.) = 2001 PTD 1180
60
An amendment which is explanatory or clarificatory is _ generally to operate retrospectively. [1996] 74 TAX 9 _ (H.C.Lah.) [1977] 35 TAX 169 (H.C.Lah.)
60
In a Taxing Act there is no room for any intendment. _ [1991] 64 TAX 60 (H.C.Kar.)
61
Omission of provision from statutes held not to operate _ retrospectively. [1991] 64 TAX 19 (H.C.Kar.)
61
Substantive law amended by Finance Act, 1973 held to have _ retrospective operation to cover only pending cases. [1988] 57 TAX 71 (H.C.Kar.) _ Scope of Retrospective Legislation. [1988] 57 TAX 46 _ (H.C.Kar.) [1985] 52 TAX 123 (H.C.Kar.)
62
For the purposes of assessment of income the law applicable is that in force on the first day of the relevant assessment _ year. [1985] 52 TAX 123 (H.C.Kar.) _ A penal provision cannot operate retrospectively. [1984] 50 TAX 187 (H.C.Kar.)
65
64
65
Any Act/Ordinance cannot cover any period prior to coming _ into force of the Act/ Ordinance [1984] 49 TAX 198 (H.C.Kar.)
65
If a provision is neither declaratory nor curative it cannot be _ retrospective [1980] 42 TAX 147 (H.C.Kar.) = 1980 PTD 314
65
5 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
49.
50. 51.
52. 53. 54. 55.
56. 57.
58.
If retrospective operation of a provision results in injustice, _ it should not be applied retrospectively. [1979] 40 TAX 113 (H.C.Lah.) _ Declaratory statutes generally apply retrospectively. [1977] 35 TAX 169 (H.C.Lah.) Explanatory amendment is always applicable retrospectively _ to all relevant cases pending at the relevant time. [1977] 35 TAX 169 (H.C.Lah.) Subordinate legislation can be applied retrospectively only if _ expressly mentioned. [1976] 34 TAX 10 (H.C.Lah.) _ Rules to determine retrospective effect. [1970] 21 TAX 62 (Income Tax Digest Feb. 1970) _ Right accrued cannot be taken away by implication. [1964] 8 TAX 1 (H.C.Kar.) = 1963 PTD 867 = 1963 PLD 996 Rights conferred under statutes cannot be taken away by later legislation except by express words or by necessary _ implication. [1 ITC 284 (Calcutta)] _ Presumption against double taxation. [1 ITC 284 (Calcutta)]
66 66
67 68 68 68
68 70
Vested rights such as rights to appeal and to demand a reference already accrued, cannot be taken away by repeal of _ Act. [1 ITC 264 (Nagpur)]
71
Fiscal statutes to be strained in favour of the subject, if at _ all. [1 ITC 248 (Nagpur)]
72
REMEDIAL AND CURATIVE LEGISLATION HAS RETROSPECTIVE EFFECT
59.
Remedial and curative legislation has retrospective effect. _ 1992 SCC 920 = [1992] 66 TAX 125 (S.C.Pak.)
72
PRINCIPLE OF CONTEMPORARY EXPOSITION
_
60.
Principle of contemporary exposition.
1 ITC 303 (Pat)
61.
Practice of Revenue Authorities as contemporanea expositio. _ [1 ITC 284 (Calcutta)]
73 73
ACTION IS DEEMED ILLEGAL, THE WHOLE SUPERSTRUCTURE BUILT UPON IT IS ALSO ILLEGAL
62.
If an action is deemed illegal, the whole superstructure built _ upon it is also illegal. [1991] 63 TAX 143 (H.C.Kar.) = _ 1991 PTD 658 [1990] 61 TAX 159 (H.C.Kar.)
74
6 Section 1
Income Tax Digest. PAGE NO
INCOME CANNOT BE TAXED TWICE
63.
Income cannot be taxed twice. TAX 223 (S.C.Pak)
_
1970 SCC 370 = [1971] 23 74
ONE THING IMPLIES THE EXCLUSION OF ANOTHER
64. 65.
“Expressio unius est exclusio alterius”. (H.C.Lah.) = 2001 PTD 1180
_
[2001] 83 TAX 451 75
“Expressio unius est exclusio alterius” (Express mention of one thing implies the exclusion of another) was neither _ absolute nor was of universal application. [2000] 82 TAX 433 (H.C.Lah.) = 2000 PTD 2958
76
APPLICATION OF RULE “GENERALIBUS SPECIALIA DEROGANT”
66.
Application of rule “generalibus specialia derogant”. SCC 289 = [1967] 16 TAX 81 (S.C.Pak.)
_
1967 76
INTERPRETATION OF STATUTES / GENERAL PRINCIPLES
67. 68. 69. 70.
71. 72. 73. 74. 75.
76.
Statute must be intelligibly expressed and reasonably _ definite and certain. PLD 2000 S.C. 111 _ True meaning of statute vis-a-vis duty of court. PLD 2000 S.C. 111 _ Interpretation of statute is not CBR‟s domain. 1993 SCC 1049 = [1993] 68 TAX 86 (S.C.Pak) Proceedings of the Legislature can be resorted to when the _ words of a provision are ambiguous. [1992] 65 TAX 281 (S.C.Pak) Person sought to be taxed must come within the letter of law. _ [1972 SCC 395 = [1974] 29 TAX 188 (S.C.Pak.) _ No words to be treated as surplusage. 1966 SCC 266 = [1966] 14 TAX 281 (S.C.Pak.) = PLD 1966 S.C. 828 _ Abrogation of International Law. 1958 SCC 37 = [1959] 1TAX (111-284) (S.C.Pak.) _ A fiscal statute should be construed strictly. 1959 SCC 68 = [1959] 1-TAX (111-207) (S.C.Pak.) Claimant of an exemption has to be the same without any _ ambiguity. [2000] 82 TAX 433 (H.C.Lah.) = 2000 PTD 2958 Where a provision was open to two reasonably possible interpretations, then, the interpretation which favours the
77 77 78
78 78 79 79 79
79
7 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
_
77.
78.
79.
80. 81. 82. 83. 84. 85.
86. 87. 88. 89. 90.
taxpayer has to be adopted. [2001] 83 TAX 404 (H.C.A&JK) = [2000] 82 TAX 417 = 2000 PTD 2872
80
Correct interpretation of Rule 15 vis-a-vis right of appeal. _ [2001] 83 TAX 404 (H.C.A&JK) = [2000] 82 TAX 417 (H.C.AJ&K) = 2000 PTD 2872
80
The use of word “shall” in Section 134(5), Income Tax Ordinance, 1979 does not make it mandatory in nature. _ [2001] 83 TAX 404 (H.C.A&JK) = [2000] 82 TAX 417 (H.C.AJ&K) = 2000 PTD 2872
80
Principles for determining mandatory or directory provision _ of law. [2001] 83 TAX 404 (H.C.A&JK) = [2000] 82 TAX 417 (H.C.AJ&K) = 2000 PTD 2872 _ Things should be done as required by law. PTCL 2000 CL. 465 _ Court must confine itself to language of law. [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280 Assessing officer to apply correct law even if assessee fails to _ make a claim. [1999 PTD 325] Explanation can be added to elaborate the meanings. _ [1996] 74 TAX 9 (H.C.Lah.) _ Harmonious construction is recommended. [1990] 62 TAX 119 (H.C.Kar.)
81 81 81 82 82 82
Proceedings of the Legislature can be resorted to when the _ words of a provision are ambiguous. [1990] 61 TAX 30 (H.C.Kar.)
82
Interpretation of machinery provisions of a fiscal statute. _ [1990] 61 TAX 30 (H.C.Kar.)
82
Speech of the Federal Minister has no legal consequences or effect. [1984] 50 TAX 158 (H.C.Kar.)
83
Role of history of legislation in interpreting a provision of _ law/statute. [1979] 40 TAX 116 (H.C.Kar.)
83
Departmental construction can be used _ interpretation. [1976] 34 TAX 54 (H.C.Lah.)
83
in
aid
of
Caution should be used while borrowing the meaning attached to terms and phrases used in one statute, while _ interpreting another statute. [1975] 32 TAX 273 (H.C.Lah.)
84
8 Section 1
Income Tax Digest. PAGE NO
91.
92. 93. 94. 95. 96. 97.
Terms and phrases used in a statute prima facie should be _ construed in their popular sense. [1974] 29 TAX 221 (H.C.Lah.)
84
While interpreting a statute - nothing is to be read in and _ nothing is to be implied. [1974] 29 TAX 115 (H.C.Kar.)
84
Departmental instructions cannot be used in aid of _ interpretation. [1966] 13 TAX 141
85
Non-revenue profit/losses are not covered in Income Tax _ unless specifically provided in statute. 2 ITC 107 (Mad)
85
In dubio construction which imposes burden on taxpayer _ should be avoided. [1 ITC 189 (Lahore)] _ Courts are not to be influenced by doctrine of hardship. [1 ITC 169 (Calcutta)] Tax must be imposed by clear and unambiguous language. _ [1 ITC 26 (Sind)
85 85 86
PRINCIPLES GOVERNING INTERPRETATION OF FINANCIAL LIABILITIES
98.
Principles governing interpretation of financial liabilities _ should be strictly construed. [1977] 36 TAX 8 (Lahore)
86
PRINCIPLE OF EQUITY
99. 100. 101.
Equitable construction of a fiscal statute is not permitted. _ [1977] 35 TAX 169 (H.C.Lah.) Equitable construction is inadmissible in a fiscal statute. _ [1 ITC 161 (Burma)] _ No equitable construction in fiscal statutes. [1 ITC 26 (Sind)]
87 87 87
POWERS OF COURTS/ADMINISTRATIVE JURISDICTION
102.
103. 104. 105.
CBR and the Federal Government have no power to resort to _ judicial interpretation of law. [1999] 80 TAX 79 (S.C.Pak) = 1999 PTD 2174]
88
In granting leave to appeal rule of consistency is to be _ followed. [1999] 79 TAX 1 (S.C.Pak.)
88
Judicial approach on constitutional issues should be _ dynamic. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak)
88
Conditions under which courts can strike down a law. _ 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.)
89
9 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
106.
107.
108. 109. 110.
111.
112.
113. 114.
115. 116. 117.
118.
CBR is not competent to issue instructions of judicial/quasi _ judicial nature. 1993 SCC 1049 = [1993] 68 TAX 86 (S.C.Pak)
89
High Court has only advisory jurisdiction under section 136 _ of the Ordinance. 1991 SCC 805 = [1992] 65 TAX 239 _ (S.C.Pak); [1985 SCC 637 = [1986] 53 TAX 122 (S.C.Pak); _ _ [1996) 74 TAX 141 (H.C.AJ&K); [1995] 71 TAX 271 _ _ (H.C.Lah.); [1994] 69 TAX 71 (H.C.Kar.); [1987) 56 TAX _ _ 78 (H.C.Kar.); [1985] 52 TAX 77 (H.C.Kar.); [1984] 50 _ TAX 115 (H.C.Kar.); [1976] 33 TAX 245 (H.C.Lah.)
89
Two equally possible interpretation emerge; leave to appeal _ granted. 1980 SCC 474 = [1981] 43 TAX 105 (S.C.Pak) _ Transfer of jurisdiction. 1974 SCC 424 = [1975] 32 TAX 170 (S.C.Pak)
92 92
Only question of law which has substance in it can be _ referred to the High Court. 1970 SCC 366 = [1975] 31 TAX 64 (S.C.Pak.)
93
Constitutional petition dismissed as withdrawn; second _ petition on the same issue is maintainable. [1974] 29 TAX 149 (S.C.Pak.)
93
In case there is anomaly in question of law framed and referred by the Tribunal to the High Court, it should refer _ the case back to Tribunal for clarification. 1965 SCC 220 = [1965] 12 TAX 15 (S.C.Pak.) _ Effect of lack of jurisdiction. 1963 SCC 167 = [1963] 7 TAX 442 (S.C.Pak.) Only Supreme Court is competent to adjudicate between the _ governments. 1956 SCC 13 (F.C.) = [1960] 2-TAX (Supp.3) (S.C.Pak) Appeal/Reference to Supreme Court governed by Income _ Tax Law. 1957 SCC 34 = [1959] TAX (III-290) (S.C.Pak) _ In tax matters Supreme Court jurisdiction is limited. 1957 SCC 34 = [1959] TAX (III-290) (S.C.Pak)
93 93
94 94 94
Preliminary objection of jurisdiction should be decided first. _ [1999] 80 TAX 115 (H.C.Lah.) = 1999 PTD 2910 = 2000 PCTLR 1046
95
Objection as to jurisdiction can be raised at any stage. _ 1999 PTD 4041 (H.C.Kar.)
95
10 Section 1
Income Tax Digest. PAGE NO
119.
120. 121.
122.
123. 124.
125.
126. 127. 128.
129. 130. 131. 132.
133.
Ombudsman has no power to declare any legally issued notification as perverse, illegal, arbitrary or discriminatory. _ 1999 PTD 4126 (H.C.Pesh.)
96
CBR has no authority to file presentation against the orders _ of Wafaqi Mohtasib. 1999 PTD 4126 (H.C.Pesh.)
96
Every order increasing tax obligation of an assessee or reducing the refund is appealable under section 129. _ [2000] 81 TAX 119 (H.C.Kar.) = 1999 PTD 4061 [Not approved by Supreme Court in [2000] 83 TAX 119 (S.C.Pak.)]
96
Submission to jurisdiction of a Court/Authority does not confer jurisdiction which does not vest in it/him in law. _ 1999 PTD 4037 _ Objection to jurisdiction can be raised at any stage. 1999 PTD 4037 Objections to jurisdiction are to be decided by adjudicating _ authority before proceeding in the matter. [1999] 80 TAX 115 (H.C.Lah.) = 1999 PTD 2910 Courts/Tribunals have inherent powers to recall orders _ independent of any statutory provisions. [PLD 1999 Lahore 462] _ Doctrine of exhaustion explained. PLD 1999 Lahore 417 CBR has no authority to place judicial interpretation on any _ provision of law. [1998] 77 TAX 127 (H.C.Lah.) CBR‟s circular holding compensation under Golden _ Handshake Scheme as taxable declared unlawful. [1998] 78 TAX 1 (H.C.Lah.) = 1998 PCTLR 1382 _ Powers of Appellate Tribunal. [1997] 75 TAX 90 (H.C.Lah.) _ Interim stay should be given once writ is admitted. [1996] 73 TAX 215 (H.C.Kar.) _ CBR instructions are binding on tax authorities [1995) 71 Tax 139 (H.C.Lah.)
97 97
97
98 98 98
100 100 101 101
Courts cannot question the wisdom of Legislature in _ enacting provision of any law. [1993] 67 TAX 195 (H.C.Lah.)
101
Presumption of irregularity with regard to official act cannot be challenged on vague allegation of mala fide. _ [1984] 50 TAX 37 (H.C.Lah.) = PLJ 1984 Lah. 423
102
11 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
134.
135. 136. 137. 138. 139.
A question not raised before the Appellate Tribunal cannot _ be raised before the High Court. [1979] 39 TAX 14 _ (H.C.Lah.); [1976] 34 TAX 199 (H.C.Lah.)
102
Provisions of the Income Tax Act can be challenged on _ Constitutional grounds. [1977] 36 TAX 8 (H.C.Lah.)
103
Only Supreme Court is competent to adjudicate between the _ governments. [1976] 34 TAX 71 (H.C.Lah.)
104
A legal plea going to the roots of the case was allowed to be _ raised at belated stage. [1976] 33 TAX 176 (H.C.Lah.)
105
Courts have inherent jurisdiction in the interest of orderly _ dispensation of justice. [1975] 32 TAX 176 (H.C.Pesh.)
105
Courts have no concern with disputable questions of _ distributive justice. [1 ITC 284 (Calcutta)]
105
INCOME / DEEMING PROVISIONS - HOW TO BE CONSTRUED
140. 141.
142. 143. 144. 145.
Scope of deeming provisions in respect of income. SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.)
_
1997
Widest amplitude of an entry in legislative list does not extend to tax something which is not a citizen‟s income. _ 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) Scope of definition of „tax on income‟ under the Constitution. _ 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) _ Deeming provisions - How to be construed. [1999] 80 TAX 24 (H.C.Kar.) = 1999 PTD 1655 _ Scope of deemed income. [1994] 69 TAX 38 (H.C.Kar.); _ [1989] 59 TAX 108 (H.C.Kar.) Assessment and levy of Super tax on total income of three months at the rate applicable to twelve months‟ notional income as a condition for permitting change of previous year _ by assessee was held without legal sanction. [1979] 39 TAX 140 (H.C.Lah.)
105
106 106 107 107
107
LEGISLATIVE POWERS VIS-À-VIS DOCTRINE OF REASONABLE CLASSIFICATION
146.
Distinction between direct and indirect taxes hardly exists _ now. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.)
DISTINCTION BETWEEN “TAX” AND “FEE”
147.
Distinction between “tax” and “fee” explained. CL. 384
_
108
PTCL 2000 109
12 Section 1
Income Tax Digest. PAGE NO
DISTINCTION BETWEEN ACTUAL LIABILITY IN PRAESENTI AND A LIABILITY DE FUTURO WHICH FOR THE TIME BEING IS ONLY CONTINGENT
148.
The Income Tax Law makes a distinction between actual liability in praesenti and a liability de futuro which for the _ time being, is only contingent. 2001 PTD 744
109
THEORY OF READING DOWN AS A RULE OF INTERPRETATION
149.
Theory of reading down as a rule of interpretation. SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.)
_
1997 110
RULE OF EVIDENCE
150. 151.
152. 153. 154. 155.
A Judge cannot be compelled to accept a piece of evidence. _ 1978 SCC 446 = [1980] 41 TAX 1 (S.C.Pak) Income Tax Authorities to establish by positive evidence that _ assessee‟s accounts are unreliable. [1996] 74 TAX 227 (H.C.Lah.) _ Standard of Proof. [1994] 69 TAX 38 (H.C.Kar.) Qanoon-e-Shahadat Ordinance is applicable to Income Tax _ Ordinance, 1979. [1992] 68 TAX 89 (H.C.Lah.) _ Provisions of Evidence Act not applicable to proceedings _ under Income Tax Act. [1978] 38 TAX 181 (H.C.Lah.) _ Statement in power of attorney not proof in itself. [1 ITC 323 (Madras)
111
111 111 112 112 113
COURTS CAN STRIKE DOWN DISCRIMINATORY AND CONFISCATORY PROVISIONS OF FISCAL LAWS
156.
Courts can strike down discriminatory and confiscatory _ provisions of fiscal laws. 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.)
113
SCOPE OF VARIOUS WORDS AND EXPRESSIONS
157. 158. 159. 160.
_ “Accrue” and “arise”. 1969 SCC 322 = [1969] 20 TAX 33 (S.C.Pak) _ “Accrue” and “arise”. [1974] 29 TAX 212 (S.C.Pak.) _ “Accrue” and “arise” vis-a-vis effect of book entries. [2 ITC 69 (Nagpur)] “Agricultural Income” when remains to be such in the hands _ of recipient. 1959 SCC 53 = [1959] 1 TAX (III-1) (S.C.Pak)
113 114 114 114
13 SHORT TITLE, EXTENT AND COMMENCEMENT
161. 162. 163. 164. 165. 166. 167. 168. 169. 170. 171. 172. 173. 174. 175. 176.
177. 178. 179.
180.
Section 1
_
“Agriculture” and “agricultural purposes”. 1959 SCC 68 = [1959] 1-TAX (III-207) (S.C.Pak.) _ _ “Annual value”. [1985] 51 TAX 5 (H.C.Kar.); [5 ITC 316] _ “Assessment”. [1992] 65 TAX 176 (H.C.Kar.) = 1992 PTD 513] Meaning of expression “assessment consciously completed”. _ [2001] 83 TAX 359 (H.C.Kar.) = PTCL 2001 CL. 250 _ Definition of the word “Business”. [1977] 35 TAX 74 _ (H.C.Lah.); [1974] 30 TAX 158 (H.C.Kar.) _ “Business connection”. 1991 SCC 784 = [1991] 63 TAX 149 (S.C.Pak) _ _ “Capital” and “dividend” distinguished. 1989 SCC 740 = [1997] 75 TAX 113 (S.C.Pak) _ “Case”. [1976] 34 TAX 199 (H.C.Lah.) _ “Certified copy”. [1978] 38 TAX 181 (H.C.Lah.) _ “Charitable purposes”. [1993] 67 TAX 400 (H.C.Kar.) _ “Charity” and “charitable purposes”. [1977] 36 TAX 117 (H.C.Lah.) _ “Commercial” and “commerce”. [1983] 47 TAX 214 (H.C.Kar.) “Company” and “shareholders” - Relationship between. _ 1959 SCC 53 = [1959] 1 TAX (III-1) (S.C.Pak) _ “Company limited by guarantee”. [1975] 31 TAX 114 (H.C.Kar.) _ “Complete”. [1997] 76 TAX 302 (H.C.Lah.) _ “Debt”, “Loan”, “Owe” and “due” difference between. _ _ [1992] 65 TAX 262 (S.C.Pak); [1975] 32 TAX 1 (H.C.Lah.) _ _ “Due” meaning of. [1984] 49 TAX 198 (H.C.Kar.); _ [1976] 34 TAX 151 (H.C.Kar.) _ “Default”. [1999 PTD 1302] _ “Definite Information”. 1997 SCC 1174 = [1997] 76 TAX _ 213 (S.C.Pak); [1997] 76 TAX 131 (S.C.Pak) = 1997 PTD _ 1485; 1993 SCC 1049 = [1993] 68 TAX 86 (S.C.Pak) _ “Discard”. 1993 SCC 1029 = (1993) 68 TAX 49 (S.C.Pak)
PAGE NO
115 115 115 116 117 117 117 118 118 118 119 120 120 121 121
122 123 123
124 125
14 Section 1
181.
182. 183. 184. 185. 186. 187. 188. 189. 190. 191. 192. 193. 194. 195. 196. 197. 198.
199. 200. 201. 202. 203. 204.
Income Tax Digest.
_
_
“Dividend”. 1991 SCC 773; 1959 SCC 53 = [1959] 1_ TAX (III-1) (S.C.Pak); [1983] 47 TAX 132 (H.C.Pesh) _ “Employee”. [1973] 27 TAX 95 (H.C.Lah.) _ “Enduring benefit”. [1967] 15 TAX 53 (H.C.Kar.) _ “Enemy”, “enemy territory” and “aggrieved party”. 1978 SCC 453 = [1978] 38 TAX 132 (S.C.Pak) _ “Erroneous”. [1984] 49 TAX 34 (H.C.AJ&K) _ _ “Evasion” and “Avoidance” the difference. 1992 SCC 974 = [1993] 67 TAX 51 (S.C.Pak) _ “Evasion of Tax”. 1992 SCC 974 = [1993] 67 TAX 51 (S.C.Pak) _ “Execution of Contract”. [1997] 76 TAX 1 (H.C.Lah.) _ “Expenditure” & “reserves”. [1982] 46 TAX 125 (H.C.Kar.) _ “Failure”. [1973] 28 TAX 181 (H.C.Lah.) _ “Fixed capital”. [2 ITC 184 (Lahore)] _ “Fixed capital” and “circulating capital”. [1966] 13 TAX 163 (H.C.Lah.) _ “Goods” do not include immovable property. [1999] 80 TAX 262 (H.C.Lah.) _ “Goodwill”. [1974] 29 TAX 91 (H.C.Lah.) _ “Immunity”. [1997] 76 TAX 302 (H.C.Lah.) _ “Includes”. [1983] 47 TAX 132 (H.C.Pesh) _ “Including”. [1973] 27 TAX 99 (H.C.Lah.) _ “Income”. 1997 SCC 1097 = (1997) 76 TAX 5 (S.C.Pak); _ 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD _ 576 = PLD 1992 SC 562; [1969] 19 TAX 222 (H.C.Kar.) _ “Individual” & “association of persons”. 1955 SCC 13 (Federal Court) = [1960] 2-Tax (Suppl.-3) (S.C.Pak) _ “Individual” and “such individual”. [1980] 42 TAX 168 (H.C.Lah.) _ “Interest”. [1983] 47 TAX 132 (H.C.Pesh) _ “Liable”. 1990 SCC 759 = [1990] 62 TAX 74 (S.C.Pak); _ [1975] 32 TAX 273 (H.C.Lah.) _ “Manufacture”. [2 ITC 129 (Rangoon)] _ “Material”. [1993] 67 TAX 311 (H.C.Kar.)
PAGE NO
126 127 127 127 128 128 129 129 129 130 130 130 130 131 131 132 132
132 134 134 134 135 135 136
15 SHORT TITLE, EXTENT AND COMMENCEMENT
205. 206. 207. 208. 209. 210. 211. 212. 213. 214. 215. 216. 217. 218. 219. 220. 221. 222. 223. 224. 225.
226.
“May”.
_
[1968] 18 TAX 72 (H.C.Kar.) _ “Merge” & “Merger”. [1992] 65 TAX 281 (S.C.Pak) _ “Occupation” [2 ITC 104 (Madras)] _ “Opinion”. [1974] 30 TAX 27 (H.C.Kar.) _ “Or”. [1999] 80 TAX 106 (H.C.Kar.)=1999 PTD 2901 _ “Owners”,”ownership” and “own”. 1 ITC 140 (Burma) _ “Paid”. [1980] 42 TAX 81 (H.C.Lah.) _ “Pay”. [1972 SCC 395 = [1974] 29 TAX 188 (S.C.Pak) _ “Penalty”. [1994] 70 TAX 159 (H.C.Kar.) _ “Person”. [1980] 42 TAX 59 (H.C.Lah.) _ “Previous year”. [1976] 33 TAX 99 (H.C.Kar.) _ _ “Processing”. [1988 SCC 663 = 1988 PTD 571]; [1981] 43 TAX 1 (H.C.Lah.) _ _ “Profit”. [1973] 28 TAX 155 (H.C.Kar.); [5 ITC 288 (H.C.Lah.) _ “Property”. [1980 SCC 497 = [1980] 42 TAX 1 (S.C.Pak) _ _ “Received” person cannot receive a thing from himself. 1 ITC 189 (Lahore) _ “Repeal” & “amendment”. [1966] 14 TAX 211 (H.C.Kar.) _ “Reserve”. [1990] 62 TAX 31 (H.C.Kar.) _ “Sales” and “supplies”. [1999] 80 TAX 282 (H.C.Lah.) _ “Specify”. [1973] 27 TAX 40 (H.C.Lah.) _ “Tax”. [1986] 53 TAX 93 (H.C.Lah.) “Working capital”, “current assets” and “current liability”. _ _ [1988] 57 TAX 118 (H.C.Kar.); [1988] 57 TAX 113 (H.C.Kar.) _ Word „year‟ - How to be understood. 1963 SCC 167 = [1963] 7 TAX 442 (S.C.Pak.)
Section 1 PAGE NO
136 136 137 137 137 138 138 138 138 139 139 139 140 140 141 141 141 142 142 142
142 145
INTERPRETATION REGARDING WORDS AND EXPRESSIONS
227.
Rule of interpretation regarding words and expressions used _ in fiscal statute. 1990 SCC 759 = [1990] 62 TAX 74 (S.C.Pak.)
145
16 Section 1
228. 229. 230.
General and special words or terms. [1990] 62 TAX 74 (S.C.Pak.)
Income Tax Digest.
_
PAGE NO
1990 SCC 759 = 146
Stable interpretation of term „assessment year‟ should be _ adopted. 1963 SCC 167= [1963] 7 TAX 442 (S.C.Pak.)
147
Law applicable on the first day of assessment year will apply and not the one in existence during the next year. _ [1988] 57 TAX 118 (H.C.Kar.) = 1988 PTD 66
147
PAST AND CLOSED PROVISION
231.
Past and closed transactions can be reopened by giving _ retroactive effect to an amending provision. 1993 SCC _ 1026 = [1993] 68 TAX 1 (S.C.Pak.); 1981 SCC 572 = [1982] 46 TAX 6 (S.C.Pak.)
147
SPECIAL LAW VS. INCOME TAX LAW
232.
233.
Scope of protection under the Protection of Economic _ Reforms Act of 1992. [2000] 82 TAX 275 (H.C.Lah.) = 2000 PTD 303 _ General Act whether overrides the provisions of specific Act _ - Held no. [1969] 19 TAX 3 (H.C.Dacca)
148 149
MACHINERY PROVISIONS
234.
Amendments in machinery section being procedural are _ applicable to pending proceedings. 1974 SCC 416 = [1974] 30 TAX 138 (S.C.Pak.)
150
Machinery provisions cannot be construed to go beyond the _ spirit of law. [2001] 83 TAX 1 (H.C.Lah.)
151
Machinery provisions of fiscal law should be construed so as _ not to destroy recovery mechanism. [2000] 82 TAX 42 (H.C.Lah.)
151
237.
Rule of liberal construction of machinery provisions.
153
238.
Basic rules to construe charging and machinery provisions. _ [1986] 54 TAX 1 (H.C.Kar.) = 1986 PTD 316
153
235. 236.
LIMITATION PERIOD CANNOT BE EXTENDED RETROSPECTIVELY
239.
Limitation period extended retrospectively by legislation _ held not valid. 1969 SCC 354 = [1970] 21 TAX 62 (S.C.Pak.)
153
17 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
RULES OF CONSTRUCTION
240. 241. 242.
243. 244. 245. 246. 247. 248.
249.
250. 251. 252. 253. 254.
255.
_
FISCAL STATUTES
General and specific words. TAX 74 (S.C.Pak)
_
1990 SCC 759 = [1990] 62
Rule of harmonious construction of statutes. 228 = [1965] 12 TAX 95 (S.C.Pak)
_
154 1965 SCC
An equitable construction of a fiscal statute is not _ permissible. 1959 SCC 68 = (1959) 1-TAX (III-207) (S.C.Pak.) _ Strict rule of fiscal statutes emphasised. [2000] 81 TAX 7 (H.C.Lah.) = 2000 PTD 497 _ Rule cannot override the statutory law. [1999] 80 TAX 62 (H.C.Qta.) Words in a statutory instrument should be construed in _ their ordinary sense. [1992] 65 TAX 80 (H.C.Lah.) _ Rule of harmonious construction of statutes. [1990] 62 TAX 119 (H.C.Kar.)
154
154 155 155 155 156
Courts while interpreting a statute must adhere to the plain _ meaning of the words. [1986] 53 TAX 93 (H.C.Lah.)
156
Meaning of doubtful words to be gathered by reference to _ words associated with them. [1981] 43 TAX 1 (H.C.Lah.)
156
Inapt and inaccurate phraseology of draftsman cannot _ nullify a provision made by legislature. [1977] 36 TAX 8 (H.C.Lah.) = 1977 PTD 183 = 1977 PLD 797
156
An equitable construction of a fiscal statute is not _ permissible. [1977] 35 TAX 169 (H.C.Lah.) _ Fiscal statutes should be strictly construed. [1976] 34 TAX 151 (H.C.Kar.) = PLD 1976 Kar. 1030 Construction of law should not lead to startling results. _ [1976] 34 TAX 54 (H.C.Lah.) _ Rule of harmonious construction of statutes. [1974] 29 TAX 165 (H.C.Lah.) Words in statutes cannot be treated as surplusage or _ redundant. 1966 SCC 266 = [1966] 14 TAX 281 (S.C.Pak.) = PLD 1966 S.C. 828 _ Punctuation marks and construction of statutes. [14 ILR _ _ PC 365]; [1944] 12 ITR 393 (Lahore); [1 ITC 244 (Madras)]
157 157 158 159
159
159
18 Section 1
256. 257. 258. 259. 260.
261. 262. 263.
Income Tax Digest.
_
Tax can only be imposed by clear words of the Act. [1 ITC 189 (Lahore)] _ Strict rule of interpretation to tax a subject. [1 ITC 172 (Madras)] Subject can only be taxed if statute expressly so provides. _ [1 ITC 161 (Burma)] _ Court must stick to the letter of the statute. [1 ITC 161 (Burma)] Subject taxable if within letter of law, not taxable if not _ within letter of law through within the spirit. [1 ITC 37 (Madras)] _ Practice as a guide to construction. 1 ITC 37 (Madras)
PAGE NO
160 160 160 161
162 162
Practice under repealed Act as an aid for construction of _ later Act. [1 ITC 37 (Madras)]
163
Long course of decisions determining construction of a repealed statute may be an aid in the construction of a new statute passed in the same terms as the former, but a single decision not. – [1 ITC 29 (Patna)]
163
_ RULE OF INTERPRETATION TWO EQUAL POSSIBLE _ INTERPRETATIONS EXEMPTION CLAUSES
264. 265.
266. 267. 268.
Exemption clauses provided under industrial incentives _ should be construed liberally. [2000] 82 TAX 3 (S.C.Pak) _ Exemption clauses vis-a-vis rules of interpretation. 1966 SCC 266 = [1966] 14 TAX 281 (S.C.Pak.) = PLD 1966 S.C. 828; [1973] 28 TAX 168 (H.C.Lah.) _ Exemption clauses are to be construed strictly. [2000] 81 TAX 7 (H.C.Lah.) = 2000 PTD 497
164
164 165
Rule of benefit to subject where two interpretations are _ possible. [2001] 83 TAX 451 (H.C.Lah.) = 2001 PTD 1180
165
Two equal possible interpretations of exemption clause one _ favouring the revenue to be adopted. [2000] 82 TAX 433 (H.C.Lah.) = 2000 PTD 2958
165
RULE OF LIMITATION
269. 270.
Claim for refund of money paid under mistake is not barred _ by time. [1998] 77 TAX 172 (S.C.Pak)
166
The provisions of Limitation Act are mandatory and cannot _ be waived. [1995] 71 TAX 280 (H.C.Kar.)
167
19 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
271. 272.
273. 274. 275.
276. 277.
278.
Time limitation for filing appeal u/s 136 vis-a-vis section 5 _ of Limitation Act. [1999] 79 TAX 161 (H.C.Qut.) _ Period of Limitation Factors to be considered while _ computing period of limitation. [1993] 68 TAX 171 (H.C.Kar.) A reference application made beyond the prescribed time _ should be dismissed. [1991) 64 Tax 31 (H.C.Kar.) _ Delay of each day must be explained. [1979] 40 TAX 60 (H.C.Kar.)
167
168 168 168
Time spent in obtaining a certified copy should be excluded _ while computing period of limitation. [1978] 38 TAX 181 (H.C.Lah.)
168
Application of provisions of Limitation Act to proceedings _ under Income Tax Laws. [1976] 34 TAX 10 (H.C.Lah.)
169
Court holidays falling on the day of expiry of the prescribed period of limitation should be excluded in counting the _ period of limitation. [1974] 29 TAX 238 (H.C.Lah.)
169
Time required for obtaining certified copy should extend the _ period of limitation. [1974] 29 TAX 238 (H.C.Lah.)
169
REDUNDANCY SHOULD NOT BE READILY ASSIGNED BY COURTS
279. 280.
Redundancy should not be readily assigned by courts. _ [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280
170
Amendment in law implies necessarily an intention on the part of legislature to depart from earlier law in some respects redundancy cannot be attributed to the legislature. _ [1982] 46 TAX 143 (H.C.Lah.)
170
INTERPRETATION FAVOURABLE TO ASSESSEE IS TO BE ADOPTED
281. 282.
Interpretation favourable to assessee is to be adopted. _ [2000] 81 TAX 229 (H.C.Kar.) _ Exemption cannot be allowed if not claimed. [1964] 9 TAX 273 (H.C.Kar.) = 1964 PTD 554
RULES WHEN LANGUAGE IS AMBIGUOUS
283. 284.
Rule of interpretation of ambiguous words 111
_
170 170
PLD 2000 S.C.
Proviso cannot extend the meaning of the enacting part. _ [1999] 79 TAX 428 (S.C.Pak.)
171 172
20 Section 1
285. 286.
287. 288. 289. 290.
291.
292. 293.
294. 295.
296.
297. 298.
299.
Effect of non-obstante clause. = 1997 PTD 1693
Income Tax Digest.
_
PAGE NO
[1997] 76 TAX 213 (S.C.Pak)
If a statute is capable of two interpretations then the one _ which is favourable to the subject be adopted. 1992 SCC 980 = [1992] 66 TAX 246 (S.C.Pak) Doubt or ambiguity in language should go in favour of _ taxpayer [2001] 83 TAX 489 (H.C.Lah.) _ Court must confine itself to language of law. [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280
172
172 173 173
Ambiguity in language should be resolved in the favour of _ taxpayer. [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280
174
Statutes should be interpreted strictly in accordance with _ letter of law. [2000] 81 TAX 88 (H.C.Lah.) = 1999 PTD 4138
174
In case of two equally reasonable interpretations, one strict and other beneficial, then the latter should be preferred. _ 1999 PTD 4138 (H.C.Lah.) _ Benefit of ambiguity should be given to the assessee. [1994] 69 TAX 79 (H.C.Kar.)
174
If a statute is capable of two interpretations then the one _ which is favourable to the subject be adopted. [1996] 74 _ _ TAX 9 (H.C.Lah.); [1991] 64 TAX 34 (H.C.Kar.); [1989] _ 59 TAX 79 (H.C.Kar.); [1985] 51 TAX 66 (H.C.Kar.) _ Benefit of ambiguity should be given to the assessee. [1977] 35 TAX 169 (H.C.Lah.)
175
In case of ambiguity in language, statement of objects _ and reason can be relied upon. [1962] 6 TAX 1 (H.C.Lah.) _ = 1962 PTD 625 = 1962 PLD 809; 5 ITC 275 (All.)
175
176
176
Literal rule can only be deviated in case of ambiguity in language; otherwise courts should adhere to plain words. _ [5 ITC 159 (H.C.Lah.) _ Inconsistencies are in-built in income tax. [5 ITC 8 (H.C.Lah.)
176
A new and added obligation not formerly cast upon the taxpayer cannot be extracted uut of ambiguity of the _ provisions of the Act [1 ITC 363 (Calcutta)] _ General Language not infrequently intended sub modo. [1 ITC 284 (Calcutta)]
177
176
177
21 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
300. 301. 302. 303.
Fiscal statutes should be interpreted according to their _ natural meanings. [1 ITC 161 (Burma)] _ Benefit of doubt is the right of taxpayer. [1 ITC 161 (Burma)] _ Practice not a guide where language of statute is clear. [1 ITC 54 (Calcutta)] _ No taxation except by express words. 1 ITC 37 (Mad.)
178 178 178 180
NON OBSTANTE PROVISION OVERRIDES CONFLICTING PROVISION
304.
Non obstante provision overrides conflicting provision. _ [2000] 82 TAX 73 (H.C.Kar.) = [2000] 81 TAX 249 (H.C.Kar.) = 2000 PTD 254
180
DOCTRINE OF BINDING PRECEDENT (STARE DECISIS)
305.
306. 307. 308.
309. 310.
311. 312. 313.
Division bench of a High Court cannot disagree with another Division Bench without reference to a larger bench or should leave the matter to be decided by Supreme Court. _ [PLD 1995 S.C.Pak 423]
181
Cautious approach is necessary when adopting foreign case_ law. 1981 SCC 546 = [1981] 44 TAX 40 (S.C.Pak.)
181
English decisions in pari materia and their binding value. _ [PLD 1963 S.C.Pak 296]
181
Pre-partition judgements are binding unless overruled by _ Pakistani courts. 1955 SCC 1 = [1960] 2-TAX (Suppl.-29) (S.C.Pak)
182
Per incuriam judgement of even the highest court is not _ binding. [1995 CLC 1435 (H.C.Kar.)
182
Reliance on foreign cases in the presence of contrary view _ taken by Pakistani courts is strongly disapproved. [1989] 60 TAX 45 (H.C.Kar.) = PTCL 1989 CL 660 _ Principles of “stare decisis”. [1981] 43 TAX 100 (H.C.Lah.)
182 182
Binding judgements and conduct of different benches. _ _ [PLD 1960 Lahore 1962]; [PLD 1960 Lahore 687]
183
English decisions in pari materia and their binding value. _ [1 ITC 133 (Madras)
183
22 Section 1
Income Tax Digest. PAGE NO
DOCTRINE OF MERGER
314.
315.
_ Doctrine of Merger. [1992 SCC 910 = PLD 1992 SC 549]; _ _ [1991 SCC 805 = 1992 SCMR 523]; [1985] 51 TAX 83 (H.C.Kar.)
184
On appeal original order ceases to exists and merges itself in _ the appellate order [1992] 65 TAX 205 (H.C.Lah.)
185
LEGAL MAXIMS
316.
317. 318.
319. 320. 321. 322. 323. 324. 325.
_ Audi alteram partem. 1964 SCC 176 = [1964] 10 TAX 49 _ (S.C.Pak); [1999] 79 TAX 605 (H.C.Kar.) = 1999 PTD _ _ 1358]; [1994 SCMR 2232]; [1979] 39 TAX 1 (H.C.Lah.); _ [AIR 1920 Lahore 247] _ Casus Omissus. [AIR 1933 PC 63, 65] _ Ejusdem generis - Meaning of. PLD 2000 S.C. 111; _ [1997] 75 TAX 1 (H.C.Lah.) = 1997 PTD 605 = PTCL 1997 CL 29] _ Ex abundanti cautela. [1935] 3 ITR 103 (Lah.); [1925] 9 TC 445 (HL) _ Generalia specialibus non derogant. [1967 SCC 289 = _ [1967] 16 TAX 81 (S.C.Pak); 1 ITC 284 (Cal.) _ Mens rea. [PLD 1967 SC 1] _ Noscitur a Sociis. [1994] 70 TAX 11 (H.C.Lah.) _ No one can be judge in his own cause. [PLD 1999 SC 1126] Things should be done as per law or not be done at all. _ [PLD 1999 Lahore 446] _ Ut res valeat quam pereat. [1940] 8 ITR 442 (PC)
185 186
186 187 188 188 188 189 189 189
DOCTRINE OF RES JUDICATA/ESTOPPEL
326. 327.
328. 329.
_ _ Principle of res judicata not applicable. 1991 SCC 805 = [1992] 65 TAX 239 (S.C.Pak) Doctrine of res judicata - not applicable to income-tax _ proceedings. 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562 _ Income tax officer - when not bound by res judicata. [1965 SCC 212 = PLD 1965 SC 171] Principles of waiver or estoppel do not apply against a _ provision of law. [1999] 80 TAX 89 (H.C.Kar.) = [1999 PTD 2895
190
190 191
192
23 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
330.
331. 332. 333.
Doctrine of promissory estoppel could not be invoked against _ the legislature and the laws framed by it. [1998] 78 TAX 168 (H.C.Lah.) _ Equitable doctrine of estoppel. [1990] 62 TAX 91 (H.C.Lah.) _ Principle of res judicata and estoppel. [1966) 14 TAX 161 (H.C.Kar.) Executive actions are not excluded from the operation of _ promissory estoppel. [1992] 65 TAX 268 (H.C.Kar.)
192 193 194 194
NATURAL JUSTICE/DUTIES OF COURT
334.
335.
336. 337.
338. 339.
340.
341.
342. 343. 344.
Affording of an opportunity is a prerequisite for taking a _ penal action. 1969 SCC 350 = [1975] 31 TAX 101 (S.C.Pak) An order affecting the rights of a party cannot be passed _ without an opportunity of hearing to that party. [1964 SCC 176 = [1964] 10 TAX 49 (S.C.Pak) _ Duties of courts in administration of justice. [1990] 62 TAX 119 (H.C.Kar.)
194
195 195
No adverse order should be passed against a party without _ affording an opportunity to hear the case. [1984] 49 TAX 18 (H.C.Kar.)
196
Justice should not only be done but must also appear to _ have been done. [1980] 42 TAX 47 (H.C.Lah.)
196
Principles of natural justice are part and parcel of every statute unless there is specific provision in a particular _ statute to the contrary. [1969] 19 TAX 198 (H.C.Kar.)
196
Principles of natural justice cannot be invoked in deciding a _ legal issue with reference to the statutory provision. [1968] 18 TAX 72 (H.C.Kar.)
196
The court must consider the intention and not merely the _ form, while examining a document. [1976] 34 TAX 54 (H.C.Lah.) _ Judicious exercise of discretion. [1973] 27 TAX 212 (H.C.Lah.)
197 197
Article 4 of Constitution of Pakistan 1973 vis-a-vis “due _ process of law”. [PLD 1999 S.C. 1126]
197
Public power and administrative discretion ought to be _ exercised fairly. [PLD 1999 Kar. 433]
198
24 Section 1
Income Tax Digest. PAGE NO
DOCTRINE OF MUTUALITY
345.
Five-point criteria for applying “doctrine of mutuality”. _ [1959] 1-TAX (III-150) (H.C.Lah.) =1959 PTD 639 =1959 PLD 627
198
NON-APPLICATION OF FEDERAL TAX LAWS TO TRIBAL AREAS
346.
_ Non-application of Federal Tax Laws to tribal areas etc. [1982] 45 TAX 263 (H.C.Kar.) = 1982 PTD 46 = 1990 PTCL 954
199
RULES RELATING TO INTERPRETATION OF AMENDING PROVISIONS EXPLAINED
347. 348.
Rules relating to interpretation of amending provisions _ explained. [1979] 40 TAX 116 (H.C.Kar.) = PLD 1979 591
200
Scope and import of incorporated provisions of law _ explained. [1977] 35 TAX 42 (H.C.Lah.)
200
PRINCIPLES GOVERNING INTERPRETATION OF FINANCIAL LIABILITIES
349.
Principles governing interpretation of financial liabilities. _ [1977] 36 TAX 8 (H.C.Lah.) = 1977 PTD 183 = 1977 PLD 797
201
INTERPRETATION LEADING TO DESTRUCTIVE ENDS SHOULD BE AVOIDED BY COURTS
350.
Interpretation leading to destructive ends should be avoided _ by Courts. [1976] 34 TAX 54 (H.C.Lah.)
202
TERMS AND PHRASES USED IN ONE STATUTE
351.
Phrases used in one statute borrowed as aid in support of the interpretation of a different statute meant for a different purpose and dealing with a wholly different subject matter _ is not always safe. [1975] 32 TAX 273 (H.C.Lah.)
204
MARGINAL NOTES TO THE SECTION OF AN ACT CANNOT BE REFERRED TO FOR THE PURPOSE OF CONSTRUING THE ACT
352.
Marginal notes to the section of an Act cannot be referred to _ for the purpose of construing the Act. [1976] 33 TAX 258 (H.C.Lah.)
205
25 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
PRINCIPLE OF LITERAL INTERPRETATION
353.
354.
Provisions should be interpretated in accordance with the _ plain meaning of the language used therein. [1966] 13 TAX 145 (H.C.Dacca) _ Statute should be given its ordinary meaning. [1963] 7 TAX 113 (H.C.Dacca)=1963 PTD 161 =1963 PLD 373
206 206
DOCTRINE OF FAVOURABLE INTERPRETATION
355.
Doctrine of favourable interpretation applies to charging _ and not to machinery provisions. [1963] 7 TAX 153 (H.C.Lah.) = 1963 PTD 534 = 1963 PLD 311
206
DEPARTMENT CAN GO BEYOND A TRANSACTION
356.
Department can go beyond a transaction. (H.C.Lah.)
_
1962 PTD 603 207
APPLICATION OF TAX RATES THROUGH A FINANCE ACT EXPLAINED
357.
Application of tax rates through a Finance Act explained. _ [1961] 4 TAX 135 (H.C.Dacca) = 1961 PTD 1110 = 1962 PLD 104
207
ACT IS TO BE READ AS A WHOLE
358.
_ Act is to be read as a whole. [1960] 2-TAX (III-474) (H.C.Dacca) = 1960 PTD 727 = 1960 PLD 535
STATUTE SHOULD BE READ AS A WHOLE
359.
Statute should be read as a whole. (H.C.Dacca)
_
208
1960 PTD 574 208
SECTION VS. RULE
360.
Rules cannot be called in aid to interpret sections of the Act. In case of discrepancy in language of section and rules, _ section is to prevail. [1959] 1-TAX (III-407) (H.C.Kar.) = 1959 PTD 707 =1959 PLD 539
PRINCIPLE OF APPROBATE AND REPROBATE
361.
Principle of approbate and reprobate explained. TAX 131 (H.C.Lah.)
_
209
[2000] 82 210
26 Section 1
Income Tax Digest. PAGE NO
HIGH COURT IS COMPETENT TO ENTERTAIN WRIT WHERE INTERPRETATION OF LAW IS INVOLVED
362.
High Court is competent to entertain writ where _ interpretation of law is involved. [2000] 81 TAX 390 (H.C.Lah.)
211
GENERAL RULES IN RESPECT OF WRIT PETITION
363. 364. 365.
366.
367. 368.
369.
370. 371. 372.
373.
Petition challenging order under section 53 held to be _ maintainable. [2001] 83 TAX 119 (S.C.Pak.)
211
Conditions for maintainability of writ petitions explained. _ 1993 SCC 1022 = [1993] 68 TAX 35 (S.C.Pak.)
211
Constitutional jurisdiction only in extraordinary _ circumstances. 1993 SCC 1018 = [1993] 68 TAX 29 (S.C.Pak.)
212
Writ jurisdiction can be invoked in cases of mala fide action _ by the departmental authorities. 1989 SCC 715 = [1989] 60 TAX 83 (S.C.Pak.)
213
Extraordinary jurisdiction is not necessarily a speedy remedy.
213
The assessee has other options like filing a complaint with _ Ombudsman. 1988 SCC 710 = [1989] 60 TAX 52 (S.C.Pak.)
213
Order passed without giving opportunity of being heard is _ not sustainable. 1969 SCC 319 = [1975] 31 TAX 94 (S.C.Pak.) _ No time limitation for illegal orders. [2000] 82 TAX 135 (H.C.Lah.)
213 214
Remedies not availed disentitles the party from relief if _ constitutional petition also fails. 2000 PTD 306
214
High Court can exercise constitutional jurisdiction in a case where alternate remedy is only illusory in its nature and on _ the face of order it is clearly misapplication of law. [1999] 80 TAX 262 (H.C.Lah.)
214
Writs held to be maintainable vis-a-vis doctrine of _ _ exhaustion as no bar. PLD 1999 Lahore 417; PTCL 1999 _ CL. 359 = 1999 SCMR 1072; [1999] 79 TAX 255 _ (H.C.Kar.) = 1998 PTD 3923]; [1997] 75 TAX 261 _ (H.C.Lah.) = 1997 PTD 821; [1994] 70 TAX 272 _ _ (H.C.Kar.); [1989] 59 TAX 115 (H.C.Kar.); [1988] 57
27 SHORT TITLE, EXTENT AND COMMENCEMENT
_
374.
375. 376.
377.
378.
379.
380.
381. 382.
383. 384. 385.
Section 1 PAGE NO
TAX 14 (H.C.A.J&K); [1981] 44 TAX 59 (H.C.Kar.); _ [1980] 41 TAX 60 (H.C.Kar.)
215
Writ cannot be converted into appeal under section 136. _ [1997] 76 TAX 238 (H.C.Lah.)= 1998 PCTLR 440 = 1998 PTD 874
219
Interim relief in the form of release of goods on furnishing of _ indemnity bond held. [1996] 73 TAX 215 (H.C.Kar.)
219
Constitutional jurisdiction cannot be invoked to enforce the rights which were not in existence at the time when the _ offending enactments were passed. [1996] 73 TAX 85 (H.C.Queeta)
221
Statutory period for filing revision petition long expired, petitioner could not be declared non-suit only on the ground _ of maintainability. [1995] 72 TAX 223 (H.C.Kar.)
221
If remedy provided under the law is not efficacious then _ speedy petition is maintainable. [1995] 72 TAX 218 (H.C.Lah.)
222
Writ petition admitted to regular hearing to consider the _ vires of legislation, demand could be stayed. [1994] 70 TAX 272 (H.C.Kar.)
222
Exemption of assessee from payment of Income Tax was refused by the Income Tax Authorities - High Court set aside the order of refusal of exemption and remitted the cases of assessee for decision according to law with the consent of _ parties and with a view to avoid delay. [1993] 68 TAX 173 (H.C.Lah.)
223
Stay cannot be granted without notice to the Law Officer of _ State. [1993] 68 TAX 171 (H.C.Kar.)
223
Extra-ordinary jurisdiction of the High Court could not be invoked without first availing the remedies available under _ the relevant law. [1992] 66 TAX 226 (H.C.AJ&K) _ Stay granted could not be given beyond six months. [1987) 56 TAX 120 (H.C.Kar.) _ High Court can grant stay of recovery of tax. [1987] 56 TAX 78 (H.C.Kar.) Exercise of jurisdiction of High Court is confined only to consideration-whether authority had acted with or without _ jurisdiction. [1984] 50 TAX 37 (H.C.Lah.) = PLJ 1984 Lah. 423
224 224 224
225
28 Section 1
Income Tax Digest. PAGE NO
386.
387.
388. 389.
Where alternate and equally efficacious remedy is available, the petitioner is not entitled to invoke extraordinary jurisdiction of the High Court by way of writ petition. _ [1981] 43 TAX 92 (H.C.Kar.) = 1981 PTD 53
225
Provisions of the Income Tax can be challenged on constitutional grounds inspite of alternate remedies. _ [1977] 36 TAX 8 (H.C.Lah.) = 1977 PTD 183 = 1977 PLD 797
226
Where there has been suppression of material/acts, writ of _ prohibition cannot be issued. [1950] 18 ITR 618 (Punj.)
226
In writ, court cannot assume jurisdiction of income _ tax department. [1964] 9 TAX 273 (H.C.Kar.) = 1964 PTD 554
227
WRIT HELD MAINTAINABLE
390.
391. 392.
393. 394.
395.
396.
397.
Writ is maintainable where order is illegal notwithstanding _ the availability of alternate remedy. [2000] 81 TAX 119 (H.C.Kar.) = 1999 PTD 4061
227
Writ is the appropriate remedy where order is void and _ without lawful authority. [1999] 79 TAX 28 (H.C.Lah.)
228
Where a finding of fact not based on evidence or where material evidence ignored, reference under section 136 is _ maintainable. [1996] 74 TAX 141 (H.C.AJ&K)
229
In case of writ, political victimization _ maintainable. [1996] 73 TAX 215 (H.C.Kar.)
229
petition
is
In cases involving fiscal rights even if alternate, adequate and effective remedies available to the petitioner, High Court can step in to prevent excess, if any, committed by _ public functionaries. [1995] 72 TAX 81 (H.C.Kar.)
231
Writ held maintainable even during the pendency of appeals when demand of taxes was huge and ran into millions and the department was pressing hard for its recovery but orders passed were against the law as held earlier by courts, _ though for different years. [1990] 62 TAX 98 (H.C.Kar.)
232
Writ maintainable provided order is unlawful although _ alternate remedy available to the petitioner. [1985] 51 TAX 157 (H.C.AJ&K)
233
Reference application pending disposal before the High Court held not a bar to maintainability of constitutional
29 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
398.
399.
400.
401.
402.
403.
404.
405.
petition challenging vires of law taxing “free reserve?‟ to _ Income Tax. [1984] 49 TAX 76 (H.C.Kar.)
234
Constitutional petition before High Court challenging vires of taxing “free reserves” to Income Tax held cannot be dismissed on ground of laches in view of nature of relief _ claimed and the circumstances of the case. [1984] 49 TAX 76 (H.C.Kar.)
235
Where alternate remedy available but not efficacious and statutory functionary acting mala-fide or in a partial, unjust and oppressive manner, High Court in exercise of its writ jurisdiction has power to grant relief to the aggrieved _ party. [1983] 47 TAX 162 (H.C.Kar.)
236
Order passed without lawful authority, partial, unjust and mala-fide; held assessee can invoke the extra-ordinary jurisdiction of the High Court even if alternate remedy is _ available by way of appeal, etc. [1981] 44 TAX 93 (H.C.Kar.)
236
Writ petition in the High Court challenging jurisdiction held _ competent even during the pending of appeal. [1980] 42 TAX 59 (H.C.Lah.)
237
In the presence of assessee‟s objection to exercise of jurisdiction on ground of bias, assessment was made without taking decision on the specific objection; held that even existence of alternate remedy would not operate to debar the assessee from invoking extraordinary jurisdiction _ of High Court. [1980] 42 TAX 47 (H.C.Lah.)
238
Order passed by a fiscal authority within jurisdiction but partial, unjust and oppressive held High Court is empowered to grant relief to aggrived party in writ _ jurisdiction. [1980] 41 TAX 25 (H.C.Kar.) = 1979 PTD 461
238
Where fact for determination was whether receipts supported by payment certificates produced by assessee were genuine and correct and claim was rejected without application of mind to this aspect, held High Court competent to interfere _ in its constitutional jurisdiction. [1976] 34 TAX 31 (H.C.Lah.)
239
If impugned action is patently without jurisdiction, writ jurisdiction of the High Court can be invoked even if _ alternate remedy is available. [1976] 34 TAX 1 (H.C.Kar.) = PLD 1976 Kar. 552
239
30 Section 1
Income Tax Digest. PAGE NO
406.
407.
408.
409.
410.
If assessment is suffering from lack of jurisdiction, writ jurisdiction of the High Court can be invoked, without _ availing of remedies available under the law. [1975] 31 TAX 114 (H.C.Kar.)
240
Writ is maintainable where action is malafide or without jurisdiction or vires of law is challenged Gulistan Textile Mills Ltd. v. CBR – [1994] 70 TAX 272 (H.C.Kar.)
241
Writ admitted during the pendency of appeals held _ maintainable. [1963] 7 TAX 153 (H.C.Lah.) = 1963 PTD 534 = 1963 PLD 311
241
Writ maintainable in case where forums provided under the _ relevant statute may not be just and proper. 1999 PTD 4037
241
Writ is maintainable where notice is without lawful jurisdiction – [1990] 62 TAX 8 (H.C.Kar.) = 1990 PTD 889
242
WRIT HELD NOT MAINTAINABLE
411.
412.
413.
414.
415.
416.
Writ petition is not maintainable in the presence of adequate _ alternate remedy under the statute. PTCL 2000 CL. 316 (S.C.Pak)
242
After availing normal remedy switching over to constitutional petition is not maintainable in the absence of _ justifiable reason. 1993 SCC 1080 = [1993] 68 TAX 176 (S.C.Pak.)
242
Where adequate alternate remedy is available writ under _ Article 199 is not maintainable. 1988 SCC 710 = [1989] 60 TAX 52 (S.C.Pak.)
243
If adequate remedy is not exhausted, writ jurisdiction _ cannot be invoked. 1968 SCC 316 = [1968] 18 TAX 1 (S.C.Pak.) _ Circumstance where writ is not maintainable. [1993] 68 _ _ TAX 145 (S.C.Pak); [1993] 68 TAX 132 (S.C.AJ&K) _ 1993 SCC 1018 = [1993] 68 TAX 29 (S.C.Pak); 1989 SCC _ 715 = [1989] 60 TAX 83 (S.C.Pak); 1972 SCC 400 = [1974] _ 29 TAX 208 (S.C.Pak.); 1968 SCC 313 = [1969] 19 TAX 97 _ _ (S.C.Pak.); [2000] 82 TAX 156 (H.C.Lah.); [2000] 82 TAX _ _ 131 (H.C.Lah.); [2000] 82 TAX 42 (H.C.Lah.); [2000] 81 TAX 224 (H.C.Lah.) = 2000 PTD 263; Writ held not maintainable where disputed question of fact _ involved. [2001] 83 TAX 17 (H.C.Lah.)
243
243 248
31 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
417.
418.
419. 420.
421. 422. 423.
424.
425. 426.
427.
428. 429.
In presence of arbitration clause in the agreement executed between the parties, writ petition is not maintainable. _ [2001] 83 TAX 397 (H.C.Lah.)
249
Writ is not maintainable where parties themselves agreed _ for arbitration in bilateral contracts. [2000] 81 TAX 60 (H.C.Lah.)
249
Writ not maintainable in case where no right to appeal or _ reference is provided in law itself. 2000 PTD 306
250
Writ petition not maintainable when remedy of seeking reference under section 136 of the unamended provisions of Income Tax Ordinance is available to the assessee at the _ relevant time. [1999] 80 TAX 273 (H.C.Lah.) = NLR 1999 TAX 170
250
Where the petitioner conceals material facts, writ is not _ maintainable. 1999 PCTLR 387
251
Writ petition is not maintainable where appeal is pending _ before any authority. [1999] 80 TAX 9 (H.C.Lah.)
251
In the presence of statutory remedy under the Income Tax Ordinance approach to the High Court through a writ _ petition is disapproved. [1997] 76 TAX 138 (H.C.Pesh) = 1997 PTD 1805
252
In case of availing the remedy of appeal writ is not _ maintainable. [1997] 76 TAX 110 (H.C.Lah.) = 1997 PTD 1104= 1998 PCTLR 520 (H.C.Lah.)
252
Where alternate statutory remedies available, writ petition _ is not maintainable. [1997] 75 TAX 259 (H.C.Lah.)
253
Assessing officer did not give appeal effect being challenged by the department. Assessee cannot be allowed to bypass the _ available adequate remedy. [1997] 75 TAX 117 (H.C.Pesh.) = 1997 PTD 7
253
Selection of return for audit - remedy sought through _ constitutional jurisdiction held not maintainable. [1996] 74 TAX 215 (H.C.Lah.)
254
Writ is not maintainable where facts are controversial. _ [1996] 74 TAX 21 (H.C.Lah.)
254
Legality and correctness of a factual controvery could not be _ resolved in constitutional jurisdiction. [1996] 73 TAX 106 (H.C.Lah.)
254
32 Section 1
Income Tax Digest. PAGE NO
430. 431. 432.
433. 434.
435.
436.
437.
438.
439.
440.
441.
442.
High Court cannot go in the domain of factual controversy. _ [1995] 72 TAX 274 (H.C.Pesh.)
255
Writ petition not maintainable where adequate and _ alternate remedy available. [1995] 72 TAX 1 (H.C.Lah.)
255
Factual inquiry involving controversial facts cannot be undertaken by the High Court in exercise of its _ constitutional jurisdiction. [1995] 71 TAX 216 (H.C.Lah.)
256
Writ cannot be entertained where adequate remedy is _ available. [1993] 68 TAX 74 (H.C.Lah.)
256
If Income Tax Officer‟s action is jurisdictional, writ _ jurisdiction of the High Court cannot be invoked. [1989] 59 TAX 86 (H.C.Kar.)
257
Issue being controversial involving inquiry - held not a fit case to be determined under supervisory constitutional _ jurisdiction of High Court. [1987] 56 TAX 24 (H.C.Kar.)
257
Assessee cannot avail remedy of constitutional petition before High Court, being dissatisfied with the notices. _ [1986] 54 TAX 1 (H.C.Kar.) = 1986 PTD 316
258
High Court cannot examine the question of controversial _ facts in constitutional jurisdiction. [1984] 49 TAX 76 (H.C.Kar.)
259
Remedies available under the law should be exhausted before invoking the extraordinary jurisdiction of the High _ Court. [1982] 45 TAX 17 (H.C.Kar.) = 1981 PTD 217
260
If question of jurisdiction of the assessing officer is not _ challenged, writ petition is not maintainable. [1982] 45 TAX 2 (H.C.Lah.)
260
Where appeal was dismissed by Appellate authorities on ground of limitation and this order was in accordance with law, held writ petition against such order was not _ competent. [1975] 31 TAX 153 (H.C.Lah.)
261
Writ not maintainable in the presence of adequate and _ efficacious alternate remedy. [1975] 31 TAX 105 (H.C.Lah.)
262
Writ is not maintainable where adequate alternate remedy _ _ is available. [1973] 27 TAX 51 (H.C.Lah.); [1972] 25 _ TAX 145 (H.C.Lah.); [1972] 25 TAX 140 (H.C.Lah.)
262
MISCELLANEOUS
33 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1 PAGE NO
443.
444.
445.
446. 447. 448. 449.
450. 451. 452.
453. 454. 455.
456. 457.
458.
Islamic jurisprudence and rules of law are equally _ applicable to fiscal laws. [1991 SCC 773 = PLD 1991 SC 368
263
Islamic jurisprudence and rules of law are equally _ applicable to fiscal laws. 1989 SCC 718 = [1989] 60 TAX 106 (S.C.Pak)
263
The assessing officer cannot lay down in their judgment a _ rule which goes against Islamic Law. 1989 SCC 718 = [1989] 60 TAX 106 (S.C.Pak) _ Remedy to be sought within four corners of Act. [1973 SCC 403 = [1974] 29 Tax 190 (S.C.Pak) Power to make rules is subject to certain limitations. _ [1998] 78 TAX 217 (H.C.Lah.) = 1998 PTD 3900] _ Discrimination in rule-making is ultra vires. [1998] 78 TAX 217 (H.C.Lah.) = 1998 PTD 3900] Civil suit does not lie against tax authorities unless order is _ malafide or illegal. [1998] 78 TAX 119 (H.C.Kar.) = 1998 PTD 2884 _ Basis of taxation in Islam. [1998] 77 TAX 1 (H.C.AJ&K) If notice is prima facie defective and error is incurable, the _ entire proceedings are null and void. [1997 PTD 47] Provisions of Protection of Economic Reforms Act, 1992 overrides Income Tax Law to the extent protections are _ provided in the former enactment. [1997] 76 TAX 302 (H.C.Lah.) _ Powers of CBR Territorial & Administrative Jurisdiction. _ [1996] 74 TAX 89 (H.C.Lah.) _ Budget speech has no legal sanctity. [1996] 73 TAX 85 (H.C.Quetta) Government employees working in non-taxable territories _ are liable to pay income tax. [1995] 71 TAX 45 (H.C.Quetta) _ The de facto doctrine. [1994] 69 TAX 109 (S.C.AJ&K)
264 265 265 266
266 266 267
268 269 270
271 271
A notification purporting to impose a new liability or _ obligation cannot operate retrospectively. [1993] 67 TAX 395 (H.C.Lah.)
271
Only natural/legal persons have vested rights and not the _ government/state. [1988] 57 TAX 46 (H.C.Kar.)
272
34 Section 1
Income Tax Digest. PAGE NO
459.
460.
It is the duty of the legislature and not of a court to save _ income from escaping assessment. [1985] 51 TAX 66 (H.C.Kar.)
272
Proceedings under the Income Tax Act are judicial _ proceedings. [1969] 19 TAX 198 (H.C.Kar.)
272
35 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1
Section 1 Short title, extent and commencement
GENERAL PRINCIPLES OF TAXATION/RULES OF INTERPRETATION LEGISLATIVE POWERS
Elahi Cotton Mills Ltd. & others v. Federation of Pakistan & Others – 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) 1.
Legislature enjoys wide powers in framing fiscal laws.
That in view of wide variety of diverse economic criteria, which are to be considered for the formulation of a fiscal policy, Legislature enjoys a wide latitude in the matter of selection of persons, subject matter, events, etc. for taxation. But with all this latitude certain irreducible desiderata of equality shall govern classification for differential treatment in taxation laws as well. That Courts while interpreting laws relating to economic activities view the same with greater latitude than the laws relating to civil rights such as freedom of speech, religion etc. keeping in view the complexity of economic problems which do not admit of solution through any doctrinaire or strait jacket formula as pointed out by Holmes J. in one of his judgments. That Frankfurter J. in Morey v. Doud (1957) U.S. 457 has remarked that „in the utilities, tax and economic regulation cases, there are good reasons for judicial self restraint if not judicial deference to the legislative judgment‟. 2.
Taxing rights of legislature are unlimited as long as these are not confiscatory.
That the taxing power is unlimited as long as it does not amount to confiscation and that the Legislature does not have the power to tax to the point of confiscation. That the word „reasonable‟ is a relative generic term difficult of adequate definition. It inter alia connotes agreeable to reason;
36 Section 1
Income Tax Digest.
conformable to reason; having the faculty of reason; rational; thinking, speaking, or acting rationally; or according to the dictates of reason; sensible; just; proper and equitable or to act within the constitutional bounds. 3.
Parliament is competent to levy presumptive taxation.
In our view, Sections 80C and 80CC of the Ordinance fall within the category of presumptive tax as under the same the persons covered by them pay a pre-determined amount of presumptive tax in full and final discharge of their liability in respect of the transactions on which the above tax is levied. If we were to read Entry 47 [of the 4th Schedule to the Constitution, Part I] in isolation without referring to Entry 52, one can urge that Entry 47 does not admit the imposition of presumptive tax as the expression „taxes on income‟ employed therein should be understood as to mean the working out of the same on the basis of computation as provided in the various provisions of the Ordinance. We are inclined to hold that presumptive tax is in fact akin to capacity tax i.e. capacity to earn. In this view of the matter, we will have to read Entry 47 in conjunction with Entry 52 which provides taxes and duties on production capacity of any plant, machinery, undertaking, establishment or installation in lieu of the taxes or duties specified in Entries 44, 47, 48 and 49 or in lieu of any one or more of them. Since under Entry 52, tax on capacity in lieu of taxes mentioned in Entry 47 can be imposed, the presumptive tax levied under Sections 80C and 80CC of the Ordinance is in consonance with the above two entries if read in conjunction. Since under Sections 80C and 80CC the imposition of presumptive tax is in substitution of the normal method of levy and recovery of the income tax, the same is in consonance with Entry 52. The question, as to whether a particular tax is confiscatory or expropriatory, is to be determined with reference to the actual earning or earning capacity of an average prudent successful entrepreneur in a particular trade or business. The fact that a particular assessee has suffered loss/losses during certain assessment years, is not germane to the above question. In this regard reference may again be made to the case of the Madurai District Cooperative Bank Ltd. v. Third Income Tax Officer, Madurai (supra), referred to hereinabove in para 28(x), wherein taxable income of the assessee declared was Rs.51,763; whereas the tax imposed was Rs.76,674/07 including surcharge. Indian Supreme Court sustained the above levy and inter alia held that what is not income under the Income Tax Act can be made
37 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1
income under the Finance Act or exemption granted by the Income Tax Act can be withdrawn by the Finance Act or its efficacy can be reduced. Reasonable classification does not imply that every person should be taxed equally. It may be pointed out that reasonable classification is permissible provided it is based on an intelligible differentia which distinct persons or things that are grouped together from those who have been left out and that the differentia must have rational nexus to the object sought to be achieved by such classification. It may further be pointed out that different laws can be validly enacted for different sexes, persons in different age groups, persons having different financial standings and that no standard of universal application to test reasonableness of a classification can be laid down as what may be reasonable classification in a particular set of circumstances, may be unreasonable in the other set of circumstances. The requirement of reasonable classification is fulfilled if in a taxing statute the Legislature has classified persons or properties into different categories which are subject to different rates of taxation with reference to income or property and such classification would not be open to attack on the ground of inequality or for the reason that the total burden resulting from such a classification is unequal. The question, as to whether a particular classification is valid or not, cannot be decided on the basis of advantages and disadvantages to individual assessees which are accidental and inevitable and are inherent in every taxing statute as it has to draw a line somewhere and some cases necessarily may fall on the other side of the line. We may observe that once the Court finds that a fiscal statute does not suffer from any constitutional infirmity, it is not supposed to entangle itself with the technical questions as to the scope and modality of its working etc. The above question pre-eminently deserve to be decided by the Government which possesses of experts‟ services and the relevant information which necessitated imposition of the tax involved unless the same suffers from any legal infirmity which may warrant interference by the Court. The impugned provisions of the Ordinance are based on reasonable classification as they are founded on an intelligible differentia which distinguishes persons covered thereunder with the other tax-payers. It has also rational nexus to the object sought to be achieved by such classification i.e. to broadening the tax base and to recover the minimum tax.
38 Section 1
4.
Income Tax Digest.
Levy of minimum tax held constitutional.
Sections 80C and 80CC cannot be equated with section 80D as the same is founded on different basis. It may again be observed that section 80D is based on the theory of minimum tax. It envisages that every individual should pay a minimum tax towards the cost of the Government. The object of the minimum tax is to ensure that the taxpayers who receive substantial amounts from exempt sources, pay at least some tax on their economic incomes of the year. This is achieved by reducing or disallowing certain itemised deductions. We may again observe that a large number of assessees though generally earn profits but on account of various tax concessions including tax holidays, depreciation allowance etc. under Schedule II and deductions allowed under the various provisions of the Ordinance, show loss instead of any net profit, with the result that they do not contribute any income tax towards the public exchequer. The levy of minimum tax has been adopted in some other countries of the world including U.S.A., Israel, France, Columbia and Thailand besides India. In United States, under section 56(a) a tax equal to 15% of the amount, by which sum of the items of tax preference exceeds the greater of (i) $100,000 (b) .. (c) .. etc. is levied. We may again point out that the NTRC, which mostly comprised the representatives of business community representing various trade associations, in its report of December, 1986, quoted hereinabove in para 17, highlighted the corruption obtaining in Government and semi-Government departments and so also the dishonest tendency on the part of the tax-payers to evade the payment of lawful taxes by using unfair means. In such a scenario, the Legislature is bound to adopt modern and progressive approach with the object to eliminate leakage of public revenues and to generate revenues which may be used for running of the State and welfare of its people. The imposition of minimum tax under Section 80D is designed and intended to achieve the above objectives. The rate of half per cent of minimum tax adopted under Section 80D seems to be on the basis of the minimum rate of tax suggested by the Exports Enhancement Committee. In our view, the above provision falls within the legislative competence under Entry 47 read with Entry 52. The approach of this Court while interpreting the Constitution should be dynamic, progressive and oriented with the desire to meet the situation effectively which has arisen keeping in view the requirement of ever changing society. Applying the above rule of interpretation, we do not find any infirmity in the impugned Section 80D of the Ordinance.
39 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1
It may be stated that non-obstante clause in section 80-D is for the purpose of liability to pay minimum tax of half per cent on the annual turnover. This will exclude any provision of the Ordinance which may be inconsistent with it. But the same does not exclude the application of other provisions of the Ordinance which are not inconsistent with section 80-D. There seems to be no conflict between above Section 80D and section 35 of the Ordinance, and hence the same remains available to assessees. To claim business loss or to carry forward the same under section 35 of the Ordinance from year to year, is not affected by the above levy of half per cent on the annual turnover under section 80D. The Central Board of Revenue in a written undertaking dated 9.4.1997 filed before this Court confirmed that subject to the conditions laid down in paras 3 and 4 of Circular No. 3 of 1996 dated 18.3.1996, it has retrospective effect and will be applicable to all pending assessments. The relevant portion of the aforesaid circular has already been quoted hereinabove, the effect of which is that while computing the annual turnover of an assessee, the amounts of sales tax and excise duty charged in terms of paras 3 and 4 of the aforementioned circular would be excluded. The above undertaking of the Central Board of Revenue is incorporated as a part of this judgment. We may point out that an executive order/notification, which is detrimental or prejudicial to the interest of a person, cannot operate retrospectively. However, a beneficial executive order /notification issued by an executive functionary can be given retrospective effect. In this regard it will suffice to refer to the judgment of this Court in the case of Army Welfare Sugar Mills Ltd. and others v. Federation of Pakistan and others (1992 SCMR 1652). The above written undertaking of the Central Board of Revenue to make this circular applicable retrospectively is in consonance with the aforesaid judgment of this Court. In our view, since the provisions of Act XII of 1992 are subsequent in time and as they are contained in a special statute, they shall prevail over the provisions of Section 80D of the Ordinance, which was enacted through Finance Act, 1991, which was an earlier statute and which was part of a general statute. In this view of the matter, assessees who fulfil the conditions of the notifications referred to in the Schedule to Section 6 of Act XII of 1992, are entitled to the protection. The question, as to whether a particular assessee fulfils the conditions of the above notifications, is a question of fact, which will have to be determined by the hierarchy provided under the Ordinance and not by this Court. However, in order to eliminate
40 Section 1
Income Tax Digest.
multiplicity of litigation and to avert element of harassment to assessees, we have dealt with the legal aspect of the above contention though apparently it was not urged before the High Court as we do not find any mention in any of the judgments under appeal. Assessees who are covered by the notifications mentioned in the Schedule to Section 6 of the Protection of Economic Reforms Act, 1992 (Act XII of 1992), are entitled to the protection in terms thereof as per paras 52 to 54 hereinabove. They may approach the Income Tax Department. 5.
Power to levy taxes is an attribute of sovereignty of a state.
The power to levy taxes is sine qua non for a state. In fact it is an attribute of sovereignty of a state. It is a mandatory requirement of a state as it generate fiscal resources which are needed for running a state and for achieving the cherished goal, namely, to establish a welfare state. In this view of the matter, the legislature enjoys plenary power to impose such conditions as to liability or as to exemption as it chooses, so long as they do not exceed the mandate of the Constitution. It is also apparent that the entries in the legislative list of the Constitution are not powers of legislature but only fields of legislative needs. The allocation of the subjects to the lists is not by way of scientific or logical definition by way of mere simple enumeration of broad catalogue. A single tax may derive its sanction from one or more entries and many taxes may emanate from one single entry. It is needless to reiterate that it is a well settled proposition of law that an entry in the legislative list must be given a very wide and liberal interpretation. The word „income‟ is susceptible as to include not only what is in ordinary parlance it conveys or it is understood, but what is deemed to have arisen or accrued. It is also manifest that income tax is not only levied in conventional manner i.e. by working out the net income after adjudicating admissible expenses and other items, but the same may also be levied on the basis of gross receipts, expenditure etc. There are new species of income tax, namely presumptive tax and minimum tax. 6.
Restrictions on power to levy tax.
That the rule of interpretation that while interpreting an entry in a legislative list it should be given widest possible meaning does not mean the Parliament can chose to tax as income an item which is no rational sense can be regarded as citizen‟s income. The item taxed should rationally be capable of being considered as income of a citizen.
41 SHORT TITLE, EXTENT AND COMMENCEMENT
7.
Section 1
The principle of “equality” applies equally to fiscal enactments.
That the Legislature is competent to classify persons or properties into different categories subject to different rates of tax. But if the same class of property similarly situated is subjected to an incidence of taxation, which results in inequality amongst holders of the same kind of property, it is liable to be struck down on account of infringement of the fundamental right relating to equality. That „a State does not have to tax everything in order to tax something it is allowed to pick and choose districts, objects, persons, methods and even rates for taxation if it does so reasonably‟. (Willi‟s Constitutional Law). That the tests of the vice of discrimination in a taxing law are less rigorous. If there is equality and uniformity within each group founded on intelligible differentia having a rational nexus with the object sought to be achieved by the law, the constitutional mandate that a law should not be discriminatory is fulfilled. Haji Muhammad Shafi & Others v. Wealth Tax Officer & Others – [1992] 65 TAX 315 (S.C.Pak) 8.
Double Taxation is prerogative of legislature.
It is, thus, clear that unless there is any prohibition or restriction on the power of the legislature to impose a tax twice on the same subject matter, double taxation cannot be declared illegal or void though it may be oppressive and inequitable. Unless there is a clear law imposing tax twice merely by implication tax cannot be imposed twice over. There should be a clear and specific provision to that effect. Pak Industrial Development Corporation v. Pakistan, through the Secretary, Ministry of Finance 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562
Unless there is any prohibition or restriction imposed on the power of legislature to impose a tax twice on the same subject-matter, double taxation though a heavy burden and seemingly oppressive and inequitable can not be declared to be void or beyond the powers of the legislature. It may, however, be noted that double taxation can be imposed by clear and specific language to that effect. Where the language is not clear or specific by implication such levy can not be permitted.
42 Section 1
Income Tax Digest.
Imperial Tobacco Company of India Ltd. v. Commissioner of Income Tax, South Zone, Karachi – 1958 SCC 37 = [1960] 2-TAX (Suppl.-308) (S.C.Pak) 9.
The scope of powers of legislature to tax non-residents.
This construction is consistent with the words and the sense of the definition of „British India‟ as well as with the principle observed in section 4 of Income Tax Act, and the rule of International Law that a legislature has a authority to tax its citizens wherever they be, and to tax the foreigners only if they earn or receive income in the country for which legislature has the authority to make the laws. Commissioner of Income Tax v. Faysal Islamic Bank of Bahrain, Karachi – [2001] 83 TAX 376 (H.C.Kar.) 10.
Definition of word/expression “income” would mean “net income” after making all permissible allowances, deductions, depreciation etc as appearing in section 2(24) of the Ordinance. The said definition cannot be assigned to the word/expression “income” as used in section 23 of the Ordinance as the very purpose of section 23 of the Ordinance would be defeated.
We are not in agreement with Mr. Muhammad Fareed that the definition as appearing in section 2(24) of the Ordinance of the word/expression “income” would mean “net income” after making all permissible allowances, deductions, depreciation etc. If assuming for the sake of arguments that the definition is to be taken to mean “net income”, the said definition cannot be assigned to the word/expression “income” as used in section 23 of the Ordinance as the very purpose of section 23 of the Ordinance would be defeated. As has already been stated herein above, section 3 of the Ordinance as the very purpose of section 23 of the Ordinance provides the various permissible allowances, depreciations, expenditures etc., which are to be deducted from income. Such deduction can only be made from the “gross income” and not from the “net income” as the “net income” would be arrived at after providing/deducting all the permissible allowance, expenditures, depreciation etc. Addition in section 23(1)(v), the legislature has given its clear intention that depreciation on assets given on lease shall be allowed against lease, rentals only. Cases referred to: Laxmi Insurance Co. Ltd. Lahore v. Commissioner of Income Tax, Punjab, NWFP and Delhi Provinces, (AIR 1931 Lahore 441), Shaw Wallace & Co. v. Privy Council (AIR 1932 PC 138), Pakistan Fisheries Ltd. Karachi and others v. United Bannk Ltd., and 6 others appeals (PLD
43 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1
1993 SC 109), Iftikhar Ahmed and others v. President National Bank of Pakistan and others (PLD 1988 SC 53).
Continental Chemical Co. (Pvt.) Ltd. v. Pakistan and others – [2001] 83 TAX 305 (H.C.Kar.) 11.
CBR circular No 19 of 1991 dated 8.7.1991, assessee was under no obligation to deduct tax at source in relation to purchases on which tax at import stage had been deducted and which constituted final discharge of liability. Jurisdiction to apply provisions of Ordinance in any manner was not restricted to proceedings for assessment or recovery of final income tax liabilities, but also related with force in respect of advance tax, be it under section 50(4) or section 53 or any other provision of the Ordinance. Proviso to section 50(4)(a) categorically confirmed that substantive provision of said section was also to be applied to non-residents.
In our view the principle of law which thus, emerges from these Indian authorities is that where the payee/deductee pays his full tax, any short-fall in or failure to deduct income tax at source by the deductor/payer would not make the later an assessee in default, since non-deduction or short-fall in relation to thereof would be of no consequence. This principle is squarely applicable in the present case since the sellers/importers in the present case having paid their full tax, any failure to deduct the tax by the petitioner would be of no consequence. Respondent No. 3 has created a liability which cannot be ascribed as one under section 50(4)(a) of the 1979 Ordinance. In fact the deduction of tax contemplated under section 50(4)(a) also makes the following incumbent conditions: (a)
the credit of the tax deducted or imposed has to be passed on to the deductee;
(b)
the deductee shall be allowed to claim the benefit of this deduction in his return of total income tax and towards his final tax liability.
However, through the Circular under discussion the exemption in relation to deduction at source under section 50(4) has been extended to all recipients who may enjoy exemption under any the provisions of the 1979 Ordinance. This would surely include the further exemption prescribed by section 80C(4). Applying this circular also the petitioner was under no obligation to deduct tax at source under section 50(4) in relation to the purchases on which tax at import stage had been deducted under section 50(5) and which constituted a final discharge
44 Section 1
Income Tax Digest.
of liability under section 80C(4). The respondent 2 and 3 were bound to obey these orders/instructions under section 8 of the 1979 Ordinance, while these instructions were also in keeping with the provisions of the 1979 Ordinance in particular section 80C(4). Failure to disregard this CBR Circular is ipso facto an unlawful exercise of jurisdiction. The jurisdiction to apply the provisions of the 1979 Ordinance in any manner is not restricted to the proceedings for the assessment or recovery of final income tax, liabilities but also relates with the same force in respect of advance tax, be it under section 50(4) or section 53 or any other provision of the 1979 Ordinance. In the context of advance deduction of income tax at source there is no provision in the 1979 Ordinance nor any jurisdictional order issued by CBR that confers jurisdiction on the respondents Nos. 2 and 3. On the contrary, the proviso to section 50(4)(a) categorically confirms that the substantive provision of section 50(4)(a) is apply to nonresidents as well, but only mutatis mutandis. It is settled law that where impugned orders are void and completely without jurisdiction (as in this case), a petitioner can directly approach the Court in its Constitutional jurisdiction. It is an admitted position that the tax to be deducted is an advance tax, more particularly when the provision of section 50(4)(a) has been made subject to section 53 of the 1979 Ordinance. Any advance tax, of necessity thus, has otherwise to be imposed as per the scheme of advance tax under section 53, before the year runs out. The income tax to be deducted has to be a percentage of purchase and is directly linked up with the transactions. But if the tax under section 50(4)(a) or under section 53 is imposed after the end of the year to which it relates, it would cease to have the character of advance tax is to be paid or collected by 15th June. In this case for the purposes of advance tax, the assessment year 1996-97, respectively, while the respondent No.3, however, admittedly had issued his first notice on 1.6.1998 and then on 3.6.1998 and had completed orders in July/August, 1998. These proceedings and orders were thus, beyond section 50(4)(a) incompetent and time-barred as well. In case an assessee continues default of section 53 and the time for framing the regular assessment or the end of the assessment year reaches, the substantive default of section 53 (i.e. advance income tax) would automatically lapse since under law any payment of section 53 is a credit with the exchequer which is liable to be adjusted with the actual liability for that year.
45 SHORT TITLE, EXTENT AND COMMENCEMENT
12.
Section 1
Under the Indian Income Tax Act, 1961 presumptive tax regime has been made applicable to limited number of items but the deduction made at source has been made liable for adjustment against the tax demand created on regular assessment.
Under the Indian Income Tax Act, 1961 presumptive tax regime has been made applicable to limited number of items but the deduction made at source has been made liable for adjustment against the tax demand created on regular assessment. 13.
The question of retrospective operation of the explanation of section 52 of the Ordinance would have arisen only if it has the effect of imposing new liability or obligation on the taxpayer or had affected any existing rights either by taking them away or curtailing them.
A bare perusal of the explanation added to section 52 of the Ordinance is sufficient to conclude that it has not created any new obligation or liability on the taxpayers but has been solely designed to bring about a change in the forum where a person responsible for deducting advance tax on behalf of another assessee as per requirement of section 50 of the Ordinance is to be proceeded against on his failure to deduct or collect the advance tax and to deposit the same in Government treasury. The question of retrospective operation of the explanation would have arisen only if it has the effect of imposing new liability or obligation on the taxpayer or had effected any existing rights either by taking them away or curtailing them. A bare perusal of the explanation is enough to hold that it only provides a change in the forum, whereby the powers to hold that it only provides a change in the forum, whereby the powers to hold proceedings against the payer as a deemed assessee in default have been taken away from the Assessing Officer/Deputy Commissioner of Income Tax dealing with the tax proceedings of the recipients and have been conferred on the Assessing Officer/ Deputy Commissioner of Income tax having power to deal with the tax proceedings of the payer. It is a well-established principle of law that when the legislature brings about a change in the forum then the same is always with retrospective effect unless it has the effect of curtailing the existing rights available to a party for challenging any adverse order. By the aforesaid explanation, the legislature has not taken away any right of appeal or revision or has not in any manner curbed the rights available to a deemed assessee in default and is merely in the nature of a change of officer/authority.
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It may also be stated that the object of an „explanation‟ to a Statutory instrument is to clarify, to facilitate proper understanding of a provision and to serve as a guideline as pronounced by the Honorable Supreme Court in the case of Naveed Textile Mills Ltd. v. Assistant Collector (Appraisement) Customs House and other reported in PLD 1984 SC 92. By virtue of the explanation added/incorporated in section 52 of the Ordinance, the Assessing Officer/Deputy Commissioner of the Income Tax dealing with the tax assessment proceedings of an assessee would have the right to initiate and finalize the proceedings against the said assessee in cases where he is to be treated as an assessee in default. As such in view of this, no exception can be taken to the orders passed under section 52 read with section 86 of the Ordinance by Assessing Officer/Deputy Commissioner of Income Tax, respondent No. 3 against the petitioners. The petitioners should have satisfied themselves by reliable and satisfactory evidence that the said importers had been subjected to tax and should not have relied on assumptions, surmises and conjectures for non-performance of the obligations cast upon them by section 50(4) of the Ordinance i.e. deduction and collection of tax from the amount which they had paid to the eleven importers/sellers of medicines. In view of the addition/incorporation of the explanation to section 52 of the Ordinance, respondent No. 3 had the jurisdiction and authority to initiate proceedings under section 52 against the petitioners as assessee in default in the assessment proceedings relating to the petitioners and no exceptions can be taken to the order passed by him under section 52 read with section 86 of the Ordinance. Consequently, this Constitutional Petition is found to be without any substance and must fail. Case referred to: Mamy Beverages v. Saseem 1995 PTD 91, Kamran Industries v. Collector of Customs PLD 1996 Kar. 68, Union Bank Ltd. v. Federationn of Pakistan [1998] 77 TAX 125 (H.C.Lah.); [1998] 77 TAX 127 (H.C.Lah.) = 1998 PTD 2116, Elahi Cotton Mills v. Federation of Pakistan [1997] 76 TAX 5 (S.C.Pak) = PLD 1997 SC 582, Pakistan Textile Mills Owners Association v. Administrator of Karachi PLD 1963 Kar. 137, Julain Hoshing Dinshaw Trust v. Income Tax Offier 1992 SCMR 250, Commissioner of Income Tax/Wealth Tax v. Prime Dairies Ice Cream Limited 1999 PTD 4147.
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Indus Steel Pipes Ltd. v. Commissioner of Income Tax, Companies-II, Karachi and others – [1999] 79 TAX 410 (H.C.Kar.) 14.
Scope of Article 165 & 165A of Constitution; corporations created by provincial statutes are not “governments”.
Having examined 1997 PTD (Tribunal) 1435, it appears to be a correct view that a corporation created as a result of a statute was held not to be a part of the Provincial Government. The present appellant company being an assessee cannot be taken to be an organ of the State and, therefore, it seems that the issue in hand can only be resolved by examining the status of a company and looking into the important distinctive features. It would be seen that the definition of the Government in the definition clause cannot be extended to an extent so as to include bodies created by Provincial or Federal Statutes or incorporated as „public companies‟ as nothing is to be employed in statutes or documents which is inconsistent with the words expressly used. We further find that legislative intent is absent so to include corporation like the appellant company as an integral part of the Federal Government. We further find that in the present set of circumstances, the legislature has, in fact restricted this concession to companies and corporations directly owned by them and not to those, which are so owned by them through the medium of intermediate corporations. We further find that a company owned by a Government shall not, for all purposes, be deemed to be a Government Department. It may be quite correct that 50% holding of shares by a corporation for carrying on the functions in which they are engaged may be some extent are carried out on behalf of the Government and further that the income of the corporation to the extent of 50% income of the appellant company is, in fact, the income of the Government of Pakistan. One further aspect could also not be ignored that 50% shares are held by the corporation in the appellant company, than at least to the same extent, employees of the appellant company would be employees of the corporation and than whether it could be said that to the extent of 50% employees of the appellant company shall be deemed to be Government servants and all properties owned by the Corporation are owned by the Government and further all contracts made by the corporation will only be made by the President is required by Article 173 of the Constitution. Consequently, we are of the view that a company or a corporation owned by the Government shall be deemed to be a department of the Government, which was confined for the
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purposes of its immunity to tax earlier granted and available under Article 165 of the Constitution. ICC Textiles Limited v. Federation of Pakistan and others – [1999] 79 TAX 77 (H.C.Lah.) 15.
Levy of Corporate Asset Tax is constitutionally valid.
....there is no limitation placed on the use of word „assets‟ in item No. 50 of 4th Schedule [to the Constitution] and the question as to whether „gross assets‟ or „net assets‟ are to be taxed was relateable to mechanism and could be determined by the Federal Legislature while further legislating on the subject. I am, therefore, unable to agree with the learned counsel on the interpretation being placed on item No. 50 of 4th Schedule to the Constitution. No doubt tax can only be levied by the Parliament as ordained by Article 77 of the Constitution but as by promulgating section 12 of the Finance Act, 1991, the tax is being levied on the capital value of assets, no valid exception can be taken thereto. Syed Bhaies Pvt. Ltd. v. Government of Punjab – NLR 1999 Tax 176 16.
Constitutional powers of levying taxes by Federation and provinces.
It is a fundamental principle of interpretation that where Constitution distributes legislative powers between two different law-making bodies i.e. Federal and Provincial, an act enacted by any such body should be examined to ascertain its „pith and substance‟ or its true nature and character for purposes of determining real field of legislation within which subject-matter of the Act lies. Wherever legislative powers are distributed between legislative bodies through legislative lists, situations may arise where two legislative fields might apparently overlap. It is duty of Courts, however difficult it may be, to ascertain to what degree and what extent, the authority to deal with matters falling within these classes of subjects exists in each legislature and to define, in the particular case before them, the limits of the respective powers. It could not have been intention of Constitution that a conflict should exist, and, in order to prevent such result the two provisions must be read together, and language of one interpreted, and, where necessary modified by that of the other.
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Pakistan Burma Shell Ltd., Etc. v. Federation of Pakistan through Secretary Ministry of Finance, Government of Pakistan, Islamabad, etc. – [1998] 78 TAX 234 (H.C.Kar.) = PTCL 1998 CL. 690 17.
Personal interest must yield to larger interest.
[Per Mamoon Kazi, J. Contra.] – The expression “tax on income” would not only include “within its ambit profits or gains actually received by an assessee, but even something that may be presume by the Legislature to have been received. The Legislature in order to achieve certain object would therefore, be acting within its power while resorting to this method of legislation. As was again observed in Elel Hotels‟ case, “taxation is now not a mere source of raising money to defray expenses of Government. It is a recognised fiscal tool to achieve, fiscal and social objectives”. Although, in the present case, ostensibly gross receipts of the assessee or the turnover of his business have been deemed to be his income, but in reality only a certain percentage thereof, higher than the imposition is presumed to be his income. Inherent in the concept of income no doubt, is also the concept of profitability and any amount to be called income must have some characteristics of income as the term is ordinarily understood by its various connotations, but the Court only has to ascertain that what has been deemed to be the Income of the assessee can reasonably be deemed to be his income. Viewing the issue in the above background, it cannot be said in the present case that the Legislature has transgressed the limits provided by the Constitution. Under section 80C of the Ordinance the whole of the amount received by a person on account of supply of goods or on execution of a contract or the amount spent by an importer of goods (which shall also include customs duty and sales tax) is to be deemed to be the income of such person. Likewise, under section 80-CC of the Ordinance the whole of export proceeds of a person are to be deemed to be his income. Under section 80C of the Ordinance, a tax at the rate of one-half per cent is to be imposed as minimum tax In relation to the turnover of business or trade of a person. The liability for payment of Income Tax varies in case of sections 80C and 80CC from one half percent to one percent of the income in case of exports and from two percent in case of imports to two and one-half percent in case of supplies. These rates neither appear to be expropriatory nor confiscatory. Unless the imposition is disproportionate to income, it cannot be said to be confiscatory.
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In our opinion, the mere fact that margin of profit would be different cannot render the said provisions discriminatory or arbitrary or violative of Article 25 of the Constitution. Profitability in any trade or a business & profession is also commensurate with the relative efficiency of its management although there can be various other factors responsible for the same. However, no two companies or firms having similar trade or business can earn similar margin of profit. The impugned provisions of the Ordinance are apparently based on a presumption that a certain percentage of the assessee‟s gross receipts would be tilt minimum profit. The assesses has been taxed accordingly by the said provisions. Since the provisions are applicable to an assessee engaged in a trade or business it can be normally presumed that the assessee will keep a sufficient margin of profit on his total turnover or his gross receipts. The income tax payable does not appear to be so unreasonable as to be regarded as arbitrary or confiscatory it is noteworthy that in case of sections 80-C and 80-CC of the Ordinance the assessee is not required to file returns. The provisions have, therefore been designed to be simple avoiding tedious procedure of assessment for the convenience and. benefit of the assessee. In case of section 80-D of the Ordinance, a return has to be filed and in case the tax payable by an assesses is more than one-half percent, the same will be assessed and paid accordingly. In case, no taxes payable or the tax payable is less than one-half per cent, such tax has to be paid. The provisions of section 80-D on the face thereof do not appear to be discriminatory as they are applicable to the assessee as a class. Section 80D which also by virtue of the non-obstante clause inserted therein purport to include such companies or registered firms in the tax net in whose case no tax is payable or has been paid for any reason enumerated in section 80D of the Ordinance. The application of the provisions of section 80C or 80CC of the Ordinance to certain contractors, importers or exporters, etc. as a distinct class is also not difficult to comprehend because tax was already being deducted from them at source under section 50 of the Ordinance. Therefore, the Legislature in Its own wisdom made the above provisions applicable to them. Apparently, the tax purported to be levied is neither unreasonable nor discriminatory nor it appears to be confiscatory. However, merely because a fiscal statute is unreasonable or oppressive, its constitutional validity cannot be called in question. In the present case, companies and registered firms have been classified by the legislation as a separate class and so have been
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certain contractors, suppliers, importers and exporters. The object sought to be achieved has been shown to be to generate more funds for the public revenue or to prevent evasion of Income Tax. It can hardly be denied that in this country, one of the methods that can be effectively employed to plug loss of revenue is by resort to presumptive taxation. Therefore, there is a reasonable nexus between the legislation and the object it seeks to achieve. As was pointed out earlier, the Legislature has sufficient latitude to classify persons or things in different categories to achieve the object of the legislation. The mere fact that the legislation tends to diminish the assessee‟s profile is not sufficient to-make it confiscatory either. The petitioners have failed to discharge the burden by demonstrating that the legislation in question is not in tune with the fundamental rights. In the present case, as we also pointed out earlier, the income tax levied on the gross receipts or as the case may be, the turnover does not appear to be unreasonable and the legislation appears to be based on a presumption that the assessee‟s minimum profit from the trade or business would exceed the Income Tax imposed under the said provisions of the Ordinance. Apparently, there appears to be no ground for assuming that such a measure is discriminatory or confiscatory, barring of course, a few exceptions reference to which has just been made in this judgment. However, as has been pointed out, when a larger benefit for the community is to be achieved, individual interest must yield to the larger interest. Punjab Small Industries Ltd. v. Deputy Commissioner of Income Tax, Lahore – [1995] 71 TAX 220 (H.C.Lah.) 18.
Powers of Federal Government to levy income tax on any property or income, including that of Provincial Government.
In the constitution as originally framed, Article 165 ordains that no tax can be levied by the Federal Government on any property or income of the Provincial Government. However, later on doubts arose as to whether the income of corporation owned and controlled by the Government or set up by it under Act of Legislature can be deemed to be the income of the Government within the meaning of Article 165 of the Constitution. In order to remove these doubts, the constitution was amended by Constitution (Amendment) Ordinance (P.O. 11) 1985 and Article 165-A was added which reads as under:Article 165-A of Constitutional: “Power of Majlis-e-Shoora (Parliament) to impose tax on the income of certain corporations, etc.(1) For the removal
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of doubt, it is hereby declared that Majlis-e-Shoora (Parliament) has, and shall be deemed always to have had, the power to make a law to provide for the levy and recovery of a tax on the income of a corporation, company or any other body or institution established by or under a Federal Law or a Provincial Law or an existing law or a corporation, company or other body or institution owned or controlled, either directly or indirectly by the Federal Government or a Provincial Government, regardless of the ultimate destination of such income.” United Liner Agencies Ltd. Karachi v. Commissioner of Income Tax, Karachi – [1988] 57 TAX (H.C.Kar.) 19.
Parliament can introduce a new change of tax either by incorporating that change in the Income Tax Act or by Finance Act.
The Income Tax Act or Income Tax Ordinance is a permanent Act or Ordinance while the Finance Acts are passed every year and their primary purpose is to prescribe the rate at which the income tax will be charged under the Income Tax Act or Ordinance. But that does not mean that a new and distinct change cannot be introduced under the Finance Act. We are of the view that the exigencies of the financial year determine the scope and nature of its provisions. If the Parliament has the legislative competence to introduce a new change of tax, it may exercise that power either by incorporating that change in the Income Tax Act, or by introducing it in the Finance Act or for the matter of that in any other statute. This is generally determined by the consideration whether the new change is intended to be more or less of a permanent nature or whether its introduction is dictated by financial exigencies of the particular year. Therefore, what is not income under the Income Tax Act can be made income by a Finance Act, an exemption granted by the Act can be withdrawn by the Finance Act or the efficacy of the exemption may be reduced by the imposition of a new change. Pak Industrial Development Corporation v. Pakistan Secretary, Ministry of Finance [1984] 49 TAX 76 (H.C.Kar.) 20.
through
Levy of tax on free reserves which had already suffered tax held not to be ultra-vires of the powers of Legislature under the Constitution.
The Finance Acts, 1967 and 1968 by which the impugned amendments were introduced in the Income Tax Act providing for levy of Income Tax on „free reserves‟ are intra vires. It is stated in para. 30 of the
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petition that the amount lying in „free reserves‟ of the company were in fact profits of the corporation on which Income Tax was already paid but this fact is not sufficient to render the levy of tax on such sums ultravires of the powers of Legislature under the Constitution. On a fair reading of para. 20 of the petition we are convinced that the amounts lying in „free reserves‟ of the petitioner were nothing but unappropriated profit which could legitimately be taxed by the Legislature as „income‟ in exercise of its power under Entry No. 43(c) of the Third Schedule to the Constitution of 1962. 21.
Words occurring in a constitutional provision relating to legislative power should be liberally construed.
The cardinal rule of interpretation is that the words should be read in their ordinary, natural and grammatical meaning. However, where courts are called upon to interpret a word occurring in a constitutional provision relating to legislative power, then the words are to be deliberately construed so as to give it widest connotation. 22.
Rule of interpretation of the word “income” occurring in Constitution explained.
The word “income” has not been defined in the Constitution and, therefore, in order to interpret the same we will refer to the dictionary meaning of the word. The cardinal rule of interpretation is that the words should be read in their ordinary, natural and grammatical meaning. However, where Courts are called upon to interpret a word occurring in a Constitutional provision to power, the words are to be liberally construed so as to give it widest connotation. Income therefore, in the light of above dictionary meanings would include all moneys or other gains periodically received by an individual, corporation, etc. for labour, service or from property, investments, operations, etc. Income denotes a thing that comes in. Therefore, in its natural meaning the word income will embrace any profit or gain which is actually received. Cases referred to: Maharajkumar Gopal Saran v. Commissioner of Income Tax (1935) 3 ITR 237; K.P. Varghese v. Income Tax Officer K.L.R. (1982) C C 84; Eisner v. Macombar 64 Law End. 521; Mst. Samina Shoukat Ayub Khan v. Income Tax Officer PLD 1981 S.C. 85 and Commissioner of Income Tax v. Shaw Wallace & Co. AIR 1932 P.C. 138.
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Pakistan Lyallpur Samundri, Transport Co. Ltd. v. Commissioner of Income Tax Lahore Zone, Lahore – [1982] 46 TAX 143 (H.C.Lah.) 23.
Redundancy cannot be readily attributed to the legislature.
One of the cardinal rules of interpretation of statutes is that where an amendment in the law takes place there must be implied necessarily an intention on the part of the Legislature to depart from the earlier law in some respects. Redundancy cannot be readily attributed to the Legislature. Haji Ibrahim Ishaq Johri v. Commissioner of Income Tax (West), Karachi – [1982] 45 TAX 263 (H.C.Kar.) = 1982 PTD 46 = 1990 PTCL 954 = 1982 PLD 266 24.
“Resident” of taxable territories is liable to tax on total world income including any income accruing or arising in non-taxable territories of Pakistan.
We are not inclined to agree with this contention of learned counsel as we are of the view that an assessee, who was ordinarily resident in a place in Pakistan but outside Swat, would be subject to tax not only in respect of income accruing to him in Pakistan outside but Swat also income accruing to him from sources in Swat. Such an assessee being a resident of an area, to which the Income Tax Act applied would be subject to tax under the Income Tax Act and his income from Swat would also be taxable. However, if the assessee was not ordinarily resident of any in Pakistan but which Income Tax Act applied, any income accruing to him from sources in Swat would not be taxable as the Income Tax Act at that time was not applicable to Swat. In this connection reference may be made to section 4(1) of the Income Tax Act where under the total income of a person ordinarily resident of a place in Pakistan to which the Income Tax Act applies includes not only income accruing to him iii Pakistan but also in respect of income accruing to him from outside Pakistan. In the instant case, if instead of the income accruing from Swat, the assessee had derived income from sources outside Pakistan, for instance from Dubai or U. K., the assessee, if ordinarily resident of Pakistan, would have been taxed in respect of such income derived by him from sources in Dubai or U. K. In such a case, it would not have been open to the assessee to argue that as Income Tax law is not applicable to Dubai or U. K., and admittedly the Pakistan Income Tax law is not applicable to such countries, income accruing from sources in, Dubai or U.K. would not be liable to tax. The appellant could not deny that at least the wife of the assessee maintains a dwelling house where a telephone is installed in the name
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of the appellant. This fact by itself shows that a part of the wife‟s residence is reserved as a dwelling place for the assessee appellant. Since this definitely gives him right to live in Pakistan and, therefore, within the meaning of section 4A(a)(ii) a residence is maintained for him in Pakistan for more than 120 days, he becomes a resident of Pakistan and as his residence for the 9 years out of the 10 previous years is not denied, he automatically becomes resident and ordinarily resident of Pakistan. We would hold that the assessee was liable to tax for all his income in and outside Pakistan. Case review : The judgement of the Sind High Court was later on approved by the Apex Court [1992 SCC 991 = [1992] 66 TAX 275 (S.C.Pak)].
Commissioner of Income Tax, (East) Karachi v. Ebrahim D. Ahmad & others – [1982] 45 TAX 232 (H.C.Kar.) 25.
Legislature has the power to enact curative legislation.
From the principles deduced from the case law discussed hereinabove, it is evident that the Legislature has the power to enact curative legislation and to validate orders/actions which were not valid or were without jurisdiction when passed or taken in cases when some proceeding arising from such order or action remains pending. As observed hereinabove that there cannot be any cavil to the proposition that an original invalid or an order/action without jurisdiction can be validated by the Legislature while some proceeding arising therefrom remains pending and that the transaction does not become past and closed. Begum Nusrat Bhutto v. Income Tax Officer, Circle V, Rawalpindi – [1980] 42 TAX 59 (H.C.Lah.) 26.
Charging section and subsequent provisions only enable the liability to be quantified.
It has, therefore, been accepted as a true principle of taxation that the liability imposed by the charging section and subsequent provisions enable the liability only to be quantified and when quantified to be enforced against the subject, but the liability is definitely and finally created by the charging section and all the materials for ascertaining it are available immediately. Mst. Saeeda & others v. Govt. of Pakistan & another – [1977] 35 TAX 180 (H.C.Kar.) 27.
Power to make and promulgate Ordinance includes the power to levy tax.
(Power to make and promulgate Ordinance for peace and good Government)........ must include the power to exact tax without
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money no good Government can function. The subject of tax therefore must be included within the scope of the phrase. The only limitation that is placed on the power of the President to promulgate Ordinance is that it is subject to the like restrictions as the powers of Federal legislature to make laws and the Ordinances so promulgated may be controlled or superceded by any such act. In other words the President can promulgate an Ordinance on any subject in regard to which the Federal Legislature can legislate which impliedly defines the scope of the legislation by the use of the phrase „peace and good Government‟. 28.
Authority to legislate includes authority to legislate with retrospective effect.
“..... it is a settled principle that the authority to legislate includes the authority to legislate with retrospective effect.” Commissioner of Income Tax v. Adamji Sons – [1966] 14 TAX 174 (H.C.Kar.) 29.
Rules cannot be made by subordinate delegate authority unless expressly permitted.
It is settled principle in law that a subordinated delegate authority cannot make rules or issue notification under a statute so as to give a retrospective effect to them, unless the statute itself grants such power. Emperor v. Probhat Chandra Barua – 1 ITC 284 (Calcutta) 30.
Charging section cannot be overlooked on hypothesis of history of exemption.
The fundamental fact for the purposes of construction is that the hypothesis, that the statute may have been enacted without attention to the broadest fact in Indian revenue history, is quite incredible. _ Again the purport of the charging sections if the express exemptions _ be disregarded as the reasoning requires is radically altered if an exemption of all permanently settled estates is implied. Wide areas escape the purview of the charge. Commissioner of Income Tax v. Venkatachalapathi – 1 ITC 185 (Madras) 31.
Modification of exemption from taxation must be express and not in general terms or by implication.
In case of exemption from tax any modification made should be through express words and not in general terms or by implications.
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Commissioner of Income Tax v. Zamindar of Singampalli – 1 ITC 181 (Madras) 32.
Subsequent general enactment does not interfere with special provisions unless expressed clearly.
That this exemption applies to taxes which might be imposed thereafter, as well as to taxes in force at the time of sanad is clear from the judgment of the House of Lords in Associated Newspapers, Ltd. v. City of London Corporation [1916) 2 A.C. 429] and it is not less clear from the same judgment that although it is competent to the legislature to withdraw or modify such an exemption by subsequent enactment, this can only be done expressly and not in general terms or by implication. For the latter proposition we may also refer to Maxwell on Interpretation of Statutes (6th Edition) Chapter VII, section 3. Rowe & Co. v. The Secretary of State for India – 1 ITC 161 (Burma) 33.
Court cannot make up for any deficiency of Legislature.
If the legislature, from want of foresight or for any other cause, has omitted to provide for a case, it is the province of the legislature itself, and not of the Courts, to supply the omission. Burma Railway Co. v. Secretary of State – 1 ITC 140 (Burma) 34.
Fair and reasonable construction for taxing statutes.
The rule for the interpretation of such statutes is laid down by Cotton L.J., in Gilbertson v. Fergusson [1881] 7 QBD 562 at p.572: „I quite agree we ought not to put a strained construction upon that section in order to make liable to taxation that which would not otherwise be liable, but I think it is now settled that in construing these Revenue Acts, as well as other Acts, we ought to give a fair and reasonable construction, and not to lean in favor of one side or the other, on the ground that it is a tax imposed upon the subject, and, therefore, ought not to be enforced unless it comes clearly within the words. There is another rule of interpretation, which must also be borne in mind. Where the object and intention of the legislature is clear and undoubted, that meaning should be given when possible to the words used which will best carry out the clear object and intention‟. _______________
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RETROSPECTIVE LEGISLATION
Commissioner of Income Tax, Rawalpindi Zone, Rawalpindi v. Lyallpur Cold Storage, Lyallpur – 1975 SCC 426 = [1976] 34 TAX 14 (S.C.Pak.) 35.
Retrospective application of law must be by explicit words.
Mr. M.A. Lone, learned counsel for the Department submitted in support of these petitions, that this Court‟s decision in the case of Noor Hussain still held the field. It was argued that the majority decision in that case proceeded on the interpretation of the crucial words „constituted by‟ which had replaced the earlier expression „constituted under‟ and which despite the amendment of 1965 still remained part of the statute. Learned counsel further submitted that the amendment of 1965 is merely declaratory and was inserted ex abundati cautela, and, therefore, will, in the absence of the express words in the amending statute or by necessary implication, not have retrospective effect. Income Tax Officer, Investigation Circle & others v. Sulaiman Bhai Jiwa & Others – 1969 SCC 354 = [1970] 21 TAX 62 (S.C.Pak.) 36.
Scope of retrospective legislation.
It is fundamental rule of law that no statute shall be construed to have a retrospective operation unless such a construction appears very clearly in terms of the Act, or arises by necessary and distinct implication (see Maxwell on the Interpretation of Statutes - 9th edition - page 221 and Treaties on Statute Law by Caries - 4th edition - page 329). It follows from this rule that retrospective effect to a statute may be given either by express words or that the same may be inferred from the language employed. It is true that the Finance Act of 1964 has not expressly stated that sub-section (2D) of section 34 shall be deemed to have taken effect from a date earlier than the date of enactment of that Act. But the language employed in that sub-section necessarily implies that the provision thereof, though prospective, has retrospective operation as well. The use by the Legislature of words, such as “shall” or “hereafter”, is taken to indicate an intent that the statute is to be construed as prospective only; on the other hand the use of words denoted past time, such as “heretobefore” constitute an explicit declaration that the Act is to be construed retrospectively. When retrospective effect to statute is not given by express words, one must, apart from the language employed, “look to the general scope and purview of the statute, and at the remedy sought to be applied, and consider what was the former state of the law, and what it was
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that the Legislature contemplated”. (See Treatise on Statute Law by Caries - 4th edition - page 334). Commissioner of Income Tax (AJ&K Council), Muzaffarabad and another v. Asian D. Enterprises through Eijaz Qureshi, Managing Director and 5 others, Commissioner of Income Tax (AJ&K Council) -&- Muzaffarabad and 2 others v. Messrs Cade Creets Associates through Managing Partner, Diwan Ali Khan Ghughtai and another [2000] 81 TAX 371 (S.C.AJ&K.) = 2000 PTD SC 892; Commissioner of Income Tax AJK and another v. Asian D. Enterprises and other [2000] 82 TAX 518 ((S.C.AJ&K.) 37.
Fiscal laws and theory of retrospectivity.
It is evidence from the case law, referred to by the learned counsel for the appellants, that there is no proposition in support of the view that a fiscal law cannot be made operative retrospectively. Obviously, when there is no such embargo imposed upon the Legislature by the Interim Constitution Act, how such a restriction can be assumed. Thus, the very basis on which the findings of the High Court rest is without any legal substance. Even if it is assumed for the sake of argument that demand of additional income tax is „deprivation‟ of the „property‟ of the respondents within the meanings of paragraph I, that has been done in pursuance of law, i.e., the Income Tax Ordinance, 1979 and the Finance Act, 1995 and, thus, the tax demanded could not be held violative of the Fundamental Right No. 14 according to which a person can be deprived of his property according to law. Needless to say, as has been indicated above, the demand of additional advance income tax from the respondents was made in pursuance of the aforesaid statutes which have been validly adapted in the State. However, the fact of the matter is that by the impugned provision of law, the rate of income tax has not been retrospectively increased; only the rate of deduction of advance tax has been increased. The deduction of advance tax is only a tentative deduction which has to be adjusted when the final assessment of income tax to be paid by the respondents-Companies is made. Thus, the findings of the High Court that demand of additional advance income tax is violative of Fundamental Right No. 14 guaranteed by the Interim Constitution Act, are devoid of any force and are not sustainable. In the light of what has been stated above, we accept the above entitled appeals, set aside the impugned judgements of the High Court and hold that additional advance income tax was rightly demanded from the respondents-petitioners. Consequently, the writ petitions filed by the respondents are hereby dismissed.
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Retroactivity of the law upheld. It may also be pointed out that in the instant case neither it has been the case of the respondents nor there are any findings by the High Court that any of the respondents-petitioners had paid the advance Income Tax at the previous rates prior to the enforcement of the Finance Act of 1995. It is evident from the above mentioned survey of case law that the findings of the High Court that the Finance Act, 1995, which was adapted retrospectively by Ordinance No. 1 of 1998, could not operate retrospectively are not legally correct. Micropak (Pvt.) Ltd., Lahore v. Income Tax Appellate Tribunal, Lahore and 2 others – [2001] 83 TAX 451 (H.C.Lah.) = 2001 PTD 1180 39. Amendment in law which is neither clarificatory nor declaratory cannot be applied retrospectively. The findings of this Court in re: Prime Commercial Bank and others v. Assistant Commissioner of Income Tax 1997 PTD 605 (H.C.Lah.) are relevant. In that case a Single Bench of this Court on the authority of an earlier view held in K.G. Old Principal Christian Technical Training Center Gujranwala v. Presiding Officer Punjab Labour Court Northern Zone and 6 others (PLD 1976 Lahore 1097) found it to be a settled proposition that generally an amendment was clarificatory or declaratory in nature. In the present case there is nothing to show that the amendment in section 12(18) by Finance Act, 1998 was brought about to clarify the earlier provision and not to bring a change in it. All the more so when the amendment was not given retrospective effect normally clarificatory or declaratory amendments are given. Rijaz (Pvt.) Ltd. v. Wealth Tax Officer, Circle-III, Lahore – [1996] 74 TAX 9 (H.C.Lah.) 40. An amendment which is explanatory or clarificatory is generally to operate retrospectively. As regards question of retrospectivity suffice it to say that the power of legislature to legislate retrospectively is well recognized and in the present case the retrospective operation to the explanation has been given by a specific provision in the amending law. Be that as it may, it is trite law that an amendment which is explanatory or clarificatory always operates retrospectively. Dreamland Cinema, Multan v. Commissioner of Income Tax Lahore – [1977] 35 TAX 169 (H.C.Lah.) If the object of the statute is to explain the provisions or to remove a doubt, the law would apply retrospectively. 38.
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National Food v. Commissioner of Income Tax – [1991] 64 TAX 60 (H.C.Kar.) 41.
In a Taxing Act there is no room for any intendment.
No doubt, as has been observed by the learned Tribunal, in a taxing act there is no room for any intendment and there is no equity about a tax and there is no presumption as to a tax and nothing is to be implied but one can only look fairly at the language used. However, in case of a beneficial statute its provisions cannot be interpreted so as to bring about a result contrary to the object of the legislation. An interpretation likely to advance the remedy and suppress the mischief must be adopted in case of statutes which confer benefit on individuals or any class of persons. Mandviwalla Motors Limited, Karachi v. Commissioner of Income Tax, Central Zone ‘B’, Karachi – [1991] 64 TAX 19 (H.C.Kar.) 42.
Omission of provision from statutes held not to operate retrospectively.
The Income Tax Officer, Company, Circle II, Karachi, passed an assessment order on the return filed by the applicants for assessment year 1971-72. He determined the undistributed profit of the applicants to be Rs.10,64,690 and imposed a tax of Rs.2,92,790 in terms of section 23-A of the said Act. On appeal the amount of undistributed profits was worked out to be Rs.8,58,392 and consequently tax payable was fixed at Rs.2,25,258. As the applicants failed to pay such amount additional tax under section 45-A of the Act was levied. On plain reading of the above provision of law it is abundantly clear that no provision has been made for providing any machinery for assessment but it clearly imposes a charge on undistributed income and is therefore of substantive nature. Such a conclusion is also in conformity with the principles of interpretation of statutes laid down in the case decided by the Privy Council and reported in [1940] 8 ITR 442 and followed in the case reported in 1985 PTD 465. The first contention advanced by Mr. Muhnmmad Nasim, Advocate for the applicant has no force. Mr. Muhammad Nasim, Advocate for the applicant has not been able to show that omission of section 23-A from the Act through Finance Ordinance, 1972, was done as a remedial or curative measure. We are also unable to subscribe to the view that original order of assessment by the Income Tax Officer required to be passed after issuing a show cause notice on the subject. At any rate in absence of
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any provision of issuing a notice in the enactment the requirements of principles of natural justice stand satisfied as the applicants were heard on the subject by the Appellate Authorities. Cases referred to : [1967] 15 Tax 303; (PLD 1974 SC 180); (1987 PTD 739); (1947) 8 ITR 442 and (1985 PTD 465).
Commissioner of Income Tax v. Olympia – [1988] 57 TAX 71 (H.C.Kar.) 43.
Substantive law amended by Finance Act, 1973 held to have retrospective operation to cover only pending cases.
The general rule of construction of statutes is that the enactments are not to be given retrospective operation unless the statute expressly provides so or from the language employed it appears to be the necessary intendment of the Legislature. As, however remedial statutes are designed to redress an existing grievance and do public good, and such statutes normally do not diminish, destroy or affect any vested right, these are liberally construed. Lahore High Court had also taken the view in Rippon‟s case (1973) PLD 1973 Lah. 849 that an amending law which is purely remedial and curative, must be liberally construed in favour of subject. We also subscribe to the same view. Then as stated in Crawford, if the rule of liberal construction is to be applied as it obviously should then any doubt should be resolved in favour of retrospective operation, if such operation does not destroy or disturb vested rights, impair the obligations of contracts, create new liabilities, violate due process of law or contravene some other provision of law and if such operation will carry out the intent of the Legislature as ascertained through the application of the principles of liberal construction. In our view, as the amending provision under consideration had been inserted in subsection (6) of section 18-A to remedy a wrong that was being done to the assessees, and the amending provision does not affect any vested right or create any new obligations, the amending provision is to be given retrospective operation for extending benefit to the affected parties in pending cases, to give effect to the intent of the Legislature. As observed earlier, a wrong was being done to the assessee by providing for an indefinite period during which they were made liable for payment of additional tax at the rate of 2 per cent per mensem and this wrong was sought to be remedied by the remedial and curative amendment brought about by the Finance Act, 1973. If the intention of the Legislature had been that this remedy should be available only in respect of assessments for the year 1973-74 and subsequent years, the Legislature would have used appropriate words
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to express such intention. No such appropriate words are mentioned in the amending provision. There is no reason why the remedial provision of the amending law should not be applied to pending proceedings. In fact, this appears to be the intent of Legislature. Although we are of the view that the amending provision being remedial in nature and not affecting any vested right or creating any new obligation and is, therefore, retrospective in operation, which also seems to be the intent of the Legislature, retrospective operation can only cover cases which were pending at the time the amending law was enacted i.e. eases which had not been finally determined or proceedings which had not attained finality. The retrospective effect of the amending law would, therefore, apply only to those cases where assessments had not been made by the Income Tax Officer or where an appeal was pending before the Tribunal or a reference was subjudice before the High Court, at the time the amending law was enacted. The cases which had finally been determined or had attained finality i.e. which were past and closed transactions, cannot be reopened under the amending legislation as there are no express words to that effect employed in the amending law. We may observe here that when reference is made in any law, legal instrument, legal document, legal language or law book or dictionary, about vested right, the reference is to the vested right of a person natural or legal, and never to vested right of the State. Legal theories relating to vested rights never contemplate vested rights of State. We are unable to accept the submission made by the learned counsel for the department that by giving retrospective operation to the amending law vested right of the State will be affected. In our opinion, this contention is not relevant for answering the question referred to us. As observed earlier, the amending law has retrospective operation to cover only pending cases and this appears to be the intention of the legislature. Cases referred to: Reliance Jute and Industries Ltd. v. Commissioner of Income Tax [1981] 44 Tax 53 (S.C.); B.B.&D. Manufacturing Co. Private Ltd. v. E.S.L Corporation [(1976) PTD (Trib.) 21]; Commissioner of Income Tax v. Rippon Printing Press (PLD 1973 Lah. 849) = [1973] 28 Tax 40; Whitney v. Commissioners of Inland Revenue (1926) AC 37; Chatturam v. Commissioner of Income Tax (1947) 15 ITR 302; Vidyapat Singhania v. Commissioner of Income Tax [1978] 38 Tax 95; C.S.T. v. Kruddsons Ltd. (PLD 1974 SC 180); Adam Afzal v. Sher Afzal (PLD 1969 SC 187); Muzaffar Ahmad v. Anwar Ali (PLD 1965 Dacca 296); Income Tax Officer v. Vidayasagar [1970] 21 TAX 110; Taimur Shah v. Commissioner of Income Tax (PLD 1951 F.C. 118) and The
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Estman Phtographic Materials Company Ltd. v. The Comptroller Geenral of Patents, Designs & Trad Marks [1898] A.C. 571.
Commissioner of Income Tax v. Olympia – [1988] 57 TAX 71 (H.C.Kar.) 44.
Scope of retrospective legislation.
It is a well-settled principle of interpretation of statutes that any amendment in the existing law will not affect cases which has been finally determined or proceeding which have attained finality unless the amendment expressly provides for such effect. The general rule of construction of statutes is that the enactment are not to be given retrospective operation unless the statute expressly provides so or from the language employed it appears to be the necessary intendment of the legislature. ...... If the rule of liberal construction is to be applied as it obviously should then any doubt should be resolved in favour of retrospective operation, if such operation does not destroy or disturb vested rights, impair the obligation of contracts, create new liabilities, violate due process of law or contravene some other provision of law and if such operation will carry out the intent of the legislature as ascertained through the application of the principles of liberal construction. Rustam F. Cousjee & 2 others v. CBR & 2 others – [1985] 52 TAX 123 (H.C.Kar.) Retrospective legislation is looked upon with disfavour as a general rule, and properly so because of its tendency to be unjust and oppressive. It is a fundamental rule of law that no statute shall be construed to have retrospective operation, unless such a construction appears very clear in terms of the Act, or arises by necessary and distinct implication. Upon the presumption that the legislature does not intend to enact what is unjust, every statute which takes away or impair a vested right acquired under the existing law or creates a new obligations or imposes a new duty or attaches a new disability in respect of transactions or considerations already passed must be presumed to be intended not to have retrospective operation; If there are words in the enactment which either expressly state or, necessarily imply that the statute is to be given retrospective operation, then the Act should have retrospective operation even though the consequence may appear
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unjust and hard; a statute is not to be construed to have greater retrospective operation that its language renders necessary. 45.
For the purposes of assessment of income the law applicable is that in force on the first day of the relevant assessment year.
It is well-settled that for the purposes of assessment to income tax the law to be applied is that law that is in force in the assessment year, in other words the income tax as stands amended on the first day of July of a financial year will apply to the assessment of that year. Commissioner of Income Tax Karachi v. Nisar Ahmad – [1984] 50 TAX 187 (H.C.Kar.) 46.
A penal provision cannot operate retrospectively.
A penal provision can‟t operate retrospectively unless it is so provided by the statute itself. A.J. Hartshorn v. Commissioner of Income Tax, West Karachi – [1984] 49 TAX 198 (H.C.Kar.) 47.
Any Act/Ordinance cannot cover any period prior to coming into force of the Act/Ordinance.
The well settled principle of law is that subject to any provision of saving clause, scope and extent of any section of any Act/Ordinance cannot cover any period prior to coming into force of the Act/Ordinance. Commissioner of Income Tax, Karachi (West), Karachi v. S. A. Rehman – [1980] 42 TAX 147 (H.C.Kar.) = 1980 PTD 314 48.
If a provision is neither declaratory nor curative it cannot be retrospective
The next argument of Mr. Mansoor Ahmed Khan is that Act XI of 1966 whereby section 10(2A) was amended is a declaratory, or in any case a creative enactment. He has stated that the amendment seeks to define what is a bad or doubtful debt, or in any case cures the existing provision by giving the words a purposeful and meaningful intent. Two questions arise namely whether the amendment is in the nature of declaratory enactment and if so, whether the same would be of retrospective application. A declaratory Act generally takes a form by statement “it is declared”. Patently such words have not been used in Act XI of 1966. The second characteristic of a declaratory statute is that it intends to remove doubts as to the meaning of effect of a statute and if not expressly at least by implication the legislature exhibits the reason for passing a Declaratory Act. Blackstone, J. in Nicol v. Verelete [1779] 26 ER 751, stated “declaratory statues do not prove the law was otherwise before, but rather the reverse”. Coleridge,
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C. J. in Jones v. Bennet [1890] 63 LT 705, defined a Declaratory Act that “means to declare the law, or to declare that which has always been the law, and there having been doubts which have arisen, Parliament declares what the law is and enacts that it shall continue what it then is”. Such characteristics are also lacking in Act XI of 1966. Further it must be stated that our system of law abhorts retrospective legislation but if ever a necessity has arisen to give retrospective effect, the statute generally expresses such intention. Act XI of 1966 can also not be called a procedural or adjective law because it is a statutory step in determination of rights of the Income Tax Officer as well as the assessee. The right is the retention of money on behalf of others. It also makes an assessee liable to taxation in respect of moneys notionally treated as his profits while exposing him to at least a risk of demand. According to us Act XI of 1966 was intended to provide a limit of time and avoid the lying of money in a sort of suspense account for a period exceeding three years. New rights and liabilities came into existence and new concepts of law were brought into existence. This act cannot, therefore, be called a Declaratory Act. Curative statutes are by their very nature intended to operate upon and affect past transactions and are for such reason wholly retrospective. These statutes are in the nature of validating statues which operate on conditions already existing and for such reason have retrospective operation. If the enactment in question is to be in the nature of a curative law the Legislature would have stated so unambiguously. We are of the view that the amending statute is not even curative in nature. Case referred to: Nocol v. Verelet (1779) 26 E.R. 751 and Jones v. Bennet (1890) 63 L.T. 705.
Mian Muhammad Khalil v. Income Tax Officer Company Circle, Faisalabad – [1979] 40 TAX 113 (H.C.Lah.) 49.
If retrospective operation of a provision results in injustice, it should not be applied retrospectively.
Where retrospectivety not expressly provided in amended provision of law, and retrospective operation results in inconvenience or injustice to the subject. Such a provision cannot be applied retrospectively. Dreamland Cinema, Multan v. Commissioner of Income Tax, Lahore – [1977] 35 TAX 169 (H.C.Lah.) 50.
Declaratory statutes generally apply retrospectively.
All the writers are unanimous in their view that the declaratory statutes apply retrospectively. A reading of the explanation would
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show that the intention of the Legislature was to remove a doubt and explain the intended import of the original provision. Undoubtedly we have to find out the intent of the Legislature and should not be swayed merely by the use of word „declaratory‟ or otherwise. If, therefore, the object of the statute is to explain the previous provisions or to remove a doubt, the law would apply retrospectively. Dreamland Cinema, Multan v. Commissioner of Income Tax, Lahore – [1977] 35 TAX 169 (H.C.Lah.) 51.
Explanatory amendment is always applicable retrospectively to all relevant cases pending at the relevant time.
The amendment under review is of explanatory type stated to have been introduced “for the avoidance of doubt”. The rule about interpretation of such statute is distinct though the principles of interpretation of taxing statutes would apply if attracted to the situation. A reading of the explanation would show the intention of the Legislature was to remove a doubt and explain the intended import of the original provision‟. If the object of the statute is to explain the provisions or to remove a doubt, the law would apply retrospectively. The addition of Explanation 2 to section 24(2) was with the object of removing a doubt (probably created by the two judgments of the West Pakistan High Court) [in Commissioner of Income Tax v. Yousuf & Co. (1967) 15 TAX 4 and Commissioner of Income Tax v. Tayah Moosa & Co. [(1967) 15 TAX 62]. The enactment was expressly explanatory in nature. Therefore, it had to apply retrospectively to all the relevant cases pending on that date. Cases referred to : Nicol v. Verelet [(1779) 26 E.R. 751]; Jones v. Bonnet [(1890) 63 L.T. 705]; Muhammadi Bibi v. Kashi Upadhya (AIR 1926 All. 725); Joti Ram Khan v. Janaki Nath Joshi (33 I.C. 54); Mst. Rashid Bibi v. Tufail Muhammad (AIR 1941 Lah. 291); Bappu Ayyar v. Ranganayaki (AIR 1955 Mad. 394): Abdul Hamid v. The State (PLD 1963 Kar. 373); Pennirselvem v. Veerish Vendayar (AIR 1931 Mad. 83); Commissioner of Sales Tax v. Kruddsons Ltd. (PLD 1974 S.C. 180); Young v. Adams (1898 A.C. 469); Muhammad Amir Khan v. Controller of Estate Duty (PLD 1961 S.C. 119); (1961) 3 TAX 166 (S.C.); Muhammadi Steamship Co. (PLD 1966 S.C. 828); (1966) 14 Tax 281 (S.C.); Commissioner of Income Tax v. Yousuf & Co. (1967) 15 TAX 4; Commissioner of Income Tax v. Tayab Moosa & Co. (1967) 15 TAX 62; Commissioner of Income Tax v. Pakistan Standard Oil & Ginning Mills (1973) 28 TAX 9.
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Aftab Medical Stores Dera Ghazi Khan v. Commissioner of Income Tax, Lahore – [1976] 34 TAX 10 (H.C.Lah.) 52.
Subordinate legislation can be applied retrospectively only if expressly mentioned.
A subordinate legislation like rules can be applied retrospectively only if the parent Act confers such a power on the rule making authority and it is so expressly mentioned in the rules as well. Income Tax Officer & others v. Suleman Bhai Jiwa & others – [1970] 21 TAX 62 (Income Tax Digest Feb. 1970) 53.
Rules to determine retrospective effect.
The use by the legislature of the words, such as „shall‟ or „hereafter‟, is taken to indicate an intent that the statute is to be construed as prospective only; on the other hand, the use of the words denoting past time, such as „has been‟ or „hereto before‟ constitute an explicit declaration that Act is to be construed retrospectively. Harjina & Company (Pak) Limited, Karachi v. Commissioner of Income Tax – [1964] 8 TAX 1 (H.C.Kar.) = 1963 PTD 867 = 1963 PLD 996 54.
Right accrued cannot be taken away by implication.
Rights under existing laws are not to be supposed to have been repealed by implication unless intention becomes clear from language of law. Emperor v. Probhat Chandra Barua – 1 ITC 284 (Calcutta) 55.
Rights conferred under statutes cannot be taken away by later legislation except by express words or by necessary implication.
I am not myself prepared to go the length of holding that rights such as those conferred under the Permanent Settlement can only be abrogated if express provisions cancelling such rights are inserted in a subsequent legislative enactment. No doubt the maxim generalia specialibus non derogant may be regarded as embodying a good working rule of construction, but where the intention of the legislature to abrogate or modify existing rights is manifest as a necessary implication from the language used in the repealing statute, it matters not, in my opinion, that the existing rights are not therein expressly and specifically modified or cancelled. Lord Selborne, Lord Chancellor, refers to this canon of construction in Seward v. Vera Cruz [(1884) to App. Ca. 59], where he observes:
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“If anything be certain it is this, that where there are general words in a later Act capable of reasonable and sensible application without extending them to subjects specially dealt with by earlier legislation, you are not to hold the earlier and special legislation indirectly repealed, altered, or derogated from merely by force of such general words, without any indication of a particular intention to do so.” Lord Justice Bowen restated the canon in In re Cuno, Mansfield v. Mansfield [(1889) 43 Ch. D. 12 at p. 17] in these words: “in the construction of statutes, you must not construe the words so as to take away the rights which already existed before the statute was passed unless you have plain words which indicate that such was the intention of the legislature.” See also Irrawaddy Flottila Company v. Bhagwandas [(1891) I.L.R. 18 Cal. 620; 18 I. A. 121]. Sunder Mull v. Ladhuram Koluram [1923) I.L.R. 50 Cal. 667; A.I.R. (1924) Cal. 240: 83 Ind. Cas. 757] and Duke of Argyll v. Commissioners of Inland Revenue [(1913) 109 L.T. 893]. In Garnett v. Bradley [(1878) 3. App. Cas. 944 at p. 967], Lord Blackburn laid down what I conceive to be the true rule of construction applicable in the circumstances of this case. His Lordship observes: “There is an other rule if it is properly applied, namely, that where there has been a particular rule established either by custom or by statute, where there is some particular law standing and a subsequent enactment has general words which would repeal that particular law or particular custom, if they were taken in all generality, ............ yet nevertheless the first particular law is not to be repealed unless there is a sufficient indication of intention to repeal it. It is not to be repealed by mere general words: the two may stand together; the first, the particular law, standing as an exceptional proviso upon the general law.” After referring to certain cases, His Lordship continues: “In all these cases, however, the particular statute relied upon was a statute in favour of a particular class of persons or the property of a particular class of persons. I do not take upon myself to say that all cases in which that rule have been applied to which that remark would
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not be applicable. But where that is the case, where the particular enactment is particular in the sense that it protects the rights, the property, the privileges of particular persons or a class of persons, the reason for the rule which has been acted upon is exceedingly plain and strong. It would be very unjust, or I would rather say unfair (I do not go further than that), to pass an enactment taking away from a particular person or class of persons his or their rights without hearing what he or they have got to say about it; and if general words were to have the effect of taking away the rights of a particular person or class which had been given to them beforehand, it would be done without their having any knowledge or opportunity of resisting it and it is not to be imputed to the legislature or to be supposed that the legislature would do what was unfair. Therefore, I think that where only general words are used, there is a strong presumption that the legislature did not intend to take away a particular privilege, right or property of a particular class, unless thy have done something to show that. If they have done something in such a way as would show that that was their intention, if they have said in negative words that those rights or privileges shall all be taken away any enactment to the contrary notwithstanding, that would prevent the presumption arising at all. But in the absence of that, I think it is an intelligible principle to say that the legislature shall not be presumed to have done anything unfair, and to have taken away this particular privilege not having stated openly that they meant to take it away, or in such open or clear language that the persons affected might come and resist and use arguments to show why it should not be taken away, but having simply used general words quite consistent with their never having thought of this privilege at all. I think, my Lords, that that principle will reconcile almost all the cases; certainly it will reconcile all I have cited, and it is a good and intelligible principle.” Emperor v. Probhat Chandra Barua – 1 ITC 284 (Calcutta) 56.
Presumption against double taxation.
Some reference was also made to what has been called a „presumption against double taxation.‟ In Manindra Chandra Nandi v. Secretary of
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State [(1907) I.L.R. 34 Cal. 257 at p. 287; 5 C.L.J. 148], royalties from a coal mine were held liable both to cess under the Cess Act, 1880 and to income tax under the Act of 1886, but it was said that „it may be conceded that Courts always look with disfavour upon double taxation and statutes will be construed, if possible, to avoid double taxes.‟ Reference was made to certain dicta of American Courts and to the English case of Carr v. Fowle [(1893) I.Q.B. 251]. But the only observation in this case was to the effect that the statute presumably did not intend that a vicar should in effect pay the same tax (land tax) twice on the same hereditament. This is plain enough. Thus the income tax is one tax, and income assessed under one Schedule cannot be assessed all over again under another. That there is any legal presumption of a general character against „double taxation‟ in any wider sense is a proposition to which I respectfully demur as a principle for the construction of a modern statute. In Maninra Chandra Nandi v. Secretary of State [(1907) I.L.R. 34 Cal. 257; 5 C.L.J. 148], it did not avail to cut down clear, though absolutely general language. Commissioner of Income Tax v. Dharamchand Dalchand – 1 ITC 264 (Nagpur) 57.
Vested rights such as rights to appeal and to demand a reference already accrued, cannot be taken away by repeal of Act.
Under the ordinary law, vested rights including rights to appeal and to demand a reference that have already accrued are taken away by the repeal of any Act; but the procedure would be under the new Act. The rule regarding vested rights is not confined to substantive rights but extends equally to remedial rights or rights of action including rights of appeal: see Maxwell‟s Interpretation of Statutes, 6th Edition 401. In Gopeshwar Pal v. Jiban Chandra [(1914) I.L.R. 41 Cal. 1125; 18 C.W.N. 804; 19 C.L.J. 549; 24 Ind. Cas. 37], it was held that, though procedure may be regulated by an Act for the time being in force, still the intention to take away a vested right without compensation or any saving, is not to be imputed to the legislature in any case unless it be expressed in unequivocal terms. [Chief Commissioner of Public Works v. Logan (1903) A.C. 355]. This was a case of right to sue. In Ramakrishna Chetty v. Subbaraya Aiyar [(1915) ILR 38 Mad. 101; 24 M.I.J. 54; (1913) MWN 303; 18 Ind. Cas. 64] which is a case of limitation, it was held that the rule regarding vested rights is not confined to substantive rights but extends equally to the remedial rights or rights of action including rights of appeal. At
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page 106 of the same ruling there is a quotation from an English case, In re Athlumney, Ex parte Wilson [(1898) 2 Q.B. 547], where wright J. observed; “Perhaps no rule of construction is more firmly established than this that a retrospective operation is not to be given to a statute so as to impair an existing right or obligation, otherwise than as regards a matter of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment;” And, further, their Lordships observe: “It is unreasonable to suppose that the Act intended to destroy a man‟s rights without giving him an opportunity to comply with its provisions. The Court, if asked to give retrospective effect to a statute, will bear in mind the consequences of doing so. See Ex parte Todd, In re Ashoroft [(1887) 10 Q.B.D. 186].” Balkishan Nathani v. Commissioner of Income Tax – 1 ITC 248 (Nagpur) 58.
Fiscal statutes to be strained in favour of the subject, if at all.
Technicalities in a fiscal statute must be strained in favour of the subject, if they are to be strained at all, and not against him. ________________
REMEDIAL AND CURATIVE LEGISLATION HAS RETROSPECTIVE EFFECT
Commissioner of Income Tax v. Shahnawaz Ltd. and others – 1992 SCC 920 = [1992] 66 TAX 125 (S.C.Pak.) 59.
Remedial and curative legislation has retrospective effect.
The amendment in relevant section was a remedial and curative legislation designed to soften the harsh, unjust and unreasonable law, as was then obtaining, not restricting the maximum period for levy of additional tax. There is no reason why the remedial law should not be applied to pending proceedings. Although the amendment was made by the Finance Act, 1973 but it could not be restricted to assessment year 1973-74. The retrospective remedy would be available to all „cases which were pending at the time the amending law was enacted i.e. cases which had not been finally determined or proceedings which had not attained finality. The retrospective effect of the amending law, would, therefore, apply only to those cases where assessment had not
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been made by the Income Tax Officers or where an appeal was pending before the Tribunal or a reference was sub-judice before the High Court, at the time the amending law was enacted. The cases which had finally determined or had attained finality i.e. which were past and closed, transaction, could not be reopened under amending legislation there are no express words to that effect employed in the amending law‟. _______________
PRINCIPLE OF CONTEMPORARY EXPOSITION
Maharaja of Darbhanga v. Commissioner of Income Tax – 1 ITC 303 (Patna) 60.
Principle of contemporary exposition.
Therefore, in the absence of any clear and unambiguous declaration by the authors of the Permanent Settlement, I think it is permissible to invoke the aid of the principle of „contemporary exposition.‟ Here it is not a case of one or two stray statutes in the administration of which the strict rule of construction has been overlooked. On the contrary, a uniform course of dealing is disclosed which shows that profits from permanently settled estates have been taxed for the purposes of the State without express words revoking the exemption alleged to have been given by the Permanent Settlement Regulation; and I have been unable to discover a single statute in which any such exemption has expressly or by implication been recognized. Emperor v. Probhat Chandra Barua – 1 ITC 284 (Calcutta) 61.
Practice of Revenue Authorities as contemporanea expositio.
Some reference was made at the bar to the practice of the Revenue Authorities since 1886 as regards fisheries in permanently _ settled estates, but there is no agreement as to what that practice if there be a practice - has been. Assuming that it would have been open to us to place some degree of reliance upon an interpretation settled by practice as contemporanea expositio, we are in fact without any such assistance. _______________
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ACTION IS DEEMED ILLEGAL, THE WHOLE SUPERSTRUCTURE BUILT UPON IT IS ALSO ILLEGAL
Muhammad Azim v. Commissioner of Income Tax East Zone Karachi – [1991] 63 TAX 143 (H.C.Kar.) = 1991 PTD 658 62.
If an action is deemed illegal, the whole superstructure built upon it is also illegal.
It is well settled principle that if the very foundation of an action is illegal or without jurisdiction the whole superstructure built upon it cannot validly and legally stand. N.V. Philips Glocilin Peufabrikan v. Income Tax Officer & others – [1990] 61 TAX 159 (H.C.Kar.) Where any action is challenged as without jurisdiction and if it is so declared then all orders and proceedings taken on the basis of such illegal action shall also be vitiated. In 1970 Law Notes 28 (DB) Lah. it was held that if on the basis of void order subsequent orders have been passed either by the same authority or by other authorities, the whole services of such order, together with the superstructure of rights and obligations built upon them, must fall to the ground because such orders have as little legal foundation as the void order on which they are grounded. _______________
INCOME CANNOT BE TAXED TWICE
M.Rehman, Income Tax Officer & others v. Narayanganj Company (Pvt.) Ltd. – 1970 SCC 370 = [1971] 23 TAX 223 (S.C.Pak) 63.
Income cannot be taxed twice.
The learned judges in the High Court relied on the following remarks of the Indian Supreme Court in the case of Commissioners of Income Tax, U.P. v. Kanpur Coal Syndication [(1964) 10 Taxation 175]: “Section 3 imposes a tax upon a person in respect of his total income. The person on whom such tax can be imposed are particularised therein, namely, Hindu undivided family, company, local authority, firm, association of persons, partners of firm or members of association individually. The
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section, therefore, does not in term confer any power on any particular officer to assess one of the person described therein, but is only a charging section imposing the levying of tax on the total income of an assessable entity described therein. The section expressly treats as association of persons and the individual members of an association as two distinct and different assessable entities. On the terms of the section the tax can be levied on either on the said two entities according to the provisions of the Act.” The rule issued in the case was in this view made absolute by the Division Bench of the High Court and the impugned notice under section 65 set aside, from which leave to appeal was generated to consider whether it was a case of double assessment or a case of rectification of assessment wrongly made upon individual partners in respect of the income of an unregistered firm. _______________
ONE THING IMPLIES THE EXCLUSION OF ANOTHER
Micropak (Pvt.) Ltd., Lahore v. Income Tax Appellate Tribunal, Lahore and 2 others – [2001] 83 TAX 451 (H.C.Lah.) = 2001 PTD 1180 64.
“Expressio unius est exclusio alterius”.
In the present case at the relevant time the express mention of the word “loan” excluded all other similar or equivalent terms, transactions, or nature of the receipts. No maxim of law was of more general and uniform application than “expressio unius est exclusio alterius”. Whenever a statute limits a thing to be done in a particular form, it necessarily includes in itself a negative, viz. that the thing shall not be done otherwise. The purpose of introduction of the provisions of section 12(18) of the Ordinance at the relevant time was to check fictitious loans and it was after quite some time that it was realized that the scope of the provisions needed to be expanded. No addition of the kind could possibly be made nor the defence taken by the assessees rejected without recording a finding of fact that these sums were injected in the business and were used as capital, circulating or otherwise. In other words the defence of the assessees could have been demolished only by recording a finding of fact that the alleged share deposit moneis were factually used in the business and therefore, could be taken as “loan” taken for catering the capital needs of the companies.
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Income Tax Digest.
Commissioner of Income Tax/Wealth Tax, Multan Zone, Multan v. Allah Yar Cotton Ginning & Pressing Mills (Pvt.) Limited, Multan Road, Vehari – [2000] 82 TAX 433 (H.C.Lah.) = 2000 PTD 2958 “Expressio unius est exclusio alterius” (Express mention of one thing implies the exclusion of another) was neither absolute nor was of universal application.
65.
The rule that express mention of one is exclusion of the rest is neither absolute nor is of universal application. _______________
APPLICATION OF RULE GENERALIBUS SPECIALIA DEROGANT
Commissioner of Income Tax, East Pakistan, Dacca v. Engineers Limited, Dacca – 1967 SCC 289 = [1967] 16 TAX 81 (S.C.Pak.) Application of rule generalibus specialia derogant.
66.
The second contention, raised by the learned counsel for the Commissioner of Income Tax, that clause (xvi) was not applicable rested on the rule that a special provision in a statute excludes the application of a general provision of similar nature. This is a well established rule of construction of statutes, but is attracted in the interpretation of clause (xvi) the relevant clauses read as follow: (xii)
any expenditure (not being in the nature of capital expenditure) laid out or expended on scientific research related to the business;
(xiv)
any expenditure of a capital nature on scientific research related to the business;
(xv)
any expenditure laid out or expended on the training abroad of citizens of Pakistan, in connection with a scheme approved by the Central Board of Revenue for the purposes of this clause; and
(xvi)
any expenditure (not being in the nature of capital expenditure or personal expenses of the assessee) laid out or expended wholly and exclusively for the purpose of such business, profession or vocation.
The scope of clause (xvi) which is residuary nature is thus wholly different from the sums included in clause (xii), (xiv) and (xv). There being no similarity of subject-matter between clauses (xii), (xiv), (xv) and (xvi) of section 10(2) the rule generalibus specialia derogant was clearly not attracted. _______________
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INTERPRETATION OF STATUTES/ GENERAL PRINCIPLES
Jamat-i-Islami Pakistan through Syed Munawar Hassan, Secretary General v. Federation of Pakistan through Secretary, Law, Justice and Parliamentary Affairs, Muttahida Qaumi Movement (MQM) through Deputy Convener, Senator Aftab Ahmad Sheikh v. Federation of Pakistan through Secretary, Ministry of Interior – PLD 2000 S.C. 111 67.
Statute must be intelligibly expressed and reasonably definite and certain.
Statutes must be intelligibly expressed and reasonably definite and certain. An act of the Legislature to have the force and effect of law must be intelligibly express and statutes which are too vague to be intelligible are a nullity. Certainty being one of the prime requirements of a statute, a statute in order to be valid must be definite and certain. Anticipated difficulty in application of its provisions affords no reason for declaring a statute invalid where it is not uncertain. Reasonable definiteness and certainty is required in statutes and reasonable certainty is sufficient. Reasonable precision, and not absolute precision or meticulous or mathematical exactitude, is required in the drafting of statutes, particularly as regards those dealing with social and economic problems. Penal statutes contemplate notice to ordinary person of what is prohibited and what is not. Statute creating an offence must be precise, definite and sufficiently objective so as to guard against an arbitrary and capricious action on the part of the State functionaries who are called upon to enforce the statute. 68.
True meaning of statute vis-a-vis duty of court.
It is the duty of the Court to find out the true meaning of a statute while interpreting the same. The general rule is that the Courts adopt as uniform an approach as possible to the reading of ambiguous Acts of Parliament which are some times imperfect, obscure and vague. The primary rule of interpretation of statutes is that the meaning of the Legislature is to be sought in the actual words used by him which are to be interpreted in their ordinary and natural meanings. The cardinal rule for the construction of Acts of Parliament is that they should be construed according to the intention expressed in the Acts themselves. Where the language of the statute is plain and unambiguous, and conveys a clear and definite meaning, there is no occasion for resorting to the rules of statutory interpretation, and the
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Court has no right to impose another meaning or to read into its limitations which are not there, based on a prior reasoning as to the probable intention of the Legislature. Court can resort to the proceedings of the Legislature when the language employed is ambiguous. Central Insurance Co. & other v. CBR Islamabad – 1993 SCC 1049 = [1993] 68 TAX 86 (S.C.Pak) 69.
Interpretation of statute is not CBR‟s domain.
The interpretation of any provision of the Ordinance can be rendered judicially by the hierarchy of the forums provided for under various sections of the Ordinance, namely, the Income Tax Officer, Appellate Assistant Commissioner, Appellate Tribunal, High Court and this court and not by the CBR. Therefore, interpretation of statute is not CBR‟s domain. A&B Food Industries Ltd. v. Commissioner of Income Tax/CST Karachi – [1992] 65 TAX 281 (S.C.Pak) 70.
Proceedings of the Legislature can be resorted to when the words of a provision are ambiguous.
We are inclined to hold that reference to the proceedings of the Legislature can be restored to when the words of a provision of a statute are ambiguous with the object to discover the real intention of the law-makers but when there is no ambiguity in the language employed in the relevant provisions of the statute, recourse to the proceedings of the Legislature cannot be made in order to construe the same in violation of the language employed therein. In our view, if the language of the statute is clear and unambiguous, the Court is bound to construe and to give it effect without taking into consideration anything extraneous to the same. Reference may also be made to a recent decision of this court in the case of Miss Benazir Bhutto v. Federation of Pakistan [PLD 1988 SC 416] wherein following observations were made on the question: whether the proceeding of the Parliament can be referred to while interpreting a provision of a statute. Commissioner of Income Tax North Zone, Lahore v. Mst. Wazirunissa Begum – 1972 SCC 395 = [1974] 29 TAX 188 (S.C.Pak.) 71.
Person sought to be taxed must come within the letter of law.
In determining whether or not a particular matter comes within taxing statutes, it is only the letter of law that can be looked into. There is ample authority for the proposition that in a fiscal case, form
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is of primary importance, the principle being that if the person sought to be taxed comes within the letter of the law, he must be taxed, however great a hardship may thereby be involved but on the other hand if the crown cannot bring the subject within the letter of the law he is free, however, apparent in may be that his case comes within what might be called the spirit of the law. Muhammadi Steamship Company Ltd. v. Commissioner of Income Tax, (Central) Karachi – 1966 SCC 266 = [1966] 14 TAX 281 (S.C.Pak.) = PLD 1966 S.C. 828 72.
No words to be treated as surplusage.
It is well established rule of interpretation of statute that no words in a statute are to be treated as surplusage or redundant. The words „such capital being computed in accordance with the rules made by the Central Board of Revenue‟ could not be read as surplusage or redundant. Imperial Tobacco Co. of India Ltd. v. Commissioner of Income Tax, South Zone, Karachi – 1958 SCC 37 = [1959] 1-TAX (111284) (S.C.Pak.) 73.
Abrogation of International Law.
Statutes are not to be construed as abrogating International Law unless their language clearly leads to that result, and that extra territorial operation of a statute over foreigners is not to be presumed as having been intended unless it is expressly so stated. Commissioner of Income Tax East Bengal v. Kumar Narayan Roy Choudhry and others – 1959 SCC 68 = [1959] 1-TAX (111207) (S.C.Pak.) 74.
A fiscal statute should be construed strictly.
A fiscal statute should be construed strictly and no question of equitable construction arises. Commissioner of Income Tax/Wealth Tax, Multan Zone, Multan v. Allah Yar Cotton Ginning & Pressing Mills (Pvt.) Limited, Multan Road, Vehari – [2000] 82 TAX 433 (H.C.Lah.) = 2000 PTD 2958 75.
Claimant of an exemption has to bring the same home without any ambiguity.
These cannot be read as exemption granting provisions. It is an established proposition of fiscal laws that the claimant of an exemption has to bring it home without any ambiguity.
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Allied Bank of Pakistan Ltd., Azad Kashmir Branches, Mirpur through Inam Elahi Azhar, EVP and Provincial Chief, PHQ (Punjab) v. Income Tax Appellate Tribunal, AJK Council, Muzaffarabad and others – [2001] 83 TAX 404 (H.C.A&JK) = [2000] 82 TAX 417 (H.C.AJ&K) = 2000 PTD 2872 76.
Where a provision was open to two reasonably possible interpretations, then, the interpretation which favours the taxpayer has to be adopted.
Where a provision was open to two reasonably possible interpretations, then, the interpretation which favours the taxpayer has to be adopted. 77.
Correct interpretation of rule 15 vis-a-vis right of appeal.
Rule 15 further contains that where the memo. of appeal is not filed in the manner specified, then, the Registrar or the Officer authorized under rule 7, may return it to the appellant or his authorized representative, if any, to bring it in conformity with the provisions of the said Rules within such time as he may think. The aforesaid rule also lends support to the arguments that section 134(5) is directory provision of law and not mandatory because it suggests that if any memo of appeal is not accompanying the necessary document then, the Registrar shall return the same and provide further time for its completion. Thus, it clearly shows that in case, the appeal fee was not deposited within time then the Registrar should have directed the appellant to deposit the requisite appeal fee. He should have also provided time to the appellant for depositing the appeal fee, so, it could not be said that this provision is a mandatory provision of law, therefore, if, at all, the memo of the appeals were not accompanying the requisite fee, then, under rule 15, it was the responsibility of Registrar to provide further time to the appellant for depositing the appeal fee. Nothing like such was done in the instant cases. It is to be noted that if it would have been a mandatory provision of law, then, the rule 11, it should have been mentioned that the memo. of appeals should accompany the requisite court-fee and the consequences for failure of which would have also been provided in the aforesaid rules. 78.
The use of word “shall” in section 134(5), Income Tax Ordinance, 1979 does not make it mandatory in nature.
No doubt, that in section 134(5), the word „shall‟ has been used but merely and simply on the basis of the word „shall‟, it could not be construed that it is mandatory provision of law.
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Both the aforesaid reports clearly conveys that where the consequences of failure to comply with the provision are not stated, the provision is directory and where the consequences are specifically mentioned, the provision is mandatory. In the instant case, the consequences of failure to comply with section 134(5) has not been given, therefore, it could not be construed as a mandatory provision of law but it is a directory provision of law. 79.
Principles for determining mandatory or directory provision of law.
No universal rule or absolute test existed for determining whether a provision of law was mandatory or directory and it was to be determined according to the intention of the Legislature and the language which had been used in the provision. Ordinarily, where consequences of failure to comply with certain provisions were not stated those were to be deemed to be directory, and where the consequences were specifically mentioned, the provision was mandatory. Statute, as a general rule was understood to be directory when it contains matter merely of directions but it was construed as mandatory when those directions were followed up by an express provision that in default of following them, he had to face the consequences. Provision was mandatory if its disobedience entitled a serious legal consequence. Muhammad Saleem v. Deputy Director FIA/CBC, Multan and another – PTCL 2000 CL. 465 80.
Things should be done as required by law.
Where a thing was provided to be done in a particular manner, it had to be done in that manner and if not so done, the same would not be lawful. Commissioner of Income Tax v. Muhammad Kassim – [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280 81.
Court must confine itself to language of law.
While interpreting a provision of statute, Court has to read the provision as it exists and to deduce or infer the meaning in accordance with the existing test or the words or particular provision. Court is not supposed to add to or subtract any word(s) from any provision of a statute while interpreting a provision so as to give same a meaning other than the one which obviously and plainly flows or can be inferred from it.
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Commissioner of Income Tax v. Prasad Film Laboratories (P.) Ltd. – 1999 PTD 325 82.
Assessing officer to apply correct law even if assessee fails to make a claim.
It is the duty of the assessing officer to correctly apply the law notwithstanding the fact that assessee failed to make a claim. Rijaz (Pvt.) Ltd. v. Wealth Tax Officer Circles III Lahore – [1996] 74 TAX 9 (H.C.Lah.) 83.
Explanation can be added to elaborate the meanings.
As a general principle it is true that an explanation does not enlarge the scope of the provision to which it is attached but it is equally wellsettled that if doubt about true interpretation of a provision have arisen, it is open to the legislation to clarify its intention by amending the law which may as well be by adding an explanation. All principles of interpretation are agreed towards finding out the true intent to the legislative which in the present case was made clear by adding an explanation which cannot be ignored. Mustafa Prestressed R.C.C.Pipe Works Ltd. Karachi v. Commissioner of Sales Tax (Investigation), Karachi – [1990] 62 TAX 119 (H.C.Kar.) 84.
Harmonious construction is recommended.
It is well-settled principle of interpretation that all the provision of an enactment have to be construed harmoniously. Trustees of the Port of Karachi v. CBR & another – [1990] 61 TAX 30 (H.C.Kar.) 85.
Proceedings of the Legislature can be resorted to when the words of a provision are ambiguous.
A taxing statute usually contains charging and machinery provisions. The former fixes the liability to pay tax and has to be construed strictly and where two reasonable interpretations are possible one which favours the subject should be accepted. Once the liability to tax is fixed the machinery provision comes into play. This has to be construed liberally and in a manner that the recovery is ensured. Where more than one reasonable interpretation of such provision is possible one which favours recovery should be adopted. 86.
Interpretation of machinery provisions of a fiscal statute.
Mr. Sheikh Haider the learned counsel for the respondent has contended that as section 50(7A) is not a charging but machinery provision it should be liberally interpreted to ensure that recovery
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of tax is made and no part of it escapes. It is true that the machinery provisions of a fiscal statute should be interpreted in such a manner that recovery is not frustrated or adversely affected. But it does not mean that to achieve this object one can travel beyond the realm of law and do violence to language and intention of the statute. The machinery can be extended only to the extent it is permissible under law. In this attempt one cannot override the rights of other parties only because a recovery has to be made. Such provision have their own limitations and they are to be found within the statute itself. Commissioner of Income Tax/CST (Central Karachi) v. A.B. Food Industries Ltd. Karachi – [1984] 50 TAX 158 (H.C.Kar.) 87.
Speech of the Federal Minister has no legal consequences or effect.
I have no hesitation in holding that the speech given by the Finance Minister cannot have any effect on the legal consequences flowing from the language employed in the enactment. Sainropt and ET Brice Karachi v. Commissioner of Income Tax West Karachi – [1979] 40 TAX 116 (H.C.Kar.) 88.
Role of history of legislation in interpreting a provision of law/statute.
It is well established that in the interpretation of statutes, the meaning of the words should be considered in the light of history of the legislation and the state of the law at the time the statute was passed, in order to consider whether the statute was intended to alter the law or to leave it exactly where it stood before. As observed by Maxwell on „Interpretation of Statutes‟, 12th edition, page 47, the court is not to be oblivious of the history of law and legislation in amending the law. Craies on „Statute Law‟, 7th edition, at page 126) observes that the cause on necessity of the Act may be discovered by considering the state of the law at the time when the Act was passed and in memorable cases the courts with a view to construing an Act have considered the existing law and reviewed the history of legislation upon the subject. Crown Bus Service Ltd. Lahore v. CBR & others – [1976] 34 TAX 54 (H.C.Lah.) 89.
Departmental construction can be used in aid of interpretation.
It was laid down in Nazir Ahmad v. Pakistan and 11 others (PLD 1970 SC 453 at page 459) that a passage from Craford‟s Statutory Construction, 1940 edition, at page 399 may be usefully reproduced to
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point out the effect of „departmental construction‟, that is to say, the construction which is placed in practice on the provisions of a statute or rule by the administrative authorities who are charged with the execution of the statute or the rules. The learned author observed; “Where the executive construction has been followed for a long timing an element of estoppel seems to be involved. Naturally many rights will grow up in reliance upon the interpretation placed upon a statute by those, whose duty it is to execute it. Often grove injustices would result should the courts reject the construction adopted by the executive authorities.” Commissioner of Income Tax Rawalpindi v. Noon Sugar Mills – [1975] 32 TAX 273 (H.C.Lah.) 90.
Caution should be used while borrowing the meaning attached to terms and phrases used in one statute, while interpreting another statute.
It is not always safe to borrow the meanings attached to terms and phrases used in one statute as aid in support of the interpretation of a different statute meant for a different purpose and dealing with a wholly different subject matter. It is of course permissible to have recourse to the ordinary dictionary meanings in interpreting a statute. Commissioner of Sales Tax Rawalpindi Zone, Rawalpindi v. Rashid Burner, Sialkot – [1974] 29 TAX 221 (H.C.Lah.) 91.
Terms and phrases used in a statute prima facie should be construed in their popular sense
There are two rules as to the way in which terms and expressions are to be construed, when used in an Act of Parliament. The first rule is that general statutes will prima facie be presumed to use words in their „popular sense‟..... critical refinement and subtle distinction are to be avoided and the obvious popular meaning of the language should, as a general rule, be followed. Commissioner of Income Tax v. Nagina Talkies (property) Karachi – [1974] 29 TAX 115 (H.C.Kar.) 92.
While interpreting a statute nothing is to be read in and nothing is to be implied.
In fiscal statutes the meaning has to be ascertained from the plain language of the statute and „nothing is to be implied‟ in such statute.
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Mujibur Rehman v. Commissioner of Income Tax – [1966] 13 TAX 141 93.
Departmental instructions interpretation.
cannot
be
used
in
aid
of
Departmental directions have nothing to do with the interpretation of the statute. Rathan Singh, Proprietor, Rathan Singh Motor Service, Madura v. Commissioner of Income Tax, Madras – 2 ITC 107 (Madras) 94.
Non-revenue profit/losses are not covered in Income Tax unless specifically provided in statute.
It is one of the fundamental principles of income tax legislation both in India and in England that capital losses are never allowed in income tax assessment unless specifically provided for in the words of the statute. It is equally true that profits arising from capital transactions are not liable to be taxed. I am fortified in this conclusion by the remarks of Schwabe C.J., in Board of Revenue v. Ramanathan Chettiar (244 ITC 247) where he states: “It does not seem probable that the legislature meant to provide a deduction for losses on sales of machinery by manufacturing concerns without at the same time bringing into account any profits that might be made on such sales. Sales of machinery are sales of parts of the capital of a concern of this kind and the resulting profits or losses on such sales are dealt with quite apart from this section.” Sundar Das v. Collector of Gujrat – 1 ITC 189 (Lahore) 95.
In dubio construction which imposes burden on taxpayer should be avoided.
It is a sound principle that the subject is not to be taxed without clear words to that effect and that in dubio you are always to lean against the construction which imposes a burden on the subject. Imperial Tobacco Company of India v. The Secretary of State for India in Council – 1 ITC 169 (Calcutta) 96.
Courts are not to be influenced by doctrine of hardship.
It is a well-established rule that Courts ought not to be influenced by any notion of hardship in exceptional or individual cases in interpreting a statute.
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Secretary of State v. Seth Khemchand Thaoomal – 1 ITC 26 (Sind) 97.
Tax must be imposed by clear and unambiguous language.
As, observed in Maxwell on the Interpretation of Statutes, 4th Ed.,page 429: „Statutes, which impose pecuniary burden, are subject to the rule of strict construction. It is a well-settled rule of law that all charges upon the subject must be imposed by clear and unambiguous language, because in some degree they operate as penalties‟. _______________
PRINCIPLES GOVERNING INTERPRETATION OF FINANCIAL LIABILITIES
Highway Petroleum Services (Regd.), Lahore v. Islamic Republic of Pakistan and another – [1977] 36 TAX 8 (H.C.Lah.) 98.
Principles governing interpretation of financial liabilities should be strictly construed.
On well based judgments, the propositions are stated in Maxwell, Rules of Interpretation, 12th Edition at page 257 as under:“It is well settled rule of law that all charge upon the subject must be imposed by clear and unambiguous language, because in some degree they operate as penalties (as in penal laws) the subject is not to be taxed unless the language of the statute clearly imposes the objection(s) and language must not be strained in order to tax a transaction which, had the legislature thought of it, would have been covered by appropriate words. „In a taxing Act‟, said Rowlett, J., „one has to look merely at what is clearly said. There is no room or any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in nothing is to be implied. One can only look fairly at the language used.‟ But this strictness of interpretation may not always ensure to the subject‟s benefit, for if the person sought to be taxed comes within the latter of the law, he must be taxed, however, great hardship may appear to the judicial mind to be.” _______________
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PRINCIPLE OF EQUITY
Dreamland Cinema, Multan v. Commissioner of Income Tax, Lahore – [1977] 35 TAX 169 (H.C.Lah.) 99. Equitable construction of a fiscal statute is not permitted. There is no dispute about the proposition that equitable construction of a fiscal statute is not permitted. A person must be taxed only if he comes with the letter of law, otherwise he is free even though his case falls within the spirit of law as held in Hira Chand v. Emperor (AIR 1931 Lah. 572). In Commissioner of Income Tax v. Ectis C. Reid (AIR 1951 Bom. 333) their Lordships observed that in interpreting a Taxing Statute the language should not be strained to hold subject liable to tax. The judicial committee of the Privy Council approved the following passage in Bank of Chittinad v. Income Tax Officer, Madras (AIR 1940 PC 183): “If the person sought to be taxed comes within the letter of law he must be taxed, however, great hardship may appear to be. On the other hand, if the Crown, seeking to recover the tax cannot bring the subject within the letter of the law, the subject is free, however, apparently within the spirit of the law, the case might otherwise appear to be.” Where two equally reasonable constructions are possible, one strict and the other beneficial to the assessee, the latter should be preferred in a taxing statute in view of the rule laid down in Commissioner of Income Tax v. Hossen Kasam Dada (PLD 1961 SC 375). Rowe & Co. v. The Secretary of State for India – 1 ITC 161 (Burma) 100. Equitable construction is inadmissible in a fiscal statute. The High Court of Calcutta relying on those and other cases, in Killing Valley Tea Company, Limited v. Secretary of State for India (1 ITC 54; 48 Cal. 161; 32 CLJ 421; 61 Ind. Cas. 107) said there is no room for controversy that the Crown seeking to recover the tax, must bring the subject within the letter of the law, otherwise the subject is free, however, much within the spirit of the law the case might appear to be. There can be no equitable construction admissible in a fiscal statute; the benefit of the doubt is the right of the subject. Secretary of State v. Seth Khemchand Thaoomal – 1 ITC 26 (Sind) 101. No equitable construction in fiscal statutes. Again, the legislature may or may not be justified on moral or political grounds in cancelling or modifying the rights and privileges which
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were granted under the Permanent Settlement. Such problems are matters of policy with which the Court has not concern. _______________
POWERS OF COURTS/ADMINISTRATIVE JURISDICTION
The Central Board of Revenue, Islamabad and others v. Sheikh Spinning Mills Limited, Lahore and others – [1999] 80 TAX 79 (S.C.Pak) = 1999 PTD 2174] 102.
CBR and the Federal Government have no power to resort to judicial interpretation of law.
It seems to be well-settled proposition of law that the Central Board of Revenue, or for that matter even the Federal Government, cannot control or curtail judicial adjudication powers vested in the forums provided under the relevant law by giving a particular interpretation to a particular provision of the relevant law or by issuing notification/S.R.O. for that purpose. Central Insurance Co. Ltd. v. Commissioner of Income Tax – [1999] 79 TAX 1 (S.C.Pak.) 103.
In granting leave to appeal rule of consistency is to be followed.
Mr.Sheikh Haider, learned Advocate Supreme Court, appearing for the official respondents/caveators, has submitted that the above petitions merit dismissal as the assessments pursuant to the impugned notices have already been finalised and recoveries have already been made and the parties have filed appeals etc. against the above assessments. Since earlier this Court has already granted leave against the judgment of the High Court which is also the subject-matter of the present petitions, in order to follow the rule of consistency, we are inclined to grant leave in the present cases to consider inter alia the question on which earlier leave has been granted. However, we are not inclined to grant any stay order. Leave is accordingly granted. Elahi Cotton Mills Ltd. & Others v. Federation of Pakistan & Others – 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) 104.
Judicial approach on constitutional issues should be dynamic.
That the policy of a tax, in its operation, may result in hardships or advantages or disadvantages to individual assessees which are accidental and inevitable. Simpliciter this fact will not constitute violation of any of the fundamental rights.
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That while interpreting constitutional provisions Courts should keep in mind, social setting of the country, growing requirements of the society/nation, burning problems of the day and the complex issues facing the people, which the Legislature in its wisdom through legislation seeks to solve. The Judicial approach should be dynamic rather than static, pragmatic and not pedantic and elastic rather than rigid. That the law should be saved rather than be destroyed and the Court must lean in favour of upholding the constitutionality of a legislation keeping in view that the rule of constitutional interpretation is that there is a presumption in favour of the constitutionality of the legislative enactments unless ex facie it is violative of a constitutional provision. 105.
Conditions under which courts can strike down a law.
That though the Legislature has the prerogative to decide the question of quantum of tax, the conditions subject to which it is levied, the manner in which it is sought to be recovered, but if a taxing statute is patently discriminatory or provides no procedural machinery for assessment and levy of tax or that is confiscatory, the court may strike down the impugned statute as unconstitutional. Central Insurance Co. & Other v. CBR Islamabad – 1993 SCC 1049 = [1993] 68 TAX 86 (S.C.Pak) 106.
CBR is not competent to issue instructions of judicial/quasi judicial nature.
We may point out that the Central Board of Revenue cannot issue any administrative directions in the nature which may interfere with the judicial or quasi-judicial function entrusted to the various functionaries under the statute. Commissioner of Income Tax, Central Zone-B, Karachi v. Farrokh Chemical Industries – 1991 SCC 805 = [1992] 65 TAX 239 (S.C.Pak.) = 1992 PTD 523 107.
High Court has only advisory jurisdiction under section 136 of the Ordinance.
The High Court should not have raised a question of law not forming the part of the Reference expressly or by implication. The mere fact that the High Court would have come to a different finding would not justify the conclusion that the findings of the Tribunal is based on conjectures, suspicion or irrelevant material. The High Court while deciding the Reference is not entitled to proceed on its own findings on
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a question of fact but has to proceed on the facts and circumstances found by the ITAT. Commissioner of Income Tax, Lahore Zone v. Sh. Muhammad Ismail and Co. Ltd. Lyallpur – 1985 SCC 637 = [1986] 53 TAX 122 (S.C.Pak)
The High Court cannot disturb or go behind any finding of fact given by the Tribunal even on the ground that there is no evidence to support it, unless it has been first expressly challenged by a question raised in the reference application under section 66 to the Tribunal. We may also add that the function of the High Court in cases referred to it under section 66 is advisory only and is confined to considering and answering the actual question referred to it. Mst. Fazal Bibi v. Commissioner of Income Tax – (1996) 74 TAX 141 (H.C.AJ&K)
A finding of fact not based on evidence or where a material evidence is ignored a reference to the High Court will be maintainable. Commissioner of Income Tax Central Zone Lahore v. Gauher Ayub – [1995] 71 TAX 271 (H.C.Lah.)
This Court can only deal with the question of law arising out of the order of the Tribunal passed under section 34 of the Act. The question arising out of the order of Tribunal is that question which was raised before the Tribunal and which was dealt with by the Tribunal, or that question which was not raised before the Tribunal but was dealt with by it or that question which was raised and alleged before the Tribunal but was not dealt by the Tribunal. All such questions are questions of law arising from the order of Tribunal. Nazir Ali M.H. Ganji v. Commissioner of Income Companies I, Karachi – [1994] 69 TAX 71 (H.C.Kar.)
Tax
Under section 136 of the Ordinance, the provision for reference to the High Court is the same as under section 66 of the 1922 Act. The scheme of the Ordinance so far as the scheme of the reference to the High Court on question of law arises the Tribunal can and in certain circumstances must seek, at the instance of the assessee or at the instance of the Revenue, the opinion of the High Court on such
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question. The jurisdiction exercised by the High Court is purely advisory. It is not that of a Civil Court exercising original or any appellate or revisional jurisdiction. We are of the view that the powers and jurisdiction of the High Court are those which are expressed and conferred upon them and also those which inhere in the exercise of that function and jurisdiction of giving advice. The appeal is kept pending before the Appellate Tribunal. It is an admitted position that in answering questions or disposing of references under section 136 of the Ordinance, the High Court do not exercise any jurisdiction conferred upon them by the Code of Civil Procedure or the Charters or by the Acts establishing the respective High Courts. We are of the humble view that in respect of certain matters, jurisdiction exercised by the High Courts must be kept separate from the concept of inherent powers or incidental powers in exercising jurisdiction under section 136 of the Ordinance. Section 136 of the Ordinance is a special jurisdiction of a limited nature conferred not by the Code of Civil Procedure or by the Charters or by the Acts constituting such High Courts but by the special provisions of the Income Tax Ordinance for the limited purpose of obtaining the High Courts opinion on question of law. In giving the opinion properly, if any question of incidental or ancillary power arises such as giving an opportunity or restoring a reference dismissed without hearing or giving some additional time to file the paper book, such powers cannot be so construed as to confer the power of reviewing the judgment. Hamdard Dawakhana (Waqf) v. Commissioner of Income Tax etc. – [1987) 56 TAX 78 (H.C.Kar.)
High Court can grant stay of recovery of tax, subject to furnishing bank guarantee of the amounts involved (outstanding tax payable). Dhanrajmal Mamnumal & Sons v. Commissioner of Income Tax, West Karachi – [1985] 52 TAX 77 (H.C.Kar.)
In our view, this Court has always the jurisdiction to intervene if it appears that the Tribunal has arrived at a finding based on no evidence or where a finding is inconsistent with the evidence or contradictory of it or it has acted on material partly relevant and partly irrelevant or where no person judicially acting and properly instructed as to the relevant law could have come to the determination reached.
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Coronet Paints & Chemicals Ltd. Karachi v. Commissioner of Income Tax, West Karachi – [1984] 50 TAX 115 (H.C.Kar.)
It has been held by the superior Courts, that the Court would be entitled to intervene if it appears that the fact finding authority acted without any evidence which cannot reasonably entertained or facts found are such that no person acting judicially and properly instructed as to the relevant law could have come to the determination reached. Commissioner of Income Tax, Lahore v. Umar Saigal – [1976] 33 TAX 245 (H.C.Lah.)
An appeal from the reference under the Income Tax Law is not concerned by any of the conditions mentioned in Article 185(2), Constitution of Pakistan (1973), Article 185(3) limits the jurisdiction of the Supreme Court by providing that: „An appeal to the Supreme Court from a judgment, decree, order or sentence of a High Court in a case to which clause (2) does not apply shall lie only if the Supreme Court grants leave to appeal‟. Mian Aziz S. Sheikh v. Commissioner of Income Tax Investigation Lahore – 1980 SCC 474 = [1981] 43 TAX 105 (S.C.Pak) 108.
Two equally possible interpretations emerge - leave to appeal granted.
The question for consideration before the High Court depended upon two equally possible interpretations of the expression „unless he is himself liable to pay any income tax and super tax thereon as an agent.‟ The High Court has itself noticed the fact that there has been a great difference of opinion as to the interpretation of this expression and since a legal question which is likely to affect a large number of cases has arisen, we grant special leave to appeal. Karachi Industrial Corporation & 3 others v. Commissioner of Income Tax – 1974 SCC 424 = [1975] 32 TAX 170 (S.C.Pak) 109.
Transfer of jurisdiction.
There is no provision in the law for issuance of a notice before a case is transferred from one office to another. It is urged that the rule of natural justice requires that before an order adverse to a party is passed he shall be heard. There is little force in the contention the transfer of jurisdiction in this case was to facilitate assessment at one
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place. Per se such an order does not result in any prejudice to the assessee. If the petitioners have any specific grievance against the Income Tax Officer, they should bring it to notice of the Inspecting Additional Commissioner. Lungla (Sylhat) Tea Co. Ltd. Sylhat v. Commissioner of Income Tax Dacca Circle Dacca – 1970 SCC 366 = [1975] 31 TAX 64 (S.C.Pak.) 110.
Only question of law which has substance in it be referred to the High Court.
It may be pointed out that it is not every question of law that must be referred to the High Court. There must be some substance in it. Commissioner of Income Tax Karachi v. Ashfaq Ahmad Khan & 10 others – [1974] 29 TAX 149 (S.C.Pak.) 111.
Constitutional petition dismissed as withdrawn second petition on the same issue is maintainable.
Writ petition dismissed as withdrawn - subsequent writ petition on the same issue - constitutional petition was held to be maintainable. Pakistan through Commissioner of Income Tax Karachi v. Majestic Cinema – 1965 SCC 220 = [1965] 12 TAX 15 (S.C.Pak.) 112.
In case there is anomaly in question of law framed and referred by the Tribunal to the High Court, it should refer the case back to Tribunal for clarification.
It might have been more appropriate course for the High Court to take, when it discovered a clear anomaly in the question referred to it, to send the case back to the Tribunal for clarification of the question referred to it, so that the High Court should have known whether it was asked to consider a question of law applying to the whole matter before the Income Tax authorities or only to a part. Nagina Silk Mills, Lyallpur v. Income Tax Officer, A-Ward, Lyallpur and Another – 1963 SCC 167 = [1963] 7 TAX 442 (S.C.Pak.) 113.
Effect of lack of jurisdiction.
In the Punjab Province v. The Federation of Pakistan [PLD 1956 FC 72], it was ruled by the Federal Court that a suit brought by the Punjab Province to challenge its liability to Income Tax, on income derived from certain commercial activities of the Province, under section 204 of the Government of India Act, 1935 was not barred by section 67 of the Income Tax Act or by section 9 of the Code of Civil Procedure. It was pointed out therein that where the Income Tax
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Officer‟s order of assessment was wholly vitiated by complete lack of jurisdiction, the principle laid down by the Privy Council in cases of Relight Investment Company Limited v. Governor-General-in-Council is a representative, would not apply. The order in such a case cannot be said to have been passed under the Act, within the meaning of section 67 of the Act and a suit even in a Civil Court would not have been barred. It therefore follows that the extraordinary writ jurisdiction of the High Court could have been invoked in challenging an Income Tax assessment on the basis that the officer in question lacked jurisdiction to pass the impugned order. The writ jurisdiction was conferred on the High Court by a constitutional provision and even if there be a conflict between such a provision and another statute, the constitutional provision must prevail. The Punjab Province v. The Federation of Pakistan – 1956 SCC 13 (F.C.) = [1960] 2-TAX (Supp.-3) (S.C.Pak) 114.
Only Supreme Court is competent to adjudicate between the governments.
The principle underlying Article 184 of the Constitution of Pakistan is that all disputes whether of law or of fact are to be determined by Supreme Court of Pakistan if the parties to the dispute happens to be the Federal Government on the one side and any one or more of the provinces on the other side or if two or more provinces are arrayed against one another. The machinery provided for appeals/revisions in the Income Tax Ordinance 1979 is not relevant in such disputes. The Provincial Library & Others v. Commissioner of Income Tax East Pakistan – 1957 SCC 34 = [1959] TAX (III-290) (S.C.Pak) 115.
Appeal/Reference to Supreme Court governed by Income Tax Law.
Where the question is whether an appeal to the Supreme Court lies in income tax matter, the question has first to be decided not with reference to provision of the Code of Civil Procedure, but solely in terms of section 137(1), though once the case is held to be qualified under section 137(1) the provisions relating to appeal to the Supreme Court will apply to the appeal as if it were an appeal from decree of a High Court. 116.
In tax matters Supreme Court jurisdiction is limited.
The Supreme Court jurisdiction to entertain a statutory appeal in matters arising under the Income Tax Law is limited to the case mentioned in sub-section (2) of section 137 and that such jurisdiction
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can be invoked only where the High Court has delivered judgment on a reference made to it under section 136 and also certified the case to be fit one for appeal before the Supreme Court. Abdul Majeed Awan v. Inspecting Additional Commissioner of Income Tax – [1999] 80 TAX 115 (H.C.Lah.)=1999 PTD 2910=2000 PCTLR 1046 117.
Preliminary objection of jurisdiction should be decided first.
Admittedly, the petitioner can raise all the objections to the exercise of jurisdiction, either under section 156 of Income Tax Ordinance, or under section 66A of the Ordinance and the respondents will be dutybound to attend to the objections and determine the same by recording a well-reasoned order. The matter will be reopened only if the objection as to the exercise of jurisdiction is over-ruled. Every quasijudicial authority is under legal obligation to consider the objections as to its jurisdiction, if raised in the proceedings and to decide it as a preliminary step, before exercising the jurisdiction or invoking authority under the relevant law. The respondents are expected to first satisfy that the circumstances warrant for indulgence under the relevant provisions and that they have the jurisdiction to reopen the matter. Learned counsel for the respondents has also submitted that the objection as to the jurisdiction would be attended to by the authority concerned as a preliminary step and will be decided in accordance with law. In the circumstances noted supra, this petition is disposed of with the observations that the petitioner should raise all objections to the jurisdiction and also on the factual side, before the respondents who will decide the objections as to the jurisdiction as a preliminary step and will proceed in the matter strictly in accordance with law. If the petitioner is not satisfied with the decision, either on the question of jurisdiction or otherwise, he shall be at liberty to challenge the order in appeal, before the forum in the hierarchy of jurisdiction under Income Tax Ordinance. Tapal Energy Ltd. v. Federation of Pakistan and others – 1999 PTD 4037 (H.C.Kar.) 118.
Objection as to jurisdiction can be raised at any stage.
It is an established principle that submission to jurisdiction of a Court or Authority does not confer jurisdiction on such court or authority and in support thereof reliance is placed on the case of Mohammad Afzal v. Board of Revenue, West Pakistan and others reported in PLD
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1967 SC 314. It may also be pointed out that the objection as to the jurisdiction can be raised at any stage and for the above reliance is placed on the case of (i) Shagufta Begum v. The Income Tax Officer reported in PLD 1989 SC 360, and (ii) Pir Sabir Shah v. Shad Mohammad and others reported in PLD 1995 SC 66......” Frontier Ceramics v. Government of Pakistan & others – 1999 PTD 4126 (H.C.Pesh.) 119.
Ombudsman has no power to declare any legally issued notification as perverse, illegal, arbitrary or discriminatory.
The issuance of notification cannot be termed as maladministration because it could not be aid to have been isued for a particular person or in a particular case, it was issued for and applied to all those concerned. In the above provisions of law [Wafaqi Mohtasib Ordinance of 1983], it is no where provided that the learned Ombuds has the authority to declare any legally issued notification as perverse, illegal or arbitrary and discriminatory. 120.
CBR has no authority to file presentation against the orders of Wafaqi Mohtasib.
“.......CBR is not a person as contemplated under section 32 of the President Order 1 of 1983 and, therefore, CBR has no authority to file representations before the President of Pakistan against the recommendations/decisions of the Mohtasib.......” Pak-Saudi Fertilizer Ltd. through Managing Director v. Federation of Pakistan through Secretary Finance, Islamabad and 4 others – [2000] 81 TAX 119 (H.C.Kar.) = 1999 PTD 4061 121.
Every order increasing tax obligation of an assessee or reducing _ the refund is appealable under section 129. [Not approved by Supreme Court in [2000] 83 TAX 119 (S.C.Pak.)]
In the context of Income tax we have been able to lay our hands on Hassan Ali Khan Kara Bhai v. Commissioner of Income Tax PLD 1974 Kar. 473 wherein Noorul Arfeen J. writing for the Court held that notwithstanding that no specific appeal was provided under section 30 of the Income tax Act, 1922 against an order under section 35, however, such appeal lay since the order under section 35 pertook the character of a fresh assessment order referable to section 23 of the 1922 Act, and therefore, such an order being in the nature of an order of assessment was appealable to the Appellant Assistant Commissioner under Section 30 of the Act. The above discussion would amply confirm that the omnibus clause in section 129 i.e. „or otherwise increasing the liability of an assessee‟
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covers every possible eventuality where the tax liability or obligation to pay income tax is increased or refund reduced, making such orders appealable under section 129. Tapal Energy Ltd. v. Federation of Pakistan and others – 1999 PTD 4037 (H.C.Kar.) 122.
Submission to jurisdiction of a Court/Authority does not confer jurisdiction which does not vest in it/him in law.
Even, otherwise failure of the petitioners to question the authority or jurisdiction of respondent No. 3 to issue the alleged notices and to initiate the said proceedings against them would not confer jurisdiction on respondent No. 3 which did not vest in him in law. It is an established principle that submission to jurisdiction of a Court or Authority does not confer jurisdiction on such Court or Authority and in support thereof reliance is placed on the case of Muhammad Afzal v. Board of Revenue, West Pakistan and others [PLD 1967 SC 314]. 123.
Objection to jurisdiction can be raised at any stage.
It may also be pointed out that the objection as to the jurisdiction can be raised at any stage and for the above reliance is placed on the cases of: (i) Shagufta Begum v. The Income Tax Officer reported in PLD 1989 SC 360, and (ii) Pir Sabir Shah v. Shad Muhammad and others reported in PLD 1995 SC 66. The objection raised by Mr. Shaikh Haider is not sustainable and is overruled. Abdul Majeed Awan v. Inspecting Additional Commissioner of Income Tax [1999] 80 TAX 115 (H.C.Lah.) = 1999 PTD 2910 = 2000 PCTLR 1046 Abdul Majeed Awan v. Inspecting Additional Commissioner of Income Tax – [1999] 80 TAX 115 (H.C. Lah.) = 1999 PTD 2910 (H.C.Lah.) = 2000 PCTLR 1046 124.
Objections to jurisdiction are to be decided before proceeding in the matter by adjudicating authority.
Admittedly, the petitioner could raise all the objections to the exercise of jurisdiction, either under section 156 of Income tax Ordinance or under section 66-A of the Ordinance and the respondents will be duty bound to attend to the objections and determine the same by recording a well reasoned order. The matter will be reopened only if the objection as to the exercise of jurisdiction is overruled. Every quasijudicial authority is under legal obligation to consider the objections as to its jurisdiction, if raised in the proceedings and to decide it as a preliminary step, before exercising the jurisdiction or invoking
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authority under the relevant law. The respondents are expected to first satisfy that the circumstances warrant for indulgence under the relevant provisions and that they have the jurisdiction to reopen the matter. Mst. Tasneem Kausar v. House Building Finance Corporation – [PLD 1999 Lahore 462] 125.
Courts/Tribunals have inherent powers to recall orders independent of any statutory provisions.
Court, Tribunal or Authority has an inherent jurisdiction to recall orders obtained from it by practising fraud and misrepresentation. Such power is inherently available to a Court/Tribunal of special or limited jurisdiction independent of any statutory provision. Hazoor Bakhsh v. Senior Superintendent of Police, Rahimyar Khan and 12 others – PLD 1999 Lahore 417 126.
Doctrine of exhaustion explained.
While parting with this order we are inclined to reiterate that rules enunciated above, flow from doctrine of exhaustion as embodied in Article 199 of the Constitution. It is hardly necessary to reiterate that this doctrine does not absolutely bar the jurisdiction of this Court to adjudicate such petitions if other remedies are available against the impugned orders/ grievance. If the Court comes to the conclusion that the orders /proceedings/actions of functionaries of State under attack are in excess of authority or totally destitude of authority if had power to come to the relief of the effected party in exceptional circumstances. Doctrine of exhaustion is regulatory in nature. In highly exceptional circumstances this Court definitely will come to the rescue of the effected party as pointed out by a celebrated Judge Mr. Justice Aftab Hussain in Haji Muhammad v. Khizar Hayat PLD 1977 Lah. 424. See Qamar-uz-Zaman v. Zila Council Bahawalpir 1990 MLD 1748. Union Bank Ltd. v. Federation of Pakistan – [1998] 77 TAX 127 (H.C.Lah.) 127.
CBR has no authority to place judicial interpretation on any provision of law.
It is not necessary to state the facts in view of the limited nature of the controversy before this Court. Suffice it to stay that according to the petitioner‟s learned counsel under section 53 of the Income Tax Ordinance, 1979 the liability of the assessee to pay advance tax has to be worked out after giving due allowance for the tax already paid under section 50 of the Income Tax Ordinance, 1979 as mentioned in
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clause (b) of sub section 1 of section 53 itself but the Central Board of Revenue while interpreting the above section in the impugned circular has opined in para-2 of the circular that the tax withheld under section 50 shall neither be included in the amount of tax assessed nor shall such tax be accounted for as payment of quarterly advance tax instalments. According to the learned counsel the direction of Central Board of Revenue that the tax withheld under section 50 be not accounted for as payment of quarterly advance tax instalment is violative of section 53 itself and cannot be given effect to. Relying upon pronouncement of the Supreme Court of Pakistan in Messrs Central Insurance Co. v. The C.B.R. and others (1993 SCMR 1232), learned counsel for the petitioner has contended that authority of the Central Board of Revenue to issue Circular No. 13 of 1997 is barred as under section 8 of Income Tax Ordinance, 1979. The jurisdiction of Central Board of Revenue for issuing instructions is confined only to administrative matters. ..................... it may be stated that prima facie this contention appears to have merit inasmuch as according to the wording of Section 53 (1)(b) the liability of the assessee is to pay the advance tax minus the tax already paid under section 50. Further discussion in this behalf is unnecessary as Mr. M. Ilyas Khan, Advocate has conceded before this court that Circular No. 13 of 1997 dated 29.9.1997 issued by the Central Board of Revenue has no binding force. He further says that neither any assessing officer nor any appellate authority under the Income Tax Ordinance has, therefore, adopted the said circular. Learned counsel has assured that the authorities concerned shall interpret section 53 of the Income Tax Ordinance, 1979 irrespective of the view taken by the Central Board of Revenue. It is a matter of some regret that the Central Board of Revenue while issuing the circulars does not follow the law declared by the Supreme Court of Pakistan which under Article 189 is binding on all authorities which are required to act in aid of Supreme Court of Pakistan. The law on the subject was clearly enunciated in Central Insurance Co.‟s case supra relied upon by the petitioner‟s learned counsel in which it was held that Central Board of Revenue is not one of the authorities in the hierarchy of officers which has jurisdiction to interpret any provision of the Ordinance. That being so, the Central Board of Revenue would be well advised to desist from issuing any such circular which influences the decision of the adjudicating authorities.
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Nasir Mahmood Dar, etc. v. Federation of Pakistan and Others – [1998] 78 TAX 1 (H.C.Lah.) = 1998 PCTLR 1382 128.
CBR‟s circular holding compensation under Golden Handshake Scheme as taxable declared unlawful.[This decision has been overturned by a Division Bench of the Lahore High Court.]
The Central Board of Revenue has no jurisdiction to issue any circular as to curtail the discretion vesting in the Adjudication Authorities .................. the circular issued holding that the amounts received under the Golden Handshake Scheme were salaries is ultra vires the powers of the Central Board of Revenue. In this view of the matter, all these petitions are allowed and the circular issued by the Central Board of Revenue on 6.11.1997 is declared to be without any lawful authority and of no legal effect. The Adjudication Officer shall proceed to decide independently of the circular as to whether the amounts received by the petitioners are tantamount to salaries or not and are taxable. The amounts, if any, withheld by the Banks and the amounts disbursed to the Department under the impugned Circular, shall be refunded to the petitioners. Karim Aziz Industries Ltd. v. Commissioner of Income Tax Rawalpindi Zone – [1997] 75 TAX 90 (H.C.Lah.) 129.
Powers of Appellate Tribunal.
A careful reading of sub-section (5) of the above provision, clearly shows that if the Appellate Tribunal is not satisfied with the orders passed by the forum below, it has the power to cancel or vary such orders and can pass necessary consequential directions as the situation may warrant. The language of this section clearly indicates that the powers of the Tribunal under this section have very wide amplitude and are almost to the power of Civil Court under Order XLI, rule 33, CPC. The ratio, deducible from the foregoing discretion is that the power of Appellate Income Tax Tribunal under section 135 of the Ordinance are almost analogous to the powers of Civil Court under Order XLI, Rule 33, CPC.These powers are of a wide sweep and arm the appellate court with the power to pass an order of remand if it comes to a finding that the orders of the courts below are illegal and there is an occasion for fresh proceeding before the first authority/court. This power is expressly embodied in the language of conclusion, we find that question referred to by the Tribunal is of academic nature and need no further examination.
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Tharparkar Sugar Mills Ltd. v. Federation of Pakistan and Others – [1996] 73 TAX 215 (H.C.Kar.) 130.
Interim stay should be given once writ is admitted.
“.......once a petition in tax matters is admitted that ispo facto shows that the petitioner has made a prima facie case and therefore interim stay may be granted.” Unique Enterprises, Lahore v. Assistant Commissioner of Income Tax and 2 others – [1995) 71 Tax 139 (H.C.Lah.) 131.
CBR instructions are binding on tax authorities
The circulars issued by CBR are of binding nature on the functionaries of Income Tax Department; and deviation from the instructions contained in the circulars is nothing but misconduct. Mian Anwar-ul-Haq Ramay v. Federation of Pakistan – [1993] 67 TAX 195 (H.C.Lah.) 132.
Courts cannot question the wisdom of Legislature in enacting provision of any law.
The law is firmly settled that it is not for the courts to question the wisdom of Legislature in enacting provision of any law in any manner and their judicial function in this regard primarily is to confine to the interpretation of the law as it is. Under Article 199 of the Constitution under which this petition has been made, this court is vested with the jurisdiction to declare any law or any custom or usage having the force of law as void to the extent so far it is inconsistent with the rights conferred by chapter I of Part II of the Constitution known as the fundamental rights beyond which the jurisdiction of this court to examine the vires of law in our view does not extend. Learned counsel for the petitioner has not been able to point out any provision of the Constitution by which the Legislature is required to lay down guidelines in the law to regulate the exercise of power which if confers on the executive. In the absence of any provision, it is difficult to hold that this court has the jurisdiction to declare any provision of law as ultra vires of the Constitution on that score. Before parting with the discussion on this aspect of the case we may observe that we should not be understood to have held that the absence of any guide-lines for exercise of discretionary power conferred under the statute gives to the authority concerned a free had to exercise the same arbitrarily and whimsically. We may state here that in our considered view to which no exception can be taken the authority is required to exercise power reasonably, justly and
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fairly on the basis of relevant consideration having legal nexus with the object of law, with wisdom and maturity keeping in view above all the interest of the state. In our opinion these principles shall be read in the statute as guiding principles to regulate the exercise of powers conferred on the functionaries of the state and they are of so fundamental in character that they need not be expressly provided in the statute itself. Muhammad Hanif Monnoo v. Income Tax Officer Central Circle 1, Lahore – [1984] 50 TAX 37 (H.C.Lah.) = PLJ 1984 Lah. 423 133.
Presumption of irregularity with regard to official act cannot be challenged on vague allegation of mala fide.
It is well settled that there is to start with, a presumption of regularity with regard to all official acts and until that presumption is rebutted, the action cannot be challenged upon mere vague allegations of mala fide. The petitioner has failed to rebut the presumption of regularity attached to the impugned proceedings. Case referred to: Federation of Pakistan v. Saeed Ahmed Khan PLD 1974 SC 151.
Modern Silk Mills Ltd. Lahore v. Commissioner of Income Tax Lahore – [1979] 39 TAX 14 (H.C.Lah.) 134.
A question not raised before the Appellate Tribunal cannot be raised before the High Court.
Now it is well settled principle of law that unless a question has been raised before the Appellate Tribunal or arises out of its order the same cannot be raised for the first time before the High Court. Abdul Rashid (c/o Union Traders GoIe Cloth, LyalIpur) v. Special Judge (Central), Lahore and another – [1976] 34 TAX 199 (H.C.Lah.)
The first question is whether there is substance in the argument that the Central Board of Revenue was required to be constituted again in Pakistan under section 9 of the Governor General‟s Order 20. Before determining this question may observe that in my view the argument of Mr. Ilyas Khan that the point about the necessity of the constitution of the Board of Revenue should have been taken and urged before the Income Tax Authorities is not without force. The Central Board of Revenue exercises functions under various enactments e.g. The Income Tax Act, the Central Excise & Salt Act, Wealth Tax Act, Gift Tax Act, Sales Tax Act, Customs Act and Estate Duty Act. It is the first authority described in section 5 of the Income Tax Act, other
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authorities being the Commissioner of Income Tax, Income Tax Officers etc. Since the year 1962 and by virtue of the provisions of Ordinance 31 of 1962 which amended the Income Tax, Act, the Central Board of Revenue is also the appointing authority of other Income Tax authorities. An attack on the existence of the Board of Revenue by the petitioner who was assessee after 1962 is an attack on the vires of the appointment of the other Income Tax authorities and ultimately on the legality of the assessment. The challenge to the constitution of Board of Revenue should have been thrown at the time of assessment; otherwise it would lead to an anomalous situation in so far as the assessment is treated as legal while the approval for prosecution on the basis of that assessment is attacked as a nullity. The dictum in Ghulam Mohy-ud-Din v. Chief Settlement Commissioner PLD 1964 S.C. 829 (840) applies to this case and the writ ought to be refused. The other point that no member of the Central Board of Revenue in Pakistan has been or can be treated to have been appointed by the competent authority i.e. the Central Government, cannot be allowed to be taken since this point was neither raised before the Income Tax authorities nor before the Special Judge nor in the writ petition. This objection is also belated. I agree with the argument of Mr. Ilyas Khan that his point raises a question in the nature of quo warranto even in regard to existing members who would be necessary parties to this petition. It falls within sub-clause (ii) of clause (b) of sub-Article 1 of Article 199 which authorises the High Court to require a person within its territorial jurisdiction holding or purporting to hold a public office to show under what authority of law he claims to hold that office. These words clearly make the person holding office a necessary party to the writ petition and in the absence of such party the petition cannot be treated to be properly constituted. The impleading of Central Board of Revenue through its Chairman cannot cure this defect. Case relief upon: Ghulam Mohy-ud-Din v. Chief Settlement Commissioner (PLD 1964 SC 829).
Highway Petroleum Service (Regd.) Lahore v. Islamic Republic of Pakistan & another – [1977] 36 TAX 8 (H.C.Lah.) 135.
Provisions of the Income Tax Act can be challenged on constitutional grounds.
The learned counsel for the petitioners have submitted that there is no right of appeal against the impugned orders and that a revision or reference is no right of a litigant. Further, that as the impugned
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provisions are being challenged on constitutional grounds, inspite of alternate remedies, the petitioners have a right to challenge the same by means of a petition under the constitution and that, lastly, since the questions raised in these petitions relate to the challenge of the provisions in the Income Tax Act itself, to declare the same to be invalid. It is submitted that a court interpreting the constitution finally is an appropriate forum to raise the questions. The submission is obviously sound and is sustained. Commissioner of Income Tax Lahore v. Govt. Jallo Rosin and Turpentine Factory, Lahore – [1976] 34 TAX 71 (H.C.Lah.) 136.
Only Supreme Court is competent to adjudicate between the governments.
On the merits the additional objection raised before us has considerable force. In this connection Article 185(1) of the 1973 Constitution lays down that the Supreme Court shall, to the exclusion of every other court, have original jurisdiction in any dispute between any two or more governments. In the 1962 Constitution there was a corresponding provision in the form of Article 57. Chief Secretary, Government of The Punjab Lahore v. Commissioner of Income Tax, Lahore Zone, Lahore – [1976] 33 TAX 176 (H.C.Lah.) = PLD 1976 Lah. 258 137.
A legal plea going to the roots of the case was allowed to be raised at belated stage.
It was, therefore, alleged in this application that under Article 184(1) of the Constitution of Islamic Republic of Pakistan, 1973 only the Supreme Court has the exclusive jurisdiction to entertain this dispute between the Central Government and the Provincial Government...... This was an altogether new plea which was for the first time raised in this court belatedly after the conclusion of the arguments. But as it was a purely legal plea gong to the root of the case we allowed the permission to the respondent to raise the objection for whatever its worth, even at this late stage. Commissioner of Income Tax Rawalpindi v. Wolf Gang Matzke – [1975] 32 TAX 176 (H.C.Pesh.) 138.
Courts have inherent jurisdiction in the interest of orderly dispensation of justice.
It is common knowledge, that a statute normally does not provide for each and every conceivable eventuality and in respect of some unforeseen events arising in a case for which it has made no provision,
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the courts would be deemed to have inherent jurisdiction in the interest of orderly dispensation of justice. Emperor v. Probhat Chandra Barua – 1 ITC 284 (Calcutta) 139.
Courts have no concern with disputable questions of distributive justice.
In construing a fiscal statute the Court has no concern with disputable question of distributive justice - this upon the plainest ground that by very strong presumption the legislature has not intended that questions of equality or fairness in taxation should be left to any decision save its own. _______________
INCOME / DEEMING PROVISIONS
_
HOW TO BE CONSTRUED
Elahi Cotton Mills Ltd. & Others v. Federation of Pakistan & Others – 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) 140.
Scope of deeming provisions in respect of income.
That generally the effect of a deeming provision in a taxing statute is that it brings within the tax net an amount which ordinarily would not have been treated as an income. In other words, it brings within the net of chargeability income not actually accrued but which supposedly to have accrued notionally. That when a statute enacts that something shall be deemed to have been done which in fact and in truth was not done, the Court is entitled and bound to ascertain for what purposes and between what persons the statutory fiction is to be resorted to. That where a person is deemed to be something the only meaning possible is that whereas he is not in reality that something, the Act required him to be treated as he were with all inevitable corollaries of that state of affairs. That the legal fictions are limited for a definite purpose, they cannot be extended beyond the purpose for which they are created. That income tax is a tax on a person in relation to his income. It is a tax imposed upon a person (natural or artificial) in relation to his income. That any legislation whereby either the prices of marketable commodities are fixed in such a way as to bring them below the cost of production and thereby make it impossible for a citizen to carry on his business or tax is imposed in such a way so as to result in acquiring property of those on whom the incidence of taxation fell, then such
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legislation would be violative of the fundamental rights to carry on business and to hold property as guaranteed in the Constitution. 141.
Widest amplitude of an entry in legislative list does not extend to tax something which is not a citizen‟s income.
That the rule of interpretation that while interpreting an entry in a legislative list it should be given widest possible meaning does not mean that Parliament can choose to tax as income an item which in no rational sense can be regarded as a citizen‟s income. The item taxed should rationally be capable of being considered as the income of a citizen. That before charging tax, an assessee must be shown to have received income or the same has arisen and accrued or deemed to be so under the statute. Any amount which cannot be treated as above is not an income and, therefore, cannot be subject to tax. That there is a marked distinction between a tax on gross revenue and a tax on income, which for taxation purposes, means gains and profits. There may be considerable gross revenues, but no income taxable by an income tax in the accepted sense. 142.
Scope of definition of „tax on income‟ under the Constitution.
We may state that at this juncture, it will not be out of context to take up Mr. Iqbal Naim Pasha‟s submission that the definition of the term „tax on income‟ given in Article 260 of the Constitution provides guideline as to the import and scope of Entry 47 of the Fourth Schedule to the Constitution, Part I, by providing that „tax on income‟ includes a tax in the nature of excess profits tax or a business profits tax which, according to him, have the same connotations which were understood in respect of Excess Profits Tax Act, 1940, and the Business Profits Tax Act, 1947. The above contention is devoid of any force, firstly, for the reason that the definition of the term „tax on income‟ given in Article 260 of the Constitution, used the words „tax on income‟ includes a tax in the nature of an excess profits business or a business profits tax. The factum that the word „includes‟ has been employed and not the word „means‟ indicates that the definition given in Article 260 of the above term is not exhaustive. Secondly, the entries in the Legislative List, as pointed out hereinabove, are to be construed liberally and not in a pedantic manner. The word „income‟ as highlighted hereinabove in various reports and treatises is susceptible to a very wide meaning. We may point out that the question, as to whether the impugned taxes are direct or indirect taxes highlighted by Mr. Sikandar Hayat with the aid of above three Privy Council cases, is not relevant. In the
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above cases the controversy in issue was, whether the Dominion concerned Legislature had the power to levy the impugned tax or the Province concerned. There is no such controversy involved in the instant case. Even otherwise, the impugned taxes are direct taxes. Kashmir Feeds (Pvt.) Ltd. v. Central Board of Revenue through Chairman, Government of Pakistan, Islamabad and another – [1999] 80 TAX 24 (H.C.Kar.) = 1999 PTD 1655 143.
Deeming provisions - How to be construed.
When a statute contemplates that a state of affairs should be deemed to have existed, it clearly proceeds on the assumption that, in fact, it did not exist at the relevant time but by a legal fiction one has to assume as it did exist. Commissioner of Income Tax v. Syed Akhtar Ali – [1994] 69 TAX 38 (H.C.Kar.) 144.
Scope of deemed income.
Setion 12(7) envisages „deemed income‟ as income where an assessee makes any loan or advances to any person which is either interest free or on which interest at a nominal rate is charged. We are of the view that in such a situation, interest worked out at the rate of two percent above the bank rate as reduced by the interest, if any, charged by the assessee shall be deemed to be interest income of the lender. J.L. Wei & Co. v. Commissioner of Income Tax – [1989] 59 TAX 108 (H.C.Kar.)
The law clearly provides that all the entires found in the assessee‟s account books for the previous year unless clearly explained and the nature and source are disclosed satisfactorily, the same will be treated as income and will be charged to tax. Commissioner of Income Tax v. Nishat Cinema, Lyallpur – [1979] 39 TAX 140 (H.C.Lah.) 145.
Assessment and levy of super tax on total income of three months at the rate applicable to twelve month‟s notional income as a condition for permitting change of previous year by assessee was held without legal sanction.
We heard the learned counsel for the Department who urged that under this proviso the Income Tax Officer had wide discretion to burden the permission for change of previous year, with such conditions as he may think fit. The assessment of notional income and imposition of super tax thereon, according to the learned counsel are
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reasonable conditions, which can justifiably be imposed on the assessee by the Income Tax Officer, to accord his consent. It is thus obvious that the tax is to be levied on the profits and gains of the business carried on by an assessee. Gain is the equivalent of profit and profit accrues if the receipts from the business exceed the expenditure incurred for acquiring the receipts. Section 10 is, however, subject to the other provisions of the Act. The combined effect of sections 3, 4, 6 and 10 is that to sustain the levy there should have been income attributable to the business carried on by the assessee. The concept of notional income of a previous year, by multiplying 3 months‟ income by 4 is thus not vouched by the provisions of the Income Tax Act. It appears to us that in imposing conditions on an assessee, to allow him to change his previous year, there is an overriding limitation on the powers of the Income Tax Officer not to levy such a condition which is not warranted by the Income Tax Act itself. The learned counsel for the Revenue has placed reliance on the proviso to spell out the powers for the assessing authority to set out the impugned condition. But as observed above this power is qualified and has to be exercised within the limits fixed by the statute. The proviso has to be interpreted in harmony with the other provisions of the Income Tax Act and not to nullify those provisions. Cases referred to: Ikram Bus Service v. Board of Revenue (PLD 1963 S.C. 564); Kohinoor Textile Mills v. The Province of Punjab (PLD 1972 SC 100) and the Guardian of the Poor of the West Derby Union v. The Metropolitan Life Assurance Society (1897) AC 647. _______________
LEGISLATIVE POWERS VIS-À-VIS DOCTRINE OF REASONABLE CLASSIFICATION
Elahi Cotton Mills Ltd. & Others v. Federation of Pakistan & Others – 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) 146. Distinction between direct and indirect taxes hardly exists now. That a direct tax is one which is demanded from the very person, who it is intended or desired should pay it, whereas indirect taxes are those, which are demanded from one person in the expectation and intention that he shall indemnify himself at the expense of another, like custom duties, excise taxes and sales taxes, which are borne by the consumers. That levy of building tax on the basis of the covered area without taking into consideration, the class to which a particular building
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belongs, the nature of construction, the purpose for which it is used, its situation and its capacity for profitable use and other relevant circumstances bearing on the matters of taxation is not sustainable in law for want of reasonable classification. That there is a clear distinction between the subject matter of a tax and the standard by which the amount of tax is measured keeping in view the practical difficulties, which are encountered by the Revenue to locate the persons and to collect the tax due in certain trades, if the Legislature in its wisdom thought that it would facilitate the collection of tax due from specified traders on a presumptive basis, the same is not violative of the Fundamental Right relating to equality. _______________
DISTINCTION BETWEEN “TAX” AND “FEE”
Biafo Industries v. Federation of Pakistan – PTCL 2000 CL. 384 147.
Distinction between “tax” and “fee” explained.
Therefore, the distinction between a tax and fee lies primarily in the fact that tax is levied as a part of common burden or general revenue, while a fee is a payment for special benefit or privilege. This distinction between tax and fee was adopted in the case of Abdul Majid and others PLD 1960 Dacca 502 and in the case of Mahboob Yar Khan PLD 1975 Lah. 748. However, it should not be forgotten that there is no generic difference between a tax and fee. Both are compulsory exaction of money by public authorities. A tax is imposed for public purposes and is not supported by any consideration of service rendered in return. Whereas a fee is levied in view of services rendered. Consequently, there is an element of quid pro quo between the payer of the fee and the authority which imposes it. _______________
DISTINCTION BETWEEN ACTUAL LIABILITY IN PRAESENTI AND A LIABILITY DE FUTURO WHICH FOR THE TIME BEING IS ONLY CONTINGENT
Commissioner of Income Tax v. Kesar Sugar Works Ltd. – 2001 PTD 744 148.
The Income Tax Law makes a distinction between actual liability in praesenti and a liability de futuro which, for the time being, is only contingent.
The Income Tax Law makes a distinction between actual liability in praesenti and a liability de futuro which, for the time being, is only
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contingent. The former is deductible but not the latter. The controversy to be decided in this case therefore is whether the present liability, accrued against the assessee in the assessment years under consideration. This has to be decided by taking into account all the facts and circumstances of the case. If the liability is an actual liability in praesenti in the year under consideration, it is deductible. If it is a contingent liability, it cannot be the subject-matter of deduction even under the mercantile system of accounting. There is no dispute in the present case that in the years under consideration the liability to pay interest was an actual liability. It was no more contingent. There is no dispute on this count. The only ground on which the claim of the assessee for deduction was denied by the Income Tax Officer was that the assessee was disputing the liability by filing an appeal to the Supreme Court. This view of the Income Tax Officer did not find favour with the Commissioner (Appeals) and the Tribunal. The law in this regard is well-settled by the decision of the Supreme Court in Kedarnath Jute Mfg. Co. Ltd. v. Commissioner of Income Tax (1971) 82 ITR 363, that if there is actual liability in praesenti, deduction cannot be denied on the ground that the assessee is disputing the liability. As a result, in the case of an assessee maintaining the mercantile system of accounting the amount payable by the assessee would be deductible as an accrued liability even though the assessee objects to it and seeks to get the order of the concerned authority reversed, subject, however, to any statutory provision to the contrary (viz., section 43B of he Income Tax Act, 1961, as inserted by the Finance Act, 1983, with effect from April 1, 1984, which provides that certain liabilities can be deducted only on actual payment). _______________
THEORY OF READING DOWN AS A RULE OF INTERPRETATION
Elahi Cotton Mills Ltd. & Others v. Federation of Pakistan & Others – 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) 149.
Theory of reading down as a rule of interpretation.
That denial of reliefs provided by sections 28 to 43C of the Indian Income Tax Act to the particular business or trades covered by section 44AC thereof without showing some basis fair and rational and without having nexus to the object sought to be achieved by the Legislature, held unfair, arbitrary, disproportionate to the prevalent evil and constitutes denial of equal treatment. Consequently, the Indian Supreme Court did not press into service non-obstante clause
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of section 44AC by applying theory of reading down as a rule of interpretation. That it is an accepted canon of taxation to levy tax on the basis of ability to pay. The sections 115J and 115JA incorporated in Indian Income Tax Act, 1961, were intended and designed to bring within the tax net the companies, which though making huge profits and also declaring substantial dividends, but have been managing their affairs in such a way by availing of tax concessions etc. as to avoid payment of income tax. That the theory of reading down is a rule of interpretation which is resorted to by the Courts when they find a provision read literally seems to offend a fundamental right or falls outside the competence of the particular legislature. _______________
RULE OF EVIDENCE
Miss Asia v. Income Tax Appellate Tribunal etc. – 1978 SCC 446 = [1980] 41 TAX 1 (S.C.Pak) 150.
A Judge cannot be compelled to accept a piece of evidence.
There is no rule of law compelling a judge to accept evidence, even though it is uncontradicted, which he believes to be a pack of lies. Amin Bricks Company v. Commissioner (Revision) etc. – [1996] 74 TAX 227 (H.C.Lah.) 151.
of
Income
Tax
Income Tax Authorities to establish by positive evidence that assessee‟s accounts are unreliable.
The contention of the learned counsel for the department that no obligation is cast on Income Tax authorities to establish by positive evidence that the assessee‟s accounts are unrealisable, seems to be misconceived; the power of assessing officer under the law is not merely discretionary power but amounts to a statutory duty; it is not a purely subjective or arbitrary exercise of discretion and is required to be exercised judicially and adverse inference cannot be drawn unless the assessing officer is satisfied that the accounts have been suppressed by the assessee. Syed Akhtar Ali v. Commissioner of Income Tax Hyderabad – [1994] 69 TAX 38 (H.C.Kar.) 152.
Standard of proof.
It is always to be remembered that the standard of proof applicable to prove a positive fact and the one which is required to prove a negative
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fact cannot be the same. A high standard is always applied for the proof of a positive fact while the standard of preponderance of probability is sufficient to prove a negative fact. The assessee is required to prove that the failure to return correct income did not arise from any fraud or gross or wilful neglect. The assessee merely has to place materials of the primary facts or the circumstances which in all reasonable probability would show that he was not guilty of any fraud or gross or wilful neglect. He may discharge this onus by placing the facts found in the assessment order to show that the facts found therein had not in the least given an inkling of fraud or gross or wilful neglect, on the part of the assessee and, therefore, it must be held without proof of any other fact that there was no fraud committed by the assessee in his failure to return the correct income nor was he acting grossly or wilfully negligently. Miss Rani v. Commissioner of Wealth Tax Lahore – [1992] 68 TAX 89 (H.C.Lah.) 153.
Qanoon-e-Shahadat Ordinance is applicable to Income Tax Ordinance, 1979.
The Qanoon-e-Shahadat Order, 1984 has been made applicable to all judicial proceedings before any court, a Tribunal or any other Authority exercising judicial or quasi-judicial powers or jurisdiction except an Arbitrator. The scope of applicability of Qanoon-e-Shahadat Order, 1984, is thus much larger than that of Evidence Act, 1972. It cannot be doubted that the proceedings before the Income Tax Authorities are judicial in nature and further that they are exercising quasi-judicial, if not judicial powers. The applicability of the Qanoon-e-Shahadat Order, 1984 to tax proceedings is, therefore, established as the Income Tax Ordinance, 1979. CST/Commissioner of Income Tax Rawalpindi v. Pakistan Television Corporation Ltd. – [1978] 38 TAX 181 (H.C.Lah.) _ 154. Provisions of Evidence Act not applicable to proceedings under Income Tax Act. It is correct that the Evidence Act is not applicable to the proceedings under the Income Tax Act.
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Siva Pratab Bhattadua v. Commissioner of Income Tax – 1 ITC 323 (Madras) 155.
Statement in power of attorney not proof in itself.
It is argued that the power of attorney, which was filed by the agent, stated that it was a joint family, but a statement in a power of attorney would not prove itself. It will be like any other statement made by a person. _______________
COURTS CAN STRIKE DOWN DISCRIMINATORY AND CONFISCATORY PROVISIONS OF FISCAL LAWS
Elahi Cotton Mills Ltd. & Others v. Federation of Pakistan & Others – 1997 SCC 1097 = [1997] 76 TAX 5 (S.C.Pak.) 156.
Courts can strike down discriminatory and confiscatory provisions of fiscal laws.
That though the Legislature has the prerogative to decide the questions of quantum of tax, the conditions subject to which it is levied, the manner in which it is sought to be recovered, but if a taxing statute is plainly discriminatory or provides no procedural machinery for assessment and levy of the tax or that is confiscatory, the Court may strike down the impugned statute as unconstitutional. _______________
SCOPE OF VARIOUS WORDS AND EXPRESSIONS
Cement Agencies Ltd. v. Income Tax Officer Central Circle-II, Karachi – 1969 SCC 322 = [1969] 20 TAX 33 (S.C.Pak) 157.
“Accrue” and “arise”.
The policy of the Ordinance is to make the amount of income taxable when it is received either actually or constructively. So far as the words „accrue‟ and „arise‟ are concerned. We are to take ordinary dictionary meaning of these words. Since both the words have been used in the provision in question they must be taken to have distinct meanings. „Accrue‟ conveys the sense of growing up by way of additional or increase or as accession or advantage, while the word „arises‟ connotes comes into existence or notice or presents itself. It is, however, to be noticed that these two words have been used in contradistinction to the word „received‟ indicating a right to receive. The words „accrues‟ and „arises‟ represent a state anterior to the point
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of time when the income becomes receivable and connote a character of the income which is more or less inchoate. Commissioner of Agricultural Income Tax v. BWM Abdur Rehman – [1974] 29 TAX 212 (S.C.Pak.) 158.
“Accrue” and “arise”.
Whereas „receive‟ clearly connotes a specified sum passing into the possession of the receiver. The word „accrued‟, in the context, obviously means no more than that a right had arisen in a certain person to recovery of a certain sum. The expression „accrued‟ in the context also, carries plainly the sense of an accrual for the benefit of the person concerned, as distinguished from the sense of merely receiving money under legal obligation to pass it on to another person or authority, which is incidental to the recovery of cesses by an assessee. Pandit Pandurang v. Commissioner of Income Tax, Central Provinces – 2 ITC 69 (Nagpur) 159.
“Accrue” and “arise” vis-a-vis effect of book entries.
In a very recent case decided by the Privy Council, St. Lucia Usines and Estates Co. v. St. Lucia [(1924) A.C.508 at p. 512], Lord Wrenbury has observed:– “The words „income arising or accruing‟ are not equivalent to the words „debts arising or accruing.‟ To give them that meaning is to ignore the word „income‟. The words mean „money arising or accruing by way of income‟ There must be a coming in to satisfy the word „income‟........ If the taxpayer be the holder of stock of a foreign Government carrying say 5 per cent interest, and the Government is that of a defaulting state which does not pay the interest, the tax-payer has neither received nor has there accrued to him any income in respect of that stock. A debt has accrued to him but income has not. It does not follow that income is confined to that which the tax-payer actually receives. Where income tax is deducted at the source the tax-payer never receives the sum deducted but it accrues to him.” Commissioner of Income Tax Punjab, NWFP & Bahawalpur v. Mrs. E.V. Miller – 1959 SCC 53 = [1959] 1-TAX (III-1) (S.C.Pak) 160.
“Agricultural Income” when remains to be such in the hands of recipient.
A servant employed on an agricultural farm under a contract of service can no more claim his salary to be agricultural income on the
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ground that he is paid by his master out of his agricultural income than a shopkeeper can claim exemption from tax because the price which he has received for his wages has come out of the agricultural income of the buyer. But if income lying in reserve with a person is agricultural income which he himself cannot enjoy and is meant to be distributed among its rightful claimants, it cannot be disputed that no change of character is implied in the distribution of that income because income is earned for expanding and a person who is precluded in law from expanding it on his own enjoyment and holds it for the benefit of the others does not bring out any change in the nature of that income when he posses it on to the beneficiary. Commissioner of Income Tax East Bengal v. Kumar Narayan Roy Choudhry and others – 1959 SCC 68 = [1959] 1-TAX (III-207) (S.C.Pak.) 161.
“Agriculture” and “agricultural purposes”.
The word „agriculture‟ is not used in the Act in its extended dictionary meaning. It has been used in a narrow sense and so interpreted, it means that an operation to be agricultural must involve or be connected with the cultivation of the soil. Commissioner of Income Tax v. Kathiawar Coopperative Housing Society – [1985] 51 TAX 5 (H.C.Kar.) 162.
“Annual value”.
From plain reading of sub-section (2) of section 19, it would appear that the actual rent received by the landlord is not the basis for determining the taxable amount, but the amount which the leased property is likely to fetch by way of rent or which the property might reasonably be expected to fetch from year to year shall be the basis of calculating the taxable amount. Chhuna Mal Salig Ram v. Punjab NWFP – 5 ITC 316
The annual value of property under section 9 of the Income Tax Act does not include sums paid by the tenants to the owner on account of house tax payable by the owner...... Muhammad Amjad v. Commissioner of Income Tax, Zone ‘A’ Karachi – [1992] 65 TAX 176 (H.C.Kar.) = 1992 PTD 513] 163.
“Assessment”.
Kanga and Palkhivala‟s in the Law and Practice of Income Tax, Eighth Edition Volume I, at page 1127 have commented upon the word „assessment‟. They have observed that “the word „assessment‟ is
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used in the Act as meaning sometimes the computation of income, sometimes the determination of the amount of tax payable; and sometimes the whole procedure laid down in the Act for imposing liability on the taxpayer. The word „assessment‟ must be understood in each section of this Act with reference to the context in which it is used, in some sections it has a comprehensive meaning and includes reassessment (e.g. section 265) and in some sections it has a restricted meaning and is used as distinct from re-assessment (e.g. section 147)”. They have further observed that “the method prescribed by the Act for making an assessment to tax using the word assessment in its most comprehensive sense as including the whole procedure for imposing liability upon the taxpayer consists of the following steps. In the first place, the taxable income of the assessee has to be computed. In the next place, the sum payable by him on the basis of such computation has to be determined. Finally, a notice of demand in the prescribed form specifying the sum so payable has to be served upon the assessee.” National Beverages (Pvt.) Ltd. v. Federation of Pakistan and others – [2001] 83 TAX 359 (H.C.Kar.) = PTCL 2001 CL. 250 164.
Meaning of expression “assessment consciously completed”.
The expression “assessment consciously completed” has been elaborately explained by the Supreme Court in the case of Pakistan Tobacco Co. Ltd. v. Government of Pakistan and 3 Others (PTCL 1992 CL. 376 = 1993 SCMR 493) as under:6.
The question as to when reopening of the case under section 65 of Income Tax Ordinance, 1979 is allowed and justified in spite of the fact that all material facts were already on the record when previous finding was given, came up for detailed examination before this Court in the case of Edulji Dinshaw Limited (supra) in which nearly the whole caselaw on the subject has been noticed. It is held in the reported judgement of that case once all the facts have been fully disclosed by the assessee and considered by the Income Tax Authorities and assessments have been consciously completed and no new fact has been discovered there can be no scope for interference with these concluded transactions under the provisions of section 65 on the ground that the income chargeable to tax under the Ordinance has escaped assessment or has been underassessed in the meaning of section 65(1)(a)(b) of the Ordinance. Maximum emphasis in this ruling is on use of words to the effect „assessments have been unconsciously
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completed‟. Requirement spot-lighted is that Income Tax Officer has applied his mind consciously to the facts of the case and perusal of the record. If there is conscious application of mind, then rule laid down in this case will apply with full force. If there is no conscious application of mind by Income Tax Officer, then rule laid down in this case will not be attracted.” Commissioner of Income Tax Lahore Zone, Lahore Muhammad Allah Bux – [1977] 35 TAX 74 (H.C.Lah.) 165.
v.
Definition of the word “business”.
The term „business‟ has been defined in section 2(4) of the Act. „Business‟ includes any trade, commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture. It has been repeatedly observed that „business‟ with the aid of meaning given in dictionary be deprecated. Commissioner of Income Tax v. New China Glassware Company – [1974] 30 TAX 158 (H.C.Kar.)
The definition of the word „business‟, as contained in section 2(4) of the Act, embraces only such activities as are in the nature of trade, commerce or manufacture. General Bank of Netherlands Ltd. v. Commissioner of Income Tax, Central Karachi – 1991 SCC 784 = [1991] 63 TAX 149 (S.C.Pak) 166.
“Business connection”.
After survey of case law, learned Judges in the High Court correctly took the view that in order to bring a case under the head of „business connection‟, it is necessary that there should be some activity in the taxable territory which contributes, directly or indirectly, to the earnings of those profits or gains which are to be taxed. Their Lordship also agreed with the view canvassed by the appellant that „the interest earned on the securities in questions cannot be said to be profits or gains accruing or arising from any business connections in Pakistan‟. Commissioner of Income Tax v. Pakistan Insurance Corporation & other – 1989 SCC 740 = [1997] 75 TAX 113 (S.C.Pak) _ 167. “Capital” and “dividend” distinguished. The words „capital‟ and „dividend‟ though related have entirely different considerations. In the context of the Income Tax Law, very
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broadly speaking „capital‟ would signify investment whereas „dividend‟ would denote gain or return on the investment. However, in clause (d) of section 2(6A) of the Act, an extended meaning has been given to the word „dividend‟ so to bring to tax such payment also that a company may make by manipulating its share capital ..... The scope of this clause can not be extended when the company merely returns to the shareholders only their original investment. Abdul Rashid v. Special Judge (Central) Lahore & another – [1976] 34 TAX 199 (H.C.Lah.) 168.
“Case”.
The word „case‟ in section 5 of the Act has recorded statutory interpretation in the explanation to sub-section (7-A) of section 5 in the following manner:“In this section, the word „case‟ in relation to any person whose name is specified in an order or any direction issued thereunder, means all or any proceedings under this Act in respect of any year which may be pending on the date of such order or direction which may have been completed on or before such date, and includes all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year.” Commissioner of Income Tax/CST Rawalpindi v. Pakistan Television Corporation Rawalpindi – [1978] 38 TAX 181 (H.C.Lah.) 169.
“Certified copy”.
A certified copy will, therefore, be one which answers the requirements as given in section 76 of the Evidence Act, by reference, even though Evidence Act is not applicable. It may, therefore, be supplied in any form provided that it bears a certificate of an authorised officer that it is a true copy of the original in his custody. Pakistan Seamen Contributory Welfare Fund Karachi v. Income Tax Appellate Tribunal & 2 Others – [1993] 67 TAX 400 (H.C.Kar.) 170.
“Charitable purposes”.
As is evident from clause 2(14), the definition of „charitable purpose‟ is not exhaustive but the same is an inclusive definition which only has the effect of enlarging the ordinary meaning of the expression „charitable purposes‟. It would, therefore, be erroneous to assume that the definition in any case restricts the meaning of the said expression to what has been referred to be in the said definition. Consequently,
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the mere fact that the object, for which the petitioner institution has been constituted, is not public benefit, cannot in any manner disentitle the petitioner to claim exemption under clause (94). Sadar Anjuman-i-Ahmedia, Rabwa v. Commissioner of Income Tax Rawalpindi – [1977] 36 TAX 117 (H.C.Lah.) “Charity” and “charitable purposes”.
171.
It is undoubtedly very difficult to define „charity‟ with precision. The literature on the point is as vast as despairing. The question strictly speaking is not whether „a charity exists, but whether the trust on which property is held as „trusts for a charitable purpose‟. In determining its legal meaning the courts have to be guided by the lists of charitable objects set out in the preamble to the statutes 43 Eliz I. C.4, 1601. The best classification of charitable purposes under the above Act has been given by Lord Macnaughtan‟s speech in Commissioner of Income Tax v. Pensel ((1891) A.C.531) which is being consistently followed by the English Courts. It was stated that „charity‟ in its legal sense comprises four principle divisions: i) ii)
trusts for relief of poverty; trusts for the advancement of education;
iii)
trusts for the advancement of religion; and
iv)
trusts for the purposes beneficial to the community, not falling under any of the preceding heads.
That judgment added that the trusts referred to are not the less charitable in the eye of law because incidentally they benefit the rich as well as the poor, as indeed, every charity that deserves the name must do so either directly or indirectly. The American Law Institute in the Restatement of Trusts adds two more headings. v) vi)
promotion of health; and governmental and municipal purposes.
The religious and charitable objects of Muslim Waqfs cannot be of any assistance in the cases in hand. A perusal of the explanation after the second proviso in section 4(3)(i) of the Act, would show that the scope of the term „charitable purpose‟ in the Act are as extensive as adopted by the British or American Courts and guidance can be sought from them in view of the paucity of authority in this country. Further, it is well established principle of law of charities that a purpose is not charitable unless its benefit is directed either to the public-at-large or a sufficient section of public or community
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sufficiently defined or identified by some quality of a public nature.......... Raleigh Investment Co. Ltd. v. Commissioner of Income Tax (East) Karachi – [1983] 47 TAX 214 (H.C.Kar.) “Commercial” and “commerce”.
172.
(i)
_ Word „commercial‟ meaning of According to Ballentine‟s Law Dictionary, 3rd Edition, page 222, means: “Pertaining to the purchase and sale or exchange of goods and commodities and connoting as well forms of, and occupation in business enterprises not involved in trading in merchandise; in a broad sense, embracing every phase of commercial and business activity and intercourse.”
(ii)
Word „Commerce‟ meaning of: “According to Black‟s Law Dictionary, 4th Edition, page 336 the word „commerce‟ is defined as, the exchange of goods, productions or property of any kind.”
Commissioner of Income Tax Punjab, NWFP & Bahawalpur v. Mrs. E.V. Miller – 1959 SCC 53 = [1959] 1 TAX (III-1) (S.C.Pak) 173.
“Company” and “shareholders” - Relationship between.
The constituents of a company are its shareholders because its promoters must subscribe to its shares in order to bring it into existence. The company has a memorandum of association which controls its business activity. For the management of its affairs it has its own articles of association and a board of directors. The assets of a company are owned by it and not by its shareholders but the company is constituted for the purpose of earning profits and the shareholders are not only entitled to rateable distribution of its assets on its being wound up, but also indirectly control the management of the company by appointing the directors. Thus the shareholders have ultimate control over the management of the company, though they do not directly manage its affairs. It is true the directors derive their authority from the law, but as their own appointment rests with the shareholders, they are, in substance, the agents or delegates of the general body of the shareholders. What is of vital importance, however, is that a company is brought into existence and exists for sole purpose of earning profits and gains and it earns them not for itself but for the benefit of the shareholders. To earn profits for its shareholders being the reison d‟entre of the company, a company would be defeating the object of its own existence if croesus-like it filled coffers with gold and did not
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distribute it as dividend to its shareholders. A company cannot enjoy its own income, the ultimate beneficiaries of the income being the shareholders themselves who, on the recommendation of the directors, declare the dividends. If a company went on taking its profits to reserve every year and did not distribute it among its shareholders, it would be acting contrary to all business principles and the shareholders would be compelled either to change its management or to dissolve it because they invest their capital for the purposes of enjoying the income and not for the purpose of the company accumulating such income. True, a company is a person but it is only a juridical person, having no mouth to feed or person to shelter and sustain, and if it is taxed, it is taxed not on any general principle of law but because such is the policy of the statute that taxed it. Its own income is but notional and it is only on its distribution that it becomes the actual income of its shareholders. Sind Industrial Trading Estate Ltd. Karachi v. Central Board of Revenue – [1975] 31 TAX 114 (H.C.Kar.) 174.
“Company limited by guarantee”.
A company limited by guarantee is generally a non-profit making association and such a company in an alternative to a company by shares. Under the scheme of Companies Act 1913, a company cannot be created in which the members are free from any liability whatsoever. Therefore, ordinarily a company created under the Companies Act is limited by shares, that is, the members of the company are made liable as contributories to the extent of the shares they have taken or they have agreed to take in the company. But such a company is not suitable for non-profit making association, and therefore, as an alternative to such a company, the companies Act permits the incorporation of a company limited by guarantee, that is, a company in which the members agree that, in the event of liquidation of the company they will subscribe an agreed amount. In effect, such members are guarantor of the company‟s debts up to the agreed amount. As regards the working capital of such a company, it generally comes from other sources, that is, endowments, grants, fees, subscriptions, etc. Hudabya Engineering (Pvt.) Ltd. Lahore v. Pakistan through Secretary Minister of Interior – [1997] 76 TAX 302 (H.C.Lah.) 175.
“Complete”.
According to Black‟s Law Dictionary, 6th edition, at page 285, complete as adjective means „full‟, „entire‟, „including every item or element‟ of the thing spoken of, without omissions or deficiencies; as, a
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„complete‟ copy, record, schedule or transcript, perfect, consummate; not lacking in any element or particular; as in the case of a „complete legal title‟ to land, which includes the possession, and the right of property. In Corpus Juris Secundum, volume 15-A at page 118 „complete‟ has been defined as „absolutely finished‟; completed or concluded; consummate, entire, filled up, free from deficiency, perfect, including every item or element of the thing spoken of, without omissions or deficiencies, whole; lacking nothing, with no part, item, or element lacking; having all needed or normal parts, elements or details. Similarly in Words and Phrases, permanent edition 8, at page 386, while defining „complete‟ it is stated that the word „complete‟ means filled up with no part, item or element lacking, free from deficiency, entire, perfect, consummate. Commissioner of Wealth Tax v. Noor Rai Ibrahim – [1992] 65 TAX 262 (S.C.Pak) _ 176. “Debt”, “loan”, “owe” and “due” difference between. From these judgments, definitions and meanings it can safely be stated that the word „debt‟ has a wide meaning and is an obligation to pay an ascertained sum in present or in future. Any amount owed to some other person would be a debt owed by him to the creditor. The essence of the word „debt‟ is the obligation to pay and the amount which is payable. It is a liability to the person who has an obligation to pay, the amount which may be certain or calculable readily. Commissioner of Wealth Tax, Lahore Zone, Lahore v. Mst. Fozia Mughis, Lahore – [1975] 32 TAX 1 (H.C.Lah.)
It is further to be noticed that the word „debt‟ is to be kept distinct from what is known as a „loan‟, for every loan may be a „debt‟ but every „debt‟ will not necessarily be a loan. Our view is that a debt is a sum of money which is now payable or will become payable in future by reason of a present obligation debitum in praesenti solvendum in futuro. In some cases it may not be presently payable and it may be uncertain in amount which will become certain when accounts are finally dealt with. In other words it is a present liability to pay an amount in future, though it was not ascertained but was ascertainable. As regards the word „owed‟ in Aiyer‟s Law Lexicon (1940 Edition page 931) it is written that „owe‟ means to be under obligation to pay.
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It is to be remembered that strictly speaking there is a difference between the words „owed‟ and „due‟ for that which is due is always owed by the debtor, but which is „owed‟ may not be due at a particular date .....the former refers to liability whereas the latter to payability. A.J. Hartshorn v. Commissioner of Income Tax (West) Karachi – [1984] 49 TAX 198 (H.C.Kar.) _ 177. “Due” meaning of. In Stroud‟s Judicial Dictionary, IVth Edition, meaning of the word „due‟ is „immediately payable‟ (it is common signification). The word „due‟ signifies a fixed and settled obligations or liability which has to be determined in each case from its own context and usually is neither contingent nor dependent on any happening. Taimur Shah v. Commissioner of Income Tax – [1976] 34 TAX 151 (H.C.Kar.)
We find ourselves unable to agree with the broad proposition of Mr. Nusrat that the word „due‟ has an implication of a liability which is continuing from the past. Irfan Gul Magsi v. Haji Abdul Khaliq Soomro and others – 1999 PTD 1302 178.
“Default”.
Expression „default‟ connotes an element of wilful and deliberate failure to fulfil an obligation and negligence in the performance of the duty. Every failure on the part of a person without any ulterior design and mala fide intention would not equate with the expression „default‟ as used in its strict legal sense. Before a person is declared to be in default, it is absolutely necessary that there should have been a demand to make payment of a determined sum which should have remained unresponded and unattended for a period beyond the period prescribed by law. Issue of „default‟ in the context of Rent Laws was set at rest in the famous case reported as Ghulam Muhammad Lundkhor v. Safder Ali (PLD 1967 SC 530). In the words of the apex Court the word „default‟ in legal terminology necessarily imports an element of negligence or fault and means something more than mere non-compliance. To establish default one must show that the noncompliance has been due to some avoidable cause, for a person who ought not to be made liable for a failure due to some cause for which he is, in no way, responsible or which was beyond his control. It is not lightly to be presumed that the law intends to cause injustice or
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hardship, thus, unless the Legislature has made its intention clear that construction must be preferred which will prevent manifest injustice and obviate hardship. On this principle also the expression „default‟ should mean an act done in breach of a duty or in disregard of an order or direction. This view was followed in the subsequent cases reported as Muhammad Hassan Khan v. Mirza Abdul Hamid (1981 SCMR 799), Irshad Hussain v. Abdul Rehman Kazi (1983 SCMR 471), M. Imamuddin v. Surriya Khanum (PLD 1991 SC 317) and NDFC v. Naseemuddin (PLD 1997 SC 564). E.F.U. General Insurance Ltd. & Others v. Federation of Pakistan & Others – 1997 SCC 1174 = [1997] 76 TAX 213 (S.C.Pak) 179.
“Definite Information”.
It was observed that the words „definite information‟ are the keywords for the purpose of justifying action under sub-section (1) [Section 65] and, as the said words had not been defined in the Ordinance they will carry their literary meanings. It was observed that every information cannot be treated as the basis for re-opening of the assessment but the information should be of the nature which should qualify as „definite information‟ and that the expression „definite information‟ could not be given a universal meaning but it will have to be construed in each case. It was further observed that where an assessee discloses all the material facts without any concealment and the assessment had been consciously completed by the Income Tax Officer, in such a case, in the absence of the discovery of any few facts which can be treated as „Definite Information‟ there cannot be any scope for reopening of the assessment under section 65. It was further observed that any change of opinion on the basis of the same material by the Income Tax Officer will not meant pressing into service the said provision. It was observed that a circular from the Central Board of Revenue interpreting any provision of a law not a „definite information‟ for reopening of assessment by an Income Tax Officer. It was then observed that expression „definite information‟ will include factual information as well as information about the existence of a binding judgment of a competent court of law/forum for the purposes of section 65 of the Ordinance, but any interpretation of a provision of law by a functionary which has not been entrusted with the function to interpret such provision judicially cannot be treated as a „definite information‟.
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Inspecting Additional Commissioner & another v. Pakistan Herald Ltd. – [1997] 76 TAX 131 (S.C.Pak) = 1997 PTD 1485
The term „definite information‟ conveys a meaning which is not the same „as change of opinion‟. A different interpretation of any provision of law or deriving a different conclusion from a given set of facts will not amount to a definite information. It will be a change of opinion. Therefore, the basis for reopening the assessment was a change of opinion of the respondent. The respondent therefore could not have taken any action under section 65 of the Income Tax Ordinance as it was not based on any definite information, but on change of opinion.” Central Insurance Co. & Others v. C.B.R. Islamabad – 1993 SCMR 1232 = 1993 SCC 1049 = [1993] 68 TAX 86 (S.C.Pak)
Mere guess, gossip or rumour cannot be treated as definite information. However, the expression „definite information‟ cannot be given a universal meaning, but it will have to be construed in the circumstances of each case. The term „definite information‟ conveys a meaning which is not same as change of opinion. A different interpretation of any provision of law or deriving a different conclusion from a given set of facts will not amount to definite information. It will be a change of opinion. Receiving or obtaining by an assessing officer certain interpretation of a particular provision of law from any department, be it a ministry of law or Central Board of Revenue or any legal adviser or from his knowledge and reading law books would not constitute „information‟ in terms of section 65. Dangerous results may follow from a liberal interpretation of the word „information‟ as sometime advocated by the Department, as it will give unrestricted discretion in the hands of the assessing officers who may on their own interpretation of law set at naught the settled and final assessment. Pak Services Ltd. v. Commissioner of Income Tax (Revision) Karachi – 1993 SCC 1029 = (1993) 68 TAX 49 (S.C.Pak) 180.
“Discard”.
No doubt that extended meaning of „discard‟ given in the dictionary includes „abandonment‟. However, all abandonment of property cannot and does not amount to discarding of the property. The word „discard‟ entails a choice, a selection, a voluntary act of leaving behind, causing of leaving or abandoning. Without such a choice, selection or volition,
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the word „discarded‟ would be inappropriate to use. For example, if one was made to forcibly leave his house that would not amount to discarding the house. Commissioner of Income Tax Peshawar Zone, Peshawar v. Siemen A.G. – 1991 SCC 773 181.
“Dividend”.
The word „return‟ is generally understood as profit in the nature of dividend and not in the nature of interest and/ or obligatory charge. „Return on capital‟ as guaranteed in the agreement between the parties was thus „dividend‟ within the meaning of term as defined in Income Tax law. The Income Tax authorities cannot change the nature of the contract intended by the parties „under the pretext that the rule of interpretation of a fiscal law in this behalf is different‟. The courts are bound to apply Islamic rules of interpretation to all laws, and fiscal laws are no exception. Commissioner of Income Tax Punjab, NWFP & Bahawalpur v. Mrs. E.V. Miller – 1959 SCC 53 = [1959] 1-TAX (III-1) (S.C.Pak)
The company, though a separate legal person in the contemplation of law and liable to assessment as a subject chargeable with tax, is not, for all purposes, to be regarded as entirely separate and distinct from the shareholders. The underlying principle of the clause, as the commissioner in stating the present case has recognised is „that the dividend represents merely the shareholders‟ share in the income of the company‟. Siemens A.G. & Halske v. Commissioner of Income Tax – [1983] 47 TAX 132 (H.C.Pesh)
„Dividend‟ according to Black‟s Law Dictionary, may denote, a fund set apart by a corporation out of its profits, to be apportioned among the shareholders, or the proportionate amount falling to each. Prima facie a “dividend” according to Stroud‟s Judicial Dictionary, means a payment to share holders when a company is a going concern. In Halsbury‟s Laws of England Volume VII, 4th Edition, the ordinary meaning of „dividend‟ is share of profits, whether at fixed rate or otherwise, allocated to the holders of shares in a company. The term is generally used with reference to trading or other companies, and to payments made to members of a company as such and not by way of remuneration for services.
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Commissioner of Income Tax North Zone, Lahore v. Owen Roberts & Co. Ltd. Lahore – [1973] 27 TAX 95 (H.C.Lah.) 182.
“Employee”.
The word „employee‟ is too well understood in the English language and usage to require any elucidation and we would restrict overselves to observe that the expression „employee‟ clearly envisages the relationship of master and servant and can hardly be applied to a person who is an alter ego of a juristic person. Sindh Trading Company v. Commissioner of Income Tax – [1967] 15 TAX 53 (H.C.Kar.) 183.
“Enduring benefit”.
The expression „enduring benefit‟ does not imply that it necessarily lasts for ever. It only means that it should endure in the way that fixed capital endures. What degree of durability or permanence it should possess for qualifying as a capital asset depends upon the facts of each case. The main consideration in such cases always is, whether the expenditure concerned, is part of the company‟s working expenses, or in other words, expenditure laid down as part of the process of profit-earning or whether on the other hand, it is a capital outlay, viz. expenditure necessary for the acquisition of property or of rights of a more or less permanent character, the possession of which is a condition of carrying on its trade at all. Associated Cement Companies Ltd. v. Pakistan – 1978 SCC 453 = [1978] 38 TAX 132 (S.C.Pak) 184.
“Enemy”, “enemy territory” and “aggrieved party”.
Now in the following rules namely, the Defence of Pakistan Rules, framed under section 3, „enemy‟ and „enemy territory‟ have been comprehensively defined as under:2-(2)
„enemy‟ means - any person or state at war with, or engaged in military operations against Pakistan.
2-(3)
„enemy territory‟ means -
(a)
any area which is under the sovereignty of, or administered by, or for the time being in occupation of, state at war with, or engaged in military operations, against Pakistan.
(b)
any area which may be notified by the Central Govt. to be enemy territory for the purposes of these rules or such of them as may be specified in the notification.
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Aggrieved party:- Now in order to be „aggrieved party‟ within the meaning of sub-Article (2) of Article 98, of the Constitution of Pakistan 1962, it would be imperative for a party to show that any of his proprietary or personal right as recognized by the laws of the country, has been invaded or denied to him. „Right‟ and „remedy‟ are no doubt complementary concepts, because right without remedy would be meaningless just as it would be inconceivable to think of a remedy without a corresponding right. In other words „a right‟, be it tangible or intangible such as the right of a person to enjoy his property or to remain secure in his reputation, clearly postulates something of value to a person for the protection or the realisation of which remedy is provided in every civilised legal system. Inevitably, therefore, if a person is unable to show that any of his right as recognized by law has been invaded or denied to him then he would have no cause of action to seek any relief, for evidently he cannot claim to be „aggrieved‟. United Builders Corporation Mirpur, v. Commissioner of Income Tax Muzzafarabad – [1984] 49 TAX 34 (H.C.AJ&K) 185.
“Erroneous”.
The word „erroneous‟, as defined in Oxford Dictionary, means, mistaken, incorrect, in the legal sense, an order was considered erroneous if it deviated from the law. Commissioner of Income Tax Companies II Karachi v. Sultan Ali Jeoffery & Others – 1992 SCC 974 = [1993] 67 TAX 51 (S.C.Pak) _ 186. “Evasion” and “Avoidance” the difference. In the field of taxation, tax avoidance and tax evasion are two different terminologies conveying completely different meaning. Tax avoidance occurs when a person in a legitimate manner as provided by law adopts a course by which the mechanism within the provisions of law. In Aruna v. State of Mairas 55 ITR 642 relying on Latilla v. IR 11 ITR (Suppl.-78) (HL) and Howard v. IR 25 TC 121, it was observed that „avoidance of tax is not tax evasion and it carries no ignominy with it, for it is sound law and, certainly not bad morality for anybody to so arrange his affairs as to reduce the burnt of taxation to a minimum‟. Avoidance of tax by adopting legal methods will not amount to evasion of tax. But the moment avoidance is sought by illegal contrivance, deceitful methods and adopting a course not permissible in law it turns into evasion.
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Commissioner of Income Tax Companies II, Karachi v. Sultan Ali Jeoffery & Others – 1992 SCC 974 = [1993] 67 TAX 51 (S.C.Pak) “Evasion of Tax”.
187.
Evasion with reference to taxation laws means to illegally manipulate things in such a manner that the tax payable under law cannot be assessed. By an act of evasion the assessee can reduce his tax liability or completely eliminate it. Evasion of tax or duty is always in breach of the applicable and binding law. In taxation law evasion will mean adoption of such deceitful mechanism and manipulation not permitted by law which may result in reduction or elimination of legal tax liability. Sarwar & Co. v. C.B.R. & Others – [1997] 76 TAX 1 (H.C.Lah.) “Execution of Contract”.
188.
The meaning being placed by the learned counsel on the expression „execution of contract‟ is neither borne by the context in which it has been used nor by its dictionary meaning. In Black‟s Law Dictionary, 5th Edition, at page 510, „execution of contract‟ has been defined as including performance of all acts necessary to render it complete. Similarly, according to Words and Phrases permanent edition, „execution‟ means, completion, fulfilment or perfecting of anything. Commissioner of Income Tax (Central) Karachi v. New Jubilee Insurance Co. Ltd. – [1982] 46 TAX 125 (H.C.Kar.) “Expenditure” & “reserves”.
189.
(i)
„expenditure‟, meaning of, Expenditure‟ is thus what is „paid out or away‟ and is something which is gone irretrievably.
(ii)
„reserves‟, meaning of, According to Ballentine‟s Law Dictionary, third edition, page 1101, „reserves‟ means: Verb: To appropriate to a particular purpose, to exclude, to set aside, to set apart from that which has been granted, to make a reservation. Noun: In insurance, a sum of money variously computed or estimated, which, with accretions from interest, is set aside, as a fund with which to nature or liquidate, either by payment or reinsurance with other companies, future unaccrued and contingent claims, and claim accrued but contingent and indefinite as to amounts or time of payment.
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Commissioner of Income Tax North Zone, Lahore v. Waris Silk Weaving and Knitting Mills, Gujranwala – [1973] 28 TAX 181 (H.C.Lah.) 190.
“Failure”.
If a person is required by law to do something which becomes impossible for him to do, not on account of his own negligence or fault, but on account of something which was unavoidable and in any case not subject to his control, he cannot be said to have failed to perform that which the law or an order passed under the law required him to do. The Punjab National Bank Ltd. v. Commissioner of Income Tax, Punjab & NWFP – 2 ITC 184 (Lahore) 191.
“Fixed capital”.
Securities purchased by banks are permanent investments being part of their „fixed capital‟. They do not form part of their stock-in-trade. Gillander Arbuthnot & Co. v. Commissioner of Income Tax – [1966] 13 TAX 163 (H.C.Lah.) 192.
“Fixed capital” and “circulating capital”.
„Fixed capital‟ represents the amount spent on setting up structure of the business, e.g. land and machinery, for manufacture of goods, the sum paid for acquiring a concern and the amount spent on purchase of stock and securities, etc. Appreciation of their value is not a trading receipt and their depreciation not a trading expense to be incorporated in the profit and loss account. Circulating or floating capital in the amount spent on running the concern, in „carrying on‟ and „carrying out‟ „an operation of business for making profit‟, for example purchase of raw-material, pay-roll, directors‟ fee, etc. Literally, it is that capital which keeps circulating and floating in the course of business and does not constitute its outer framework. The amount spent in this account is trading expense and an increase on it a trading receipt to be incorporated and circulating capital is, however, not inflexible, e.g., land and machinery will be circulating capital in the hands of a real estate dealer and manufacturer of machinery, respectively, but fixed capital in the hands of a manufacturer of goods. Kawther Grain (Pvt.) Ltd. v. Deputy Commissioner of Income Tax, Gujranwala – [1999] 80 TAX 262 (H.C.Lah.) 193.
“Goods” do not include immovable property.
The interpretation of word „Goods‟ as adopted by the Assessing Officer does not find support either from the Income Tax Ordinance or for that matter from any other law. The consistent view of the Superior
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Courts in Pakistan that in cases of fiscal statutes only the letter of law should be seen has sufficiently been highlighted in re: Collector of Customs v. S.M. Ahmad & Company (supra) and re: Muhammad Younis v. C.B.R. (supra). It is also an accepted proposition that the words used in a statute if not defined therein should be assigned their ordinary dictionary meaning. Reference to the aforesaid two dictionaries supports the contention of the learned counsel. The sale of immovable property including land and building alongwith machinery installed therein could by no imagination be treated as supply goods or services rendered. Controller of Estate Duty, Lahore v. Muhammad Bashir Muhammad Nazir & others – [1974] 29 TAX 91 (H.C.Lah.) 194.
“Goodwill”.
A goodwill is a thing very easy to describe, very difficult to define, it is the benefit and advantage of the good name and reputation and connection of a business. It is the attractive force which brings in customers. It is the one thing which distinguishes an old established business from a new business at its first start. The term „goodwill‟ is nothing more than a summary of the rights accruing to the purchaser from their purchase of the business and property employed in it. The goodwill of a partnership may be said in a general way to be the value of its business, over and above the value of its tangible assets and which grows out of the firm name, trade worked up and publicity obtained. It is as much an asset of the firm, to the amount of its actual value to the business, as is its physical property, and consequently, is the subject of sale and other contract or of a right of action for a trust concerning it, as is any other property of the firm. Like any other form of goodwill, the goodwill of partnership depends very largely upon the continuance of the business and a cessation of the business, for any extended time will generally in whole or in part, destroy the value of the goodwill..... Goodwill being an asset of the firm is subject to a partial ownership of every member thereof and is ascertained in the same manner as any other asset, by settlement of partnership. Hudabya Engineering (Pvt.) Ltd. Lahore v. Pakistan through Secretary Minister of Interior [1997] 76 TAX 302 (H.C.Lah.) 195.
“Immunity”.
In Ballentine‟s Law Dictionary, 3rd Edition, the following definition of „immunity‟ appears at page 584:
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A personal favour granted by law, contrary to the general rule ex parte levy, 43 Ark 42. A privilege or special privilege, a favour granted, an affirmative act of selection of special subjects of favours not enjoyed in general by citizen under constitution, statute, or laws, Hammer v. State 173 Ind. 199, 89 NE 850. A right in the negative form of freedom from action or restraint which otherwise might be taken against or imposed upon a person such as the right of witness to be free from arrest while attending court. Siemens A.G. & Halske v. Commissioner of Income Tax – [1983] 47 TAX 132 (H.C.Pesh) 196.
“Includes”.
The word „includes‟ [in section 2(6-A) of I.T.A. 1922] is significant and it is apparent that the word „means‟ has not been used in the section. The „includes‟ denotes that the definition is inclusive and not exhaustive. The meaning of both these words has been given at page 197 of Crais on Statute Law, 1952 Edition, and it is remarked that „there are two forms of interpretation clause‟. In one, where the word defined is declared to „mean‟ so and so, the definition is explanatory and prima facie restrictive. In the other, where the word defined is declared to „include‟ so and so, the definition is extensive. Commissioner of Sales Tax, Rawalpindi Zone, Rawalpindi v. Abdul Razaq Zia-ul-Qamar – [1973] 27 TAX 99 (H.C.Lah.) 197.
“Including”.
We have already seen that the word „including‟ is used for enlarging the scope and for bringing in species which would otherwise not be covered. Elahi Cotton Mills Ltd. & others v. Federation of Pakistan through Secretary Finance, Islamabad – 1997 SCC 1097 = (1997) 76 TAX 5 (S.C.Pak) 198.
“Income”.
The expression „income‟ entails wide spectrum. It covers actual as well as constructive receipts and benefits in cash or kind. It even includes what one saves by using it for oneself. For example, use of house by its owner. That as per dictionary, the word income means „a thing that comes in‟. Its natural meaning embraces any profit or gain which is actually received. However, while construing the above word used in any entry
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in a legislative list, the above restrictive meaning cannot be applied keeping in view that the allocation of the subjects to the lists is not by way of scientific or logical definition but by way of mere simple enumeration of broad categories. That what is not income under the „income tax act‟ can be made „income‟ by Finance Act. An exemption granted by the Income Tax Act can be withdrawn by the Finance Act or the efficacy of that exemption may be reduced by the imposition of a new charge, of course, subject to Constitutional limitations. That the question, whether a particular kind of receipt is income or not would depend on its answer on the peculiar facts and circumstances of the case. If the nature of the receipt and its source are not satisfactorily explained by an assessee, facts which are generally within his peculiar knowledge the Income Tax Officer may legitimately presume that the amount in question is an income of the assessee from an undisclosed source. In Haig‟s language, income is „increase or accretion in one‟s power to satisfy his wants in a given period in so far as that power consists of (a) money itself, or (b) anything susceptible of valuation in terms of money‟, whereas, Simon equates personal income with algebraic sum of consumption and change in network. That the process of income determination is often expressed as one, of matching costs and revenues. It involves the process of working out costs used in connection with the earning of the revenue in a particular accounting period. Pak Industrial Development Corporation v. Federation of Pakistan – 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562
Word „Income‟ as used in section 2(24) should be read in its ordinary, natural and grammatical meaning. However, when this term is to be viewed in the constitution conferring legislative powers, the most liberal construction should be put upon this word so that the same may have effect in their widest amplitude. Commissioner of Income Tax, (Central) Karachi v. Habib Insurance Co. Ltd. Karachi – [1969] 19 TAX 222 (H.C.Kar.)
Having held that the word „income‟ in the Government of India Act 1935 has to be given the widest possible meaning the court observed that the gains taxed under section 12(B) were profits that were
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received by the assessee. It was in this context that the court went on to say that, according to its ordinary meaning, income means „a thing that comes in.‟....... We have to construe the word „income‟ in the widest possible manner and, in our opinion the word is wide enough to include capital gains on the appreciation of investment as provided in rules 3 and 6 even though such gains have not been realised. The Punjab Province v. Federation of Pakistan – 1955 SCC 13 (Federal Court) = [1960] 2-Tax (Suppl.-3) (S.C.Pak) 199.
“Individual” & “association of persons”.
There can be no doubt that the word „individual‟ can only mean a natural person i.e. a human being. While every individual must be a person, the converse is not true because an artificial juridical person or a legal person, whether it is a corporation aggregate or corporation sole, is not an individual. By no stretch of imagination the provincial government can be held to be an „association of persons. Rashid Akhtar & Sons v. Commissioner of Income Tax Lahore – [1980] 42 TAX 168 (H.C.Lah.) 200.
“Individual” and “such individual”.
There are in fact three reasons for giving to the words „any individual‟ now a meaning different from one that is urged..... Firstly, the word „individual‟ as held in the case of Khatija Begum, in its ordinary meaning, and as it was then used in section 3 of the Income Tax Act, implied both a male and a female....... Secondly, any doubt in this respect has been further removed by the substitution of the expression „her husband‟ by the expression „he or she‟ in clause (i). The context now is such that it positively indicates that the individual could be male or a female....... Thirdly, in clause (ii) the use of the expression „such individual‟ takes us back to the individual mentioned in the opening words of sub-section (3) of section 16. The scope of expression „such individual‟ is, as wide as that of the expression „an individual‟. Siemens A.G. & Halske v. Commissioner of Income Tax – [1983] 47 TAX 132 (H.C.Pesh) 201.
“Interest”.
The word „interest‟ has not been defined in the Income Tax Act. Various meaning of „interest‟ have been given in Stroud‟s Judicial Dictionary and at serial no. 42 it is shown to mean compensation paid by the borrower to the lender for deprivation of the use of his money.
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Interest, according to Black‟s Law Dictionary, means the compensation allowed by law or fixed by the parties for the use or forbearance or detention of money. According to Wharton‟s Law Lexicon, „interest‟ means money paid at a fixed rate percent for the loan or use of some other sum, called the principal. Noon Sugar Mills Ltd. v. Commissioner of Income Tax Rawalpindi – 1990 SCC 759 = [1990] 62 TAX 74 (S.C.Pak) 202.
“Liable”.
The word „liable‟ inter alia carries the meaning as subject to an obligation, that for which one is liable, a debt, bound or obliged in law or equity, responsible, chargeable, answerable, legally subject or amenable to, compellable to make satisfaction, compensation or restitution. The above quoted definitions of word „liable‟ indicate that it inter alia carried the meaning as „subject to an objection‟, „that for which one is liable‟, „a debt‟ „bound or obliged in law or equity‟, „responsible‟ „chargeable‟ answerable legally subject or amenable to‟, „compellable to make satisfaction compensation or restitution. It is also evident that the meaning of the word „liable‟ is not restricted to denote an absolute and fixed liability but has the meaning expressed by phrase „within the range of possibility. Commissioner of Income Tax Rawalpindi v. Noon Sugar Mills – [1975] 32 TAX 273 (H.C.Lah.)
The word „liable‟ is susceptible of two interpretations. In a wider and a broader sense it means answerable or responsible in law. In narrow and stricter sense it only connotes held liable, after the liability has been fixed on him by adjudication. Commissioner of Income Tax, Burma v. Messrs Steel Brothers and Co., Ltd. – 2 ITC 129 (Rangoon) 203.
“Manufacture”.
In Murray‟s New English Dictionary, „manufacture‟ is defined as „to work up (Material) into forms suitable for use‟. In Annandale‟s Concise English Dictionary, „manufacture‟ is defined as „the operation of reducing raw materials into a form suitable for use by more or less complicated processes.‟ In Chamber‟s Twentieth Century Dictionary „manufacture‟ is defined as „to make from raw materials by any means into a form suitable for use.‟ According to these definitions it appears to me to be self-evident that Messrs. Steel‟s
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operations in the milling of rice, in the extraction and conversion of timber, in the ginning of raw cotton and the pressing of oil-seeds all amount to „manufacture‟. Pak. Educational Society Karachi v. Govt. of Pakistan through Chairman & Secretary Revenue Division Islamabad – [1993] 67 TAX 311 (H.C.Kar.) “Material”.
204.
The meaning of the word „material‟ given in Legal Thesaurus by W.C.Burton „basic, capital, cardinal, central, compelling, consequential, essential, extensive, far-reaching, fundamental, indispensible, influential, key, heading, main, major, memorable, momentous, necessary, paramount, pertinent, pivotal, prevalent, primary, principal, relevant, remarkable, salient, signal, significant, substantial, valuable, vital, weighty, worth considering‟. (i)
“Material Evidence”: The expression „material evidence‟ has been defined by Black‟s Law Dictionary as under:Material Evidence: - Such as is relevant and goes to the substantial matters in dispute, or has a legitimate and effective influence, or bearing on the decision of the case. „Materiality‟, with reference to evidence does not have the same signification as „relevancy‟.
Commissioner of Income Tax v. Surridge & Beecham – [1968] 18 TAX 72 (H.C.Kar.) 205.
“May”.
Ordinarily the word „may‟ is used in a permissive or an enabling sense. But this is not universally true. There are cases in which it is used in the imperative sense. When statutes authorise persons to do acts for the benefit of others or for public good or the advancement of justice, the use of expression „may‟ has a compulsory force. A&B Food Industries Ltd. v. Commissioner of Income Tax/CST Karachi – [1992] 65 TAX 281 (S.C.Pak) 206.
“Merge” & “Merger”.
The definitions of the words „merge‟ and „merger‟ given in Corpus Juris Secundum, Vol 57, pages 1067 and 1068, read as follows:„Merge‟ The verb „to merge‟ has been defined as meaning to suck or disappear in something else; to be lost to view or absorbed into something else; to become absorbed or extinguished; to be combined or be swallowed up; to lose identity or individuality. It has also been defined as
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meaning to sink the identity or individuality of; to cause to disappear; to make to disappear in something else; to cause to be absorbed or engrossed; to swallow up. It is frequently used with the words „in‟ or „into‟. „Merger‟. In law it is the absorption or extinguishment of one estate or contract in another. It is said that merger is an operation of law not depending on the intention of the parties. However, it has also been stated that it is the law that merger is largely a question of intention to a great extent depending on the circumstances surrounding each particular case, and it is said that the courts will always presume against it whenever it will operate to the disadvantage of a party. In merger there is a carrying on of the substance of the thing, except that the substance is merged into, and becomes a part of a separate thing with a new identity......” Commissioner of Income Tax, Madras v. Sri Krishna Chandra Gajapathi Narayan Deo, Raja of Parlakimedi – 2 ITC 104 (Madras) 207.
“Occupation”
If, however, he (that is the owner) furnishes it (that is, the vacant house) and keeps it ready for habitation whenever he pleases to go to it, he is an occupier though he may not reside in it one day in a year. Star Rolling Mills v. Commissioner of Income Tax – [1974] 30 TAX 27 (H.C.Kar.) 208.
“Opinion”.
An opinion on the basis whereof a statutory authority is entitled or empowered to take any action or initiate any legal proceeding, may by accurate or erroneous, but it must be an honest opinion or conviction, based on tangible material capable of sustaining such opinion, and not mala fide opinion or colourable exercise of statutory power. Pakistan Services Ltd., Karachi v. Commissioner of Income Tax, Central Zone ‘C’ (COS-1) – [1999] 80 TAX 106 (H.C.Kar.) = 1999 PTD 2901 209.
“Or”.
We do not see any reason for holding that word „or‟ appearing in Explanation (i) to section 24(i) of the Ordinance is not to be used in its ordinary and natural use as disjunctive and to use it as conjunctive as to relate to the word „bonus‟ with the expression „payable to an employee in accordance with the terms of his employment as remember‟.
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Burma Railway Co. v. Secretary of State – 1 ITC 140 (Burma) 210.
“Owners”, “ownership” and “own”.
It must be presumed that the legislature was aware that the expressions „owner‟, „ownership‟ and the verb „to own‟ in its various tenses have been frequently used in Acts of a similar nature and further that they can be and are used in various meanings in different Acts, in some of which they have been specially defined for the purposes of particular sections. Nevertheless the expression has not been defined for the purposes of this Act. It may have the narrow and technical meaning of the full ultimate and legal owner, but if this was intended, it could easily have been expressed and the failure to do so points to its not having been so intended. Commissioner of Income Tax, Rawalpindi v. K.K. & Co. Ltd. – [1980] 42 TAX 81 (H.C.Lah.) 211.
“Paid”.
The word „paid‟ used in the context of the bonus under section 10(2)(x) could not be so extended as to cover any provision of payment at the end of the year unless the obligation is discharged by actual payment of the sum involved during the accounting year. Commissioner of Income Tax, North Zone, Lahore v. Mst. Wazirunnissa Begum – 1972 SCC 395 = [1974] 29 TAX 188 (S.C.Pak.) 212.
“Pay”.
The word „pay‟ in section 16(2) means to satisfy, to set at rest, to discharge, to require with what is due or deserved etc., and it is obvious that the word as used in the aforesaid provision means when the money is actually delivered and not when a decision is made to make the payment. City Bank N.A. Karachi v. Commissioner of Income Tax, Central Zone ‘C’ Karachi – [1994] 70 TAX 159 (H.C.Kar.) 213.
“Penalty”.
Term „penalty‟ according to the Black‟s Law Dictionary is an elastic term with many differentiations of meaning. It involves an idea of punishment corporeal or pecuniary, civil or criminal, although its meaning generally is confined to pecuniary punishment. There can not be two opinions about such meaning of the term. But in order to understand the real import of a term in a statute, it is necessary to examine the statute itself as an aid to interpretation.
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Begum Nusrat Bhutto v. Income Tax Rawalpindi – [1980] 42 TAX 59 (H.C.Lah.) 214.
Section 1
Officer
Circle-V,
“Person”.
The power of authority of the present day legislature is not limited to the following of principles of jurisprudence and treat a dead man as a non-entity which in actual fact is; the Legislature can treat the dead man as alive as for certain purposes, it can treat a living human being as dead for example in cases of bankruptcy or insolvent. Sheikh Miran Bux Karam Bux Ltd. Karachi v. Income Tax Officer, Company Circle 12, Karachi – [1976] 33 TAX 99 (H.C.Kar.) 215.
“Previous year”.
Previous year‟ had only one definition in the Income Tax Act, 1918. However, by a subsequent legislation, namely, the Income Tax Act of 1922, the definition of „previous year‟ was enlarged. While retaining the old definition, paragraph (b) was added, and paragraph (c) was introduced by the Income Tax (Amendment) Act 1939. Looking at the two paragraphs, it is clear that, in case of paragraph (a), the previous year meant an accounting year comprised of a full period of twelve months and corresponding to a financial year preceding the financial year of assessment. But in paragraph (b), the use of words „such period‟ was unqualified and gave a discretion to the Central Board of Revenue or such authority, as was authorised by the Board in this behalf to lay down the length of the period which could either be less than one year or more than one year of a year. Rafhan Maize Products Co. Ltd. v. Commissioner of Income Tax – 1988 SCC 663 = 1988 PTD 571 216.
“Processing”.
Admittedly the operation of freezing, preserving or canning of these items would not change their identity and, therefore, the word processing as used in the aforesaid legal provision, is also to be interpreted or understood in the same manner, i.e. the identity of the raw material is not destroyed in the operation or operations. Crescent Sugar Mills & Distillery Ltd. Lahore v. Commissioner of Income Tax Lahore Zone, Lahore – [1981] 43 TAX 1 (H.C.Lah.)
The term „manufacture‟ has often been understood as transformation of one article into a commercially different commodity. The Tribunal does not appear to be wrong in confining the „processing‟ to undergoing a treatment which does not change the identity of the
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goods. May be, that in some shades in exactly, the connotation of the word „manufacture‟ and „processing‟ overlap but we, feel, that here the word processing is not amenable to extended meaning and conceivably has been used along with the associated words in the cognate sense as a phenomenon of the food processing industry which includes, the canning, freezing and preservation of good through various methods. Commissioner of Income Tax Karachi v. Paracha Textile Mills Karachi – [1973] 28 TAX 155 (H.C.Kar.) 217.
“Profit”.
The word „profits‟ has not been defined in the Income Tax Act. Firstly the word „profits‟ as occurring in the said proviso must be understood in its context, and that is, in relation to the bonus paid to the employees and the requirement of reasonableness between profits and bonus, including as aforesaid, commercial expediency. The Bharat Insurance Company Ltd. v. Commissioner of Income Tax, Punjab & NWFP – [5 ITC 288 (H.C.Lah.)
In Mersy Docks and Harbour Board v. Lucas (2 Tax Cas. 25) interpreted by the House of Lords to mean „the net proceeds of a concern after deducting the necessary outgoing without which those proceeds could not be earned or received‟ or „income of whatever character it may be over and above the costs of receipts and collection‟, and the „gains of a trade‟ were taken to be „whatever was gained by the trading, for whatever purpose it was used‟. The same view was adopted by the majority of that House in Last v. London Assurance Corporation (2 Tax Cas. 100). There is nothing to show that the word „profit‟ is used in different sense in the Indian Income tax Act. In Board of Revenue v. Al.A.R.RM Arunachalam Chethiar (1 ITC 75), a similar interpretation was adopted by a Special Bench of the Madras High Court on the basis of several English decisions...... The Income Tax then in force was the Act of 1918, but there seems to be no material difference in the provision of that Act and the present Act so far as the point under discussion is concerned. Hamdard Dawakhana v. Commissioner of Income Tax Karachi – 1980 SCC 497 = [1980] 42 TAX 1 (S.C.Pak) 218.
“Property”.
There is consensus of judicial opinion that the term „property‟, as used in clause (i) is a term of the wide import and subject to any limitation
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or qualification which the context might require, it signifies every possible interest, which a person can acquire, hold and enjoy. It is comprehensive enough so as to cover even business, cash, deposits, securities and other such things. There is nothing in the language of the clause in question to restrict in any manner the normal and accepted meaning to the word „property‟ so as to exclude business from its contention. Sundar Das v. Collector of Gujrat – 1 ITC 189 (Lahore) _ 219. “Received” person cannot receive a thing from himself. The Act contains no definition of the word „receive‟ or „received‟ but in Murray‟s Oxford Dictionary the expression „receive‟ is defined as „To take in one‟s hand or into one‟s possession (something held out or offered by another), to take delivery of (a thing) from another, either for oneself or for a third party.‟ In the Imperial Dictionary the same expression is defined as „to get or obtain; to take, as a thing offered, given, sent, committed, paid, communicated or the like; to accept.‟ It seems to me that the word „receive‟ implies two persons, namely, the person who receives and the person from whom he received. A person cannot receive a thing from himself. Taking the expression „received‟ in its ordinary dictionary meaning, I am of opinion that the assessee, who had already received the money in Baluchistan, did not receive it again when he brought it into, or forwarded it to, the Punjab. I would, therefore, hold that he is not taxable on the alleged income mentioned in the reference. Eastern Federal Union Insurance Co. v. Commissioner of Income Tax – [1966] 14 TAX 211 (H.C.Kar.) 220.
“Repeal” & “amendment”.
There is no difference in principle between repeal and amendment. Section 6 of General Clauses Act is applicable to the present case. Under this provision of law the repeal does not affect any right, privilege, obligation or liability, acquired, accrued under any enactment so repealed.” Commissioner of Income Tax Central Zone Karachi v. United Liner Agencies, Karachi – [1990] 62 TAX 31 (H.C.Kar.) 221.
“Reserve”.
The word „reserve‟ in its ordinary sense means keeping apart something with a view to utilise it on a future date for a particular or specific purpose. Therefore, any amount which has been kept apart with reference to its particular use at a future time will be called a
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reserve. But if there is an unappropriated amount in the profit and loss account without specifically keeping it apart for utilising for any purpose in future, it will not be deemed to be a reserve. Commissioner of Income Tax v. Prime Dairies Ice Cream Limited – [1999] 80 TAX 282 (H.C.Lah.) 222.
“Sales” and “supplies”.
......‟the supply may include sale but this cannot be synonymous with the aforesaid expression‟...... The expression „supplies‟ as embodied in section 50(4) of the Income Tax Ordinance, 1979 (XXXI of 1979) does include „sales‟. Commissioner of Income Tax North Zone, Lahore v. Lahore Central Iron and Hardware Machinery, Merchants – [1973] 27 TAX 40 (H.C.Lah.) 223.
“Specify”.
To sum up, therefore, if something has been described „as far as is reasonably possible‟ or „as far as a careful man of business could and would do without going into the unreasonable particulars‟ and it need not „be a completely accurate and detailed description‟ and it can be „unambiguously identified‟ it would be said to have been „specified‟. This in fact is a specification „by reference and this is nothing usual. Muhammad Younus v. Chairman Town Committee Sahiwal – [1986] 53 TAX 93 (H.C.Lah.) 224.
“Tax”.
A tax is a compulsory extraction or a contribution imposed by a sovereign authority or required by the general body of the subjects and citizens. The power to levy a tax has to be founded in a statute whereby authority is given to levy and collect the compulsory contribution in the good of the citizens or for running the administration...... Commissioner of Income Tax v. Pakistan Tobacco Company Ltd. – [1988] 57 TAX 118 (H.C.Kar.) = 1988 PTD 66 225.
“Working capital”, “current assets” and “current liability”, meaning of.
From the above quoted passages from the various books on accounting the following deductions can be deduced with reference to the terms, „working capital, current liability and current assets‟:
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(i)
The working capital is the amount that remains for the running or working of a business after the purchase price of the fixed assets has been paid.
(ii)
That the difference between the current assets and current liabilities is also called working capital.
(iii)
Working capital can also be defined as the money which has been put into business and which to stay there, the amount of cash and supplies necessary to be kept in hands to meet current expenses and contingencies as they arise for the proper, safe and convenient conduct of the business having regard to the owner‟s ordinary outstanding both payable and receivable.
(iv)
Total the working capital represents the investment of the company‟s medium and longer term funds in assets which are expected to be realised within the year of trading. It is not a permanent investment but turn over many times in a year. It is required for maintenance of inventories i.e. stock of raw-materials, work-in-progress, and purchase of goods, for extending credit to customers and for maintaining a cash balance. The total requirement is met partly by the credit that the suppliers of goods and services rendered to the firm and the remaining by the firm itself.
(v)
That according to Machullan Dictionary of Accounting, working capital is current assets less current liability other than those for taxation and proposed dividends.
(vi)
Current liability is a financial obligation of company falling due within one year or within an operating cycle if it is longer than one year.
(vii)
Current liabilities are debts which business must pay in near future not later than 12 months from the date of the last balance sheet which includes inter alia taxes.
Commissioner of Income Tax v. Pakistan Tobacco Company Ltd., etc. – [1988] 57 TAX 113 (H.C.Kar.)
In the instant ease it is an admitted position that the dividend was not even declared by the respondent company when the above provision was included by the Income Tax Officer for the purpose of levying 10% surcharge of income tax and super tax instead of excluding the above amount. The conclusion arrived at by the learned Income Tax Appellate Tribunal that the provision for the proposed
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dividend should have been excluded for the purpose of computing the above tax and should have been included in the amount retained for meeting the working capital requirement seems to be correct. Our answer accordingly is that the learned Tribunal was justified in holding that the provision for proposed dividend was retained income as requirement of working-capital and was not liable to surcharge. Any payment under section 18A of the Act is merely on account in respect of the liability which is to be determined after the coming into force of the new Finance Ordinance or Act for the relevant year and that the mere fact that certain amount of advance tax goes out of the control of an assessee does not change the legal character of the amount as it remains a provision for tax. There cannot be any cavil to the legal proposition propounded in the above two cited cases. The legal position is very obvious, namely, that accounting year is different from assessment year. The law applicable to a particular assessment year will be the law which is in force in that year and not the law which was in force during the accounting year unless otherwise stated or implied. As a matter of fact, contrary to this was not convassed by the learned counsel for the respondent assessees. it was not contended that the above substituted proviso pertaining to surcharge which was effective from assessment year 1981-82 was applicable to the present cases which pertain to the assessment years prior to the above year but what was Contended and referred to hereinabove is that the factum that the legislature thought it fit to provide definition of the words „retained income‟ in explanation (a) and to‟ exclude, tax and super tax payable, indicate that law prior to it did include the amount of tax and super tax payable within the ambit of the definition of „retained income‟ which submission is supported by the above Supreme Court Case. For the aforesaid reasons, our answer to the question referred to hereinabove in para 1 is that the Tribunal was justified in holding that income tax liability payable for relevant assessment year could be included for purposes of working out „retained income‟ for levy of surcharge. Cases referred to : [1979] 40 Tax 47 (Trib.); 1987 PTD (Trib.) 347; Hirjina & Co., (Pakistan) Ltd.; Karachi v. CST, Central, Karachi (1975) 31 Tax 78 (SC); Commissioner of Income Tax v. Isthmian Steamship Lines (1951) 20 ITR 572; Maneklal Vallabhdas Parikh & Sons v. Commissioner of Income Tax (1969) 72 ITR 637.
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Nagina Silk Mills, Lyallpur v. Income Tax Officer, A-Ward, Lyallpur & others – 1963 SCC 167 = [1963] 7 TAX 442 (S.C.Pak.) Word „year‟ - How to be understood.
226.
Definition alone cannot extend a period of (limitation) which had already commenced to run many years earlier, according to a fixed measure of time, namely, a year of twelve months. The legislature never intended that the period of limitation prescribed in the Act should become variable with the changes in the “financial year” or “year” inserted by Finance Act for certain other purposes, namely, to accord with the new accounting years adopted by Government. _______________
INTERPRETATION REGARDING WORDS AND EXPRESSIONS
Noon Sugar Mills Ltd. v. Commissioner of Income Tax, Rawalpindi – 1990 SCC 759 = [1990] 62 TAX 74 (S.C.Pak.) Rule of interpretation regarding words and expressions used in fiscal statute.
227.
The rule of interpretation of statutes referred to in the above two cases of English jurisdiction has been consistently pressed into service by the superior Courts in Pakistan. In this behalf reference to the following judgments of this Court will not be out of context:(i)
Mehar Khan v. Yaqub Khan and another (1981 SCMR 267); in which this Court while construing the word “inquiry” used in sections 190(I)(3) and 344 (1) Cr. P.C., inter alia observed as follows:“No doubt the elementary rule of construction is that the words used in a Statute should be construed literally but according to what is termed as the „Golden Rule of Interpretation‟ by Maxwell, the ordinary meaning of a word need not be adhered to if a construction based on it, would be at variance with the intention of the Legislature as collected from the statute itself or if it leads to an absurdity. In such cases the language may be varied or modified so as to avoid such absurdity or inconvenience Beck v. Smith (1836) 2 MW (191). While interpreting the statutes like the one before us, the proper mode of interpretation or discovering the true intention of the Legislature would be to consider as to what was the state of law before the statute
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or its provision was given its present form and as to what was the mischief of difficulty which was sought to be suppressed and remedy which the Legislature had intended to advance. Ref: Abdul Majid Khan v. Chief Settlement and Rehabilitation Commissioner (PLD 1968 S.C. 154); Divisional Superintendent, P.W.R. v. Bashir Ahmad (PLD 1973 S.C. 589); and Rabnawaz v. Jahana (PLD 1974 S.C. 210) and Maxwell on the Interpretation of Statutes, 12th Edn. at p. 40”. (ii)
Hirjan Salt Chemicals (Pak) Ltd. v. Union Council & others (1982 SCMR 522); in which this Court made the following observations on the question in issue:“It is now a well established principle of interpretation of Statutes that Rules which are merely subordinate legislation, cannot over-ride or prevail upon the provisions of the parent Statute and whenever there is an inconsistency between a Rule and Statute, the latter must prevail. This, however, envisages that all efforts to reconcile the inconsistency must first be made and the provisions of the parent statute prevail only if the conflict is incapable of being resolved. We also do not have any cavil with the proposition that when construing any word used in a Statute which has not been defined therein, it should be understood to have been used in its dictionary meaning or even its ordinary or popularly understood meaning . . . . . ”
228.
General and special words or terms.
Reference may also be made to para 189 from the Construction of Statutes by Earl T. Crawford 1940 Edition, which reads as follows:189.
General and Special Words or Terms.-It is also a basic rule of construction that general words should be given a general construction; that is, they should be given their full and natural meaning, unless the statute in some manner reveals that the legislative intent was otherwise. Such a contrary intent may be found in the purpose and subject matter, or context of the statute, so that as a result the general terms may be qualified or restrained . . . . .” .
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Nagina Silk Mills, Lyallpur v. Income Tax Officer, A-Ward, Lyallpur & others – 1963 SCC 167 = [1963] 7 TAX 442 (S.C.Pak.) 229.
Stable interpretation of term „assessment year‟ should be adopted.
The word “assessment year” should not be broken into two segments i.e., “assessment” and “year”. It must be given stable interpretation and must be held to mean a period of twelve months. The “year” here does not mean period of shorter or longer duration than a time frame of 12 months. Commissioner of Income Tax v. Pakistan Tobacco Company Ltd. – [1988] 57 TAX 118 (H.C.Kar.) = 1988 PTD 66 230.
Law applicable on the first day of assessment year will apply and not the one in existive during the next year.
The legal proposition is very obvious, namely, that accounting year is different from assessment year. The law applicable to a particular assessment year will be the law which is in force in that year and not the law which was in force during the accounting year unless otherwise stated or implied. _______________
PAST AND CLOSED PROVISION
Income Tax Officer & another v. Chappal Builders – 1993 SCC 1026 = [1993] 68 TAX 1 (S.C.Pak.) 231.
Past and closed transactions can be reopened by giving retroactive effect to an amending provision.
We are of the opinion that, even though the amending provisions in question, were a part of the procedural laws, they cannot be given retrospective effect, in the facts of the present case. There is no dispute between the parties, that but for the amendments, the business profits for the chargeable accounting period in question, were not liable to be assessed on 31.1.1958. On the expiry of the period of four years under section 14, the assessee had, therefore, clearly acquired a right and the assessment for the said year became a past and closed transaction. This right could not, therefore, be taken away by giving retroactive operation to the amended statutory provisions extending the period for assessment. The contentions advanced on behalf of the appellant are without substance.
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Commissioner of Income Tax v. Eastern Federal Union Insurance Company – 1981 SCC 572 = [1982] 46 TAX 6 (S.C.Pak.)
We are of the opinion that, even though the amending provisions in question, were a part of the procedural laws, they cannot be given retrospective effect, in the facts of the present case. There is no dispute between the parties, that but for the amendments, the business profits for the chargeable accounting period in question, were not liable to be assessed on 31.1.1958. On the expiry of the period of four years under section 14, the assessee had, therefore, clearly acquired a right and the assessment for the said year became a past and closed transaction. This right could not, therefore, be taken away by giving retroactive operation to the amended statutory provisions extending the period for assessment. The contentions advanced on behalf of the appellant are without substance. _______________
SPECIAL LAW VS. INCOME TAX
Zahur Textile Mills Limited v. CBR through Chairman, Government of Pakistan, Islamabad and 2 others – [2000] 82 TAX 275 (H.C.Lah.) = 2000 PTD 303 232.
Scope of protection under the Protection of Economic Reforms Act of 1992.
From a perusal of various provisions of Act, 1992 it becomes clear that it provides protection to the various economic measures taken on or after 7.11.1990. Although it is true that section 6 of the Act, 1992 does not use the words “economic reforms” but it is to be seen that this word does not appear anywhere except in the preamble and the definition clause. In case of doubt about interpretation of this statutory provision preamble can validly be referred to. It reads as under:“Whereas it is necessary to create a liberal environment for savings and investments and other matters relating thereto; And whereas a number of economic reforms have been introduced and are in the process of being introduced to achieve the aforesaid objectives; And whereas it is necessary to provide legal protection to these reforms in order to create confidence in the establishment and continuity of the liberal economic environment created thereby.”
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The definition of “economic reforms” in the Protection of Economic Reforms Act, 1992 is contained in section 2(b) which reads as under:2(b)
„economic reforms‟ means economic policies and programmes, laws and regulations announced, promulgated or implemented by the Government on and after the seventh day of November, 1990, relating to privatization of public sector, enterprises, and nationalized banks, promotion of savings and investments, introduction of fiscal incentives for industrialization and deregulation of investment, banking, finance, exchange and payment systems, holding and transfer of currencies; and;”
A cumulative reading of section 2(b) and the preamble would who that the saving clause apply only to the economic measures taken after 5th November, 1990 pursuant to the economic policy of the Government which granted the incentives. The Intention of the Legislature becomes manifest from a perusal of the Schedule. If the argument of the learned counsel is correct that section 6 applies to all the notifications issued before the promulgation of the Act, then there was no necessity of specifically mentioning two notifications in the Schedule. It is thus obvious that what section 6 says is the measures taken by the Government after 5th November, 1990 which was the date on which the then Government came into power. Essential Industries, Dacca v. Commissioner of Income Tax, East Pakistan, Dacca – [1969] 19 TAX 3 (H.C.Dacca) 233.
General Act - Whether overrides the provisions of Specific Act Held no.
For the charge year 1953-59 an application for registration under section 26A was made on behalf of the assessee-firm comprising of five partners and constituted under a partnership deed dated the 12th February. 1954. Applications for renewal of registration for the subsequent two years were also made on the basis of the same partnership. deed. The Income Tax Officer refused to grant registration and renewal of registration for all these years on the ground that these applications were not signed by all the partners of the firm. When the matter reached the High Court it was contended on behalf of the assessee that (i) the provisions of subsections (1) and (2) of section 26A and section 18 of the Partnership Act do not provide that application for registration or renewal of registration should be signed by all the partners; (ii) Rule S of the Income Tax Rules which requires that such as application shall be signed by all the partners is ultra vires of sub-section (i) and (2) of section 26A of the Income Tax
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Act; and (iii) if the application for registration had not been decided after a lapse of over four years the assessee could have filed the subsequent applications duly signed by all the partners well within the period of limitation. Held, that (i)
the expression such person or persons occurring in subsection (2) of section 26A clearly shows that the power of fixing the number of persons requiring to file such application has been delegated to the Rule making authorities. Therefore, the contention that rule 3 of the Income Tax Rules is ultra vires of section 26A is of no substance;
(ii)
it is clearly laid down in the Rules that the application should be signed by the partners and the Income Tax authorities have, therefore, rightly refused to entertain this application in question;
(iii)
the Partnership Act is a general law which will govern the business transaction of the firm but it cannot override a specific provision. In fact, this specific provision shall override the general provisions made in the Partnership Act; and
(iv)
it is indeed deplorable that such applications are left unattended by the department for years and then are turned down for technical defects. Had the list application been disposed of expeditiously the assessee would have been spared some financial toss. At the same time it is also true that a firm should be vigilant about its rights and should be aware of the rules required to file. _______________
MACHINERY PROVISIONS
Kohinoor Textile Mills Ltd. v. Commissioner of Income Tax – 1974 SCC 416 = [1974] 30 TAX 138 (S.C.Pak.) 234.
Amendments in machinery section being procedural are applicable to pending proceedings.
We have carefully re-examined the provisions of the Finance Act of 1957 and have come to the conclusion that the applicability of statutory amendments could not possibly have been made to depend upon modifications to be made by the executive for then the executive could have rendered the statute nugatory by one making the
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necessary modifications. The use of the words “modifications, if any,” clearly indicated that even if no modifications were made the amendment would still be operative. The statute which had come into force by the will of legislature could not also remain “dormant” at the will of the executive. It operated of its own force and it becomes the duty of the executive to give effect to it as far as possible even without the modifications which could, at best be only of a consequential nature. We are unable, therefore, to agree with the High Court that without the modifications the amendment was not applicable. We are also unable to agree that the amendment did not apply to pending proceedings because, the provisions of section 34 of the Income Tax Act impose no charge on the subject but merely deal with the machinery of assessment as held by the Privy Council in the case of the Commissioner of Income Tax, Bengal v. Messrs Mahaliram Ramjidas [(1940) 8 ITR 442]. This was, therefore, an amendment of procedure in which no assessee has a vested right. Such procedural amendments operate retroactively and apply even to pending proceedings. Leather Connections (Pvt.) Ltd. v. Central Board of Revenue, Islamabad – [2001] 83 TAX 1 (H.C.Lah.) 235. Machinery provisions cannot be construed to go beyond the spirit of law. It is settled proposition of law that principle of strict construction of fiscal statute is applicable only to taxing provisions such as charging provisions and not to those parts of statutes which contain machinery provisions as per principle laid down in (1980 Tax Law Report 185). It is true that the machinery provisions of a fiscal statute should be interpreted in such a manner that recovery is not frustrated or adversely affected. But it does not mean that to achieve this object one can travel beyond the spirit of law and do violence to language and intention of the statute. The machinery can be extended only to the extent it is permissible under the law. In this attempt one cannot override of other parties only because a recovery has to be made. Such provisions have their own limitation and they are to be found within the statute itself. Leather Connections (Pvt) Limited v. The Central Board of Revenue Govt. of Pakistan, Islamabad through its Chairman – [2000] 82 TAX 42 (H.C.Lah.) 236. Machinery provisions of fiscal law should be construed so as not to destroy recovery mechanism. Mere reading of aforesaid section, notification and letter dated 4.4.1995 reveal that the same are in accordance with law. Section
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50(7BB) was inserted by the Competent body by Finance Act No. 10 of 1993, as per principle laid down by the Hon‟ble Supreme Court in Ellahi Cotton Mills‟s case (PLD 1997 SC 582). Proviso (ii) of aforesaid section 50(7BB)(b) confer powers to C.B.R. therefore, C.B.R. issued S.R.O. No. 614/93, dated 18.7.1993 which was published in official gazette on 18th July, 1993, therefore, contention of petitioner‟s counsel has no force that C.B.R. has no authority to issue notification. Similarly the contention of petitioner‟s counsel has no force that notification was not published in the official gazette. C.B.R. has given formula to determine the estimated cost of construction of a building on the basis of cost of construction as specified by Pakistan Public Works Department or Provincial Building Department does not indicate at all that the CBR has delegated its powers to the other department on the well known principle of adoption or legislation by Reference which is known principle. In arriving to this conclusion I am fortified by judgment of this Court “P.I.A. Corp‟s case (PLD 1979 Lah 415). It is also settled proposition of law that interpreting a fiscal statute that Court must look all the words of statute and interpret the same in the light of what is clearly expressed and Court has no jurisdiction to imply anything which is not expressed. In this behalf reliance is placed on Hirjina and Company v. Commissioner (1971) 23 Tax 230 (S.C.Pak) = (1971 SCMR 128) and Collector of Custom‟s case (1977 SCMR 371). It is settled proposition of law that principle of strict construction of fiscal statute is applicable only to taxing provisions such as charging provisions and not to those parts of statutes which contain machinery provisions as per principle laid down in (1980 Tax Law Report 185). It is true that the machinery provision of a fiscal statute should be interpreted in such a manner that recovery is not frustrated or adversely affected. But it does not mean that to achieve this object one can travel beyond the spirit of law and do violence to language and intention of the statute. The machinery can be extended only to the extent it is permissible under the law. In this attempt one cannot over-rights of other parties only because a recovery has to be made. Such provisions have their own limitation and they are to be found within the statute itself. In arriving to this conclusion I am fortified by the following judgments: Commissioner of Income Tax‟s case AIR 1940 PC 124 Maithram v. Ranjidas.
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Escorts Limited‟s case [1975] 31 TAX 164 (H.C.Lah.) = 1975 SCMR 570. 237.
Rule of liberal construction of machinery provisions.
It is also settled proposition of law that machinery provisions of fiscal statute should be liberally construed to ensure recovery as per principle laid down by this Court in W.P. Province v. K.B. Amir-uddin (P.L.D. 1953 Lah 433). The aforesaid judgment was confirmed by Federal Court reported as (P.L.D. 1956 Federal Court 220) The same was again upheld by the Hon‟ble Supreme Court in Let. Con. Nawabzada Muhammad Amir Khan‟s case (PLD 1961 SC. 119) The contention of learned counsel for respondent No. 3 has a force that in case of non-deduction of advance tax on the basis of aforesaid section penal consequences have to be faced by respondent No. 3 as is held by D.B. of Karachi High Court in Raman‟s case (1985 P.T.D. 787). Arafat Woollen Mills Ltd. v. Income Tax Officer, Companies Circles E-1, Karachi – [1986] 54 TAX 1 (H.C.Kar.) = 1986 PTD 316 238.
Basic rules to construe charging and machinery provisions.
Income Tax Act/Ordinance provides structure for levying and collection of tax and purpose of scheme of Act/Ordinance relating to this object must be kept in view. Provisions of Income Tax Act/ Ordinance are to be construed in such a way as to make it workable. Sections which impose charge should be strictly construed and those which deal with machinery of assessment and collection should not be subjected to strict construction. _______________
LIMITATION PERIOD CANNOT BE EXTENDED RETROSPECTIVELY
Income Tax Officer, Investigation Circle & others v. Sulaiman Bhai Jiwa & Others – 1969 SCC 354 = [1970] 21 TAX 62 (S.C.Pak.) 239.
Limitation period extended retrospectively by legislation held not valid.
The orders annulling the assessments in question on ground of limitation in view of the extension of the period of limitation by ex post facto legislation, shall be deemed to have been made without lawful authority. _______________
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RULES OF CONSTRUCTION
_
FISCAL STATUTES
Noon Sugar Mills Ltd. v. Commissioner of Income Tax, Rawalpindi – 1990 SCC 759 = [1990] 62 TAX 74 (S.C.Pak) 240.
General and specific words.
Reference may also be made to para 189 from the Construction of Statute by Earl T. Crowford 1940 edition, which reads as follows: „General and special words or terms: It is also basic rule of construction that general words should be given a general construction, that is, they should be given their full and natural meaning, unless the statute in some manner reveals that the legislative intent was otherwise. Such a contrary intent may be found in the purpose and subject matter, or context of the statute, so that as a result the general terms may be qualified or restrained......‟.” Commissioner of Income Tax Karachi v. Khatija Begum, partner Shakil Impex Karachi – 1965 SCC 228 = [1965] 12 TAX 95 (S.C.Pak) 241.
Rule of harmonious construction of statutes.
Now it is well-settled that the words of a statute, when there is doubt about their meaning, are to be understood in the sense in which they best harmonize with the object of the enactment and the object which the legislature had in view. See Maxwell on Interpretation of Statute. The same author also says that: “To arrive at the real meaning it is always necessary to get an exact conception of the aim, scope and object of the whole Act, to consider according to Lord Coke (I) what was the law before the Act was passed; (ii) what was the mischief or defect for which the law had not provided; (iii) what remedy Parliament has appointed; and (iv) the reasons of the remedy.” Commissioner of Income Tax, East Bengal v. Kumar Naryan Roy Choudhry & others – 1959 SCC 68 = (1959) 1-TAX (III-207) (S.C.Pak.) 242.
An equitable construction of a fiscal statute is not permissible.
A fiscal statute should be construed strictly and no question of equitable construction arises.
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Commissioner of Income Tax/Wealth Tax, Companies Zone, Faisalabad v. Rana Asif Tauseef C/o Rana Hosiery & Textile Mills (Pvt.) Ltd., Faisalabad – [2000] 81 TAX 7 (H.C.Lah.) = 2000 PTD 497 243.
Strict rule of fiscal statutes emphasised.
Before proceeding further, we feel necessary to reiterate three wellknows rules of construction of fiscal statute. Firstly, that fiscal statutes are to be construed strictly and a citizen is to be taxed within the letter and spirit of a charging statute. Briefly, the imposition of tax must be affected by plain words of Legislature. Lord Atkinson stated this principle in case of Ormond Investment Co. v. Betts, (1928) A.C. 143, 162 in the following words:It is well-established that one is bound, in construing Revenue Acts, to give a fair and reasonable construction to their language without learning to one side or the other, that no tax can be imposed on a subject by an Act of Parliament without words in it clearly showing an intention to lay the burden upon him, that the words of the statute must be adhered to, and that so-called equitable constructions of them are not permissible. Tariq Sultan & Co. v. Government of Pakistan, etc. – [1999] 80 TAX 62 (H.C.Qta.) 244.
Rule cannot override the statutory law.
Rule 96ZZ [Central Excise Rules, 1944] being subordinate legislation cannot supersede to the provisions of Section 3-C of the Act; [Central Excise Act, 1944] secondly it mainly deals with special procedure in respect of certain manufactured goods as provided under Chapter-XV of the Central Excise Rules, 1944. This Chapter deals with regard to filing of the application and the revised procedure, maintenance of current account, deposit of goods in the store room, clearance of goods on payment of duty, clearance of goods exempted from duty etc. but does not deal in respect of the event when determination of tariff value and of rate of duty will be worked out, therefore, the argument put forth by the learned counsel has not substance. Commissioner of Income Tax Companies Zone Lahore v. Naveed A. Sheikh – [1992] 65 TAX 80 (H.C.Lah.) 245.
Words in a statutory instrument should be construed in their ordinary sense.
It is well settled and needs no authority that the words used in a statutory instrument are to be construed in their ordinary and natural
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sense and if different words are used by the legislature, the object is to convey different meaning, unless the context otherwise requires. Mustafa Prestressed R.C.C.Pipe Works Ltd. Karachi v. Commissioner of Sales Tax (Investigation), Karachi – [1990] 62 TAX 119 (H.C.Kar.) 246.
Rule of harmonious construction of statutes.
It is well-settled principle of interpretation that all the provisions of an enactment have to be construed harmoniously. Muhammad Younus v. Chairman Sahiwal – [1986] 53 TAX 93 (H.C.Lah.) 247.
Municipal
Committee,
Courts while interpreting a statute must adhere to the plain meaning of the words.
It is also true that the historical background of a statute serve as a useful guide in ascertaining the intention of the legislature, but, only if the words used are capable of more than one interpretation; but it has never been held that courts may depart from the plain meaning of the words employed in statute because of its historical background. The court remains under an obligation to adhere to the plain meaning of the words employed in it. Crescent Sugar Mills Distillery Ltd. Lahore v. Commissioner of Income Tax Lahore Zone, Lahore – [1981] 43 TAX 1 (H.C.Lah.) 248.
Meaning of doubtful words to be gathered by reference to words associated with them.
It is one of the cordinal rules of the construction of statute that when several words have been used in an enactment, the meaning of the doubtful words may be gathered by reference to words associated with it. Highway Petroleum Services (Regd.) Lahore v. Islamic Republic of Pakistan & another – [1977] 36 TAX 8 (H.C.Lah.) = 1977 PTD 183 = 1977 PLD 797 249.
Inapt and inaccurate phraseology of draftsman cannot nullify a provision made by legislature.
I put on the phrase „additional amount of tax‟, renders the last two words virtually redundant but clearly I am of this view also, that an inapt and inaccurate phraseology of the draftsman cannot and should not nullify a provision made by the legislature which is consistent with existing legal norms. A passage from Sweet and Maxwell, 11th edition, at page 221, based on sound judicial precedents, may be quoted in support of this view. It is to the following effect:
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“Where the language of a statute in its ordinary meaning and grammatical construction, leads to a manifest contradiction of the apparent purpose of the enactment, or to some inconvenience or absurdity, hardship or injustice, presumably not intended, a construction may be put upon it which modifies the meaning of the words, and even the structure of the sentence. This may be done by departing from the rules of grammar, by giving an unusual meaning to particular words, by altering their collection, or by rejecting them altogether, under the influence, no doubt, of an irresistible conviction that the legislature could not possibly have intended what its words signify, that the modifications thus made are mere corrections of careless language and really give the true meaning. Where the main object and intention of a statute are clear, it must not be reduced to a nullity by the draftsman‟s unskillfulness or ignorance of the law, except in a case of necessity or the absolute intractability of the language used.” Dreamland Cinema, Multan v. Commissioner of Income Tax Lahore – [1977] 35 TAX 169 (H.C.Lah.) 250.
An equitable permissible.
construction
of
a
fiscal
statute
is
not
There is no dispute about the proposition that equitable construction of a fiscal statute is not permitted. A person must be taxed only if he comes within the letter of law, otherwise he is free even though his case falls within the spirit of law. Taimur Shah v. Commissioner of Income Tax – [1976] 34 TAX 151 (H.C.Kar.) = PLD 1976 Kar. 1030 251.
Fiscal statutes should be strictly construed.
The provisions of the aforesaid (section 45A) come into play only when an assessee fails to pay the tax due from him. It is, therefore, to be seen when a Tax is due from a person leaving aside the deduction of Tax at source under section 18 or the payment of advance tax under section 18-A, neither of which provisions are applicable in the instant case, tax is to be determined and assessed under the provisions of section 23 of the Act, mainly, on the basis of the returns of income to be made under section 22. On such assessment being made, the Tax becomes due and a notice of demand is to be issued under section 29 of the Act specifying the sum due and payable.
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The amount specified in the notice of demand is required to be paid with the time specified in the notice, as provided in section 45, An assessee this would be deemed to have failed to pay the tax due from him if he fails to pay the tax by the date specified in the notice of demand issued under section 29. In the instant case, as already pointed out, the three notices of demand for the three charge years in question were all issued in September 1965 much after section 45A had been added to the Income Tax Act. As such the assessee‟s failure to pay the tax due from him occurred after section 45A had become a part of the Income Tax Act. No question, therefore, of retrospective operation of section 45A arises in the instant case. If the intention of the Legislature had been that the application of this section should be restricted to the tax due for the_charge years following insertion of the said section then this intention would have been made manifest by the use of appropriate words. There is, however, nothing in section 45A which implies that its application is restricted to tax due for the year following the insertion of the said section. in a fiscal statute, its provision have to be strictly construed and no additions to or omissions therefrom are permissible. As such, we are unable to construe section 45A of the Act so as to limit its application to tax due for the years following its addition to the Act as this can only be done if we were to add these words or words of similar „import‟ in the section, which is not permissible to us. According to Maxwell, 10th Edition : “It is but a corollary to the general rule of literal construction that nothing is to be added to or taken from a statute unless there are similar adequate grounds to justify the inference that the Legislator intended spine thing which it omitted to express”. As observed by Lord Mersey in (1910) AC 409, 420: “It is a strange thing to read in an Act of Parliament words which are not there, and, in the absence of clear necessity, it is a wrong thing to do”. Crown Bus Service Ltd. Lahore v. CBR and others – [1976] 34 TAX 54 (H.C.Lah.) 252.
Construction of law should not lead to startling results.
It is well settled that courts should follow that construction of law which does not lead to startling results or destructive ends.
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Commissioner of Income Tax Lahore Zone Lahore v. Malik & Co. Lahore – [1974] 29 TAX 165 (H.C.Lah.) 253.
Rule of harmonious construction of statutes.
Rules and the section are to be read together in harmony and not in derogation of one another. Muhammadi Steamship Company Ltd. v. Commissioner of Income Tax, (Central) Karachi – 1966 SCC 266 = [1966] 14 TAX 281 (S.C.Pak.) = PLD 1966 S.C. 828 254.
Words in statutes cannot be treated as surplusage or redundant.
Provisions granting exemptions or privileges have to be construed strictly against the person claiming the exemption or the privilege. It is a well established rule of interpretation of statutes that no words in a statute are to be treated as surplusage or redundant. Maharani of Bardwan v. Krishna Kamini Dasi – 14 ILR PC 365 255.
Punctuation marks and construction of statutes.
It is an error to rely on punctuation in construing Acts of the Legislature. Seth Gurmukh Singh v. Commissioner of Income Tax – [1944] 12 ITR 393 (Lahore)
“........ in the interpretation of statute punctuation, not being a part of the statute to be construed, is not a determining factor and if the proviso as punctuated leads to an absurd result or conflicts with some other provision of the statute which is unambiguous and free from doubt, the punctuation must yield to an interpretation that is reasonable and makes it consistent with the other provisions of the Act ........” [p. 424]. Board of Revenue v. Ramanathan Cheltian – 1 ITC 244 (Madras)
It is then argued that, on the true construction of clause (vii), all sales of machinery are included irrespective of whether they are sold by reason of their being obsolete; in other words, that the words „as obsolete‟ govern the word „discarded‟ appearing immediately before them and not the word „sold.‟ The phraseology of this clause is not very happy because it is obvious that the words could bear either meaning; but the statute has been punctuated, and we must take the punctuation marks as part of the statute. If it were intended to read
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the words „as obsolete‟, as governing „sold‟ one would expect to find a comma after the word „sold‟ There is none, the comma being put after the word „obsolete‟. Sundar Das v. Collector of Gujrat – 1 ITC 189 (Lahore) 256.
Tax can only be imposed by clear words of the Act.
„No tax can be imposed except by words which are clear and the benefit of the doubt is the right of the subject‟ [per Lord Justice FitzGibbon in In re Finance Act, 1894 and Studdert [(1900) 2 Ir. R. 400], and the Court is not entitled to substitute for express words or an irresistible inference a process of guess-work, however subtle the reasoning or ingenious the marshalling of facts by which such a process is supported. „If the person sought to be taxed comes within the letter of the law he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand, if Crown, seeking to recover the tax, cannot bring the subject within the letter of the law, the subject is free, however apparently within the spirit of the law the case might otherwise appear to be. In other words, if there be admissible, in any statute, what is called an equitable construction, certainly such a construction is not admissible in a taxing statute, where you can simply adhere to the words of the statute‟. Secretary to the Board of Revenue (Income Tax) v. North Madras Mutual Befit & Co – 1 ITC 172 (Madras) 257.
Strict rule of interpretation to tax a subject.
It is a commonplace that in statutes of taxation the imposition of a duty must be in plain terms [Per Buckley L.J., in Inland Revenue Commissioners v. Gribble [(1913) 3. K.B. 212 at p. 219]; such a statute must be construed strictly and the onus lies upon the Crown to show that the person whom it is sought to tax falls clearly within its operation. Rowe & Co. v. The Secretary of State for India –1 ITC 161 (Burma) 258.
Subject can only be taxed if statute expressly so provides.
In Tennant v. Smith [(1892) A.C.150 at page 154], Lord Halsbury L.C.said: This is an Income Tax Act, and what is intended to be taxed is income. And when I say what is intended to be taxed, I mean what is the intention of the Act as expressed in its provisions, because in a taxing Act, it is impossible, I believe, to assume any intention, any governing purpose in the Act, to do more than take such tax as the statute imposes. In various cases the principle of construction of
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taxing Act has been referred to in various forms, but I believe they may be all reduced to this, that inasmuch as you have no right to assume that there is any governing object which a taxing Act is intended to attain other than that which it has expressed by making such and such objects the intended subject for taxation, you must see whether a tax is expressly imposed. Cases, therefore, under the taxing Acts always resolve themselves into a question whether or not the words of the Act would have reached the alleged subject of taxation. Lord Wensleydale said in Micklethwaite, In re [(1855) II Ex. 452 at p.456], „It is a well established rule, that the subject is not to be taxed without clear words for that purpose; and also, that every Act of Parliament must be read according to the natural construction of its words‟. 259.
Court must stick to the letter of the statute.
In Attorney-General v. Milne [(1914) A.C.765 at p. 771] Viscount Haldance L.C. said: „It may be that, if probabilities, apart from the words used, are to be looked at, there is, on the construction which the Court of Appeal have put on the statute, a causus omissus which the legislature was unlikely to have contemplated. But, my Lords, all we are permitted to look at is the language used. If it has a natural meaning we cannot depart from that meaning unless, reading the statute as a whole, the context directs us to do so. Speculation as to a different construction having been contemplated by those who framed the Act is inadmissible, above all in a statute which imposes taxation,‟ and in the same case Lord Atkinson said:“To succeed the Crown must bring the case within the letter of that enactment. It is not enough to bring the case within the spirit of it, or to show that if the section be not construed as the Crown contends it should be construed, property which ought to be taxed will escape taxation, or will enjoy....an immunity from successive levies of estate duty. These evils, if such they be, must, if they exist, be cured by legislation. Judicial tribunals must in interpreting these taxing Act stick to the letter of the statute.” Again in Lumsden v. Inland Revenue Commissioners [(1914) A.C.877 at p. 887], Viscount Haldane L.C.said:“The duty of a court of construction in such cases is not to speculate on what was likely to have been said if those who framed the statute had thought of the point which has arisen; but, recognising that the words leave the intention
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obscure, to construe them as they stand, with only such extraneous light as is reflected from within the four corners of the statute itself, read as a whole.” Secretary of Commissioner Salt v. Ramanathan Chetti, minor by guardian – 1 ITC 37 (Madras) 260.
Subject taxable if within letter of law, not taxable if not within letter of law through within the spirit.
In Partington v. Attorney-General [(1869) 4 E.G.I.App. H.L. 100], Lord Cairns stated the rule thus“As I understand the principle of all fiscal legislation, it is this. If the person sought to be taxed comes within the letter of the law he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand, if the Crown, seeking to recover the tax, cannot bring the subject within the letter of the law the subject if free, however apparently within the spirit of the law the case might otherwise appear to be. In other words, if there be admissible, in any statute, what is called an equitable construction certainly such a construction is not admissible in a taxing statute where you should simply adhere to the words of the statute.” In Coltness Iron Company v. Black [(1881) 6 App. Cas. 315] Lord Blackburn stated the same rule somewhat differently. The noble Lord said: “No tax can be imposed on the subject without words in an Act of Parliament clearly showing an intention to lay a burden on him. But when that intention is sufficiently shown it is not open to speculate on what would be the fairest and most equitable mode of levying that tax.” 261.
Practice as a guide to construction.
We are justified in assuming that the legislature was aware of this practice, and if with that knowledge they repeated in the new enactment the same words on which the practice of the Government was founded, it gives rise to the presumption that they did not want to assess such incomes. If the legislature intended to tax these incomes and it would have been a very substantial source of public revenue they could have easily said, as in the English statute, that income accruing to a person in British India from any business wherever carried on is liable to be assessed.
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Section 1
Practice under repealed Act as an aid for construction of later Act.
The language employed by some of the noble Lords in that case was very strongly relied on by the learned Advocate-General. The observations of Lord Davey who subsequently explained the position in Commissioners of Taxation v. Kirk [(1900) A.C. 588] do not support the view that by giving general instructions the business is carried on in the country from which these instructions issue. Moreover, the facts in De Beers Consolidated Mines, Limited v. Howe [(1906) A.C. 455] and in Cesena Sulphur Company v. Nicholson [(1876) I Fx. D., 428] and in Mitchell v. Egyptian Hotels, Limited [(1915) A.C. 1022] were different from the facts on which we have been asked to give our opinion. I do not therefore think any good will be served by discussing these cases. In my opinion the facts to which our attention has been drawn are not specific enough to enable us to say that the business was really carried on in British India. There is only one other remark that need be made. It was elicited in the course of the argument that until the year 1914 or 1915 no income tax was levied in respect of foreign trades of principals residing in British India. The old Act of 1886 was repealed in 1918. So, for about 30 years at least, the executive Government in India did not levy income tax upon business of this kind. Mr. Krishnaswami Ayyar relied on this practice and quoted Commissioner for Special Purposes of Income Tax v. Pemsel [(1891) A.C. 531] and Yewens v. Noakes [(1880) 6 Q.B.D. 530] as enunciating that the practice under a repealed enactment can be looked into for construing the later enactment. Whatever may be the weight we may attach to it, it seems to me that Courts will not acting wrongly in referring to the practice in construing the Act. However, I do not invoke the aid of this practice as in my opinion there is nothing in the Act, which on the face of it imposes a duty upon income of this kind. As I started by saying, unless the words are clear, a fiscal enactment should not be construed as imposing a tax by implication. For these reasons I am of opinion that the assessee is not taxable. The Bhikanpur Sugar Concern In re: [1 ITC 29 (Patna)] 263.
Long course of decisions determining construction of a repealed statute may be an aid in the construction of a new statute passed in the same terms as the former, but a single decision not.
The provisions of the previous Acts in practically identical language and must, therefore, be taken to have concurred in the interpretation
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placed upon the Act by the Commissioner of Tirhut in 1912. It appears, however, that in 1914 the Board of Revenue were not satisfied with this decision and placed the matter before the Local Government and finally before the Government of India, with the result that the Bhikanpur factory was assessed on the whole of its profits for the year 1916-17. This assessment has been paid under protest and a suit is still pending in connection with it, which it has been agreed shall abide the result of the present reference. I agree where there has been a long course of decisions determining the construction of a statute, this may be taken into consideration in construing a new enactment passed in the same terms as pre-existing statutes, but a single decision such as that referred to cannot, in my opinion, from the basis of any presumption as to the intention of the legislature in the present case. _______________
_ RULE OF INTERPRETATION TWO EQUAL POSSIBLE _ INTERPRETATIONS EXEMPTION CLAUSES
Irum Ghee Mills Limited v. Income Tax Appellate Tribunal and another – [2000] 82 TAX 3 (S.C.Pak) 264.
Exemption clauses provided under industrial incentives should be construed liberally.
For the reasons discussed above, the appeal is allowed, the ex-parte order dated 30.06.1997, the subsequent appellant orders and judgement of the High Court, dated 26.6.1998 are set aside, and the appellant is declared entitled to the exemption granted by clause 118E of the Second Schedule to Income Tax Ordinance, 1979. Since the principal objection of the clause was to encourage setting up of industrial undertakings by offering tax incentives to boost up industrial growth a benefit view was to be taken rather than to defeat its object on technical grounds. Muhammadi Steamship Company Ltd. v. Commissioner of Income Tax, (Central) Karachi – 1966 SCC 266 = [1966] 14 TAX 281 (S.C.Pak.) = PLD 1966 S.C. 828 265.
Exemption clauses vis-a-vis rules of interpretation.
Provisions granting exemptions or privileges have to be construed strictly against the person claiming the exemption or the privilege.
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Commissioner of Sales Tax Lahore v. Lutfi & Co. Lahore – [1973] 28 TAX 168 (H.C.Lah.)
Since the exemption creates an exception to the general rule of taxation, it would be for the assessee to show that his case falls strictly within the scope of the exemption. Micropak (Pvt.) Ltd., Lahore v. Income Tax Appellate Tribunal, Lahore and 2 others – [2001] 83 TAX 451 (H.C.Lah.) = 2001 PTD 1180 266.
Rule of benefit to subject where two interpretations are possible.
Where two interpretations of a taxing statute are equally possible then the one favourable to the subject was to be adopted. Commissioner of Income Tax/Wealth Tax, Multan Zone, Multan v. Allah Yar Cotton Ginning & Pressing Mills (Pvt.) Limited, Multan Road, Vehari – [2000] 82 TAX 433 (H.C.Lah.) = 2000 PTD 2958 267.
Two equal possible interpretations of exemption clause one favouring the revenue to be adopted.
Further that in case of doubt or two equally possible interpretations the one favour to the revenue shall be adopted. For reference see the judgement in re: Army Welfare Sugar Mills Ltd. v. Federation of Pakistan (1992 SCMR 1652). Commissioner of Income Tax/Wealth Tax, Companies Zone, Faisalabad v. Rana Asif Tauseef C/o Rana Hosiery & Textile Mills (Pvt.) Ltd., Faisalabad – [2000] 81 TAX 7 (H.C.Lah.) = 2000 PTD 497 268.
Exemption clauses are to be construed strictly.
Where the fiscal legislation embodies exemption/deduction provisions, the same are construed strictly and against assessee. See Iram Ghee Mills Ltd. v. Income Tax Appellate Tribunal, (1998 PTD 3835); Thirdly; an exemption/deduction provision should be construed by liberal approach with an eye on the underlying purpose of said provisions. If the language of that provision is doubtful, the same should be resolved in favour of assessee on the touch-stone of the intention of legislature. See P.A. Likunju, Cashew Industries v. Commissioner of Income Tax (V. 166 (1986) ITR 804), Commissioner of Income Tax, Luknow v. U.P. Cooperative Federation Ltd. (V. 176 (1989) ITR 435 and Collector of Central Excise, Bombay-I, and another v. Parle Export (P) Ltd. (V. 183 (1990) ITR 624). Reference be made also to Heartland v. Damon‟s Estate (103 V. 519, 156, Atl. 518) and
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Kimball v. Potter (N.H. 196 Atl. 272). Observation of learned Judge, in first case, in following terms:A law for the assessment and collection of taxes is to be construed with the utmost liberality. But in order to be subjected to a tax, the property must be such as is ordinarily included, in the description given in the statute, and not such as can be brought within it by a process of reasoning only or by a strained construction because the legislature must be presumed to be fairly able to describe such property as it desires to tax without resorting to a strained construction or a course of fine reasoning. _______________
RULE OF LIMITATION
Pfizer Laboratories Ltd. v. Federation of Pakistan – [1998] 77 TAX 172 (S.C.Pak) 269.
Claim for refund of money paid under mistake is not barred by time.
The above resume of the case-law of Indian, English and Pakistani jurisdiction, indicates that the latest judicial trend is to deprecate and to discourage withholding of a citizen‟s money by a public functionary on the plea of limitation or any other technical plea if it was not legally payable by him. It is also evident that the claims for the refund of the amount paid as a tax or other levy on account of mistake as to want of constitutional/legal backing or because of exemption are at par. It is also apparent that such payments are held to be not covered by rule 11 of the Central Excise Rules, 1944, or section 27(1) of the Indian Customs Act, 1951, or section 33 of the Act etc. The refunds of such amounts are allowed by the Superior Courts inter alia in India on the basis of section 72 off the Contract Act which provides that „a person to whom money has been paid or anything delivered by mistake or under coersion must repay or return it.‟ Such refunds can be claimed either by filling a suit for the recovery of the amount for which the period of limitation applicable would be three years under Article 96 of the First Schedule to the Limitation Act (which provides period of three years from the date mistake becomes known to the plaintiff) or the same can be recovered through a constitutional petition if no disputed fact is involved. The Indian Supreme Court and the various High Courts referred to in the cited case-law, hereinabove had ordered the refund of the amounts involved in exercise of their constitutional jurisdiction under Article 226 of the Indian
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Constitution. In Pakistan, Sindh and Lahore High Courts have also allowed the refund of such amounts under Article 199 of the Constitution in exercise of their constitutional jurisdiction in the cases of Ghulam Abbas v. Member (Judicial), CBR and Kohinoor Industries Ltd. Faisalabad v. Ministry of Finance. But it may not be understood that we are laying down that a party is free to claim refund of a tax or any other levy paid under a mistake of fact or law at his sweat will at any time even after the expiry of 20 years. If a suit is to be filed for the refund, it should be within statutory period provided under the relevant Article of the First Schedule to the Limitation Act, or if the refund of the same is to be claimed by invoking in aid the constitutional jurisdiction of a High Court, the petitioner should approach the court promptly. The petition should not suffer from laches which may defeat the claim. We can‟t approve the view that a party can claim the refund of an amount paid to a Government functionary under a mistake without any constraint of limitation as it would adversely affect the good governance in financial matters. Commissioner of Income Tax Companies Zone Lahore v. Mst. Khursheed Begum – [1995] 71 TAX 280 (H.C.Kar.) 270.
The provisions of Limitation Act are mandatory and cannot be waived.
The words of section 3 of the Limitation Act are mandatory in nature and that every suit or application instituted after period of limitation shall, subject to the provisions of section 4 to 25 of that Act, be dismissed although limitation has not been set up as defence. The law, therefore, does not leave the matter of limitation to the pleadings of the parties as it imposes a duty in this regard upon the court itself. The limitation being a matter of statute and the provisions being mandatory cannot be waived and even if waived can be taken up by the party waiving it and by the Courts themselves. Commissioner of Income Tax Sukkur Zone, Sukkur, through Deputy Commissioner of Income Tax v. Gatron (Industries) Ltd. – [1999] 79 TAX 161 (H.C.Qut.) 271.
Time limitation for filing appeal under section 136 vis-a-vis section 5 of Limitation Act.
It is an admitted feature of the case that the order of Appellate Tribunal was received on 14.5.1997, and reference application could have been made within 60 days, but it was made on 21.7.1997 which is time-barred and it should have been filed on or before 14.7.1997 and as such, it is time-barred by 7 days for which no explanation
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whatsoever has been given but factum of delay has been taken very lightly and even the exact number of days were not mentioned regarding which condonation is required. Insofar as section 5 of Limitation Act is concerned it is well-settled by now that once limitation starts running no subsequent event can stop or suspend it and that matters dealt with by the Limitation Act shall be determined according to the true construction of the word used by the legislature and the doctrine of equity, justice and good conscience cannot be applied as to over-ride and abrogate the express provisions of the Limitation Act. The statutes of limitation should consequently be applied without regard to equitable consideration. Eastern Poultry Services v. Govt. of Pakistan & others – [1993] 68 TAX 171 (H.C.Kar.) _ 272. Period of Limitation Factors to be considered while computing period of limitation. Section 160(b) of the Income Tax Ordinance provides that the period during which any assessment or other proceedings under the Ordinance are stayed by any Court shall be excluded while computing the period of limitation. Commissioner of Income Tax Central Zone ‘A’ Karachi v. S.M. Naseem Allahwala – [1991) 64 Tax 31 (H.C.Kar.) 273.
A reference application made beyond the prescribed time should be dismissed.
So far as the second issue is concerned, it has been dealt with in several cases, holding that if the Reference Application is made beyond the prescribed time Tribunal has no discretion but to dismiss the same unless the statutory provision to the contrary is made. Khalid Cotton Factory, Multan v. Income Tax Officer, A-Circle, Multan – [1979] 40 TAX 60 (H.C.Kar.) 274.
Delay of each day must be explained.
It is settled principle of law of limitation that each day‟s delay in filing of reference application has to be explained. Commissioner of Income Tax/CST Rawalpindi v. Pakistan Television Corporation Ltd. Rawalpindi – [1978] 38 TAX 181 (H.C.Lah.) 275.
Time spent in obtaining a certified copy should be excluded while computing period of limitation.
An intending appellant has got the right to get excluded the time requisite for obtaining a certified copy even though an attested copy
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had been supplied to him by the Income Tax Officer, alongwith the notice of demand or even if he is not required to file one with an application for reference. Aftab Medical Stores, Dera Ghazi Khan v. Commissioner of Income Tax Lahore – [1976] 34 TAX 10 (H.C.Lah.) 276.
Application of provisions of Limitation Act to proceedings under Income Tax Laws.
We are, therefore, of the considered opinion that section 14 of the Limitation Act is applicable to the proceedings before the Income Tax Authorities. Alyani Cotton Ginning and Pressing Factory, Rahimyar Khan v. Assistant Commissioner of Income Tax and another – [1974] 29 TAX 238 (H.C.Lah.) 277.
Court holidays falling on the day of expiry of the prescribed period of limitation should be excluded in counting the period of limitation.
Only court holidays which are to be allowed in addition to the prescribed period of limitation for filing suit, appeal or application are those which fall on the day of the expiry of that period or immediately following it. If the period of limitation is still running when the court re-opens, the plaintiff or the appellant cannot claim the exclusion of such holidays. Alyani Cotton Ginning and Pressing Factory, Rahimyar Khan v. Assistant Commissioner of Income Tax and another – [1974] 29 TAX 238 (H.C.Lah.) 278.
Time required for obtaining certified copy should extend the period of limitation.
The principle, that the period of limitation comprises two elements namely, the primary period plus the periods allowed by the various provisions of the Limitation Act itself, is certainly not open to any exception, and as long as this period has not expired, the right of appeal subsists. Such being the case an application for obtaining a certified copy of the judgement or decree can be made within this period, with the result that the period shall stop running until such time as the copy is delivered. To put it more simply, the period of limitation would stand extended by the time requisite, for obtaining the certified copy. _______________
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Income Tax Digest.
REDUNDANCY SHOULD NOT BE READILY ASSIGNED BY COURTS
Commissioner of Income Tax v. Muhammad Kassim – [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280 279.
Redundancy should not be readily assigned by courts.
It is a well-established principle of interpretation of statutes that no provision of an enactment is to be treated as redundant or surplus and has to be given its meaning and effect to. Pakistan Lyallpur-samundri Transport Co. Ltd. Lahore v. Commissioner of Income Tax, Lahore Zone, Lahore – [1982] 46 TAX 143 (H.C.Lah.) 280.
Amendment in law implies necessarily an intention on the part of legislature to depart from earlier law in some respects redundancy cannot be attributed to the legislature.
One of the cardinal rules of interpretation of statutes is that where an amendment in the law takes place there musts be implied necessarily an intention on the part of the Legislature to depart from the earlier law in some respects. Redundancy cannot be readily attributed to the Legislature. The position canvassed by the learned counsel for the petitioner would lead us to the conclusion that such an amendment is redundant because inspite of it the position in regard to the adjustment of unabsorbed depreciation carried forward remained as it was before the amendment. This cannot be readily accepted. There must be something in the law to irresistibly indicate, that the alteration sought has not been achieved on the words or expressions used in the amending Act. _______________
INTERPRETATION FAVOURABLE TO ASSESSEE IS TO BE ADOPTED
Commissioner of Income Tax v. Muhammad Kassim – [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280 281.
Interpretation favourable to assessee is to be adopted.
If there is any doubt or ambiguity in the language used in the statute which renders it capable of several interpretations, then the interpretation favourable to the assessee or the citizen is to be adopted. Singer Sewing Machine Co. v. Commissioner of Income Tax and others – [1964] 9 TAX 273 (H.C.Kar.) = 1964 PTD 554 282.
Exemption cannot be allowed if not claimed.
Assessee was entitled to relief under section 15B of 1922 Act, but he did not claim this relief in the return of income. It is held that
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assessing officer was not bound to grant relief as ignorance of law is no excuse. Judicial Review : OVERRULED by the Supreme Court of Pakistan in 1965 SCC 234 = [1965] 11 TAX 364 (S.C.Pak). Their Lordships observed: “. . . That such a proceeding in revision would be a judicial proceeding and not merely departmental affair. The power of revision has to be exercised, according to judicial principles. The provision of section 33A(2) of 1922 Act apparently envisages a remedy alternative to a regular appeal from assessment. In the circumstances, it became the duty of the Commissioner to grant relief if the entitlement was clear. The learned Commissioner apparently misdirected himself in holding that he had no power to interfere in the matter.” “. . . All these factors go to establish the bona fides of the assessee-company in claiming that the assessment in question was not appealed against, owing to misapprehension of the correct position. The High Court has observed, in this connection, that ignorance of law was no excuse. That may be conceded, but section 33, sub-section (20) provided on alternative judicial remedy to the assessee, of which it availed itself and the relief was denied to it, on an erroneous view of law by the Commissioner.” “. . . It must be found as a result of the above discussion that the Commissioner declined to exercise his undoubled jurisdiction in the case, on a ground which was legally not supportable. This fact calls for correction of his order. We allow the appeal and quash the order passed by the Commissioner of Income Tax in this case.” _______________
RULES WHEN LANGUAGE IS AMBIGUOUS
Jamat-i-Islami Pakistan through Syed Munawar Hassan, Secretary General v. Federation of Pakistan through Secretary, Law, Justice and Parliamentary Affairs -&- Muttahida Qaumi Movement (MQM) through Deputy Convener, Senator Aftab Ahmad Sheikh v. Federation of Pakistan through Secretary, Ministry of Interior – PLD 2000 S.C. 111 283.
Rule of interpretation of ambiguous words.
It is a well-settled rule of construction of statutes that if the words used are ambiguous and admit of two constructions and one of them leads to a manifest absurdity or to a clear risk of injustice and the
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other leads to no such consequence, the second interpretation must be adopted. Commissioner of Income Tax v. Nasir Ali and another – [1999] 79 TAX 428 (S.C.Pak.) 284.
Proviso cannot extend the meaning of the enacting part.
It is a well-settled principle of interpretation that a proviso deals with the subject, which is covered by the enacting part of the provisions. The proviso only carves out an exception which, but for the proviso, would fall within the language and meaning of the enacting part. A proviso, therefore, has to be interpreted strictly, and where the language of main enacting part is clear and unambiguous, the proviso cannot by implication exclude from its purview what clearly falls within the express terms of the main enacting part. Accordingly, we hold that the export rebate contemplated under section 3(4)(a) of the Ordinance is admissible both to the registered firm as well as its partners in respect of super-tax and income tax payable by them, respectively. E.F.U. General Insurance Company Ltd. and Others v. The Federation of Pakistan & Others – [1997] 76 TAX 213 (S.C.Pak) = 1997 PTD 1693 285.
Effect of non-obstante clause.
Effect of said non-obstante clause is that the specified sections of the Act or rest of the Ordinance to the extent that these are inconsistent with Section 10(7) and First Sched. of the Act or Section 26 and Fourth Schedule of the Ordinance shall not be given effect to. No inconsistency exists between the special provision relating to general insurance business in the Act or Ordinance and the applicable Schedules containing general provisions for computation of tax on business. Such general provisions then apply for computation of tax on income from general insurance business. Mehran Associates Ltd. v. Commissioner of Income Tax, Karachi – 1992 SCC 980 = [1992] 66 TAX 246 (S.C.Pak) 286.
If a statute is capable of two interpretations then the one which is favourable to the subject be adopted.
The cardinal principles of interpretation of a fiscal statute seem to be that all charge upon the subject are to be imposed by clear and unambiguous words. There is no room for any intendment nor there is any equity or presumption as to a tax. A fiscal provision of a statute is to be construed liberally in favour of the taxpayer and in case of any substantial doubt, the same is to be resolved in favour of the citizen.
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Khurram Saghir Industries, Lahore v. Commissioner of Income Taxx, Zone-A, Lahore – [2001] 83 TAX 489 (H.C.Lah.) 287.
Doubt or ambiguity in language should go in favour of taxpayer.
The use of word “prior” in second proviso to sub-section (1) of section 13 and in sub-section (2) makes it very clear that two “prior” separate approvals of the Inspecting Additional Commissioner were required where an Assessing Officer was to make addition to the declared value of any valuable property. Obviously the requirement of prior approval was meant to safeguard the interest of the assessee to avoid arbitrary exercise of jurisdiction vested in the Assessing Officer. A simultaneous approval normally will not serve the purpose of the provisions because more often than not a simultaneous approval would be a fait accompli. Lastly as remarked by the learned Division Bench of the Karachi High Court in the aforesaid judgement even if there was any doubt or ambiguity in the language the interpretation favourable to the assessee had to be adopted as laid down by the apex Court in re: B.P. Biscuit Factory Ltd. For the aforesaid reasons we are of the considered view that two separate prior approvals under section 13(2) and in proviso to section 13(1) of the Ordinance were required and a combine approval obtained under both these sub-sections or of the draft assessment order did not fulfil the requirement of law. Cases referred to: Commissioner of Income Tax v. Muhammad Kassim [2000] 81 TAX 229 (H.C.Kar.), V.N. Rakhani & Company v. M.V. Lakotoi Express and 2 others [PLD 1994 SC 894], Biscuit Factory Ltd. v. Wealth Tax Officer (1996 SCMR 1470).
Commissioner of Income Tax v. Muhammad Kassim – [2000] 81 TAX 229 (H.C.Kar.) = 2000 PTD 280 288.
Court must confine itself to language of law.
While interpreting a provision of statute, Court has to read the provision as it exists and to deduce or infer the meaning in accordance with the existing test or the words or particular provision. Court is not supposed to add to or subtract any word(s) from any provision of a statute while interpreting a provision so as to give same a meaning other than the one which obviously and plainly flows or can be inferred from it.
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Income Tax Digest.
Ambiguity in language should be resolved in the favour of taxpayer.
If there was any doubt or ambiguity in the language used in the statute which rendered same capable of several interpretations, then the interpretation favourable to the assessee or the citizen was to be adopted. J.A. Textile Mills Ltd. v. CBR – [2000] 81 TAX 88 (H.C.Lah.) = 1999 PTD 4138 290.
Statutes should be interpreted strictly in accordance with letter of law.
It is an established principle that fiscal statutes should be interpreted strictly in accordance with the letter of law used and the words employed. For reference see 1977 SCMR 371 re: Collector of Customs, Karachi & Others v. Abdul Majeed Khan & Others. Also that in case of any ambiguity or doubt arising from construction, the same should be resolved in the favour of subject. For reference sees PLD 1961 SC 375 re: Commissioner of Income Tax East Pakistan v. Hossen Kasam Dada, Karachi & others and Abdul Majeed Khan and others (supra). The ratio settled in 1993 SCMR 274 = 1993 PTD 69 re: Mehran Associate Limited v. Commissioner of Income Tax, Karachi also supports this kind of approach in fiscal matters. 291.
In case of two equally reasonable interpretations, one strict and other beneficial, then the latter should be preferred.
“.......in case of other laws and statutes which infringe upon the rights of citizen or a party the apex court in re: Abdul Rehman v Inspector General of Police, Lahore and 2 others (PLD 1995 SC 546) favoured a beneficial interpretation. The rule settled in re: Commissioner of Income Tax, East Pakistan v. Hossen Kasam Dada, Karachi (PLD 1961 SC 375) states that when two equally reasonable constructions are possible one strict and other beneficial then the latter should be preferred. The situation, thus, calls for employing at least two general principles. First, that where an article or income can equally be placed under two heads of income or tariff then the one favourable to the taxpayer should be adopted. Second when an item or income etc. expressly falls into one clause then its placing into another clause would be unjustified. All the moreso, when the other clause is subject to a higher rate of tax.
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Searle Pakistan (Pvt.) Ltd. v. Government of Pakistan through Secretary Ministry of Finance & Another – [1994] 69 TAX 79 (H.C.Kar.) 292.
Benefit of ambiguity should be given to the assessee.
There is no cavil about the settled principle of interpretation that taxing provisions should be strictly interpreted and the benefit of ambiguity, if any, must go to the subject. Rijaz (Pvt.) Ltd. v. Wealth Tax Officer Circle-III Lahore – [1996] 74 TAX 9 (H.C.Lah.) 293.
If a statute is capable of two interpretations then the one which is favourable to the subject be adopted.
It was observed that according to the well-accepted principles of interpretation the doubt has to be resolved in favour of the citizen. In these circumstances, the law-maker could clarify its intention by adding an explanation which cannot be legitimately objected to. Commissioner Sales Tax v. Rizki Ink Company Ltd. – [1991] 64 TAX 34 (H.C.Kar.)
“...... according to us, if two interpretations are possible then any interpretation which favours the assessee has to be preferred.” Commissioner of Income Tax, Central Zone-B, Karachi v. Zakia Siddiqui – [1989] 59 TAX 79 (H.C.Kar.)
It is well recognised principle of interpretation that if a fiscal statute is capable of two reasonable interpretations then the one which is favourable to the subject be adopted. Highland Manufacturers (Pak) Ltd. v. Commissioner of Income Tax, West Karachi – [1985] 51 TAX 66 (H.C.Kar.)
We would observe that the Income Tax provisions have to be strictly construed and should be interpreted in a manner which is more favourable to the subject.
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Dreamland Cinema, Multan v. Commissioner of Income Tax Lahore – [1977] 35 TAX 169 (H.C.Lah.) 294.
Benefit of ambiguity should be given to the assessee.
Where two equally reasonable constructions are possible, one strict and the other beneficial to the assessee, the latter should be preferred in a taxing statute. Mst. Fatima Bibi c/o Crown Bus Service, Lahore v. Commissioner of Income Tax, North Zone (West Pakistan), Lahore – [1962] 6 TAX 1 (H.C.Lah.) = 1962 PTD 625 = 1962 PLD 809 295.
In case of ambiguity in language, statement of objects and reason can be relied upon.
Statement of objects and reasons be referred when there is ambiguity in fiscal statute. In such a case are to benefit should go to subjects. Hari Krishna Das v. Commissioner of Income Tax, UP – 5 ITC 275 (Allahabad)
The Income tax Act is a fiscal enactment and in the case of an ambiguity, it is to be construed by the well-known principle in favour of the subject and not against the subject. Muhammad Hayat Haji Mohammad Sardar v. Commissioner of Income Tax, Punjab & NWFP – 5 ITC 159 (H.C.Lah.) 296.
Literal rule can only be deviated in case of ambiguity in language; otherwise courts should adhere to plain words.
But the argument ab inconvenient as well as that based upon the order in which the two sections stand, may influence the interpretation of a statute when its language is ambiguous and capable of more than one meaning ....... When once the meaning is plain, it is not the province of a Court to scan its wisdom or its policy. Its duty is not to make the law reasonable, but to expound it as it stands, according to the real sense of the words. Hatz Trust of Simla v. Commissioner of Income Tax, Punjab & NWFP – 5 ITC 8 (H.C.Lah.) 297.
Inconsistencies are in-built in income tax.
It is true that the interpretation of the Indian Income Tax Act is far form being an easy matter. It is founded on the English Acts with certain differences to meet different conditions. The English Acts have been added so or varied to meet certain attempts to evade them and
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the same is true of the Indian Acts. The result is that there may appear to be certain inconsistencies. Roger Pyatt Shellac & Co., v. Secretary of State – 1 ITC 363 (Calcutta) 298.
Out of ambiguity of the provisions of the Act cannot be extracted a new and added obligation not formerly cast upon the taxpayer.
It is, I think, important to remember the rule, which the Courts ought to obey, that, where it is desired to impose a new burden by way of taxation, it is essential that this intention should be stated in plain terms. The Courts cannot assent to the view that if a section in a taxing statute is of doubtful and ambiguous meaning, it is possible out of that ambiguity to extract a new and added obligation not formerly cast upon the taxpayer. Emperor v. Probhat Chandra Barua – 1 ITC 284 (Calcutta) 299.
General Language not infrequently intended sub modo.
General language is not infrequently intended sub modo, and even in statutes cannot be taken at the foot of the letter. But in the first place an Income tax Act may be taken to have been framed so as to express intentions of the legislature on a matter of cardinal importance for its purpose. Secondly, the words employed in section 4 - the charging section - are calculated to an end which in the absence of any saving clause they are apt and sufficient to secure, that is, they place on the subject claiming exemption the burden of making out his case under the strict provisions of the statute. Thirdly, the modification sought to be implied overlaps a modification made expressly and with much care to limit and define its scope. Fourthly, the basis of the express modification is the payment of land revenue, and the legislature so far from moving in diversa materia, may very easily be supposed to regard its own provision as a precise formula, probably of compromise, adequately meeting the obligations imposed on it for modern purposes by the Permanent Settlement as well as the demands of others (e.g., the more highly assessed holders of estates temporarily settled) for some degree of uniformity in the incidence of direct taxation. It is difficult indeed to believe that the effect of the tax upon such important subjects as mining profits in permanently settled provinces was left to be thrashed out as against all interests upon the terms of the Regulation. Nor can it reasonably be taken as axiomatic that it is any more fair or just to tax forthwith an estate subject to periodical revision as regards land revenue than to tax an estate permanently settled.
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Fiscal statutes should be interpreted according to their natural meanings. _ _ I am not at all sure that in a case of this kind a fiscal case form is not amply sufficient; because, as I understand the principle of all fiscal legislation, it is this: If the person sought to be taxed comes within the letter of the law he must be taxed, however, great the hardship may appear to the judicial mind to be. On the other hand, if the Crown seeking to recover the tax cannot bring the subject within the letter of law the subject is free, however apparently within the spirit of the law the case might otherwise appear to be. In other words, if there be admissible in any statute what is called an equitable construction, certainly such a construction is not admissible in a taxing statute, where you can simply adhere to the words of the statute.” These observations were cited by Collins M.R. in Attorney General v. Selborne [(1902) 1 K.B. 388 at p. 396] and the learned judge proceeded to say: 300.
“Therefore, the Crown fails, if the case is not-brought within the words of the statute interpreted according to their natural meaning; and if there is a case which is not covered by the statute so interpreted, that can only be cured by legislation, and not by an attempt to construe the statute benevolently in favour of the Crown.” Rowe & Co. v. The Secretary of State for India – 1 ITC 161 (Burma) 301.
Benefit of doubt is the right of taxpayer.
In Finance Act, 1894 and Studdert, In re [1900] 2 Ir. R. 400 at p. 410] Fitzgibbon L.J. said: “The benefit of the doubt is the right of the subject”. Killing Valley Tea Company v. Secretary of State – 1 ITC 54 (Calcutta) 302.
Practice not a guide where language of statute is clear.
In great stress has naturally been laid by Sir Binod Mitter, who appeared on behalf of the Company, on the important fact that no attempt was ever made to assess the Company to income tax under the corresponding provisions of the Indian Income Tax Act, 1886, which have been, so far as the present question is concerned, reproduced with no substantial variation in the Indian Income tax Act, 1918. This is no doubt a circumstance to be taken into consideration, for an interpretation which has long been acted on, will not be disregarded by a Court of law [Lancashir and Yorkshire
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Railway Co., v. Sury Corporation [(1889) 14 App. Cas. 417 at p. 422], Tancred Arrol and Co., v. Steel Co., of Scotland [(1890) 15 App. Cas. 125 at p. 141]] and the Court should have regard to the construction put upon a statute when it first came into force; Morgan v. Crawshay [(1871) L.R. 5 H. L. 304 at p. 315], Fermoy Peerage Claim [(1856) 5 H.L.C. 716 at p. 747], Goldsmith Co., v. Wyatt [(1905) 2 K.B. 586 at p. 596]. But as Channell J. observed in the case last mentioned, where the Court is called upon to construe an Act of Parliament expressed in unambiguous language, it ought to put its own construction upon it, regardless of the construction that has been commonly put upon it; the fact that a mistaken interpretation has been generally put upon it cannot alter the law. To the same effect are the observations in Baleshwar v. Bhagirathi [(1908) ILR 35 Cal. 701 at p.713; 7 CLJ 563; 12 CWN 657]. “It is a well-settled principle of interpretation that Courts, in construing a statute, will give much weight to the interpretation put upon it, at the time of its enactment and since, by those whose duty it has been to construe, execute and apply it. I do not suggest for a moment that such interpretation has by any means a controlling effect upon the Courts; such interpretation may, if occasion arises, have to be disregarded for cogent and persuasive reasons and, in a clear case of error, a Court would without hesitation refuse to follow such construction.” This view is supported by the dictum of Sir Robert Phillimore in Evanturel v. Evanturel [(1869) L.R. 2 P.C 462 at p. 488] and has been applied in the case of Corporation of Calcutta v. Benony Krishna Boos [(1919) 12 C.L.J. 476; 15 C.W.N. 84; 7 Ind. Cas. 890] and Mathura Mohan Saha v. Ramkumar Saha [(1915) L.L.R. 43 Cal. 790 at p. 816; 23 C.L.J. 26; 20 C.W.N. 370; 35 Ind. Cas. 305]. We may add that it was stated by the Advocate-General that there has been some divergence of opinion among successive legal advisers of the Crown and that the assessment has been made in this instance with a view to obtain a judicial determination of the true meaning of the legislative provisions on the subject. Clearly, we cannot, in such circumstances, allow our decision to be controlled by the conduct of the Revenue Authorities in the past. We have finally been pressed to apply the elementary rule that taxing statutes must be construed strictly; Manindra Chandra v. Secretary of State for India [(1907) I.L.R. 34 Cal. 257; 5 C.L.J. 148], Mylapore Hindu Permanent Fund, Limited v. Corporation of Madras [(1908) I.L.R. 31 Mad. 408; 3 M.L.T. 400; 18 M. L.J. 349], Tenant v. Smith [(1892) A.C. 150 at 154], Lumsden v. Inland
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Revenue Commissioners [(1914) A.C. 877 at p. 897], Attorney-General v. Milne [(1914) A.C. 765]. Now, there is no room for controversy that the Crown, seeking to recover the tax, must bring the subject within the letter of the law, otherwise the subject is free, however much within the spirit of the law the case might appear to be. There can be no equitable construction admissible in a fiscal statute; the benefit of the doubt is the right of the subject; Partington v. Attorney-General [(1869) 4 E. & I. App. H. L. 100 at p. 122], Pryce v. Monmouthshire Canal Company [(1879) L.R 4 H.L. 197 at p. 202]. Secretary to Commissioner Salt v. Ramanathan Chetti, minor by guardian – 1 ITC 37 (Madras) 303.
No taxation except by express words.
Unless the words are clear, a fiscal enactment should not be construed as imposing tax by implication. _______________
NON OBSTANTE PROVISION OVERRIDES CONFLICTING PROVISION
Commissioner of Income Tax v. National Agriculture Ltd., Karachi – [2000] 82 TAX 73 (H.C.Kar.) = [2000] 81 TAX 249 (H.C.Kar.) = 2000 PTD 254 304.
Non obstante provision overrides conflicting provision.
....if two provisions of a Statute are not consistent or are in conflict with each other then the provision of the section starting with the expression “notwithstanding” or with “non obstante” clause would have preference and would override the provisions or the sections of the Statute dealing with the same subject-matter. _______________
DOCTRINE OF BINDING PRECEDENT (STARE DECISIS)
The doctrine of stare decisis is one of the policies grounded on the theory that justice and certainty require that the established legal principle, under which right may accrue, be recognised and followed. In Constitution of Pakistan, this doctrine is reflected in Article 189 and 201 which read as under: 189.
Any decision of the Supreme Court shall, to the extent that it decides a question of law or is based upon or enunciates a principle of law, be binding on all other courts in Pakistan.
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Subject to Article 189, any decision of a High Court shall, to the extent that it decides a question of law or is based upon or enunciates a principle of law, be binding on all courts subordinate to it.
Multiline Associates v. Ardeshir Cowasjee – PLD 1995 S.C.Pak 423 305.
Division bench of a High Court cannot disagree with another Division Bench without reference to a larger bench or should leave the matter to be decided by Supreme Court.
In such circumstances, legal position which emerges is that the Second Division Bench of the High Court should not have given finding contrary to the findings of the 1st Division Bench of the same court on the same point and should have adopted the correct method by making a request for constitution of a larger Bench, if a contrary view had to be taken. In support reference can be made to the cases of the Province of East Pakistan v. Azizul Islam PLD 1963 SC 296 and Sindheswar Ganguly v. State of West Bengal PLD 1958 SC (Ind.) 337, which is the case of Indian Jurisdiction. We, therefore, hold that the earlier judgement of equal Bench in the High Court on the same point is binding upon the Second Bench and if a contrary view had to be taken, then request for constitution of a larger Bench should have been made. Beach Luxury Hotel Ltd. v. Commissioner of Income TAX (Central), Karachi – 1981 SCC 546 = [1981] 44 TAX 40 (S.C.Pak.) 306.
Cautious approach is necessary when adopting foreign case-law.
There is, however, a word of caution, a reservation to be kept in view in all such historical and comparative studies. Not much help can be directly obtained in construing a particular provision of our Income Tax Act, by reference to interpretation of similarly, or analogous provisions, in Income Tax Legislation in England or India. However, on analogous provisions, fundamental concepts and general principles, unaffected by the specialities of either, the authorities may be helpful as guides. Province of East Pakistan v. Dr. Azizul Islam – PLD 1963 S.C.Pak 296 307.
English decisions in pari materia and their binding value.
If there is decision which constitutes direct authority on a question by High Court another Bench of same strength of the High Court if inclined to take to a different view they should have referred the matter to a larger Bench. Alternately, they could have expressed their doubts regarding the view taken in the precedent case in a court of equal strength, while yet following the view and left the matter to be raised in appeal before Supreme Court.
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Ramkola Sugar Mills Ltd. v. Commissioner of Income Tax Punjab & NWFP – 1955 SCC 1 = [1960] 2-TAX (Suppl.-29) (S.C.Pak) 308. Pre-partition judgements are binding unless overruled by Pakistani courts. The judgements of Indian courts are binding, unless overruled by Pakistani Courts, having being pronounced prior to the partition of the sub-continent. Abdul Razzak v. Collectors of Customs – 1995 CLC 1435 (H.C.Kar.) 309. Per incuriam judgement of even the highest court is not binding. A per incuriam decision, even of the highest court, does not bind any other court and it matters little that such court itself be at the lowest rung of the hierarchy of courts. [N.B. The position after adoption of 1973 Constitution is different as Article 189 and 201 specifically provide the binding nature of orders passed by the Supreme Court and High Courts. Recent decisions explain the correct position that decisions of co-equal benches cannot be ignored by subsequent benches unless the matter is referred to a larger bench or a contrary judgement of a higher court is available. For detailed discussion see Article “Tax laws and law of binding precedent” in Tax Review, May 2005.]
Nishat Talkies Karachi v. Commissioner of Income Tax – [1989] 60 TAX 45 (H.C.Kar.) = PTCL 1989 CL 660 310. Reliance on foreign cases in the presence of contrary view taken by Pakistani courts is strongly disapproved. We disapprove the practice of not considering and relying upon the judgements of our Superior Courts. It is the duty of every court and Tribunal in Pakistan to follow the judgements of Supreme Court. Under Article 189 of the Constitution any judgement of the Supreme Court which decides a question of law or enunciates a principle of law is binding on all Courts in Pakistan. Likewise and in the same terms, Article 201 provides that subject to Article 189 all judgements of the High Court are binding on all the Courts subordinate to it. We hope in future learned Tribunal will be careful in this regard. Commissioner of Income Tax, Lahore Zone, Lahore v. Badar Ice Factory, Lahore – [1981] 43 TAX 100 (H.C.Lah.) 311. Principles of “stare decisis”. The Tribunal agreed with the departmental representative‟s assertion that each assessment is final and conclusive and should not be allowed to operate as estoppel or resjudicata on the other assessments, but it was of the view that as a general rule it would not be permissible to abandon a consistently applied formula. it accordingly directed the
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Income Tax Officer to work out the assessee income on the tank capacity basis, after taking into consideration admissible allowance. The Income Tax Officer had in this particular case, rejected the prevailing 1/3rd tank capacity formula and applied his own formula, which according to him was a better one. The formula suggested by the Income Tax Officer did not find favour with the Tribunal, and we have no doubt that a more accurate formula could have found favour with the Tribunal, as it itself rejected the department‟s plea of stare decisis. Having found that the formula suggested by the Income Tax Officer was neither lucid nor certain and that it was dependent upon varied and uncertain factors, which in turn were capable of manipulation, and adoption of such a formula could result in arbitrariness, it was within the competence of the Tribunal to reject the same. Jamal v. The State – PLD 1960 Lahore 1962 312.
Binding judgements and conduct of different benches.
......a decision of a Division Bench was not binding on another Division Bench. It is unnecessary to give here elaborate reasons for that view and all that needs to be said is that it is not obligatory for a Division Bench if it does not agree with the view of another Division Bench to follow the views it does not agree with, and in case it is not prepared to do this, to refer the case to a Full Bench. Bashir Ahmad v. The State – PLD 1960 Lahore 687
(1)
The decision of the Full Bench of the Court cannot be dissented from by a Division Bench or a Single Bench.
(2)
The decision of a Division Bench of the Court cannot be dissented from by a Single Bench.
(3)
The decision of a Division Bench of the Court can be dissented from by another Division Bench or even by the same Bench and may be overruled by a Full Bench but it cannot be dissented from by a Single Bench and
(4)
The decision of a Single Bench can be dissented from by another or the same Single Bench and can be overruled by a Division Bench or a Full Bench.
Commissioner Income Tax v. Anantapur Gold Mines – 1 ITC 133 (Mad) 313.
English decisions in pari materia and their binding value.
As regards this particular case, I will only say that while the Commissioner has rightly based his decision on the language of the
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Indian section, which differs materially from the corresponding section of the English Act, he has fallen into error in supposing that in Imambandi v. Mutsaddi [1918) I.L.R. 45 Cal. 878; 45 I.A. 73: 35 M.L.J. 422; 16 A. L.J. 800: 24 M. L.T. 330; 28 C.L.J. 409; 23 C.W. N. 50; 5 P.L.W. 276; 20 Bom. L.R. 1022; (1919) M. W.N. 91; 9 L.W. 518; 47 Ind. Cas. 513], the Privy Council deprecated the practice of referring to English decisions, which are the basis of so much of our law in India. The decisions in question were American decisions and were correctly described as foreign, an adjective which is inapplicable and would certainly not have been applied by the Privy Council to the decisions of the English Courts. As regards income tax, the Indian Act generally follows the lines of the English Act, and where the provisions are similar, English decisions are the best guide to their meaning. The revenue authority no doubt may not always find it easy to apply them, and that is one reason why the Act empowers and requires it to make a reference to the High Court in appropriate cases. _______________
DOCTRINE OF MERGER
Glaxo Laboratories Ltd. v. Inspecting Assistant Commissioner of Income Tax & Others – 1992 SCC 910 = [1992] 66 TAX 74 (S.C.Pak.) = 1992 PTD 932 = PLD 1992 SC 549 314.
Doctrine of Merger.
Section 66A authorises Inspecting Additional Commissioner to examine and initiate action if the decision is erroneous and prejudicial to the interest of revenue. The Inspecting Additional Commissioner did not have the jurisdiction or power to initiate same action in respect of the orders passed by the appellant authorities or the Tribunal. However, as observed above such power has now been vested in Inspecting Additional Commissioner from the year 1991. The controversy is whether after the appellate authority has passed an order the Inspecting Additional Commissioner can still go to take action under section 66A. In Corpus Juris Secundum, Volume 57, at page 1067 words „Merge‟ and „Merger‟ have been defined as follows:“The verb „to merge‟ has been defined as meaning to sink or disappear in something else, to be lost to view or absorbed into something else, to become absorbed or extinguished, to be combined or be swallowed up.
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„Merger‟ is defined generally as the absorption of a thing of lesser importance by a greater, whereby the lesser ceases to exist, but the greater is not increased, an absorption or swallowing up so as to involve a loss of identity and individuality.” Commissioner of Income Tax v. Farrokh Chemical Industries – 1991 SCC 805 = [1992] 65 TAX 239 (S.C.Pak.) = 1992 PTD 523
It was observed that „the order of the Income Tax Officer upon appeal merged in the ......... order of the Income Tax Appellate Tribunal‟. Here the assessment order made by Income Tax Officer was reopened under section 65 and a revised assessment was framed which has been set aside by the Tribunal. Thus, the order of the Income Tax Officer has merged in the order of the Tribunal which holds the field. Commissioner of Income Tax, Karachi v. Sadruddin – [1985] 51 TAX 83 (H.C.Kar.)
The view that has consistently been prevailing and has been followed is that after the Appellate Court has passed an order, the order of the Original Court is merged into it. Commissioner of Income Tax Faisalabad v. Chief Glass House – [1992] 65 TAX 205 (H.C.Lah.) 315. On appeal original order ceases to exist and merges itself in the appellate order Indeed it is well recognised general principle that on appeal the original order ceases to exist and merges itself in the appellate order of variance. As a necessary corollary, with all the proceedings taken in pursuance to the original order would be washed away and obliterated. _______________
LEGAL MAXIMS
Commissioner of Income Tax Pakistan v. Fazlur Rehman & Sayeedur Rehman – 1964 SCC 176 = [1964] 10 TAX 49 (S.C.Pak) 316.
Audi alteram partem.
No man should be condemned unheard is not confined to courts extend to all proceeding by whomsoever held with may effect person a property or other rights of the parties concerned in dispute, and the maxim [audi alterm partem] will apply with no force to proceedings which effect liability to pay a tax.
but the the less
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Siemens Pakistan Engineering Ltd. v. Federation of Pakistan & Other – [1999] 79 TAX 605 (H.C.Kar.) = 1999 PTD 1358]
Audi alteram partem i.e. no one shall be condemned unheard is a universally established principle of law. This rule is applicable to both judicial and non-judicial proceedings (1994) SCMR 2232). Anisa Rehman v. PInspecting Additional Commissioner – 1994 SCMR 2232
No order is maintainable if affected person is denied his right of audi alteram partem. Mian Aziz Ahmad, Lahore v. Commissioner of Income Tax Lahore – [1979] 39 TAX 1 (H.C.Lah.)
The right to be heard is not confined to proceedings which are judicial in form. The maxim „no man shall be condemned unheard‟ is not confined to courts but extends to all proceedings, by whomsoever held which may affect the person or property or other right of the parties concerned in the dispute, and the maxim will apply with no less force to proceedings which affect liability to pay a tax. Muhammad Khan and Others v. Ghazanfar Ali & Others – AIR 1920 Lahore 247
Orders violating the principles of audi alterm partem are void. Hansraj Gupta v. Dhera Dun Mussorai Electric & Tramway Co. Ltd. – AIR 1933 PC 63, 65 317. Casus Omissus. A casus omissus cannot be supplied by the court except in the case of clear necessity and when reasons for it is found in the favour corners of statutes itself. Jamat-i-Islami Pakistan through Syed Munawar Hassan, Secretary General v. Federation of Pakistan through Secretary, Law, Justice and Parliamentary Affairs & Muttahida Qaumi Movement (MQM) through Deputy Convener, Senator Aftab Ahmad Sheikh v. Federation of Pakistan through Secretary, Ministry of Interior – PLD 2000 S.C. 111 318. Ejusdem generis - Meaning of. The doctrine of ejusdem generis is well-settled. It means that where general words follow an enumeration of persons or things, by words of
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a particular and specific meaning such general words are not to be construed in their widest extent, but are to be held as applying only to persons or things of the same general kind or class as those specifically mentioned. However, the doctrine will apply when there is nothing in the provision or Act to show a wider sense was not intended or the intention to give to the general term a broader meaning than the doctrine requires was not manifested. General terms following particular ones apply only to such persons or things as are ejusdem generis with those comprehended in the language of the Legislature. In other words, the general expression is to be read as comprehending only things of the same kind as that designated by the preceding particular expressions, unless there is something to show that a wider sense was intended. The rule of doctrine of „ejusdem generis‟ will apply unless intention to the contrary is clearly shown. Where general words follow the enumeration of particular classes of persons or things, the general words, under the rule or maxim of construction known as „ejusdem generis‟, will be construed as applicable only to persons or things of the same general nature or class as those enumerated unless an intention to the contrary is clearly shown. The doctrine applies when the following five conditions exist: (1)
The statute contains an enumeration by specific words;
(2)
the members of the enumeration constitute a class;
(3)
the class is not exhausted by the enumeration;
(4)
a general term follows the enumeration; and
(5) there is not clearly manifested an intent that the general term be given a broader meaning than the doctrine requires. Prime Commercial Bank v. Assistant Commissioner of Income Tax – [1997] 75 TAX 1 (H.C.Lah.) = 1997 PTD 605 = PTCL 1997 CL 29]
The provision itself which if read as a whole leaves no room to hold that the words (special deposit receipt) must be interpreted ejusdem generis and must take colour from the preceding and subsequent words. Beli Ram & Bros. v. Commissioner of Income Tax – [1935] 3 ITR 103 (Lah.) & AG v. Aramago [1925] 9 TC 445 (HL) 319.
Ex abundanti cautela.
An assessment which is made ex abundanti cautela by the assessing authority is called protective or precautionary assessment or
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alternative assessment. When the department has any doubt as to person who is or will be deemed to be in receipt of the income, protective or alternative assessment is permitted. Thus there is no double assessment if the first assessment is void. Commissioner of Income Tax, East Pakistan, Dacca Engineers Ltd. – 1967 SCC 289 = [1967] 16 TAX 81 (S.C.Pak) 320.
v.
Generalia specialibus non derogant.
The scope of clause (xvi) [parallel to section 23(i)(xviii) of Income Tax Ordinance, 1979] which is residuary in nature is thus wholly different from the sums included in clauses (xii), (xiv) and (xv). There being no similarity of subject matter between clauses (xii), (xiv) and (xvi) of section 10(2) the rule Generalia specialibus non derogant was clearly not attracted. Emperor v. Probhat Chandra Barua – 1 ITC 284 (Calcutta)
No doubt the maxim generalia specialibus non derogant may be regarded as embodying a good working rule of construction, but when the intention of the legislature to abrogate or modify existing rights is manifest as a necessary implication from the language used, it matters not, in my opinion, that the existing rights are not therein expressly and specifically modified or cancelled. Pakistan Hardcastle Wand (Pak) v. Federation of Pakistan etc. – PLD 1967 SC 1 321.
Mens rea.
Even in the case of statutory offence, the presumption is that mens rea is an essential in gradient. Kohinoor Industries Ltd. v. Government of Pakistan etc. – [1994] 70 TAX 11 (H.C.Lah.) 322.
Noscitur a Sociis.
The words used in statute are to receive the meaning which the context in which they appear admits. Maxwell on Interpretation of Statute 12th Edition at page 289 explains the principle of noscitur a sociis:“Where two or more words which are susceptible of analogous meaning are coupled together, noscitur a sociis they are understood to be used in their cognate sense. They take, as it were, colour from each-other, the meaning of the more general being restricted to a sense analogous to that of the less general.”
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New Jubilee Insurance Company Ltd., Karachi v. National Bank of Pakistan, Karachi – PLD 1999 S.C. 1126 323.
No one can be judge in his own cause.
Before delisting the name of the Insurance Company from the list of approved Insurance Companies, the Bank was not obliged to obtain adjudication as to the genuineness of its claim against the Insurance Policy. The basic question was as to whether there was material available on record on the basis of which a reasonable unbiased person could have concluded that there was no basis for rejection of the claim. In the present case if the Bank would have invoked section 44-B, of the Insurance Act, and if the second Surveyor would have given report to the effect that the Insurance Company‟s rejection of the Bank‟s claim was unjustified/unwarranted by law, it would have been justified to delist the Company from the list of approved Insurance Companies. Bank did not opt to get an independent surveyor appointed by the Controller of Insurance under sub-section (1) of section 44B of the Act, nor it had recourse to the remedies provided under the Insurance Policy, namely, arbitration, nor it invoked the jurisdiction of a competent Court of law. The Bank had itself adjudicated upon the question of genuineness and correctness of its claim. In other words it had become a judge in its own cause and delisted the Company‟s name from the list of approved Insurance Companies, and in consequence thereof it carried with it a stigma to the effect that the Company was an Insurance Company which did not honour its legal obligation under the Insurance Policies. The Bank not only delisted the Company from the list of approved Insurance Companies, but circulated the copy of the same inter alia to all of their offices and branches. Muhammad Saleem Chotia, Advocate v. Zafar Iqbal Owasi, Advocate, Bahawalnagar and 4 others – PLD 1999 Lahore 446 324.
Things should be done as per law as not to be done at all.
Where law had provided a thing to be done in a particular manner then it ought to be done in that manner and all other modes of doing it would stand excluded. Commissioner of Income Tax v. Mahaliram Ramjidas – [1940] 8 ITR 442 (PC) 325.
Ut res valeat quam pereat.
It is a crucial rule of interpretation of statutes that the words of the statute should be given a sensible meaning so as to make them effective....... The provisions in a taxing statute dealing with machinery
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for assessment have to be constrained according to the ordinary rules of construction, that is to say, in accordance with the clear intention of the Legislature which is to make a charge levied effectively. _______________
DOCTRINE OF RES JUDICATA/ESTOPPEL
Commissioner of Income Tax Central Zone B, Karachi v. Farrokh Chemical Industries – 1991 SCC 805 = [1992] 65 TAX 239 (S.C.Pak.) = 1992 PTD 523 _ 326. Principle of res judicata not applicable. The doctrine of res judicata does not strictly apply to Income Tax cases. The previous decisions or findings can be reopened if fresh facts come to light which on investigation would lead to a conclusion different from that of his predecessor. Commissioner of Income Tax v. Pakistan Industrial Engineering Agencies Ltd. – 1991 SCC 857 = [1992] 65 TAX 84 (S.C.Pak.) = 1992 PTD 576 = PLD 1992 SC 562 Doctrine of res judicata - not applicable to income tax proceedings.
327.
It is now well-settled that principles of res-judicata cannot be applied to the cases on assessments under the Income Tax Act in the same manner as it is applied in Civil proceedings. Reference can be made to Commissioner of Income Tax v. Waheeduzzaman PLD 1965 SC 171, which was followed in a recent judgement namely Commissioner of Income Centre Zone B v. Farrokh Chemical Industries, Case Nos. 104 to 111 K of 1984. In both the cases the applicability of principles of res-judicata was restricted and in the later case following Waheeduzzaman‟s case it was observed as follows: It may be reiterated that a previous decision of an Income Tax Authority will not be a bar in the following cases: (i) (ii)
Where the earlier decision is clearly open to some objections; if it is a decision which is not reached after proper inquiry;
(iii)
if it is a decision as could not reasonably have been reached on the material before the authority;
(iv)
it is a decision which suffers from a defect which falls within the purview of the ground mentioned in section 100, CPC and liable to correction thereunder in second appeal, if it were a decision of a Civil Court; and
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if fresh evidence having a material bearing on the point decided in the previous decision is available.
Commissioner of Income Tax, East Pakistan Dacca v. Wahiduzzaman – 1965 SCC 212 = [1965] 11 TAX 296 (S.C.Pak.) = PLD 1965 SC 171 328.
Income tax officer - when not bound by res judicata.
Where there is no statutory provisions barring reopening of a matter the applicability of the principle of res-judicata depends on the necessity of giving finality to litigation and the injustice of vexing a person twice in respect of the same matter and these being only general considerations relating to administration of justice with no technical and defined limits the applicability of res judicata in such cases will be governed by considerations arising with respect to the particular statute under which a matter has been determined. The dominant consideration always being that the cause of the justice be advanced..... under the circumstances the ends of justice will be served by confining the bar of res judicata in relation to decision of Income Tax Authorities to cases where the decision is not clearly open to some objection. On the basis of assessments for the year 1945-46 and 1946-47, it was contended that the findings of the Income Tax Appellate Tribunal, so far as the amounts in question were concerned, operated as resjudicata and these questions could not be re-agitated in the subsequent assessment proceedings of the same assessee. The Bombay High Court held in Seth Ram Nath Daga v. Commissioner of Income Tax [1971] 82 ITR 287 that the question of res-judicata need not detain us long, as there is a plethora of decisions holding that the income tax authority is not a court and the decision of an income tax authority in a prior year does not operate as res-judicata in the assessment proceedings of the subsequent years. To quote a few, they are: Perianna Pillai v. Commissioner of Income Tax (1929, 4 TRC 217), Kaniram Ganpat Rai v. Commissioner of Income Tax (1929, ITR 332 (Pat.), Tejmal Bhojraj v. Commissioner of Income Tax (1941, 22 ITR 208) (Nag.) Omar Salay Mohammad Sait v. Commissioner of Income Tax, etc. v. Commissioner of Income Tax; Colombo (1961, 2 All S.R. 436 (PC) and Joint Family of Udayan Chinubhai, etc. v. Commissioner of Income Tax (1967, 63 ITR 416). In Kaniram Ganpat Rai v. Commissioner of Income Tax (1941, 9 ITR 332) the Patna High Court held that the Income-tax Officer is not bound by rule of res-judicata or estoppel and he can reopen the assessment if fresh facts came to light which on investigation would entitle the officer to come to a conclusion different from that of his predecessor. Similarly, in Tejmal Bhojraj v.
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Commissioner of Income Tax (1952, 22 ITR 108) (Nag.) it has been held that the principle of res-judicata or estoppel by record has no application and the previous finding or decision may be re-open by the department when the previous decision has not been arrived at after due enquiry, or the said decision is arbitrary or fresh facts come to light. In view of this, if the assessee in a subsequent year is able to satisfy the income tax authority that the previous finding is not correct either because it was not arrived at after due enquiry or because it is arbitrary of if the assessee has put before the income tax authority fresh facts from which a different conclusion can be arrived at, then in that case the income tax authority would be justified in arriving a different conclusion than what was arrived at in the previous proceeding. C.W.T., Southern Region, Karachi v. Abid Hussain – [1999] 80 TAX 89 (H.C.Kar.) = [1999 PTD 2895 329.
Principles of waiver or estoppel do not apply against a provision of law.
There is no waiver or estoppel against a provision of law and furthermore the question of exemption, being a question of law, it could be raised at any stage of the proceedings. If any authority is required in support of this it is to be found in the case of Shad Muhammad v. Pir Sabir Shah, reported in PLD 1995 SC 66. Moin Sons (Pvt.). Ltd., Rawalpindi v. Capital Development Authority, Islamabad – [1998] 78 TAX 168 (H.C.Lah.) 330.
Doctrine of promissory estoppel could not be invoked against the legislature and the laws framed by it.
The Capital Development Authority would be under an obligation under the law to deduct Income Tax on all the bills to be paid to the petitioner in accordance with the rate or rates specified in the First Schedule to the Income Tax Ordinance, 1979, pursuant to sub-section (4) of section 50 thereof. In the case, of failure to deduct tax in accordance with the rate specified in the First Schedule to the Ordinance, the Capital Development Authority will be liable to penal action specified in section 52 of the Income Tax Ordinance, 1979, meaning thereby that irrespective of sub-clause 73.1 of the agreement between the petitioner and the Capital Development Authority the liability of payment of tax at the rate or rates specified in the First Schedule to the Ordinance will remain intact. As held by the Supreme Court in Pakistan through Secretary Ministry of Commerce and 2 Others v. Salahuddin and 3 others (PLD 1991 SC 546). The doctrine of
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promissory estoppel cannot be invoked against the Legislature or the laws framed by it. It was held by the Court that payments received by the contractors are deemed to be their income in terms of section 80C of the Income Tax Ordinance, 1979, which does not contain any provision that the rate of tax shall relate back to the date on which agreement was entered into and not when the payments were received. It was, thus, held therein that the contractors were liable to, pay tax on the payments received by them under the contracts of the nature specified by sub-section (2) of section 80C of the Income Tax Ordinance, 1979, at the rate prevailing at the time of receipt of payments and not on the date the contrat under which these payments were made were entered into. In the instant case, the petitioner is not being asked to pay tax at the, enhanced rate on the payments which had been made to him prior to the first, July, 1995, but the tax at the prevailing rate of 5% is being collected on the payments to be received by him on and after the first July, 1995, when the rate of tax was enhanced under the Finance Act, 1995, from 3% to 5% on the payments to be made to the contractors. Hence, in view thereof, the deduction of tax at the enhanced rate cannot be claimed to have been given retroactive operation. Cases referred to: Elahi Cotton Mills Ltd. and others v. Federation of Pakistan through Secretary, Ministry of Finance, lsMmabad and 6 others (1997) 76 Tax 5 (S.C.Pak.) = (PLD 1997 SC 582); Al-Samrez Enterprise v. The Federation of Pakistan (1986 SCMA 1917); Secretary Ministry of Commerce and 2 others v. Salahuddih and 3 others (PLD 1991 SC 546); Altaf Construction Co. v. Central Board of Revenue and others (1995 PTD 804) = (1996) 74 Tax 39 (H.C.Lah.) and Sarwar & Co. v. C.B.R. and others (1997) 76 Tax 1 (H.C.Lah.) = (1997 PTD 1138).
Afzal Construction Co. (Pvt.) Ltd. v. Chairman, CBR – [1990] 62 TAX 91 (H.C.Lah.) 331.
Equitable doctrine of estoppel.
As regards technical objection to the sustenance of the writ petition, it may be observed that estoppel does not flow out of the proceedings which are violative of law. The rule that a litigant on account of his conduct may be disentitled to discretionary relief under writ jurisdiction, is an equitable doctrine by which the court regulates its jurisdiction and is not an absolute rule.
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S.M. Abdullah v. CIT – [1966) 14 TAX 161 (H.C.Kar.) 332.
Principle of res judicata and estoppel.
The doctrine of res judicata or estoppel by record cannot be applied to proceedings pending before the Income Tax authorities. Admittedly the proceedings before them are not judicial proceedings in the sense that they are before the courts of law. The assessment of Income Tax authorities for a particular year is binding on the parties to the extent of that assessment. But the question is whether the Income Tax authorities are entitled to change the basis of assessment or the footing on which the previous assessment was made in subsequent years. In other words, whether they are entitled to blow hot and cold in the same breath? On principles of natural justice, finality and certainty of decision is expected and desirable even before quasi-judicial tribunals like the Income Tax authorities, and if such a tribunal arbitrarily and capriciously comes to a different conclusion from another tribunal on the same question, it will create uncertainty in the minds of the assessee. In order to avoid resulting injustice, there is an implied limitation on the power of such tribunal, namely, that it cannot reopen a question unless some fresh facts comes to its notice or the previous decision was arrived at without equity and is perverse. This implied restriction is inherent in every quasi judicial tribunal and there is no reason why it should not be applied in the case of Income-tax authority. Ahmed Maritime Breakers Ltd. v. Central Board of Revenue etc. – [1992] 65 TAX 268 (H.C.Kar.) 333.
Executive actions are not excluded from the operation of promissory estoppel.
Bare perusal of the above citation would make it clear that executive actions are not excluded from the operation of the doctrine of promissory estoppel. _______________
NATURAL JUSTICE/DUTIES OF COURT
Commissioner of Income Tax East Pakistan & 2 others v. Aswab Ali & others – 1969 SCC 350 = [1975] 31 TAX 101 (S.C.Pak) 334.
Affording of an opportunity is a prerequisite for taking penal action.
It is an elementary principle of law that no person can be subjected to an obligation without affording him an opportunity to show cause.
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Similarly, an order favouring a person passed by a competent authority cannot be varied to his disadvantage without hearing him. Commissioner of Income Tax East Pakistan v. Fazlur Rahman & Saeedur Rahman – 1964 SCC 176 = [1964] 10 TAX 49 (S.C.Pak) 335.
An order affecting the rights of a party cannot be passed without an opportunity of hearing to that party.
We do not think the mere absence of a provision as to notice can override the principle of natural justice that an order affecting the rights of party cannot be passed without an opportunity of hearing to that party. Yet it cannot be said that it is not necessary to hear the parties affected in a proceeding under section 115, CPC.The fact that the proceedings are judicial or quasi-judicial in nature is sufficient to entitle a party to a hearing in the absence of specific provision to the contrary. Mustafa Prestressed R.C.C.Pipe Works Ltd. Karachi v. Commissioner of Sales Tax (Investigation), Karachi – [1990] 62 TAX 119 (H.C.Kar.) 336.
Duties of courts in administration of justice.
The Courts and quasi-judicial officers are required not only to do justice but to perform their duties in such a manner that justice is seen to have been done. In discharge of such duties no steps should be taken which may create apprehension in the mind of a litigant that justice may not be done. If a subordinate officer submits his proposed order to his revisional appellate or superior authority and after his approval announces it then it will furnish a strong ground for challenging it, although such authority may not have amended the order. Such reference indicates that the judicial mind of the officer passing the judgment was not free and sufficiently tainted as he had in the mind the feeling that he has to submit the proposed order to his superior officer and thus may have thought fit to make such an order which may be acceptable to him. If the documents are such which a party has to produce the same may not be looked into if not produced at the relevant time, but if reference is to be made to the notifications or gazettes then they have to be treated differently from the documents which require proof. Duly notified order can be referred by looking to the gazettes. It is the primary duty of every party to produce all the records and documents relevant to the case. But so statute, rules and notifications which are notified and gazetted are concerned they should not escape notice of the court and all efforts should be made to find them out so that a
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wrong order may not be passed. Therefore, the court should not entirely rely upon the parties and their advocates for producing these documents, but should make search, to find out the state of law applicable to a case. Karachi, Textile Dyeing and Printing Works, Karachi v. Commissioner of Income Tax (Central), Karachi – [1984] 49 TAX 18 (H.C.Kar.) 337.
No adverse order should be passed against a party without affording an opportunity to meet the case.
No party can be condemned on basis of evidence or information adduced behind his back and without any notice to him. It is true that technicalities of Evidence Act cannot fetter the exercise of power of the Assessing Authority but rule of justice demands that before any adverse order, penalty or liability is passed or imposed upon a party he should be afforded full opportunity to meet the case and rebut the evidence used against him. Sheikh Akhtar Ali v. Federation of Pakistan and 4 others – [1980] 42 TAX 47 (H.C.Lah.) 338.
Justice should not only be done but must also appear to have been done.
Justice should not only be done but must also appear to have been done. Sh. Diwan Muhammad Mushtaq Ahmad, Karachi v. CBR – [1969] 19 TAX 198 (H.C.Kar.) 339.
Principles of natural justice are part and parcel of every statute unless there is specific provision in a particular statute to the contrary.
It has been irrevocably held by decisions of the Supreme Court that the rules of natural justice are to be read as part and parcel of every statute unless and until there is a specific provision in a particular statute to the contrary. Commissioner of Income Tax v. Surridge and Beecheno – [1968] 18 TAX 72 (H.C.Kar.) 340.
Principles of natural justice cannot be invoked in deciding a legal issue with reference to the statutory provision.
We are doubtful of the application of the principles of natural justice by the learned Tribunal inasmuch as the matter has to be decided in the first instance strictly in legal plane with reference to the statutory provision whose proper application clinches the issue.
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Crown Bus Service Ltd. Lahore v. CBR and others – [1976] 34 TAX 54 (H.C.Lah.) 341.
The court must consider the intention and not merely the form, while examining a document.
We may observe as a matter of principle, all that the courts of law are required to examine while considering a document or an instrument is the intention and not merely the form of any order or direction continued therein depending upon the facts, circumstances and the context of each case. Commissioner of Income Tax Rawalpindi Zone, Rawalpindi v. New Afza Hotel Rawalpindi – [1973] 27 TAX 212 (H.C.Lah.) 342.
Judicious exercise of discretion.
Since the discretion is objective it is to be exercised according to the rules of reason and justice and not according to the private opinion, according to law, and not humour. It is to be not arbitrary, vogue and fanciful but legal and regular. And it must be exercised within the limit to which an honest man competent to the discharge of his office ought to exercise. New Jubilee Insurance Company Ltd., Karachi v. National Bank of Pakistan, Karachi – PLD 1999 S.C. 1126 343.
Article 4 of Constitution of Pakistan 1973 vis-a-vis “due process of law”.
There are certain basic norms of justice. One of the cardinal principles of such basic norms is that one cannot be a judge in his own cause. The breach of the said cardinal principle of jurisprudence will in fact be violative of the right of „access to justice to all‟ which is a wellrecognised inviolable right enshrined in Article 4 of the Constitution. This right is equally founded in the doctrine of „due process of law‟. The right of access to justice includes the right to be treated according to law, the right to have a fair and proper trial and the right to have an impartial Court or Tribunal. The term „due process of law‟ can be summarised as follows:(1) A person shall have notice of proceedings which affect his rights, (2) He shall be given reasonable opportunity to defend, (3) That the Tribunal or Court before which his rights are adjudicated is so constituted as to give reasonable assurance of its honesty and impartiality, and (4) That it is a Court of competent jurisdiction. Above are the basic requirements of the doctrine „due process of law‟
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which is enshrined, inter alia, in Article 4 of the Constitution. It is intrinsically linked with the right to have access to justice which is a fundamental right. This right, inter alia, includes the right to have a fair and proper trial and a right to have an impartial Court or Tribunal. A person cannot be said to have been given a fair and proper trial unless he is provided a reasonable opportunity to defend the allegation made against him. Messrs Neelam Textile Mills Ltd. v. State Bank of Pakistan and 2 others – PLD 1999 Kar. 433 344.
Public power and administrative discretion ought to be exercised fairly.
We may further observe that it is by now settled law that all public power and administrative discretion ought to be exercised fairly and reasonably and a burden imposed must bear a reasonable nexus with the harm caused. The concept of proportionality in the exercise of public power has been recognised and approved by our Courts and in the case of Independent Newspaper Corporation v. Chairman Fourth Wage Board (1993 SCMR 1533) the Honourable Supreme Court observed „the principle is well-settled that when express statutory power is conferred on a public functionary, it could not be pushed too far, for such conferment implies a restraint in operating that power, so as to exercise it justly and reasonably. In the words of Scarman, L.J‟ excessive use of lawful powers is itself unlawful. _______________
DOCTRINE OF MUTUALITY
Commissioner of Income Tax, Lahore v. The Lyallpur Central Co-operative Bank Ltd., Lyallpur – [1959] 1-TAX (III-150) (H.C.West Pakistan, Lahore Bench) = 1959 PTD 639 = 1959 PLD 627 345.
Five-point criteria for applying “doctrine of mutuality”.
The assessee was registered under the Co-operative Societies Act 1912. Up to 1948, income of all co-operative societies and banks was exempt from payment of tax, but on the 20th August 1948, the exemption was withdrawn. Shortly after this, the Central Board of Revenue issued a circular that profits earned by co-operative credit societies registered under the Co-operative Societies‟ Act 1912 from dealing with their own members would continue to be exempt under the doctrine of mutuality. The Income Tax Officer while making
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assessment for the charge year 1950-51 declined to exclude such profits from the income of the assessee on the ground that it was not derived on the basis of mutuality. The Appellate Assistant Commissioner upheld the Income Tax Officers‟ order on the ground that since the assessee‟s business consisted of financing Co-operative Societies and other parties and loans were not restricted exclusively to members, the income in question had arisen not because of the relationship between the assessee and its members but because of the loans advanced to them. The Appellate Tribunal accepted the assessee‟s contention that doctrine of mutuality was applicable incase of income derived from members because one could not assess income arising to oneself. After discussing a good deal of the case law the Department‟s reference failed and the Tribunal‟s finding was upheld. Their Lordships while examining the cases cited, observed that each of those cases was based on its own peculiar facts. Judicial review: This is perhaps the only case in Pakistan where their Lordships have considered the doctrine of mutuality at a great length, considering a number of cases cited at bar. Their Lordships laid down five point criteria in determining the applicability of the doctrine of mutuality. After applying the said criterion, their Lordships observed that interest on loans advanced to members of the assessee should be exempt from tax. Cases referred: Last v. London Assurance Corporation (2 Tax cases 100 CH. L.); Styles (Surveyor of Taxes) v. New York Life Insurance Company (2 Tax cases 460 CH. L.); Secretary, Board of Revenue (Income Tax) Madras v. The Mylopore Hindu Permanent Fund Ltd. (1) Income Tax cases 217 (Madras) Trichmopoly Tennore Hindu Permanent Fund Ltd., v. Commissioner of Income Tax Madras (1937 ITR 703); Commissioner of Income Tax Madras v. Salem District Urban Bank Ltd. (1940 ITR 269); The English and Scottish Joint Co-operative Wholesale Society Ltd. v. Commissioner. of Agr. Income Tax Assam (1945 ITR 295); The English and Scottish Joint Co-operative Wholesale Society Ltd. v. Commissioner of Agr. Income Tax Assam (1948 ITR 270 (P.C.); Municipal Mutual Insurance Ltd., v. Hills (16 Tax cases 430). _______________
NON-APPLICATION OF FEDERAL TAX LAWS TO TRIBAL AREAS
Haji Ibrahim Ishaq Johri v. Commissioner of Income Tax (West), Karachi – [1982] 45 TAX 263 (H.C.Kar.) = 1982 PTD 46 = 1990 PTCL 954 = 1982 PLD 266 346.
Non-application of Federal tax laws to tribal areas etc.
According to the above Article of the 1962 Constitution, no central law was to apply to any tribal area unless the Governor of the Province
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which the tribal area was situated, with the previous approval of the President, so directed. In the circumstances we are of the view that Income Tax Act, 1922 was not applicable to Swat for the assessment years in question. _______________
RULES RELATING TO INTERPRETATION OF AMENDING PROVISIONS EXPLAINED
Sainrapt & Et. Brice, Karachi v. Commissioner of Income Tax (West), Karachi [1979] 40 TAX 116 (H.C.Kar.) = PLD 1979 591 347.
Rules relating to interpretation of amending provisions explained.
It is well established that in the interpretation of statutes, the meaning of the words should be considered in the light of history of the legislation and the state of the law at the time the statute was passed, in order to consider whether the statute was intended to alter the law or to leave it exactly where it stood before. As observed by Maxwell on “Interpretation of Statutes” (12th Edition page 47), the Court is not to be, oblivious of the history of law and legislation and the Court has to say what is the object of the legislation in amending the law. Craies on “Statute Law” (7th Edition at page 126) observes that the cause and necessity of the Act may be discovered by considering the state of the law at the time when the Act was passed and in innumerable cases the Courts with a view to construing an Act have considered the existing law and reviewed the history of legislation upon the subject. Cases referred to : Rais Pir Ahmad Khan v. Commissioner of Income Tax, Lahore Zone, Lahore (1975 PTD 70) = [1975] 32 TAX 22; Sitaram Motiram Jain v. Commissioner of Income Tax [1961] 43 ITR 405; Wallem & Co. (Pak) Ltd. Karachi v. Commissioner of Income Tax [1974 PTD 207] = [1974] 30 TAX 34; Pherozali v. Commissioner of Income Tax (Est) Pakistan, Karachi [PLD 1978 Kar. 765] = [1979] 40 TAX 109 and Abdul Aziz and another v. Muhammad Ibrahim [PLD 1977 SC 442].
Commissioner of Income Tax, Lahore v. Kohinoor Industries Ltd., Lahore – [1977] 35 TAX 42 (H.C.Lah.) 348.
Scope and import of incorporated provisions of law explained.
The learned counsel for the petitioner did not dispute the well established position of law that when some provisions of an earlier Act are incorporated in a later Act, the incorporated provisions, for all practical purposes, become part and parcel of the later Act and no subsequent change in the earlier Act even though retrospective in its
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application, shall apply to the incorporated provisions of the later Act unless the same had been made applicable express or by necessary intendment. _______________
PRINCIPLES GOVERNING INTERPRETATION OF FINANCIAL LIABILITIES
Highway Petroleum Service (Regd.), Lahore v. Islamic Republic of Pakistan and another [1977] 36 TAX 8 (H.C.Lah.) = 1977 PTD 183 = 1977 PLD 797 349.
Principles governing interpretation of financial liabilities.
Before adverting to the contentions of the learned counsel for the petitioners on merits which he canvassed very ably, if I may say so with respect, it may be said straight-away, that he is quite right when he made the submissions about the principles governing interpretation of financial liabilities. The tax can be imposed on “income” and not on any thing else much less on expenditure or tax, which is not an “income” but a liability. But all this does not solve the problem and help the petitioners. They are not being imposed a tax. What is happening to them is that for non-compliance of the relevant provisions for paying the tax either in full or part they are being asked to pay an additional amount. In other words, for withholding the amount which they were liable to pay, they are being told that for user of that amount or depravation of the use of the same by the rightful owner i.e, the State, the person concerned must pay an additional amount. Now, it is quite common in Civil Law that a person withholding somebody else‟s money and using the same or depriving the rightful owner of used, the former may be liable to make good the gain derived by him, or, suffer the loss which the rightful owner had undergone for not getting his money. Therefore when the petitioners are asked to pay additional amount of tax for non payment of the tax contrary to law, they are not being imposed additional amount of tax on their income but are being asked to defray the liability for non-compliance of the law. The use of the phrase “additional amount of tax” and since that is calculable with reference to the non paid or underpaid amount of the tax, gives an impression that the demand is of “additional amount of tax” on the non paid or unpaid “tax”, and that, no additional amount of tax can be levied on. tax, the latter being not an income but an expenditure
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or liability, Though the phrase “additional amount of tax” as a whole is loose and it would have sufficed to say that for nonpayment or under payment. The defaulting persons would be liable to pay additional amount” without saying “of tax”, yet, for an inaccurate or inapt phrase, the provision cannot be rendered nugatory.....an inapt and inaccurate phraseology of the draftsman cannot and should not nullify a provision made by the Legislature which is consistent with existing legal norms. Cases referred to : Maxwell, on Interpretation of Statutes, 12th Edition, p.157; Craies, on Statute Law, 17th Edition, pp.112-115; Bank Chettinad Ltd. v. Commissioner of Income Tax (1940) 1 ITR 523; D‟avigdor Goldmid v. Inland Revenue Commissioner (1953) A.C. 347; Wijesuriya v. Amit (l965) 33 All. E.R. 72 and (1944) AIR F.C. 73. _______________
INTERPRETATION LEADING TO DESTRUCTIVE ENDS SHOULD BE AVOIDED BY COURTS
Crown Bus Service Ltd., Lahore v. Central Board of Revenue and others – [1976] 34 TAX 54 (H.C.Lah.) 350.
Interpretation leading to destructive ends should be avoided by Courts.
In Act IV of 1924 no particular mode of constituting the Central Board of Revenue has been mentioned except, perhaps, by making appointments of its members and we are doubtful as to whether any such plea in his context can be successfully advanced by the petitioner. The objection of the learned counsel for the petitioner is based on the assumption that under section 2 of Act IV of 1924 two formalities viz. (a) constitution of Central Board of Revenue and (b) appointments of its members, had to be independently performed and if, for instance, certain person or persons are straightaway appointed as members of the Central Board of Revenue that probably is not enough. We do not agree, because, there is nothing to lead to such a corollary in the wording of section 2 of Act IV of 1924. Confining ourselves to the notification dated 29.8.1947 we may observe as a matter of principle, all that the courts of law are required to examine while considering a document or an instrument is the intention and not merely the form of any order or direction continued therein depending upon the facts, circumstances and the context of each case. Acting on that principle we hold that if the intention of making appointments of certain officer or officers as members of the Central Board of Revenue is for example with a view
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to establish the Central Board of Revenue and similarly if the appointments cannot be made except when it implies a creation of the Central Board of Revenue, then on the facts and overall circumstances in such situations, it can be safely held that the aforesaid appointment inter alia implied the constitution of the Central Board of Revenue as well and a specific and independent recital regarding the creation of the Central Board of Revenue is not to be considered as a must, especially when as already pointed out, in Act IV of 1924 no particular form and procedure for constituting a Central Board of Revenue had been laid down. The view of our government has also been the same. This will bear out the deductions which we have made from Governor-General‟s Orders Nos. 2 and 12 of 1947 hereinbefore referred to. The first was issued by Lord Mountbatten and the letter by the Quaid-i-Azam Muhammad Ali Jinnah in their capacities as Governor-General of their respective countries. These two Orders implied that the Central Board of Revenue constituted as a legal entity in 1924 continued with necessary adaptation for each Dominion and it was on that assumption that without staging its recreation or reconstitution various powers, functions and directions were given or assigned to it, because, otherwise there was no justification to quote or make mention of Central Board of Revenue for Pakistan and Central Board of Revenue for India in those two Orders when no such Boards as alleged by the petitioner existed then and thereafter. We were told that neither in India nor in Pakistan there was staged any re-creation or re-constitution of the Central Board of Revenue afresh and that both the countries acted on the premises that the Central Board of Revenue constituted in 1924 was a legal entity which had duly come into being in that year and later on only appointments of its members were to be made whenever necessary. It was on that construction of the relevant law that both the countries uptil now worked. The Central Board of Revenue is referred to in (i) Income Tax Act XL of 1922 (ii) Central Board of Revenue Act VI of 1924; (iii) Excess Profits Tax Act XV of 1940; (iv) Business Profits Tax Act XXI of 1947; (v) Central Excise and Salt Tax Act I of 1944; (vi) Sea Customs Act VII of 1888; and (vii) Land Customs Act XIX of 1924. If the contention of the learned counsel for the petitioner is accepted it will mean that almost whole of the revenue financial laws of the country came to a stand still due to non-creation of the Central Board of Revenue as alleged. Obviously we cannot endorse such a plea. If the contention as suggested by the learned counsel for the petitioner is accepted that
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will create complications and confusions for all concerned leading to a great deal of chaos in the country and will throw open all the actions taken, functions performed, orders passed and directions issued by the Central Board of Revenue after 1947 up to-date or, as a matter of fact, onward from 1924. On the other hand, the view taken by us will not lead to any destructive results. It is well settled that courts should follow that construction of law which does not lead to startling results or destructive ends. Cases referred to : Bashir Ahmnad Khan v. Mahniud Ali Khan Chowdhury (PLD 1960 S.C 195); United Netherland Navigation Co. Ltd. v. Commissioner of Income Tax (PLD 1965 S.C. 412); [1965] 12 TAX 57 and Nazir Ahmad v. Pakistan and others (PLD 1970 S.C. 453). _______________
TERMS AND PHRASES USED IN ONE STATUTE
Commissioner of Income Tax, Rawalpindi v. Noon Sugar Mills – [1975] 32 TAX 273 (H.C.Lah.) 351.
Phrases used in one statute borrowed as aid in support of the interpretation of a different statute meant for a different purpose and dealing with a wholly different subject matter is not always safe.
It is not always safe to borrow the meanings attached to terms and phrases used in one statute as aid in support of the interpretation of a different statute meant for a different purpose and dealing with a wholly different subject matter. It is of course permissible to have recourse to the ordinary dictionary meanings in interpreting a statute. Cases referred to: Littlewood v. George Wimpey & Co. Ltd. British Overseas Airway Corporation (1953, 2A. B.R. 915); Roberts v. Roberts L (1962, 2 A.E.R. 697); Wallance Brothers and Co. Ltd. v. Commissioner of Income Tax, Bombay (1938) 16 ITR 240; Chatturam Horilram Ltd. v. Commissione of Income Tax, Bihar and Orissa (1955) 27 ITR 709; Radhashyam Agarwala v. Commissioner of Income Tax, East Pakistan (PLD 1960 S.C. 187); (1960) 2-TAX (III-211) (S.C.). _______________
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MARGINAL NOTES TO THE SECTION OF AN ACT CANNOT BE REFERRED TO FOR THE PURPOSE OF CONSTRUING THE ACT
Commissioner of Income Tax, Lahore v. Aziz Din – [1976] 33 TAX 258 (H.C.Lah.) 352.
Marginal notes to the section of an Act cannot be referred to for the purpose of construing the Act.
But in this connection before us reliance was strongly placed on the marginal note to section 46 of the Act which speaks of the “Mode and time of recovery”. It was, therefore, contended that sub-section (I) of this section recovery of imposition of penalty is nothing but a provision for mode of relating to the tax and a part of the machinery provided to facilitate the recovery of tax. It is lever and a handle to exert pressure on the assessee and even to force him to pay the arrears of tax due from him. But we see no force in this contention. These marginal notes do not form part of the section. These observations were cited with approval by Their Lordships of the Supreme Court in The Commissioner of Agricultural Income Tax, East Bengal v. B.W.M. Abdul Rehman Manager, Taki Bara Taraf Wards Estate [(1973) SCMR 445] and the Court observed that in interpreting a fiscal statute only the letter or the law must be looked to and there is no room for any intendment. Also in Mssrs Hirjina & Co. (Pakistan) Ltd.. Karachi v. Commissioner of Sales Tax Central, Karachi [(1971) SCMR 128], the Court held that in interpreting a taxing statute the Courts must look to the words of the Statute and interpret it in the light of what is clearly expressed. It cannot imply anything which is not expressed, It cannot import provisions in the statute so as to support assumed deficiency. In the instant case, we find that in the adaptation order passed by the Central Board of Revenue, it is not expressly stated that the penalty provisions contained in sub-section (1) of section 46 of the Income Tax Act are applicable to the amount payable in virtue of Martial Law Regulation No. 43/48 and it is not permissible to import any such construction into that order by implication. Cases referred to: Sushil Kumar v. Emperor (AIR 1943 Cal. 489); Sutton v. Sutton [(1882) 22 Ch.D 511]; Balraj Kumar and annher v. Jagat Pal Singh [(1904) ILR 26 All. 393]; Commissioner of Income Tax v. Ahmadbhai Umarbhai & Co. (AIR 1950 S.C. 134); Cap Brandy Syndicate v. In land Revenu Commissioner [(1921) 1 K.B. 64]; Commissioner of Agricultural Income Tax v. B.W.M. Abdul Rahman, Manager Taki Bara Taraf Wards Estate [(1973) SCMR 445]; Hirjina & Co. (Pak.) Ltd. v. Commissioner of Sales Tax [1971] SCMR 128]; [1975] 31 TAX 78 (S.C.); Rajba v. Lala and another
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(PLD 1971 Lah. 1056) and Siraj Din v. Mst. Iqbal Begum (PLD 1968 Lah. 639). _______________
PRINCIPLE OF LITERAL INTERPRETATION
Eastern Textile Mills Ltd., Chittagong v. Commissioner of Income Tax, East Pakistan, Dacca / and / G. Merajuddin and another v. Commissioner of Income Tax, East Pakistan, Dacca – [1966] 13 TAX 145 (H.C.Dacca) 353.
Provisions should be interpretated in accordance with the plain meaning of the language used therein.
It is an accepted principle of interpretation that a statute is to be understood in accordance with the plain meaning of the language used. in it. “If there is one rule of construction of statutes and other document, it is that you must dot simply anything in them which is inconsistent with the words expressly used”. Noor Hussain, Dacca v. Commissioner of Income Tax, Dacca – [1963] 7 TAX 113 (H.C.Dacca) = 1963 PTD 161 = 1963 PLD 373 354.
Statute should be given its ordinary meaning.
Interpretation of one statute by analogy to interpretation of another is unsafe, particularly when two statutes not pari materia. Proper way of construction is to give effect to all words of relevant provisions dispassionately. Fiscal statute must be strictly construed in favour of assessee. Golden rule is that statute must prima facie be given its ordinary meaning. _______________
DOCTRINE OF FAVOURABLE INTERPRETATION
Barnala Commission Shop, Chak-Jhumra v. Income Tax Officer, B-Ward, Lyallpur – [1963] 7 TAX 153 (H.C.Lah.) = 1963 PTD 534 = 1963 PLD 311 355.
Doctrine of favourable interpretation applies to charging and not to machinery provisions.
Fiscal provision in case of ambiguity should be interpretation in favour of subject. This doctrine applies to charging provisions of Act and not to collecting provisions. CASE APPROVED: [1961] 4 TAX 94 (Trib). _______________
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DEPARTMENT CAN GO BEYOND A TRANSACTION
Mian Muhammad Allah Buksh v. Commissioner of Income Tax – 1962 PTD 603 (H.C.Lah.) 356.
Department can go beyond a transaction.
In case of splitting into four subsidiary firms of partners of an existing firm the deponent could decide whether it constitutes „transaction‟ designed to evade tax liability. Burden of proof rests with the department, which can go behind transaction to find affirmatively whether there was intention to evade tax. _______________
APPLICATION OF TAX RATES THROUGH A FINANCE ACT EXPLAINED
Commissioner of Income Tax, East Pakistan, Dacca v. Wahidur Rahman, Income Tax Officer, Companies Circle IV, Chittagong [1961] 4 TAX 135 (H.C.Dacca) = 1961 PTD 1110 = 1962 PLD 104 357.
Application of tax rates through a Finance Act explained.
The assessee, an Income Tax Officer, received a sum of Rs.4,581 as his salary for the period from 1st April, 1956 to 3rd March, 1957. Under section 18(2) of the Income tax Act tax was deducted at source from month to month at the rates laid down by the Finance Act, 1956. In making the assessment for the assessment year 1957-58 the assessing Income Tax Officer worked out the total income at Rs.4,585, including his income chargeable under the head “salaries”. The income was assessed to tax at the rates laid down by the Finance Act, 1956 and after giving credit for the tax deducted at source, provident fund contributions, etc., a net amount of Rs.4/2/- was found payable by the assessee. The assessee filed an appeal before the Appellate Assistant Commissioner contending that for the assessment year 1957-58 the minimum taxable income was fixed at an amount exceeding Rs.5,000 and as his income during the year 1956-57 was below the limit of Rs.5,000 he was not liable to be assessed and pay any tax at all. The Appellate Assistant Commissioner accepting the contention reversed the assessment order. The Department filed a second appeal and contended before the Tribunal that the proviso to the Schedule to the Finance Acts of 1956 and 1957, providing for exemption of income not exceeding Rs.4,200 and Rs.5,000 respectively, are inseparable parts of the rate structure and in the case of salary earner what should be considered to be immune from taxation for the taxing year 1957-58 is
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Rs.4,200 under the proviso to the Schedule to the Finance Act, 1956 and not Rs.5,000 under the proviso to the Schedule to the Finance Act, 1957. The Tribunal could not accept the contention of the Department and affirmed the order of the Appellate Assistant Commissioner. On a reference by the Department the High Court upholding the order of the Tribunal: Held, that: (i)
sub-section (3) of section 17 of the Finance Act, 1957 is only applicable to those cases where the assessee himself is chargeable to Income Tax under section 17 of the Finance Act of 1957. If he is not chargeable, there is no scope for application of sub-section (3) of section 17 of the Finance Act of 1957; and
(ii)
in section 17(3) of the Finance Act, 1957 the reference to the Finance Act, 1956 is only for the purpose of calculation of income tax on the salaried portion of the total income and in doing so it may be on the basis of the exemption amount of Rs.4,200, provided his total income is chargeable i.e., exceeding Rs.5,000. _______________
ACT IS TO BE READ AS A WHOLE
Commissioner of Income Tax, East Pakistan v. Aizuddin Gazi and others – [1960] 2-TAX (III-474) (H.C.Dacca) = 1960 PTD 727 = 1960 PLD 535 358.
Act is to be read as a whole.
Act should be so construed as not to render other parts superfluous, void or insignificant. It should be construed as a whole. It is court‟s duty to reconcile different provision of law especially in case of taxing statute. _______________
STATUTE SHOULD BE READ AS A WHOLE
Commissioner of Income Tax v. Hoosen Kasam Dada Karachi – 1960 PTD 574 (H.C.Dacca) 359.
Statute should be read as a whole.
One section in statute should not be read independently of all others and should be given unreasonable interpretation.
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Judicial analyses : CONFIRMED by the Supreme Court of Pakistan in Commissioner of Income Tax, East Pakistan Dacca v. Hossen Kasam Dada, Karachi 1961 SCC 102 = [1961] 4 TAX 96 (S.C.Pak.) with the following observations: “Such a reading of the provisions of Business Profits Tax Act appears to us not only to be reasonable but also the one which produce a consistency with the various provisions thereof. To hold otherwise would produce the anomalous result that whilst a dishonest assessee would be protected from harassment after the lapse of four year, an hones assessee would remain exposed to the harassment for even 10 to 50 years. It is difficult to impute such an iniquitous intention to the Legislature. _______________
SECTION VS. RULE
Commissioner of Income Tax, South Zone, Karachi v. Radio Hotel, Karachi – [1959] 1-TAX (III-407) (H.C.West Pakistan, Karachi) = 1959 PTD 707 = 1959 PLD 539 360.
Rules cannot be called in aid to interpret sections of the Act. In case of discrepancy in language of section and rules, section is to prevail.
Three references were simultaneously decided by a joint order. In all these references the partnership deeds were executed after the lapse of the relevant year of account and on this ground the Income Tax Officer had refused to allow registration under section 26A of the Income Tax Act. The Tribunal in all these cases had allowed registration. At the instance of the Department the Tribunal referred the following question of law to the High Court “Whether, in the facts and circumstances of the case, the assessee firm which came into existence by verbal agreement, long before the relevant year of account is entitled to be registered under section 26A of the Income Tax Act, in respect of the assessment year 1951-52 relevant to the previous year ending the 31st March, 1951, when the instrument of partnership was drawn up on the 16th April, 1951, that is to say, after the expiry of the relevant „previous year‟.” Following the case of Commissioner of Income Tax v. Rashid Motors [(1957) 32 ITR 101] it was held that it is not necessary to bring a partnership into existence, that such an instrument may legitimately
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record the previous history of the partnership and that what is being registered is not the instrument but the firm. Judicial analyses : FOLLOWED BY - Commissioner of Income Tax v. Rashid Motors [1957] 32 ITR 101, wherein it was held that it not necessary to bring a partnership into existence, that such an instrument may legitimately record the previous history of the partnership and that what is being registered is not the instrument but the firm. Cases relied: Dwarkadas Khetan and Co., Bombay v. Commissioner of Income Tax, Bombay City [AIR 1956 Bom. 321] and Commissioner of Income Tax, East Bengal v. Messrs. Rashid Motors, Chittagong [PLD 1957 Dacca 459]. Cases descended from: R. C. Mitter & Sons v. Commissioner of Income Tax, West Bengal [AIR 1956 Cal. 303]; Kalsi Mechanical Works, Nandpur v. Commissioner of Income Tax, Simla [AIR 1953 Pb. 301]; Messrs. Padam Parshad Rattan Chand of Delhi v. Commissioner of Income Tax, Delhi [AIR 1954 Pb. 188] and B. N. Dheer & Sons v. Commissioner of Income Tax, Delhi [AIR 1958 Pb. 463]. _______________
PRINCIPLE OF APPROBATE AND REPROBATE
Guarantee Engineers (Pvt.) Ltd. v. Federation of Islamic Republic of Pakistan through Secretary, Ministry of Finance, Islamabad and another – [2000] 82 TAX 131 (H.C.Lah.) 361.
Principle of approbate and reprobate explained.
Mere reading of sub-clause (2) of clause 54* clearly reveals that petitioner has to pay income tax in accordance with the prevailing Income Tax Law of the Government of Pakistan, therefore, petitioner is estopped to agitate the matter before High Court on the well-known principle of approbate and reprobate as per rule laid down by the Hon‟ble Supreme Court in Ghulam Rasool‟s case (PLD 1971 SC 376). The petitioner wants enforcement of contract, through constitutional jurisdiction which is not permissible as per principle laid down by the Hon‟ble Supreme Court in the following judgements:PLD 1958 SC 267 (The Chandpur Mills Ltd. v. The District Magistrate, Tippera etc.) PLD 1962 SC 108 (Messrs Momin Motors Co. v. The Regional Transport Authority, Dacca etc.). 1999 YLR 950 (Muhammad Insar etc. v. Administrator, Town Committee, Kabirwala and 4 others). _______________
* This is subsection (2) of section 54 of the Contract Act (IX of 1872)
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HIGH COURT IS COMPETENT TO ENTERTAIN WRIT WHERE INTERPRETATION OF LAW IS INVOLVED
Bank of Punjab v. Federation of Pakistan – [2000] 81 TAX 390 (H.C.Lah.) 362.
High Court is competent to entertain writ where interpretation of law is involved.
The fate of this case turns upon the interpretation of section 53(b) of the Income Tax Ordinance, 1979 and the said dispute can very well be decided by this Court in the exercise of its constitutional jurisdiction without insisting that the petitioner should follow the remedies provided by the Income Tax Ordinance, 1979. Furthermore, it appears that the Deputy Commissioner of Income Tax was influenced by Circular No. 13 of 1997 issued by the Central Board of Revenue which had been declared as without lawful authority by this Court. In view of what has been said above, this petition is allowed, the impugned order of the Deputy Commissioner of Income Tax to the extent it disallowed the petitioner to deduct the tax paid by it under section 50 of the Income Tax Ordinance, 1979 while computing the payment of advance tax payable under section 53, is declared to be without any lawful authority and of no legal effect. _______________
GENERAL RULES IN RESPECT OF WRIT PETITION
Chairman, Central Board of Revenue v. Pak-Saudi Fertilizer Ltd. – [2001] 83 TAX 119 (S.C.Pak.) 363.
Petition challenging order under section 53 held to be maintainable.
The petition under Article 199 of the Constitution was maintainable and the learned members of Division Bench of Sindh High Court rightly held so. Commissioner of Income Tax, Karachi & other v. N.V. Philip’s Gloelampenfabriaken, Karachi – 1993 SCC 1022 = [1993] 68 TAX 35 (S.C.Pak.) 364.
Conditions for maintainability of writ petitions explained.
“………We may now revert to the question, whether the appellant was justified to file above constitutional petition against the order of the Tribunal instead of invoking section 136 of the Ordinance for making
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a reference to the High Court. According to Mr. Rehan Naqvi, a reference under the above provision would not have been adequate and efficacious remedy as it would have taken years before it could have been heard. The same could be true for a onstitutional petition. The tendency to bypass the remedy provided under the relevant statute and to press into service constitutional jurisdiction of the court has developed lately which is to be discouraged. However, in certain cases invoking of constitutional jurisdiction of the High Court instead of availing of remedy provided for under the relevant statute may be justified, for example when the impugned order/action is palpably without jurisdiction and/or malafide. To force an aggrieved person in such a case to approach a forum provided for in the relevant statute may not be just and proper. H.M. Abdullah v. Income Tax Officer Circle V, Karachi & 2 others – 1993 SCC 1018 = [1993] 68 TAX 29 (S.C.Pak.) 365.
Constitutional circumstances.
jurisdiction
only
in
extraordinary
Income Tax Ordinance is a complete code in itself which creates rights in favour of an assessee and in certain circumstances in favour of the Revenue as well, and also provides remedy for redress of the grievances of the aggrieved party. In every tax case, constitutional jurisdictions as an alternate remedy in terms of Article 199 of the Constitution cannot be availed. Reference in this connection may be made to the following observations appearing in Commissioner of Income Tax, Companies II, Karachi & others v. Hamdard Dawakhana (Waqf) Pakistan 1992 SCC 957 = [1993] 67 TAX 1 (S.C.Pak) = PLD 1992 SC 847 at p.861: “In cases where any party resorts to statutory remedy against an order he cannot abandon or bypass it without any valid and reasonable cause and file constitutional petition challenging the same order. Such practice, in cases where statute provides alternate and efficacious remedy up to High Court, cannot be approved.”
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Shagufta Begum v. Income Tax Officer, Circle XI, Zone B Lahore – 1989 SCC 715 = [1989] 60 TAX 83 (S.C.Pak.) 366.
Writ jurisdiction can be invoked in cases of mala fides action by the departmental authorities.
In case of mala fides, particularly when the allegation, is that the departmental authorities on account of political or other reasons would either be not free to decide correctly or on account of their own departmental compulsion be prejudiced in rendering a particular verdict, writ jurisdiction under Article 199 is the appropriate remedy. 367.
Extraordinary jurisdiction is not necessarily a speedy remedy.
In practice it takes longer time for disposal of writ petitions than departmental appeals. For example in this very case the writ petition was filed in September 1984. About five years have passed but the matter has not yet been disposed of. This has happened despite the dismissal of the writ petition in limine. Had it been admitted to hearing it might have taken much longer period to reach the Supreme Court. It is accordingly in the interest of litigants themselves first to choose the speedier remedy with the Department Authorities and thereafter if needed they can invoke the extraordinary jurisdiction of the High Court. Hafiz Muhammad Arif Dar v. Income Tax Officer – 1988 SCC 710 = [1989] 60 TAX 52 (S.C.Pak.) 368.
The assessee has other options like filing a complaint with Ombudsman.
In case the petitioner has not allowed any relief by the departmental authorities (despite the observations by the Supreme Court) the petitioner would have no immediate remedy at all against the highhandedness of the department. In such circumstances amongst other remedies, he can file a complaint/grievance application before the Federal Ombudsman, who can provide effective redress. Muhammad Khan v. Shamsuddin and others – 1969 SCC 319 = [1975] 31 TAX 94 (S.C.Pak.) 369.
Order passed without giving opportunity of being heard is not sustainable.
On merit the point raised in the writ petition falls within the principle laid down by this Court, in the case of Dina Sohrab Katrak [PTD (1959) S.C. 45]. The order of the Provincial Government setting aside the sale without hearing the appellant cannot be upheld.
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As a result the appeal is allowed. The judgment of the High Court is set aside and it is declared that the order dated the 5th July 1955, passed by the Government of Sindh, was passed without lawful authority. Respondent No. 4, the Province of West Pakistan, is directed to dispose of the applications for setting aside the sale filed by respondent Nos. 1 to 3 after notice to the appellant. Parties are directed to bear their own costs. Pakistan Electric Fittings Manufacturing Co. Ltd. through Directors v. Commissioner of Income Tax and 2 others – [2000] 82 TAX 135 (H.C.Lah.) 370.
No time limitation for illegal orders.
The principle of law that orders in contravention of mandatory provisions of law are a nullify and no limitation runs against such orders seems well settled; in this respect reference is invited to Khawaja Muhammad v. Marduman Babar Kahol 1987 SCMR 1543; also see Ali Muhammad v. Hussain Bakhsh PLD 1976 SC 37. Islamuddin and 3 others v. The Income Tax Officer and 4 others – 2000 PTD 306 371.
Remedies not availed disentitles the party from relief if constitutional petition also fails.
It is also an established principle of law that when the petitioner failed to avail himself of the remedies available to him under any statute he would have no locus standi to file a Constitutional petition in the High Court to challenge the legality and validity of the orders. Kawther Grain (Pvt.) Ltd. v. Deputy Commissioner of Income Tax, Gujranwala – [1999] 80 TAX 262 (H.C.Lah.) 372.
High Court can exercise constitutional jurisdiction in a case where alternate remedy is only illusory in its nature and on the face of order it is clearly misapplication of law.
As far the maintainability is concerned, I will agree that the assessment order in question on the face of it is a clear case of misapplication of law. Reliance of the learned counsel in this regard re: Jullien Hoshanj Dinshaw Trust (supra) is relevant and pertinent. I will also agree that the alternate remedy in the facts and circumstances of the case is only illusory in nature. In such situation the apex Court in re: Collector of Customs v. S.M. Ahmed & Company (supra) approved the exercise of Constitutional jurisdiction by this Court. Learned counsel is correct in pointing out that the Central Board of Revenue having adopted the stated interpretation of the
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provisions in question no Officer in the hierarchy in all probability would show indulgence for the petitioner. Cases referred to: Messrs Hirjina & Co. (Pakistan) Ltd. v. Commissioner of Sales Tax Central, Karachi (1971) 23 Tax 230 (S.C.Pak.) = (1971 SCMR 128); Muhammad Younus v. Central Board of Revenue Government of Pakistan and others (PLD 1964 SC 113); Nagina Silk Mill, Lyallpur v. Income Tax Officer (1963) 7 Tax 442 (S.C.Pak.) = (PLD 1963 SC 322); Messrs Julian Hoshang Dinshaw Trust and others v. Income Tax Officer (1992) 65 Tax 102 (S.C.Pak.) = (1992 SCMR 250); EduIji Dinshaw Limited v. Income Tax Officer (1990) 61 Tax 105 (S.C.Pak.) = (PLD 1990 SC 399); Collector of Customs, Customs House Lahore and 3 others v. Messrs S.M. Ahmad & Company (Pvt.) Ltd. Islamabad (1999 SCMR 138); Adamjee Insurance Company Ltd. v. Pakistan (1993) 68 Tax 176 (S.C.Pak.) = (1993 SCMR 1998); Government of Pakistan v. Hashwani Hotel (PLD 1990 SC 68); Trust Ceramics Industry v. Deputy Collector CE & LC. (1991 SCMR 138); Star Vacuum Bottle Manufacturing Company v. Collector of Customs (PLD 1972 Karachi 210); H.M. Abdullah v. Income Tax Officer (1993) 68 Tax 29 (S.C.Pak.) = (1993 SCMR 1195); Nagina Dal Factory v. The Income Tax Officer (1968 SCMR 1035); Steel Brothers & Co. v. C.B.R. (1969) 19 Tax 97 (S.C.Pak.) = (1968 SCMR 374).
Hazoor Bakhsh v. Senior Superintendent of Police, Rahimyar Khan and 12 others – PLD 1999 Lahore 417 373.
Writs held to be maintainable vis-a-vis doctrine of exhaustion as no bar.
While parting with this order we are inclined to reiterate that rules enunciated above, flow from doctrine of exhaustion as embodied in Article 199 of the Constitution. It is hardly necessary to reiterate that this doctrine does not absolutely bar the jurisdiction of this Court to adjudicate such petitions if other remedies are available against the impugned orders/grievance. If the Court comes to the conclusion that the orders/proceedings/actions of functionaries of State under attack are in excess of authority or totally destitute of authority it had power to come to the relief of the affected party in exceptional circumstances. Doctrine of exhaustion is regulatory in nature. In highly exceptional circumstances this Court definitely will come to the rescue of the affected party as pointed out by a celebrated Judge Mr. Justice Aftab Hussain in Haji Muhammad v. Khizar Hayat PLD 1977 Lah. 424. See Qamar-uz-Zaman v. Zila Council Bahawalpir 1990 MLD 1748. Gatron (Industries) Ltd. v. Government of Pakistan and others – PTCL 1999 CL. 359 = 1999 SCMR 1072
The rule about invoking the constitution jurisdiction only after exhausting all other remedies, is a rule of convenience and discretion
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by which the Court regulates its proceedings and it is not a rule of law affecting the jurisdiction. A constitution petition is competent if an order is passed by a Court or Authority by exceeding its jurisdiction even if the remedy of appeal/revision against such order is available, depending upon the facts and circumstances of each case. Tri Star Industries (Pvt.) Ltd. & 8 others v. Commissioner of Income Tax Companies-I, Karachi & 5 others – [1999] 79 TAX 255 (H.C.Kar.) = 1998 PTD 3923]
Keeping in view the allegations of the plaintiffs as levelled in the plaint and for the facts and law stated hereinabove, I am of the considered view that in the peculiar circumstances of this suit, the jurisdiction of this Court is not barred. For this view, I am fortified by the observations made in the case of Al-Ahram Builders (supra), also reported in (1993 SCMR 29) where at page 38/39 it was held that „in certain cases invoking of Constitutional jurisdiction of the High Court instead of availing of remedy provided for under the relevant statute may be justified, for example when the impugned order/action is palpably without jurisdiction and/or mala fide. To force an aggrieved person in such a case to approach the forum provided under the relevant statute may not be just and proper‟. Mrs. Tahmina Daultana v. Hafiz Naeem-ud-Din – (1997) 75 TAX 261 (H.C.Lah.) = 1997 PTD 821
I have give my anxious consideration to the arguments addressed at the Bar. No doubt the petitioner directly approached this Court without availing the rights of appeal, revision and reference etc. as provided under Chapter VI of the Act, the present writ petition was still maintainable as in such circumstances where the efficacious and speedy remedy was not available the writ petitions are maintainable. Reliance is placed on Premier Cloth Mills v. Sales Tax Officer (1974) 29 Tax 199 (S.C.Pak = PLD 1972 SC 257 and Nagina Silk Mills Ltd. v. Income Tax Officer and another (1963) 7 Tax 442 (S.C.Pak) = PLD 1963 SC 322. It is very clear from the impugned notice that the respondent had under Tax. Recovery Rules framed under subsection (5) of section 93 of Income Tax Ordinance, 1979, further proceeded to direct that the petitioner shall not sell or deal with any property belonging to her except with the permission in writing to that effect granted by the
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Tax Recovery Officer. It is clear from the contents of the notice impugned that prejudice in fact was caused to the petitioner and a legal right to appeal which was available to her and which was to be notified to her in Form-C, format of notice under section 30 of the Wealth Tax act, was infringed. The provision of section 45-A of Wealth Tax Act, 1963 do not cure the irregularity or omission on the part of the respondent in not issuing the notice in the format prescribed under Wealth Tax Act, 1963, resulting in substantial prejudice to the petition. In view of the above the notices issued to the petitioner under section 85 of Income Tax Ordinance, 1979 on 29.4.1995 for payment of tax assessment at Rs.1,10,301 for the year 1993-94 and Rs.1,02,138 for the year 1994-95 and notice under section 93(2) of the said Ordinance for payment of assessed amount under section 93(2) thereof are declared to be without lawful authority and without any effect against the petitioner.” Gulistan Textile Mills Ltd. v. Central Board of Revenue, etc. – [1994] 70 TAX 272 (H.C.Kar.)
While it is true that where alternative remedy is provided by a statute those remedies should first be resorted to before seeking relief under Article 199 of the Constitution, in cases where an action is alleged to be mala fide or is obviously without jurisdiction or where vires of legislation is in question, the petition under Article 199 would be maintainable. Car Tunes v. Income Tax Officer etc. – [1989] 59 TAX 115 (H.C.Kar.)
The learned counsel for the respondent, however, very vehemently argued before us that mere issuance of notice could not furnish any ground to the petitioner to approach this Court in its constitutional jurisdiction as the Income Tax Ordinance 1979 provided adequate and efficacious remedy in this regard which should have been exhaust by the petitioner before approaching this Court. Although detailed reasons are not given in the above quoted order but it is quite clear that existence of another remedy under the relevant law was not considered as a bar for issuance of direction under Article 199 of the Constitution. It cannot be denied that interference of notice can be made by this Court in exercise of its constitutional jurisdiction where the proposed action lacks jurisdiction on the part of authority
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initiating the action or on the basis of admitted facts the action proposed by the authority is shown to be unsustainable in law. We have already reached the conclusion in this case that the notice dated 11.4.1987 issued by the successor Income Tax Officer is based merely on a change of opinion which could not in law justify reopening of the case under section 65 of the Income Tax Ordinance. In these circumstances no useful purpose will be served by allowing the continuation of proceedings in pursuance of the aforesaid before the hierarchy of Income Tax Department. We accordingly accept this petition and declare the notice dated 11.4.1987 issued by the respondent as without authority. Case referred to: Civil Appeal No. 5-K of 1986, dated 16.5.1988 (S.C.).
Abdul Hamid & Others v. Deputy Collector Excise & Taxation – [1988] 57 TAX 14 (H.C.A.J&K)
Ordinarily a person aggrieved of an order of a statutory authority under the Income Tax Ordinance, must avail of himself the remedies provided in the Ordinance and he is not entitled to by pass those remedies and seek Civil judicial review of the said, right away when the order was passed by the authority, in exercise of the powers vested in him but if the order sought to be reviewed or quashed, was passed by the said authority without jurisdiction or in exercise of a colourful jurisdiction or the spirit of natural justice was violated or the order was passed without providing an opportunity of being heard to the aggrieved person and it was patently illegal and no adequate remedy was available against it, the relief sought for by way of writ petition, cannot be refused. Hussain Sugar Mills v. Islamic Republic of Pakistan – [1981] 44 TAX 59 (H.C.Kar.)
It is now a settled law that the jurisdiction of this Court under Article 199 is always available to the party in cases where the impugned orders are without lawful authority, partial, unjust and mala fide even in cases where alternate remedy by way of appeal etc., is available.
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International Body Builders v. Sales Tax Officer, Lahore – [1980] 41 TAX 60 (H.C.Kar.)
It is also now well established that it is a rule of practice and not of law for this court to entertain a petition despite the fact that another remedy was available. The question to be considered in all such cases is whether the remedy available under the law is adequate, efficacious, speedier and shall provide a petitioner with the relief claimed? Abdul Hameed Awan v. Tax Recovery Officer-04 Coys Zone, Income Tax Building at Rawalpindi and 3 others – [1997] 76 TAX 238 (H.C.Lah.) = 1998 PCTLR 440 = 1998 PTD 874 (H.C.Lah.) 374.
Writ cannot be converted into appeal under section 136.
The learned counsel for the petitioner in reply has submitted that this writ petition be converted into a reference under section 136 of the Income Tax Ordinance, 1979. I am afraid this cannot be done firstly because the last order passed by the Income Tax Appellate Tribunal on review petition was made on 14.11.1993 and the reference was required to be filed within 90 days of the date of original decision of the Tribunal which was rendered on 3.4.1991. However, instead of availing a proper remedy under section 136 of the Income Tax Ordinance, the petitioner opted to move a miscellaneous application against the decision of the Appellate Tribunal. This would hardly justify the conversion of this writ petition to a reference which has now been patently and hopelessly time-barred. Even otherwise all the factual and legal issues have been thoroughly thrashed at the level of Income Tax Appellate Tribunal and the learned counsel for the petitioner has not been able to show me any material from which a question of law may be framed under section 136 of the Income Tax Ordinance. Needless to say that the reference in the High Court is to be dealt with by a Division Bench if at all it is to be preferred. Tharparkar Sugar Mills Ltd. v. Federation of Pakistan through Secretary, Revenue Division and Chairman, C.B.R., Islamabad and another – [1996] 73 TAX 215 (H.C.Kar.) 375.
Interim relief in the form of release of goods on furnishing of indemnity bond held reasonable.
Per Amanullah Abbasi, J. - The arguments and contentions of the petitioner and respondents have been examined. According to respondents SRO 484(I)/92 allows exemption from Customs duty and
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Sales Tax to machinery imported during the period commencing from 1st December 1990 and ending on 30.6.95. The value and rate is determined as on the date the manifest is delivered and bill of entry is field. This SRO cannot be made applicable to the goods which arrived after 30.6.1995. The goods of petitioner arrived on 30.6.1995 and manifest was filed after 30.6.1995 after the expiry of SRO 484(1)192. Accordingly it can be said that benefits of SRO 484(I)/92 were available in all cases where import General Manifest was filed prior to 30.6.1995 and bill of entry was also submitted before this date. There is_ a dispute of few days Only and according to petitioner delay was caused because of political victimization otherwise he was entitled to benefits of SRO 484(I)/92. The counter affidavit filed by Mr. Ahmed Mujtaba Memon Asstt Collector Customs mentions that duty is chargeable on standard rate of duty/taxes. It is stated that vessel arrived on 30.6.1995 but ft has not been clarified in the affidavit as to how much amount is payable by petitioner. The petitioner wants the machinery for installation as allowed and the respondents want duty/taxes. The amount is not mentioned. The learned advocate for the petitioner has submitted that vested rights were created because all contracts were prior to 30.6.1995. In similar cases to Hon‟ble Supreme Court and Lahore High Court following the order of Supreme Court in Petition No. 695-L/1995 dated 11.2.1996 we order that the machinery in question be released to the petitioner on furnishing of indemnity bond to the satisfaction of Collector of Customs, Karachi. The petition may be fixed for regular hearing within three months. Per Dr. Ghous Muhammad, J. - In view of these facts as also because of the reason that the Government of Pakistan, Finance Division, (Investment Wing) in 2 letters attached as Annexures C-1 and E-3 has confirmed that any delay is not attributable to the sponsors/petitioners and that the petitioner‟s project has been politically victimized, I have come to the conclusion that the petitioner has a prima facie case which warrants further probe and analysis and it would be very unreasonable to deny interim relief in the form of release of goods till disposal of the petition, especially because the petition already stands admitted on this score vide admission orders of any other bench dated 17.12.1995. Cases referred to: Associated Trading Co. Ltd. v. C.B.R. (PLD 1987 Kar 63); Al Samrez Enterprise v. Federation of Pakistan (1986 SCMR 1917); lnayat Hussein v. Union of India (1980) 122 ITR 227; Guilstan Textile Mills v. Federation of Pakistan (1994) 70 TAX 272 (H.C.Kar.) = (1994 PTD 581); Kamran Industries v. Collector of Customs (1995) 72 TAX 223 (H.C.Kar.) = (PLD 1996 Kar. 68); Usmania Glass Sheet Factories Ltd. v. Assistant Collector Customs (1966) 14 TAX 176 (H.C.Dacca) = (PLD 196 Dacca 276);
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Inter Ocean Cargo Services Karachi v. Federation of Pakistan (1992 PTD 1411); Nasir Flour Mills (Pvt.) Ltd., Karachi v. Federation of Pakistan (1994 PTD 1421); International Tea Traders v. Federation of Pakistan (1994 PTO 1422); Pakistan Paper Products v. Income Tax Officer; Mansoor Ali v. Federation of Pakistan; Abdul Cadir Adam Saedat v. Federation of Pakistan; S. Abdullah & Co. v. Collector of Customs (PLD 1992 Kar. 258); Salochistan Textile Mills Ltd. v. C.B.R. (1984 CLC 2192); Molasses Trading v. Federation of Pakistan (1993 SCMR 1905); M.Y. Electronics Industries (Pvt) Ltd. v. Govt. of Pakistan (1994 SCMR 2123); Trustees of Port of Karachi v. Manzoor Sans Corporation (1993 SCMS 69) and Ashique Hussain v. The State (PLD 1994 SC 879).
Metro Shipbreakers and another v. Pakistan through the Secretary, Ministry of Finance, Islamabad, etc. – [1996] 73 TAX 85 (H.C.Queeta) 376.
Constitutional jurisdiction cannot be invoked to enforce the rights which were not in existence at the time when the offending enactments were passed.
In the light of what has been discussed above, It can be safely inferred that the import fee was legally charged from the petitioner at the relevant time when Letter of Credit was opened in view of the Provisions as contained in Import Fee Order, 1993, which have nat been challenged. Since the facts of C.P. No. 261 of 1994 C.P. No. 262 of 1994, and C.P. No. 193 of 1994 are common and law points involved are also similar and indentical, therefore all the petitions are disposed of by this common judgment and keeping in view the above discussion being devoid of force merit dismissal. Kamran Industries, Karachi v. Collector of Customs (Exports) Karachi and Others – [1995] 72 TAX 223 (H.C.Kar.) 377.
Statutory period for filing the revision petition has long expired - Whether petitioner could non-suit only on the ground of maintainability - Held no.
We feel that the facts and circumstances of this case would not justify us to dismiss the petition only on grounds of maintainability. Considering that his view of the recovery drive the alternate revisional remedy was hardly efficacious. Also of this stage, once the petition has already been admitted if we were to non-suit the petitioner only on grounds of maintainability the petitioner would be left without any remedy since the 30 day statutory period for filing the revision petition under section 196 of the Customs Act has long expired. We accordingly held that the petition is maintainable also because it appears to be a point of first impression which has to be decided as to
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whether the Customs authorities have any jurisdiction to question into the valuation and scrutinize the description of the goods imported into the EPZ. Cases referred to: S.M. Anwar Sethi v. South British Insurance Co. Ltd. (PLD 1975 Kar. 458); Barkat Ali v. The State (PLD 1973 Kar. 659); Mst. Safia Begum v. Mst. Malkani and another (PLD 1965 Lah. 576); Akbar Ali v. Ehsan Elahi (PLD 1980 Lah. 145); Government of Pakistan v. Moulvi Ahmad Saeed (NLR 1982 Rev. 217); Muhammad Sarwar v. Fazal Rehman (1982 CLC 1286); Sardar Ghulam Nabi Khan v. Azad Government of State of Jammu and Kashmir (1984 CLC 325); Eastern Rice Syndicate v. C.B.R. (PLD 1959 SC Pak. 364); The Collector, Central Excise and Land Customs, Chittagong v. lmdad Ali (1969) SCMR 708) Latif Bors. v. Deputy Collector Customs, Lahore (1992 SCMR 1083) and Mst. Zainab v. Kamal Khan (PLD 1990 SC 1051).
Basharat Ali and another v. Deputy Superintendent, Central Excise and Sales Tax, Mananwala Circle, Sheikhupura [1995] 72 TAX 218 (H.C.Lah.) 378.
If remedy provided under the law is not efficacious and speedy petition is maintainable.
No doubt the remedy of appeal and revision was provided under Sales Tax Act, 1990 but whether the same was efficacious also is to be seen in the circumstances of the writ petitions. I am of the view that the remedy provided under the law was not efficacious and speedy so far as the carriers were concerned. Cases relied on: Premier Cloth Mills v. S.T.O. (1972 SCMR 257) = (1974) 29 TAX 199 (S.C.Pak.); Salah ud Din v. Friends Sugar Mills (PLD 1975 S.C. 244) and Nagina Silk Mills v. Income Tax Officer, etc. [1963] 7 TAX 442 (S.C.Pak.) = (PLD 1963 S.C. 322).
Gulistan Textile Mills Ltd. v. Central Board of Revenue, etc. – [1994] 70 TAX 272 (H.C.Kar.) 379.
Writ petition admitted to regular hearing to consider the vires of legislation, demand could be stayed.
In the circumstances, we are of the opinion that the petition having been admitted to regular hearing, it is necessary that further action not recovery of the amount mentioned in the application be stayed. We, therefore, direct that no further action will be taken for recovery of the tax on account of profits on sales of assets, to the extent of Rs.66,98,424/- subject to the petitioner furnishing security to the satisfaction of the Nazir of this Court to the extent of that amount plus profits thereon @ 24% per annum from the date of demand till payment.
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Saleem and Co. v. Income Tax Authorities – [1993] 68 TAX 173 (H.C.Lah.) 380.
Exemption of assessee from payment of Income Tax was refused by the Income Tax Authorities - High Court set aside the order of refusal of exemption and remitted the cases of assessee for decision according to law with the consent of parties and with a view to avoid delay.
As against the arguments addressed by the learned counsel for the petitioners, Mr. Muhammad Ilyas Khan, Advocate learned counsel for the respondents has contended that in Writ No. 404 of 1990 case of the petitioner Nos.1 and 2 has been decided so far whereas the case of other petitioners in still pending adjudication with respondent No. I and, therefore, in order to avoid the piecemeal decision of the matter in issue, the respondents have no objection to the acceptance of both the writ petitions and setting aside of the impugned order and remission of the cases of the petitioners to respondent No.1 for decision thereof in accordance with law. Learned counsel for the petitioners has accepted the offer made by the learned counsel for the respondents and has stated that in view of the apprehension of the petitioners that decision of the cases shall be delayed, the period of one month may be fled for decision of the cases of all the petitioners. Learned counsel for the respondents has no objection to the fixation of the period of one month for decision of the cases. Resultantly, we accept both the writ petitions, set aside the impugned orders and remit the cases of the petitioners which have been decided and direct that their cases as well as the cases of other petitioners which have not been decided as yet and which are pending adjudication shall be decided within a period of one month w.e.f. today. The assessment of income tax as against the petitioners shall not be finalised till disposal of the cases by respondent No. 1. It is observed, however that in case the petitioners are not satisfied after the matter is finally decided by the respondents, they shall be at liberty to move this Court again. Eastern Poutry Services v. Government of Pakistan and others – [1993] 68 TAX 171 (H.C.Kar.) 381.
Respondent‟s contention that stay shall not be granted unless the prescribed Law Officer has been given notice of the application and an opportunity of being heard - Whether argument was without merit - Held yes.
He submits that stay cannot be granted in view of the provisions of Article 199(4) of the Constitution. The argument is without merit.
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Article 199(4) provides that stay shall not be granted unless the prescribed Law Officer has been given notice of the application and an opportunity of being heard. Such notice and opportunity have been given in this ease. Muhammad Ismail v. Income Tax Officer, Mirpur and 2 others – [1992] 66 TAX 226 (H.C.AJ&K) 382.
Extra-ordinary jurisdiction of the High Court could not be invoked without first availing the remedies available under the relevant law.
Even a right of appeal has been given before the Supreme Court. Any person who is affected by the order of any authority, first of all, has to seek remedy under the relevant law on the subject. The extraordinary jurisdiction of this Court could be invoked only in cases where efficacious and alternate remedy is not available. No party can be allowed to avail writ jurisdiction without first availing the remedies available to it under the relevant law. As said in the early part of the order, the right of appeal under section 129 was available against the order of Income Tax Officer dated 20.9.1989. The petitioner had not availed this remedy. Therefore, under these circumstances, the order of assessment passed by the Income Tax Officer had attained finality. Siddique Trust v. Income Tax Officer and another – (1987) 56 TAX 120 (H.C.Kar.) 383.
Stay granted could not be given beyond six months.
Operation of notices under sections 56 & 61. Stay granted for extension of short period could be given beyond six months cannot be held. Cases referred to: (PLD 1960 Kar. 174); (PLD 1975 Lah. 7); (PLD 1982 Lah. 452); (PLD 1973 SC 589); (AIR 1949 FC 135); (AIR 1962 Bombay 92); (AIR 1981 SC 1284); (AIR 1960 SC 56); (PLD 1965 SC 479); (PLD 1971 SC 242); (PLD 1970 Kar. 179); (PLD 1973 Kar. 383); (PLD 1981 Kar. 123); (PLD 1979 SC 44).
Hamdard Dawakhana (Waqf) v. Commissioner of Income Tax, etc. – [1987] 56 TAX 78 (H.C.Kar.) 384.
High Court can grant stay of recovery of tax.
Since another Division Bench of this Court by an order dated 5.3.1937 passed in Constitution Petition No. D-69 85 in an identical writ petition filed by the present petitioner has granted the stay subject to furnishing security in respect of the tax amount, we would grant the
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stay but subject to furnishing bank guarantee of the amounts involved in three writ petitions (either a joint bank guarantee or three separate bank guarantees) within a month and thereafter the above petition as well as the other connected petitions be fixed for regular bearing as Case. No. 1. Muhammad Hanif Monnoo v. Income Tax Officer Central Circle 1, Lahore – [1984] 50 TAX 37 (H.C.Lah.) = PLJ 1984 Lah. 423 385.
Exercise of jurisdiction of high Court is confined only to consideration whether authority had acted with or without jurisdiction.
There is no cavil with the proposition that where the question of jurisdiction of the authority passing the impugned order is raised, the remedy of appeal is not an adequate remedy and in such cases the constitutional jurisdiction can be invoked. The exercise of jurisdiction is, however, confined only to consideration whether the authority had acted with or without jurisdiction. The precedents cited at the Bar by the learned counsel for the petitioner, on closer examination, have been found to be not applicable to the facts of the present case. The scope of interference in this case, under Articles 9 of the Provisional Constitution order is, therefore, limited to the inquiry, whether the Income Tax Officer had definite information on the basis of material on record or he had already obtained previous approval of the Inspecting Assistant Commissioner, If the answer in the affirmative, this Court will stay its hand and will not substitute its belief for that of the Income Tax Officer. If the answer is in the negative, an appropriate writ may be granted. Case referred to: Paramount Electric Company, Lahore v. Commissioner of Income Tax, Lahore Zone [1974] 29 Tax 77 (H.C.Lah.); Begum Nusrat Bhutto v. Income Tax Officer, Circle V, Rawalpindi [1980] 42 Tax 59 (H.C.Lah.); Escorts Limited v. Income Tax Officer, Lahore [1975] 31 Tax 164 (H.C.Lah.)
Julian Hoshang Dinshaw Trust v. Income Tax Officer, Circle XVIII, South Zone, Karachi and two others – [1981] 43 TAX 92 (H.C.Kar.) = 1981 PTD 53 386.
Where alternate and equally efficacious remedy is available, the petitioner is not entitled to invoke extraordinary jurisdiction of the High Court by way of writ petition.
The petitions are not competent under Article 199 of the Constitution as the petitioners have other alternate and equally efficacious remedy, the learned counsel for the respondents is on much firmer ground. In
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the first two petitions the petitioners have still an opportunity to raise their plea before the Income Tax Officer and in case of an adverse decision file an appeal before the Appellate Tribunal and eventually the matter can come up before the High Court in a reference under section 136 of the Income Tax Ordinance. Cases referred to : Burmah Oil Co. v. Trustees of the Port Trust, Chittagong (PLD 1962 SC 113); Bashir Co. v. Income Tax Officer (1968 SCMR 997); Habib Ahmad v. Income Tax Officer (1972 SCMR 631) and Colony Textile Mills Ltd. v. Income Tax Appellate Tribunal (PLD 1971 Lah. 861). Judicial Review: OVERRULED by the Supreme Court of Pakistan in 1993 SCC 777 = (1992) 65 Tax 102 = 1992 SCMR 250 = PTCL 1992 CL 181.
Highway Petroleum Service (Regd.), Lahore v. Islamic Republic of Pakistan and another – [1977] 36 TAX 8 (H.C.Lah.) = 1977 PTD 183 = 1977 PLD 797 387.
Provisions of the Income Tax can be challenged constitutional grounds inspite of alternate remedies.
on
The learned counsel for the petitioners has submitted that there is no right of appeal against the impugned orders and that a revision or reference is no right of a litigant. Further, that as the impugned provisions are being challenged on constitutional grounds, inspite of alternate remedies, the petitioners have a right to challenge the same by means of a petition under the Constitution and that, lastly, since the questions raised in these petitions relate to the challenge of the provisions in the Income Tax Act. It would not be possible for the authorities created by the Income Tax Act itself, to declare the same to be invalid. It is submitted that a Court interpretation the Constitution finally is an appropriate forum to raise the questions. The submission is obviously sound and is sustained. U.C. Rekhi v. First Income Tax Officer – [1950] 18 ITR 618 (Punj.) 388.
Where there has been suppression of material/facts, writ of prohibition cannot be issued.
A writ of prohibition is issued only where there is something done in the absence of jurisdiction or in excess of jurisdiction. Thus, where there had been suppression of material facts in the affidavit which was filed by the petitioner, the court would refuse a writ of prohibition without going into the merits of the case.
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Singer Sewing Machine Co. v. Commissioner of Income Tax and others – [1964] 9 TAX 273 (H.C.Kar.) = 1964 PTD 554 389.
In writ court cannot assume jurisdiction of income tax department.
Exercise of extraordinary jurisdiction is not called for even where relief ought to be granted on ascertainment of facts as High Court cannot assume functions of Income Tax Authorities. Judicial Review: OVERRULED BY - The Supreme Court of Pakistan in 1965 SCC 234 = [1965] 11 TAX 364 (S.C.Pak). Their Lordships observed: “. . . That such a proceeding in revision would be a judicial proceeding and not merely departmental affair. The power of revision has to be exercised, according to judicial principles. The provision of section 33A(2) apparently envisages a remedy alternative to a regular appeal from assessment. In the circumstances, it became the duty of the Commissioner to grant relief if the entitlement was clear. The learned Commissioner apparently misdirected himself in holding that he had no power to interfere in the matter.” “. . . All these factors go to establish the bona fides of the assessee-company in claiming that the assessment in question was not appealed against, owing to misapprehension of the correct position. The High Court has observed, in this connection, that ignorance of law was no excuse. That may be conceded, but section 33, sub-section (20 provided on alternative judicial remedy to the assessee, of which it availed itself and the relief was denied to it, on an erroneous view of law by the Commissioner. It must be found as a result of the above discussion that the Commissioner declined to exercise his undoubled jurisdiction in the case, on a ground which was legally not supportable. This fact calls for correction of his order. We allow the appeal and quash the order passed by the Commissioner of Income Tax in this case.” _______________
WRIT HELD MAINTAINABLE
Pak-Saudi Fertilizer Ltd. through Managing Director v. Federation of Pakistan through Secretary Finance, Islamabad and 4 others [2000] 81 TAX 119 (H.C.Kar.) = 1999 PTD 4061 390.
Writ is maintainable where order is illegal notwithstanding the availability of alternate remedy.
Though we have held that the impugned order under section 53 is appealable under section 129, we still feel that in the present
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circumstances the petition would be maintainable since the impugned order is completely without jurisdiction and extraneous to the very powers conferred under the 1979 Ordinance on the Assessing Officer. It is settled law that availability of alternate remedies would be no bar to the maintainability of Constitutional petitions where impugned orders are completely without jurisdiction, mala fide, unlawful and of no legal effect. The latest pronouncement of the Honourable Supreme Court in this regard in Gatron (Industries) Ltd. v. Government of Pakistan, 1999 SCMR 1072, which reiterates this principle yet again, and which was earlier echoed by this Court in Kamran Industries v. Collector of Customs PLD 1996 Kar. 68. When it is amply demonstrated that the impugned order is completely without jurisdiction, it would be a travesty of justice, as in the present circumstances, to decline relief as the impugned exercise of power goes to the very root of the jurisdiction. Board of Intermediate & Secondary Education v. Central Board of Revenue, etc. – [1999] 79 TAX 28 (H.C.Lah.) 391.
Writ is the appropriate remedy where order is void and without lawful authority
The instant writ petition has been admitted to regular hearing, therefore, the question of alternative remedy is not available to the respondents. The order on its face is a void order and made without lawful authority. The provision of section 50 and the provision of section 48 of the Income Tax Act on its bare reading explain that it relates to a person who is liable to pay tax in excess of what was required from him. It does not apply to one who is exempted from payment of income tax. Therefore, it was incumbent upon the respondents to see and apply conscious mind to the facts that they had wrongly deducted the income tax on the securities belonging to the petitioner which were admittedly exempted from payment of income tax. When an order is void and made without lawful authority this Court has the jurisdiction to deal with the matters in order to determine the legal rights of the parties. In the instant case admittedly the petitioner on coming to know about the illegal deduction had filed numerous reminders and appeal before the respondents and the limitation of four years as envisaged in section 50 and section 48 of the Income Tax Act was obviously not applicable to the petitioner‟s case. Therefore, it was incumbent upon the respondents to refund the income tax on Securities illegally deducted by them.
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The petitioner was not liable to pay income tax, therefore, was not governed by the provisions of Income Tax Act. He was making hectic efforts but all the respondents were misapplying their mind holding that the claim made by the petitioner is time barred which was not time barred as their original action of illegal deduction of income tax, from tax exempted security, was void ab initio, and arbitrary in nature, was not sustainable in law. Where any authority guided and governed by law exceeds jurisdiction and interferes in any person‟s right by passing a void order, this Court in the exercise of extraordinary jurisdiction can determine the rights of such party against a void order and writ jurisdiction is available to such party. Case referred to: Singer Sewing Machine Company v. Commissioner of Income Tax, Karachi and others (1982 PTD 274) = (1983) 47 TAX 10 (H.C.Kar.); Syed Nazir Hassan v. Settlement Commissioner and another (PLJ 1974 Lah. 598); The Punjab Province v. Federation of Pakistan (PLD 1956 F.C. 72); Adamjee Insurance Company Ltd. v. Pakistan through the Secretary to the Government of Pakistan in the Ministry of Finance, Islamabad and 5 others [1993] 68 TAX 176 (S.C.Pak.) = (1993 SCMR 1798); Wealth Tax Officer and another v. Shaukat Fazal and 4 others [1993] 68 TAX 145 (S.C.Pak.) = (1993) SCMR 1810) and The Commissioner of Income Tax, Karachi and 2 others v. N.V. Philip‟s Gloeilampen Fabriaken, Karachi [1993] 68 TAX 35 (S.C.Pak.) = (1993 PTD 865).
Mst. Fazal Be and 6 Others v. Commissioner of Income Tax – [1996] 74 TAX 141 (H.C.AJ&K) 392.
Where a finding of fact not based on evidence or where material evidence ignored, reference under section 136 is maintainable.
From the perusal of the authority quoted herein before it follows that a finding of fact not based on evidence or where material evidence is ignored a reference to the High Court will be maintainable. Cases referred to: [PLD 1958 (S.C.Ind). 151]; [1974 PTD 207]; [PLD 1976 Lah. 353]; [1962] TAX 239 and [1953] 24 ITR 506.
Tharparkar Sugar Mills Ltd. v. Federation of Pakistan through Secretary, Revenue Division and Chairman, C.B.R., Islamabad and another [1996] 73 TAX 215 (H.C.Kar.) 393.
In case of writ, maintainable.
political
victimization,
petition
is
I would now like to deal with the objection of the learned D.A.G. that the petition is pre-mature and warrants dismissal since no bill of entry has been filed and no assessment or evaluation thereon has been made by the Respondents to examine whether in the first place the
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petitioner is or not entitled to the sought exemption. I am of the view that this objection is not tenable. Article 199 of the Constitution clearly spells out that the High Court in a writ jurisdiction has not only the power to pass a corrective order by curring a defect in an existing order but it also has the power to prohibit a functionary from passing an illegal order. In other words the High Court under Article 199 has squarely the power to pass a prohibitory order of restrain against a threatened action as well. Such interpretation is quite apparent from the language employed in Article 199(1)(a)(i). I am of the view that there is nothing wrong with the course adopted by the petitioner who became aggrieved the moment the subsequent notifications dated 4.10.1995 and 29.10.1995 were issued by the C.B.R. There is every indication that assessment on the bill of entry is a mere formality as is also apparent by the stance taken in the counter affidavit. I, accordingly hold that the petition is not premature while in doing so I may also point out that nowhere in the counter affidavit has this objection been taken. The stance taken by the learned D.A.G. in this regard is quite at variance with the stance taken in the counter-affidavit wherein it had been categorically stated that the petitioner is not entitled to relief under S.R.O. 484. I feel that the courts while granting interim relief in a tax mailer ought to consider that It would be completely against the concept of writ jurisdiction to give such terms to the assessee which would amount to directly or indirectly depositing the demand amount. If the assessee is an identificable person and also holds assets it can be asked not to sell or dispose of that property whereon some lien or charge can be created or otherwise the assessee can be asked to arrange an insurance guarantee to the satisfaction of Nazir of the Court according to the directions given by the Hon‟ble Supreme Court in Trustees of Port of Karachi v. Manzoor Sons Corporation (1993 SCMR 69). I have also noticed that in income tax matters since the assessees are associated with the exchequer not only in a one-off transaction the courts have been willing to grant unconditional stays. In the end a lot would depend upon the facts and nature of each individual case and the above are only some guidelines. Although I was inclined to direct release of goods upon submission of an insurance guarantee to the satisfaction of Nazir and/or upon an undertaking of the petitioners that till disposal of the petition the factory shall not be sold, however, in identical petitions the Lahore High Court in W.P. No. 1174/95 and W.P. No. 1221/95 has granted an interim relief by directing the Respondents to release goods in terms of S.R.O. 484 subject to the petitioner furnishing an indemnity bond
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for the disputed amount, interestingly, in another identical mailer the Lahore High Court directed the petitioner to submit a bank guarantee instead of indemnity bond while on appeal in that matter the Supreme Court through order dated 11.2.1996 in Civil Petition No. 695-L/96 modified the order of the Lahore High Court and directed release of goods on furnishing of indemnity bond to the satisfaction of Collector of Customs. It would not be out of point to cite Ashique Hussain v. The State (PLD 1994 SC 879) wherein a full bench of the Supreme Court has sternly admonished the courts below to follow the decisions of the Supreme Court. Accordingly the respondents are directed to release the goods of the petitioners as per list enclosed as annexure F-3 and F-4 (i.e. for goods where contracts are finalized prior to 30.6.1995) of the petition in terms of S.R.O. 484(I)/92 dated 14.5.1992 upon the petitioner submitting an indemnity bond to the satisfaction of the Collector of Customs. In view of the delay occasioned in disposing of the listed interim application we direct the Collector of Customs to comply with the instant order as expeditiously as possible without any further delay. GEC Avery (Pvt.) Ltd. v. Government of Pakistan through C.B.R., Islamabad and 2 Others – [1995] 72 TAX 81 (H.C.Kar.) 394.
In cases involving fiscal rights even if alternate, adequate and effective remedies available to the petitioner, High Court can step in to prevent excess, if any, committed by public functionaries.
The Central Board of Revenue has already issued a circular in this regard indicating a process to be followed by the Assessing Officer while applying the provisions of sub-section (5) of section 80-C of the Ordinance. By working backward, a figure of income is to be first determined, which if taxed at normal rates, would have resulted into a tax liability equal to the presumptive tax paid. Any sum in excess of that amount is to be regarded as unexplained investment with reference to the relevant provisions of section 13. Now, in view of such clear instructions issued by the Board in the said Circular, it cannot be understood what useful purpose would have been served if the assessee had first availed the remedies provided in the Ordinance. Many instances can be found where even the Income Tax Appellate Tribunal has been found to endorse the opinion held by the Board of Revenue. Even otherwise, as has been held by the Supreme court in the case of Julian Hoshang Dinshaw Trust, in cases involving fiscal rights, the superior Courts have always stepped in to prevent excess,
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if any, committed by public functionaries. We are, therefore, not inclined to consider the preliminary objection. Cases referred to: Julain Hoshang Dinshaw Trust and others v. Income Tax Officer [1992] 65 TAX 102 (S.C.Pak.) = (1992 PTD 1); Usmania Glass Sheet Factory Ltd. v. S.T.O. [1971] 22 TAX 229 (S.C.Pak.) = (PLD 1971 SC 205) and Edulji Dinshaw v. Income Tax Officer [1990] 61 TAX 105 (S.C.Pak) = (1990 PTD 155).
Hamdard Dawakhana (Waqf) Pakistan v. Commissioner of Income Tax Central Zone, ‘B’ Karachi and another – [1990] 62 TAX 98 (H.C.Kar.) 395.
Writ held maintainable even during the pendency of appeals when demand of taxes was huge and ran into millions and the department was pressing hard for its recovery but orders passed were against the law as held earlier by courts, though for different years.
Before considering the arguments on merit, in the above cases, it will be appropriate to first decide the preliminary objection raised by the respondents regarding maintainability af the above petitions. The Contention of the learned counsel for the respondents is that the petitioner in all the above cases while filing petitions under Article 199 of the Constitution against the orders of Income Tax Officer had also simultaneously filed the departmental appeals which were subsequently decided during the pendency of these petitions and thereafter, the petitioner filed further departmental appeals before Income Tax Appellate Tribunal which are still pending.. It is accordingly contended that the petitioner having opted for availing of the departmental remedy in the cases under the Ordinance, was not entitled to invoke the Constitutional jurisdiction of this Court without having first exhausted all the remedies provided under the Ordinance. We are in respectful agreement with the above observations of the learned Judges of the Division Bench and applying the test laid down in the above case to the present cases, we are of the view that the above petitions cannot be dismissed as not maintainable. Besides, the fact that the controversy involved in the above petitions rests mainly on the interpretation and affect of the Judgments in cage of the petitioner by the Supreme Court, (reported in PLD 1980 SC 84) and that of the Division Bench of this Court in Civil Reference No. 5 of 1966 dated 24.3.1981 with reference to Clause 93 of the Second Schedule to the Ordinance, the admitted position in the cases is that the appeals filed before the Tribunal by the petitioner against the
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order of 1st Appellate Authority in 1986 have not been heard and disposed of as yet and the learned counsel for the department is still unable to state when these are likely to be decided. It is also admitted before us that demand of taxes against the petitioner on account of rejection of their claim for exemption is huge and runs into millions and the department is pressing hard for its recovery and as there is no stay, the petitioner had to agree to pay the same in instalments of ten millions each. We are, therefore, of the view that the departmental appeals of the petitioner pending before the Income Tax Appellate Tribunal since 1986 in the circumstances of the case can neither be treated efficacious nor a speedy remedy so as to dis-entitled the petitioner from invoking the Constitutional jurisdiction of this Court. We, therefore, do not agree with the learned counsel for the department that in the circumstances of the cases, the above writ petitions are not maintainable. Cases referred to: Tripura Modern Bank Ltd. v. Khan Bahadur Khalilur Rehman & 3 others (PLD 1971 S.C. 236); Shagufta Begum v. Income Tax Officer [1989] 60 TAX 83 (S.C.Pak) = (1989 PTD 544); Julian Hoshang Dinshaw Trust v. Income Tax Officer (1981 PTD 53) = [1981] 43 TAX 92 (H.C.Kar.); Nagina Dal Factory v. Income Tax Officer [1968] 18 TAX 1 (S.C.Pak) = (1968 SCMR 1035); Steel Brothers and Company Ltd. v. C.B.R. (1968 SCMR 374) = (1969) 19 Tax 97 (S.C.Pak.); Raja Habib Ahmad Khan v. Income Tax Officer (1972 SCMR 556); Nagina Silk Mills Lyalpur v. Income Tax Officer [1963] 7 TAX 442 (S.C.Pak.); The Income Tax Appellate Tribunal Pakistan (PLD 1963 SC 322); Eruch Maneckji and 2 others v. Income Tax Officer (1979 PTD 461) = (1980) 41 Tax 25 (H.C.Kar.); Utility Stores Corporation of Pakistan Ltd. v. Punjab Labour Appellate Tribunal and others (PLD 1987 S.C. 447); Premier Cloth Mills Ltd. Lyallpur v. STO (1972 SCMR 257) and Husein Sugar Mills Ltd. Raraehi v. The Islamic Republic of Pakistan and another (1981 PTD 169).
Syed Guulam Abbass Shah v. Income Tax Officer, Mirpur and 3 others – [1985] 51 TAX 157 (H.C.AJ&K) 396.
Writ maintainable provided order is unlawful although alternate remedy available to the petition.
Replying to the point whether there is an alternate remedy, Ch. Muhammad Afzal Advocate has referred to me section 30 of the Income Tax Act of 1922 = section 129 of the Income Tax Ordinance of 1979. The appealable orders are mentioned in this section. The impugned order does not fall under this section, and, therefore, the learned counsel fox the petitioner has submitted that he filed a Revision Petition before the learned Commissioner Income Tax and when the learned Commissioner Income Tax rejected the said revision
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petition, there was no other remedy available to him, and therefore, he knocked at the doors of the High Court and invoked its constitutional jurisdiction under section 44 of the Azad Jammu and Kashmir Interim Constitution Act of 1974. I do not think that the petitioner was guilty of any laches or delay. As soon as be came to know about the Recovery Certificates he approached the learned Commissioner income Tax in Revision Petition but when his revision petitions failed, he came to the High Court and invoked its constitutional jurisdiction. Even otherwise, the objection of laches and delay or acquiescence is not available to the respondents in this case because the impugned Recovery Certificates have been issued without a Notice of Demand and have been issued for the Recovery of the liabilities against a dead person (assessee). An order which is a nulty in the eye of law is not an order at all and can be ignored all together even if no Writ Petition is moved to impeach it. Cases referred to: United Builders v. Commissioner of Income Tax (1984) 49 TAX 34; Dr. H.K. Mahtab v. Income Tax Officer [1980] 41 TAX 136 and Abdul Karim v. Commissioner of Income Tax (H.C.AJ.K.) unreported
Pakistan Industrial Development Corporation v. Pakistan – [1984] 49 TAX 76 (H.C.Kar.) 397.
Reference application pending disposal before the High Court held not a bar to maintainability of constitutional petition challenging wires of law taxing “free reserve?‟ to Income Tax.
The above observations on the contrary support the contention of petitioner in the present case as it is an admitted position that the petitioner specifically prayed before the Court while with drawing the earlier petition that he reserves the right to bring fresh petition on the same cause of action and the Court allowed withdrawal of the earlier petition but did not specifically grant permission to bring the fresh petition. Mr. Fazeel, contended that in view of the fact that the Court did not specifically grant the permission it should be presumed that the permission to bring a fresh petition asked for was declined. We are unable to accept this contention. In our view in the absence of an express order by the Court granting permission to file a fresh proceedings while allowing withdrawal under sub-rule (2) of rule 1 of Order XXIII, C.P.C. it will necessarily follow that such a permission has been granted by the Court or otherwise the court while allowing withdrawal in such a case cannot refuse to grant permission. We may also mention here that Mr. Khalid
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Anwar the learned count-self or the petitioner also referred us to the case of Durvas and others v. State of U.P. [AIR 1961 SC 1457] in which the Supreme Court of India considered the scope of applicability of principles of res judicata and constructive res judicata to constitutional petition. The following observations were made by the Indian Supreme Court at page 1465 of the report with which we fully agree. Cases referred to: Karim Bakhsh v. Jan Muhammad PLD 1977 - Lah. 1033; Karim Gul v. Shahzad Gul 1978 SCMR 141 and Durvao and others v. State of U.P. AIR 1961 S.C. 1457.
Pakistan Industrial Development Corporation v. Pakistan – [1984] 49 TAX 76 (H.C.Kar.) 398.
Constitutional petition before High Court challenging vires of taxing “free reserves” to Income Tax held cannot be dismissed on ground of laches in view of nature of relief claimed and the circumstances of the case.
From the statement made in the counter-affidavit it appears that the objection regarding delay is founded on the ground that the impugned orders are challenged after about 10/12 years of the creation of liability against the petitioner. We may mention here that the respondents did not mention in their counter-affidavit the dates of orders impugned in the petition and from the certified copies of the orders produced in the petition we were unable to ascertain their dates. We, therefore, enquired from the learned counsel for the respondents about the dates of these orders but they were unable to give the same. The petitioner in its rejoinder has denied that 10/12- years period had passed when the liability was created against them and it is claimed that the final order imposing penalty was passed against them only, on 30th May, 1979 and immediately thereafter Petition No. 981/79 was filed by them challenging the action of respondents and the vires of legislation but the petition was subsequently withdrawn in the circumstances stated above and as the matter was not settled amicably the present petition was filed in this Court on 10.1.1980. It is, therefore contended that there was no delay at all in filing the present petition. Keeping in view the nature of relief claimed in the petition and the circumstances stated above we are satisfied that the present petition cannot be dismissed on the ground of ladies alone.
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Kassam Haji Abbas Patel v. Income Tax Officer, Contractors Circle, Karachi & Another – [1983] 47 TAX 162 (H.C.Kar.) 399.
Where alternate remedy available but not efficacious and statutory functionary acting mala-fide or in a partial, unjust and oppressive manner, High Court in exercise of its writ jurisdiction has power to grant relief to the aggrieved party.
Since show-cause notice has been issued without there being any sufficient reason or legal authority we should not decline to exercise on jurisdiction. The availability of alternate remedy in every case is not a ground to refuse the relief when the remedy is not efficacious, for, if in spite of showing cause any additional amount bad been assessed the same could have been recovered through coercive process, on petitioners failure to pay the same. In the case of East and West Steamship Co. v. Pakistan this Court has held that where a statutory functionary acts mala-fide or in a partial, unjust and oppressive manner, the High Court in the exercise of its writ jurisdiction has power to grant relief to the aggrieved party. Cases referred to: Nawabzada Muhammad Amir Khan v. Controller of Estate Duty and others (PLD 1961 SC 119) = [1962] 6 TAX 84 (S.C.); Burmah Oil Company (Pakistan Trading) v. The Trustees of the Port of Chittagong (PLD 1962 SC 113); Pakistan and another v. Qazi Ziauddin (PLD 1962 SC 440); Nagina Silk Mills, Lyallpur v. The Income Tax Officer, A-Ward, Lyallpur and another (PLD 1963 SC 322) = [1963] 7 TAX 442 (S.C.); Syed Ali Abbas and others v. Vishan Singh and others (PLD 1967 SC 294); Abdul Ghani and another v. Government of Pakistan and others (PLD 1968 SC 131); Usmania Glass Sheet Factory Ltd., Chittagong v. Sales Tax Officer, Chittagong (PLD 1971 SC 125) = [1970] 22 TAX 229 (S.C.) and the Murree Brewery Co. Ltd. v. Pakistan through the Secretary to Government of Pakistan, Works Division and others (PLD 1972 SC 279) Case relied on: East and West Steamship Co. v. Pakistan (PLD 1958 SC 41)
Hussain Sugar Mills v. Islamic Republic of Pakistan and others – [1981] 44 TAX 93 (H.C.Kar.) 400.
Order passed without lawful authority, partial, unjust and mala-fide held assessee can invoke extra-ordinary jurisdiction of the High Court even if alternate remedy is available by way of appeal, etc.
It is now a settled law that the jurisdiction of this Court tinder Article 199 is always available to the party in cases where the impugned orders are without lawful authority, partial, unjust and mala-fide even in cases where alternate remedy by way of appeal etc., is available.
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In the present case as observed by us that the impugned orders passed by the Income Tax Officer under the provisions of section 18A and 45A(b)(ii) were without lawful authority and unjust. Cases referred to : Murree Brewery Co. Ltd. v. Pakistan (PLD 1972 SC 279); Usmania Glass sheet Factory Ltd. v. Sales Tax Officer (PLD 1971 SC 205) = [1970] 22 TAX 229 (S.C.Pak.); Miss. Tayyaba v. Controller of Examinations (PLD 1976 Kar. 481); First National City Bank, Karachi v. Income Tax Officer, Karachi (PLD 1976 Kar. 552) = [1976] 34 TAX 1 (Kar.); Municipal Committee Multan v. Burmah Shell Storage and Distributing Co. of Pakistan and another (PLD 1976 Lah. 726) and [1968 SCMR 1035].
Begum Nusrat Bhutto v. Income Tax Rawalpindi – [1980] 42 TAX 59 (H.C.Lah.) 401.
Officer,
Circle-V,
Writ petition in the High Court challenging the jurisdiction held competent even during the pending of appeal.
The writ is not competent where an appeal is pending or where a reference under the provisions of the Income Tax Act can be made to the High Court. Where there is another adequate and efficacious remedy open to the petitioner, a petition under Article 199 of the Constitution of 1973 would be incompetent unless the legal remedies including remedies as provided in the Income Tax Act are exhausted. But one essential condition for applicability of this rule is that the alternative remedy should be adequate and efficacious. Where the question of jurisdiction of the Authority passing the impugned order is raised, the remedy of appeal is not as adequate or efficacious as the writ jurisdiction of the High Court and consequently in such cases a petition under Article 199 would be competent. Cases referred to : S.A. Haroon and others v. Collector of Customs, Karachi (PLD 1959 S.C.Pak. 177); Lt. Col. Nawabzada Muhammad Amir Khan v. Controller of Estate Duty (PLD 1961 SC 119) = (1961) 3 TAX 165 (SC); Premier Cloth Mills Ltd., Lyallpur v. The Sales Tax Officer (1972 SCMR 257); Salahuddin and others v. Frontier Sugar Mills (PLD 1975 SC 244); The Burmah Oil Co. (Pakistan Trading) Ltd., Chittagong v. The Trustee of the Port of Chittagong (PLD 1962 SC 113); Pakistan and another v. Qazi Ziauddin (PLD 1962 SC 440); Nagina Silk Mills, Lyallpur v. The Income Tax Officer and another (PLD 1963 SC 322) = (1963) 7 TAX 442 (S.C.); Abdul Ghani and another v. Subedar Shoedar Khan Co. and others (PLD 1968 SC 131); Usmania Glass Sheet Factory Ltd., Chittagong v. Sales Tax Officer, Chittagong (PLD 1971 PLD 205) = (1970) 22 TAX 229 (S. C.); The Murree Brewery Co. Ltd. v. Pakistan etc. (PLD 1972 SC 279); Batala Engineering Co. Ltd.‟s case (1974) 29 TAX 190 (S.C); Raja Habib Ahmed Khan v. Income Tax Officer (1974) 29 TAX 209 (S.C); Nizamuddin Ahmad V. Commissioner of Sales Tax and 3 others (1975) 31 TAX 71 (S.C) and The International Body Builders v. Commissioner of Income Tax, Lahore and another (1971 PTD 513) = (1972) 25 TAX 133.
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Sheikh Akhtar Ali v. Federation of Pakistan and 4 others – [1980] 42 TAX 47 (H.C.Lah.) 402.
In the presence of assessee‟s objection to exercise of jurisdiction on ground of bias assessment was made without taking decision on the specific objection held that even existence of alternate remedy would not operate to debar the assessee from invoking extraordinary jurisdiction of High Court.
It is contended that the petitioner in this case had an adequate alternate remedy available to him by way of reference under the provisions of section 66 of the Income Tax Act, 1922 and for. that reason it was not open to the petitioner to have invoked the extraordinary jurisdiction of this Court. After giving the matter our anxious consideration we are of the view that the alternate remedy in this case was not adequate and equally efficacious and even the existence of an alternate remedy would not operate to debar a petitioner from invoking the extraordinary jurisdiction of this Court. Cases referred to : Nagina Silk Mills v. Income Tax Officer (PLD 1963 S.C. 322) = (1963) 7 TAX 442 (S.C.); Premier Cloth Mills Ltd. v. Sales Tax Officer (1972 SCMR 237) = (l974) 29 TAX 199 (S.C.); Murree Brewery Co. Ltd. v. Pakistan (PLD 1972 S.C. 279) and Salahuddin v. Frontier Sugar Mill and Distillery Ltd. (PLD 1975 S.C. 244).
Eruch Maneckji and others v. Income Tax Officer, Central Circle III, Karaciu – [1980] 41 TAX 25 (H.C.Kar.) = 1979 PTD 461 403.
High Court is empowered to grant relief to aggrived party in writ jurisdiction where order passed by a fiscal authority within jurisdiction but partial, unjust and oppressive
Mr. Mansoor Ahmad Khan, the learned counsel for the respondent Income Tax Officer had a limited contention to raise and that was that the order made was within jurisdiction and this Court will not interfere merely because the order made cannot be justified for reasons given therein. It is, however, well settled that where a statutory functionary and more so, a fiscal authority, acts in a partial, unjust or the oppressive manner the High Court in exercise of writ jurisdiction has the power to grant the relief to the aggrieved party. (See PLD 1972 SC 279), In PLD 1971 SC 205, it was held that where a dispute arises between the parties in respect of a fiscal right based upon a statutory instrument the same can be easily determined in writ jurisdiction. Cases referred to : Usmania Glass Sheet Factory Ltd., Chittagong v. Sales Tax Officer, Chittagong (PLD 1971 SC 205) = (1970) 12 Taxaiion 229 (S.C.) and Murrey Brewery Co. Ltd. v. Pakistan (PLD 1972, SC 279).
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Shahid Hameed, Gulberg, Lahore v. Income Tax Officer, Film Circle, Lahore and another [1976] 34 TAX 31 (H.C.Lah.) 404.
High Court competent to interfere in its constitutional jurisdiction where fact for determination was whether receipts supported by payment certificates produced by assessee were genuine and correct and claim was rejected without application of mind to this aspect
The learned counsel for the respondent finally submitted that in any case the orders passed by the authorities below cannot be said to be without lawful authority and of no legal effect in view of the rule laid down by their Lordships of the Supreme Court in case of Muhammad Hussain Munir and others v. Sikandar and others (PLD 1974 S.C. 139), the relevant portion of which reads as under: “It is well-settled that where a Court or tribunal has jurisdiction and it determines that question, it cannot be said that it acted illegally or with material irregularity merely because it came to an erroneous decision on a question of fact or even of law.” The contention of the learned counsel that the High Court cannot interfere in its constitutional jurisdiction in a case of this nature is not correct. In view of what has been discussed above, I have no option but to declare the impugned orders to be without lawful authority and of no legal effect. The Income Tax Officer is directed to reconsider the return filed by the petitioner and complete the same in accordance with law. Cases referred to : Muhammad Hussain Munir and others v. Sikandar and others (PLD 1974 SC 139); Abdul Jabbar and others v. Abdul Waheed Khan and others (PLD 1974 SC 331); Usmania Glass Sheet Factory Ltd. v. Sales Tax Officer (PLD 1971 SC 205); [1970] 22 TAX 229; Zafarullah Khan (PLD 1964 SC 865); Province of-East Pakistan v. Abdus Sobhani Sowdagar (PLD 1964 SC 1) and Islamic Republic of Pakistan v. Abdul Wali Khan (1976 PLD SC 57).
First National City Bank, Karachi v. Income Tax Officer, Karachi and another – [1976] 34 TAX 1 (H.C.Kar.) = PLD 1976 Kar. 552 405.
If impugned action is patently without jurisdiction, writ jurisdiction of the High Court can be invoked even if alternate remedy is available.
Mr. S.A. Nusrat, Advocate for the respondents submitted that the petition is not maintainable as the petitioner had not availed of the
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other remedies provided under the Income Tax Recovery Rules, 1969 which according to him, afforded adequate remedy. No doubt upon receiving the recovery notice from the Tax Recovery Officer dated 9.5.1975, the petitioner could have objected to the attachment of the money under rule 9(1) of the said Rules, which requires the Tax Recovery Officer to proceed to investigate the objection. The order of the Tax Recovery Officer was also appealable under 74 to the Inspecting Assistant Commissioner of Income Tax, as is also provided in section 30(A) of the Income Tax Act A further revision and review is also provided. But where the impugned action is patently without jurisdiction, relief in Constitutional petition cannot be refused on the ground that an alternate remedy is available. Cases referred to: Nagina Silk Mill, Lyallpur v. Income Tax Officer and others (PLD 1963 S.C. 322); (1963) 7 TAX 442 (S.C.); Premier Cloth Mills Ltd. v. Sales Tax Officer (1972) SCMR 257; (1974) 29 TAX 199 (S.C.) and Murree Brewery Cold v. Pakistan (PLD 1972 S.C. 279).
Sind Industrial Trading Estate Ltd., Karachi v. Central Board of Revenue and 3 others – [1975] 31 TAX 114 (H.C.Kar.) 406.
If assessment is suffering from lack of jurisdiction, writ jurisdiction of the High Court can be invoked, without availing of remedies available under the law.
Mr. S.A. Nusrat, the learned counsel for the Income Tax Department contended that the petitioners should in the first instance, have exhausted the remedies available to them by way of appeal and reference under the Income Tax Act, 1922. Mr. S.A. Nusrat stated that, in fact some appeals filed by the petitioners are still pending for adjudication. But, in our opinion, the fact of the Income Tax Department in assessing, or in proposing to assess, the petitioners to income tax is without jurisdiction altogether, and it is, therefore, not incumbent upon the petitioners to avail themselves of the remedies provided to them under the Income Tax Act or even to wait for adjudication of their appeals or references, if any. Cases referred to : Muhammad TufaiI v. Abdul Ghafoor and others PLD 1958 S.C.Pak 20; Lt..Col. Nawabzada Muhammad Amir Khan v. Controller of Ectate Duty and others (PLD 1961 S.C. 119) = [1961] 3 TAX 165 (S.C.) and Nagina Silk Mill, Lyallpur v. The Income Tax Officer, A-Ward, Lyallpur and another PLD 1963 S.C. 322 = [1963] 7 TAX 409 (S.C.Pak).
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Gulistan Textile Mills Ltd. v. CBR – [1994] 70 TAX 272 (H.C.Kar.) 407.
Writ is maintainable where action is malafide or without jurisdiction or vires of law is challenged
Writ challenging action alleged to be mala fide or without jurisdiction or vires of legislation calls into question is maintainable though appeal is pending the Income Tax Appellate Tribunal. Barnala Commission Shop, Chak-Jhumra v. Income Tax Officer, B. Ward, Lyallpur – [1963] 7 TAX 153 (H.C.Lah.) = 1963 PTD 534 = 1963 PLD 311 408.
Writ admitted maintainable.
during
the
pendency
of
appeals
held
Failure of Income Tax Officer to comply with provision of condition precedent to issuing notice to assessee under section 34(1), Income Tax Act (XI of 1922). Objection was not raised to any part of proceedings on any ground at any stage before income tax Officer. Petition, otherwise deserving dismissal in limine, admitted to hearing since point of objection arose also in several other petitions. Income tax assessment proceedings under section 34, Income Tax Act (XI of 1922), completed beyond time. Alternative remedy by appeal under Income Tax Act (XI of 1922) availed but, without waiting for result, assessee preferring petition invoked writ-jurisdiction of High Court. Petition otherwise deserving dismissal in limine admitted to hearing, since point of objection arose also in several other petitions. Tapal Energy Ltd. v. Federation of Pakistan and others –1999 PTD 4037 409.
Writ maintainable in case where forums provided under the relevant statute may not be just and proper
We are of the view that the aforesaid Constitutional petitions are maintainable notwithstanding the fact that the adequate and alternate remedy by way of first and second appeal.........the pronouncement made in the case of Ahram Builders Ltd. v. Income Tax Appellate Tribunal (1993 SCMR 29) to the following effect would be attracted: The tendency to bypass the remedy provided under the relevant statute and to press into service the Constitution jurisdiction of the High Court has developed. However, in certain cases involving of constitutional jurisdiction of the High Court instead of availing remedy provided for under the statute may be justified, for example when the
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impugned order/action is palpably without jurisdiction and/a mala fide. To force an aggrieved person in such a case to approach the forum provided under the relevant statute may not be just and proper.” Republic Motors Ltd. v. Income Tax Officer & Others – [1990] 62 TAX 8 (H.C.Kar.) = 1990 PTD 889 410.
Writ is maintainable where notice is without lawful jurisdiction
“......where the action of any authority is challenged on the ground of lack of jurisdiction, the aggrieved party is entitled to invoke constitutional jurisdiction without availing or exhausting the alternate remedy.......As notice under section 65 was without jurisdiction all subsequent orders passed by the same authorities or other authorities the whole series of such orders will be void. How an appellate order which confirms such an order can become valid.” _______________
WRIT HELD NOT MAINTAINABLE
Amin Textile Mills (Pvt.) Ltd. v. Commissioner of Income Tax and 2 others – PTCL 2000 CL. 316 (S.C.Pak) 411.
Writ petition is not maintainable in the presence of adequate alternate remedy under the statute.
The High Court was right to observe that the petitioner should, in the first instance, approach the hierarchy of the forums provided for under the Ordinance instead of filing a Constitutional petition. Apart from the bald assertion that the impugned order is void ab initio there is nothing on record to substantiate the above plea. In the case of Al Ahram Builders (Pvt.) Ltd. v. Income Tax Appellate Tribunal (1993 SCMR 29), this Court discouraged the tendency to bypass the remedy provided under the relevant statute to press into service Constitutional jurisdiction of the High Court. Adamjee Insurance Co. Ltd. and others v. Pakistan through Secretary Ministry of Finance – 1993 SCC 1080 = [1993] 68 TAX 176 (S.C.Pak.) 412.
After availing normal remedy switching over to constitutional petition is not maintainable in the absence of justifiable reason.
Once the appellant had opted to avail of the hierarchy of forums provided for under the Ordinance upto the stage of filing of appeal before the Tribunal, it would have been proper on his part to have invoked section 136 of the Ordinance for making a reference to the
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High Court instead of filing of constitutional petition. Once a party opts to invoke the remedies provided for under the relevant statute, he cannot, at his sweet will, switch over to constitutional jurisdiction of the High Court in the mid of the proceedings in the absence of any compelling and justifiable reason. Hafiz Muhammad Arif Dar v. Income Tax Officer – 1988 SCC 710 = [1989] 60 TAX 52 (S.C.Pak.) 413.
Where adequate alternate remedy is available writ under Article 199 is not maintainable.
One of the conditions for grant of relief in writ jurisdiction of the High Court is that the petitioner before it should not have any alternate adequate remedy. Since the petitioner has availed the right of appeal, the High Court correctly held that no relief could be granted under Article 199 of the Constitution. Nagina Dal Factory through Allah Ditta, Partner v. Income Tax Officer, and another – 1968 SCC 316 = [1968] 18 TAX 1 (S.C.Pak.) 414.
If adequate remedy is not exhausted, writ jurisdiction cannot be invoked.
The High Court has declined to give relief on the ground that the petitioner firm has invoked its extraordinary jurisdiction under Article 98 of the Constitution without first exhausting its statutory remedies as provided by the Act. We can see no fault in the order of High Court. When a statute under which action is taken itself provides remedies, recourse must be had to those remedies first. Direct access to the High Court for relieve in writ jurisdiction thus bypassing the special forums, which are created by the special law itself, is not permissible. Article 98, in terms, precludes action under it where another adequate relief is available. In the present case it is not disclosed that the impugned action suffered from lack of jurisdiction for invocation of writ jurisdiction by the High Court directly without first availing of the other remedies as provided by the special law. Wealth Tax Officer & Other v. Shaukat Afzal & 4 Others – [1993] 68 TAX 145 (S.C.Pak) 415.
Circumstance where writ is not maintainable.
Before parting with the judgment we may observe that in cases where any party resorts to a statutory remedy against an order he cannot abandon or bypass it without any valid and reasonable cause and file constitutional petition challenging the same order. Such practice, in
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cases where statute provides alternate and efficacious remedy up to High Court, cannot be approved or encouraged. Abdul Rehman & Another v. Income Tax Officer Mirpur & another – [1993] 68 TAX 132 (S.C.AJ&K)
It is, therefore, difficult to agree in the light of prevalent constitutional provisions that if an interpretation placed by an executive authority is palpably wrong and leads to miscarriage of justice and High Court can directly entertain a writ petition. The High Court only directly entertains a writ petition if it finds that alternate remedy is not adequate. In our view existence of another adequate remedy is a rule of law which ousts the jurisdiction of the High Court and we hold accordingly. H.M. Abdullah v. Income Tax Officer, Circle V Karachi – 1993 SCC 1018 = [1993] 68 TAX 29 (S.C.Pak)
Income Tax Ordinance is a complete code in itself which creates rights in favour of an assessee and in certain circumstances in favour of the Revenue as well, and also provides remedy for redress of the grievances of the aggrieved party. In every tax case, Constitutional Jurisdiction as an alternate remedy in terms of Article 199 of the Constitution cannot be availed. Shagufta Begum v. Income Tax Officer, Circle-II, Zone-B, Lahore – 1989 SCC 715 = [1989] 60 TAX 83 (S.C.Pak)
In all such cases where a Tribunal lacks jurisdiction and this aspect is discoverable on the record, it is permissible for an aggrieved person to go directly to the High Court against the issuance of a notice without approaching the authority concerned in this behalf in the first instance. The oratical speaking it might be correct; mainly, because wastage of time spent before the departmental authorities could be avoided by expeditious disposal of the writ petition in the High Court and if the matter is brought higher up in the Supreme Court it would still be a speedier remedy. We do not agree with this submission. In practice, it takes longer time than the normal departmental remedies. It is accordingly in the interest of litigants themselves first to choose the speedier remedy with departmental authorities and thereafter if need be, invoke the extraordinary jurisdiction of the High Court.
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Raja Habib Ahmad Khan v. Income Tax Officer – 1972 SCC 400 = [1974] 29 TAX 208 (S.C.Pak.)
The assessee preferred appeals against the assessment orders, as also filed a petition under Article 98 of the Constitution of 1962. Supreme Court while deciding the petition for leave to appeal held that: “That the writ petition was misconceived and not maintainable. The petitioner should have been left to pursue his remedy by the appeal which he had already filed. He had elected first to follow that remedy. He should not, therefore, have been allowed to simultaneous pursue an alternate remedy under Article 98 of the Constitution of 1962.” Steel Brothers and Company Ltd., London v. Commissioner of Income Tax, Dacca – 1968 SCC 313 = [1969] 19 TAX 97 (S.C.Pak.)
We are not convinced that the matter in dispute here will not be adequately determined in the reference pending in the High Court. The principle of law, once settled, would apply to all the assessment years and it is conceded by Mr. Mohammad Fazlur Rehman that in respect of the years mentioned in the reference, the same question of law is being agitated as would apply to the other years. The Income Tax Appellate Tribunal has, apparently given a decision in favour of the petitioner-Company in respect of the apportionment of the Managing Agency income, accruing to the petitioner-Company and on some other points. That decision is being challenged in the reference, on behalf of the department, in the High Court. On some other points going against the petitioners in proceedings before the Tribunal, the petitioner has been successful in obtaining a reference to the High Court. It would be circumventing the provisions of the Income Tax Act if parallel proceedings are started, under Article 98 of the Constitution, to deal with the same questions. We see no ground for grant of special leave to appeal in the circumstances of this case and dismiss the petition. Data Distribution Services v. Deputy Commissioner of Income Tax and another – [2000] 82 TAX 156 (H.C.Lah.)
In case aforesaid paragraphs of parawise comments and writ petition are put in juxta position, then it brings the case of petitioners in the
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area of disputed question of facts. It is settled proposition of law that this Court has no jurisdiction to resolve the disputed question of facts in Constitutional jurisdiction as the principal laid down by the Hon‟ble Supreme Court in Muhammad Younas Khan‟s case (1993 SCMR 618). The petitioner‟s counsel appeared in Pak-Arab Fertilizer (Pvt.) Ltd. v. Deputy Commissioner Income Tax (2000 PTD 263) and cited almost all the case law which was considered by this Court and laid down principle that writ petition is not maintainable against show-cause notice and also observed that party cannot be allowed to by-pass jurisdiction vested by law in special Tribunal. As mentioned above I have already dismissed the writ petitions qua the similar controversy on the question of law in Pak-Arab Fertilizer (Pvt.) Ltd.‟s case (supra). It is settled proposition of law that previous decision should have been accepted and binding on me as per principle laid down by the Hon‟ble Supreme Court in Muhammad Muzafar Khan v. Muhammad Yousaf Khan (PLD 1959 SC (Pakistan) (9). Guarantee Engineers (Pvt.) Ltd. v. Federation of Islamic Republic of Pakistan through Secretary, Ministry of Finance, Islamabad and another – [2000] 82 TAX 131 (H.C.Lah.)
The contents of the writ petition as well as contentions of the learned counsel of the petitioner do not reveal that the petitioner has challenged vires of the provisions of the Finance Act, therefore, responsent No. 2 is well within his right to deduct the income tax from the petitioner to the tune of 5 per cent on the basis of provisions of Finance Act, 1995-96. It is settled proposition of law that Court should save the laws instead of declaring them ultra vires. I am fortified by the following judgements:PLD 1995 SC 432 (Multi National‟s case) PLD 1983 SC 457 (Fauji Foundation‟s case) The learned counsel of the petitioner does not mention any provision of Finance Act in the contents of the writ petition which was framed by the competent authority which is in violation of Articles 2A, 3 and Article 25 of the Constitution. It is settled proposition that Constitution should be read as organic whole. The Articles of the Constitution do not reveal prohibition that the Pakistani Legislature/Parliament and Provincial Assembly do not possess the right to make retrospective legislation which every sovereign Legislature possesses. The only express limit imposed upon the power of retrospective legislation is that Legislatures cannot make retrospective penal laws meaning thereby any other law including
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Taxation Law may, therefore, be made with retrospective effect under the Constitution. In arriving to this conclusion I am fortified by the leading judgement of the subjection by the Hon‟ble Supreme Court in Salauddin‟s case PLD 1991 SC 546. The aforesaid proposition of law is also supported by the judgement of Hon‟ble Supreme Court in Haider Automobile Ltd. v. Pakistan (PLD 1969 SC 623). In the present case as mentioned above there is no retrospective effect of the Finance Act since the contention was raised by the learned counsel of the petitioner and the contention of the learned counsel of the Petitioner has no force on the basis of the aforesaid judgement of the Hon‟ble Supreme Court. In view of clause 54(2) of the Contract executed between the petitioner and respondent No. 2 principle of Reciprocal Promises is not attracted. Leather Connections (Pvt) Limited v. The Central Board of Revenue Govt. of Pakistan, Islamabad through its Chairman – [2000] 82 TAX 42 (H.C.Lah.)
In view of what has been discussed above, this writ petition is not maintainable. Any how the letter issued by respondent No.2 to respondent No. 3 on 16.5.1996 by fixing cost of construction at the rate of Rs.400/- per sq. ft is not borne out and is not in accordance with notification issued by C.B.R. dated 18.7.1993 under the aforesaid Section 50(7BB). The letter does not contain any comparative rates of the other departments; therefore, same is not sustainable in the eyes of law. The Notification of C.B.R. is misconstrued by the subordinate functionaries of C.B.R. In view of these circumstances, let a copy of this order judgment be sent to Chairman C.B.R. Islamabad, who is directed to issue general instructions to all the functionaries to issue letters to the Administrative officer concerned in accordance with law and Notification dated 18.7.1993, after comparison of the rates mentioned by different departments in the Notification or the Chairman C.B.R. must issue a notification and fix rate either yearly basis for each area or 2/3 years so that poor citizen should not be penalized. He is also directed to issue direction in the light of notification, preferably within one month, after receiving the order of this Court. Pak-Arab Fertilizers (Pvt.) Ltd. v. Deputy Commissioner of Income Tax and Others – [2000] 81 TAX 224 (H.C.Lah.) = 2000 PTD 263
The nature of controversy between the parties to the petition by itself falls in the area of factual controversy. In case the contents of writ
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petitions and parawise comments are put in juxta position which cannot be resolved in Constitutional jurisdiction of High Court. Even otherwise writ petition is not maintainable in view of the law laid down by the Hon‟ble Supreme Court in Bashir & Company‟s case [1968] 17 Tax 207 (S.C.Pak) = (1968 SCMR 997) in which it was held that a party cannot be allowed to by pass jurisdiction vested by the law in special tribunal, and writ petition cannot be invoked, special remedy is available under the Income Tax Ordinance. I am fortified by the judgements of Abdul Rehman Mayet‟s case (1988 SCMR 1712). Kohinoor Industries Ltd. v. Government of Pakistan through C.B.R., Islamabad – [2001] 83 TAX 17 (H.C.Lah.) 416.
Writ held not maintainable where disputed question of fact involved.
In the present case learned counsel for the respondents or any official of the respondents did not give any concession. It is admitted fact that tribunals below have given con-current finding of fact against the petitioner. Therefore, writ petition is not maintainable as per principle laid down by the Hon‟ble Supreme Court in the following judgments: 1974 SCMR 279 (Khuda Bakhsh‟s case) PLD 1981 S.C. 246 (Muhammad Sharif‟s case) PLD 1981 S.C. 522 (Abdul Rehman Bajwa‟s case). It is also settled principle of law that this court has no jurisdiction to substitute its own decision in place of the finding of the tribunal below as per principle laid down by the Division Bench of this court in Mussaduq‟s case PLD 1973 Lahore 600. The tribunal below have given finding of fact against the petitioner that bags were not warehoused at Karachi with the connivance of the petitioner in original condition whereas the case of the petitioner that petitioner is not responsible for that mis-chief. It is the Paul Corporation who committed this mischief. This fact brings the case in the area of disputed question of fact and this court has no jurisdiction to resolve the disputed question of fact in a Constitutional jurisdiction as per principle laid down by the Hon‟ble Supreme Court in Muhammad Younis‟s case 1993 SCMR 618. Petitioner has alternative remedy for resolution of the disputed question of fact by filing civil suit under section 9 of the CPC before the competent court. In this view of the matter writ petition is also not maintainable as per principle laid down by the Hon‟ble Supreme Court in Muhammad Ismail‟s case PLD 1996 S.C. 246. In view of that has been discussed above, this writ petition is dismissed with no order as to costs.
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Amir Nawaz Khan, etc. v. Government of Pakistan, through Secretary Finance, Islamabad, etc. – [2001] 83 TAX 397 (H.C.Lah.) 417.
In presence of arbitration clause in the agreement executed between the parties, the writ petition is not maintainable.
It is admitted fact that petitioner executed agreement with the respondent No. 5 of his own free will which contains the arbitration clause. In presence of Arbitration Clause in the agreement executed between the parties, the writ petition is not maintainable. The writ petition is also not maintainable on the well known principle of approbate and reprobate. It is also settled proposition of law that the contract cannot be enforced through Constitutional jurisdiction as the petitioner has alternative remedies either to file a civil suit or invoke arbitration clause. It is also settled proposition of law that leave granting order by the Honorable Supreme Court is not judgment. Cases referred to: Muhammad Ansar, etc. v. Administrator Town Committee, Kabirwala, District Khanewal & 4 others [2000] 81 TAX 60 (H.C.Lah.), Bismillah & Co. v. Secretary, Government of the Punjab, etc. [1997] 75 TAX 109 (H.C.Lah.), Adam Khan Mirza v. Muhammad Sultan PLJ 1975 SC 21, Shameer v. Board of Revenue 1981 SCMR 604.
Muhammad Ansar etc. v. Administrator Town Committee Kabirwala District Khanewal and 4 others – [2000] 81 TAX 60 (H.C.Lah.) 418.
Writ is not maintainable where parties themselves agreed for arbitration in bilateral contracts.
It is settled proposition of law that specific arbitration clause has been provided in the agreement as mentioned above and if the petitioners have got any grievance against the contents of the said agreements they can avail their remedies before the appropriate forum as it needs a detail inquiry. Since the petitioners have voluntarily executed an agreement with arbitration clause with the respondents then the petitioners are stopped to challenge the same in writ jurisdiction on the well known principle of approbate and reprobate as the principle laid down by the Hon‟ble Supreme Court in Haji Ghulam Rasool‟s case PLD 1971 S.C. 376. It is settled principle of law that contractual obligations cannot be enforced through a writ petition as the petitioners have alternative remedies to invoke the jurisdiction of a
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Civil Court by means of regular suit. I am fortified by the following judgements of Hon‟ble Supreme court of Pakistan:(i) (ii) (iii)
PTD 1981 S.C. 604 (Shameer‟s case); PTD 1986 Quetta 181 (Pakistan Mineral Development Corp‟s case); PTD 1958 S.C. 387 and PTD 1962 SC 108.”
Islamuddin and 3 others v. The Income Tax Officer and 4 others – 2000 PTD 306 419.
Writ not maintainable in case where no right to appeal or reference is provided in law itself.
It is also an established principle that where a statute does not provide the remedy by way of appeal or Reference against the order then the same cannot be challenged by way of a Constitutional petition as it would amount to rendering the provision of statute which does not provide an appeal for a reference or any other remedy against a particular order. In support of this proposition reliance is placed on the cases of Syed Saghir Ahmed Naqvi v. Province of Sindh and another reported in 1996 SCMR 1165 and Abdul Wahab Khan v. Government of Punjab and others, reported in PLD 1989 SC 508. Crescent Sugar Mill v. Income Tax Officer – [1999] 80 TAX 273 (H.C. Lah.) = NLR 1999 TAX 170 420.
Writ petition not maintainable when remedy of seeking reference under section 136 of the unamended provisions of Income Tax Ordinance is available to the assessee at the relevant time.
This writ petition is disposed of with the observation that present writ petition is not maintainable as the remedy of seeking reference under section 136 of the unamended provisions of Income Tax Ordinance were available at the relevant time. The petitioner having once approached the authority in the hierarchy of jurisdiction is required to exhaust his remedy before invoking the Constitutional jurisdiction. The petitioner may, if so advised, apply for reference to the Appellate Tribunal alongwith application for condonation of delay, on the plea of proceedings in due vigilance in the Constitutional jurisdiction, which application if filed will be decided by the Tribunal, in accordance with law and on its own merits. Keeping In view the circumstances noted supra.
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Nawab Sons, Lahore v. The Assistant Commissioner Tax etc. – 1999 PCTLR 387 421.
Where the petitioner conceals material facts, writ is not maintainable.
The contents of the writ petition revealed that the petitioner has concealed material facts from this Hon‟ble Court qua the appeal filed by the petitioner before the appellate authority against assessment order, therefore, petitioner is not entitled to get any discretionary relief under Article 199 of the Constitution. I am not inclined to exercise discretion in favour of petitioner who concealed the material facts from this Hon‟ble Supreme Court. I am fortified by the following judgments:C.M. Malik‟s case (1990 C.L.C. 1783); Ronaq Ali‟s case (PTD 1973 S.C. 326); Saif Ullah‟s case (PTD 1989 S.C. 166); Rana Arshad‟s case (1998 SCMR 1462); For what has been discussed above, this writ petition is dismissed in limine, as the petitioner did not approach this Court with clean hands as well as the petitioner has availed alternate remedy which is pending adjudication. Saleem Automotive Industries (Pvt.) Ltd. v. Central Board of Revenue etc. – [1999] 80 TAX 9 (H.C.Lah.) 422.
Writ petition is not maintainable where appeal is pending before any authority.
The petitioner has already travelled through some of the forums provided under the law. His appeal before the Customs Tribunal is still pending in which injunction order restraining the recovery of disputed amount has also been made in his favour. In such situation, the entertainment of the petition or to make the kind of declaration prayed for by the appellant will not only frustrate the whole scheme of the law providing for various stages and forums of appeal but also will amount to pre-suppose an order by a judicial authority namely the Customs Excise and Sales Tax Appellate Tribunal. The view of the Supreme Court as well as of this Court on the issue is quite clear. Two cases decided by the Supreme Court are directly relevant on the issue. These are reported as re: Wealth Tax officer and another v. Shaukat Afzal and 4 others (1993) 68 Tax 145 (S.C.Pak.) and re: H.M. Abdullah v. Income Tax Officer, Circle-V. Karachi and 2 other (1993) 68 Tax 29 (S.C.Pak.). In the first reported judgement the assessee respondents were before the Tribunal for the redressal of
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their grievances. During the pendency of the appeal, they approached the High Court in its Constitutional jurisdiction which was allowed by a division bench of Sindh High Court whereby the order passed by the Wealth Tax Officer treating the disputed properties as “assets” of the assessee was declared as without lawful authority and of no legal effect. Like-wise in a recent judgment reported as re: Sameer Electronics v. A.C. of Income Tax, Lahore (1996) 73 Tax 106 (H.C.Lah.) this Court refused to entertain a Constitutional petition under Article 199 of the constitution and rejected the contentions similar to those now being made by the learned counsel before me. Rehmania Hospital v. Government of Pakistan etc. – [1997] 76 TAX 138 (H.C.Pesh) = 1997 PTD 1805 423.
In the presence of statutory remedy under the Income Tax Ordinance approach to the High Court through a writ petition is disapproved.
“...... it seems the preponderance and the recent trend in the judgments of the Superior Courts ..... is that in the presence of statutory remedy under the Income Tax Ordinance approach to the High Court through a writ petition is disapproved.” State Cement Corporation of Pakistan (Pvt.) Ltd. v. Commissioner of Income Tax –[1997] 76 TAX 110 (H.C.Lah.) = 1997 PTD 1104= 1998 PCTLR 520 (H.C.Lah.) 424.
In case of availing the remedy of appeal writ is not maintainable.
Before these petitions could be argued on merits, learned counsel for respondent has raised a preliminary objection that against the decisions of respondent dated 7.8.1994, the petitioner has already filed appeals which are pending before the Income Tax Appellate Tribunal where they have raised the same depute as to whether or not any Income Tax is payable on the cement development funds received by the petitioner company under Ordinance, II of 1979. This is not denied by the learned counsel for respondent who has, however, submitted that the petitioner had earlier filed W.P. No. 6584 of 1994 which was disposed of with the direction that the plea raised in the Constitutional petition may be repeated before the Commissioner of Income Tax before whom the proceedings are pending. Learned counsel for the petitioner has attempted to argue that notwithstanding filing of the appeal by the petitioner, these petitions are maintainable as it has been held by the Supreme court in various
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cases that it is not essential to file a departmental appeal when the matter relates to the interpretation of statutory instrument and the matter can be brought directly to this Court. There may not be any cavil with this proposition but here the position is different as the petitioner has itself invoked the jurisdiction of the Income Tax Appellate Tribunal by filing appeals and there is no reason also as to why the Appellate Tribunal should not be allowed to decide the questions which are arising in these petitions. In view of what has been stated above, these petitions are held to be not maintainable at this stage and dismissed, leaving the parties to bear their own costs. No doubt the petitioner had raised various pleas before the Commissioner of Income Tax who by his detailed order dated 7.8.1994 has rejected the same and against his order the petitioner has gone to the Income Tax Appellate Tribunal. As the petitioner has chosen its remedy by filing appeals before the Appellate Tribunal, these petitions are clearly not maintainable. It is also to be noted that if the decision of the Appellate Tribunal goes against the petitioner, it can come to this Court by filing an application under section 136 of the Income Tax Ordinance, 1979 which is to be heard by a Division Bench of this Court. The petitioner cannot be allowed to bypass the normal procedure. Sante International (Pvt.) Ltd. and Another v. Commissioner of Income Tax, Zone-B, Lahore and Another – [1997] 75 TAX 259 (H.C.Lah.) = 1997 PTD 819 425.
Where alternate statutory remedies available, writ petition is not maintainable.
Since the petitioner had alternate statutory remedies in the hierarchy of the income Tax Department as already mentioned above, this petition is not maintainable Accordingly, the petition being premature Is dismissed in limine. However, all available objections, Including the one relating to the Jurisdiction of the Income Tax Officer, may be taken before the appropriate forum, If so advised. Haji Gula Khan v. Special Officer, Income Tax and Others – [1997] 75 TAX 117 (H.C.Pesh.) = 1997 PTD 7 426.
Assessing officer did not give appeal effect being challenged by the department; assessee cannot be allowed to bypass the available adequate remedy.
It may be stated at the very outset that the petitioner can file an appeal before respondent No. 3 against the impugned order recorded by respondent No. 1. As an adequate remedy has been made available to the petitioner under the relevant law, therefore, he cannot be
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allowed to by pass the same and approach this Court straightaway under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973. We are, therefore, of the view that this writ petition is misconceived. Agha Ice Factory, Sheikhupura v. Regional Commissioner Of Income Tax, Central Region, Lahore and 4 Others – [1996] 74 TAX 215 (H.C.Lah.) 427.
Selection of return for audit challenged through constitutional jurisdiction held not maintainable.
The manner, answers to questions raised in the petition; have been sought by the petitioner is unwarranted and misconceived; as the income Tax Ordinance itself is a complete Code and procedure for referring a question of law to the High Court has been provided under section 136(1) of the income Tax Ordinance. The writ petition even otherwise being devoid of merits is not maintainable. Zam Zam Traders v. Income Tax Officer – [1996] 74 TAX 21 (H.C.Lah.) 428.
Writ is not maintainable where facts are controversial.
I am of the opinion that it is a controverted question of fact and such a question cannot be resolved In constitutional jurisdiction of the High Court; without prejudging the issue; the petitioner, who has already submitted the returns in response to the notice under section 65. and proceedings have already been initiated by the respondent by issuing the mandatory notice under section 62 of the Ordinance; ft is undesirable for the petitioner to switch over to the constitutional jurisdiction of the High Court at his sweet will in the mid of the proceedings in the absence of any compelling and justifiable reasons. Sameer Electronics v. Assistant Commissioner of Income Tax, Circle-B, Zone ‘A’ Lahore – [1996] 73 TAX 106 (H.C.Lah.) 429.
Legality and correctness of a factual controversy could not be resolved in constitutional jurisdiction.
Section 65(2) of the Income Tax Ordinance provides that no proceedings under sub-section (1) shall be initiated unless definite information has come into the possession of the Income Tax Officer and he has obtained the previous approval of Assistant Commissioner of Income Tax in writing to do so. The respondent No. 1 positively is in possession of information as indicated in his letter dated 11.3.1995. The respondent No. 1 in the said letter alleged that the petitioner is carrying on the business of releasing Indian films after obtaining expensive master prints from Karachi and hundreds of films are
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available in the Video Market bearing the name of petitioners concern. The petitioner vide his letter dated 20.3.1995 in response to the said notices denied the fact of “Releasing” Hindi films being without any evidence and proof and added that neither the import of Indian films is allowed to Pakistan nor violated any provision of law in that regard; the nature of controversy, particularly the legality and correctness of “releasing” Indian films is a factual controversy; such a question cannot be resolved in Constitutional jurisdiction of High Court and refrains (sic) from substituting Its own finding of fact as observed by their Lordships in case Muhammad Younus Khan and 12 others v. Government of N.W.F.P. through Secretary Forest and Agriculture, Peshawar and others (1993 SCMR 618) as it is a consistent view of Supreme Court that in cases where factual controversies are involved, constitutional petition is not the proper remedy. Cases referred to: Julian Hoshang Dlnshaw Trust and others v. Income Tax Officer (1992 SCMR 250); Muhammad lsmail v. Abdul Rasheed and 2 others (1983 SCMR 168) and Muhammad Younas Khan and 12 others v. Government of N.W.F.P. through Secretary Forest and Agriculture, Peshawar and others (1993 SCMR 618).
Saif Nadeem Electro Ltd. v. Collector of Customs and Central Excise/Commissioner of Sales Tax, Peshawar and 3 Others – [1995] 72 TAX 274 (H.C.Pesh.) 430.
High Court cannot go in the domain of factual controversy. (a)
In the first instance the questions of fact have been raised and the High Court cannot go in the domain of such controversy.
(b)
In the next place, the petitioner instead of seeking adequate and alternate remedy from the department concerned, including the C.B.R. has straight away came to this Court, for the redress of his grievance, it may be mentioned here that the petition in hand cannot be entertained unless all the remedies available and open to the petitioner are not exhausted, in the first instance.
Muhammad Jameel v. Income Tax Officer – [1995] 72 TAX 1 (H.C.Lah.) 431.
Writ petition not maintainable where adequate and alternate remedy available.
The petitioners were provided proper opportunity to represent their facts and were properly heard by the Assessing Officer; rather the conduct of petitioners remained objectionable and did not appear
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before him with clean hands. As already observed the Income Tax Ordinance is a complete code in Itself. In view of the above observations made by their Lordships, I am of the view keeping in view the conduct of petitioners; who have not come with clean hands before this Court even otherwise have remedy by way of appeal. The instant petition is not entertainable and is dismissed in limine. Cases referred to: Julian Hoshang Dinshaw Trust and others v. Income Tax Officer and anothers (1992) 65 TAX 102 (S.C.Pak) = (1992 SCMR 250) and Hafiz Muhammad Arif Dar v. Income Tax Officer (1989) 60 TAX 52 (S.C.Pak) = (PLD 1989 SC 109).
Allied Cans v. Income Tax Officer, Circle-8, Multan and others – [1995] 71 TAX 216 (H.C.Lah.) 432.
Factual inquiry involving controversial facts cannot be undertaken by the High Court in exercise of its constitutional jurisdiction.
It is a field, experts of which are the Income Tax people, and it is not that pure and simple legal proposition, which calls for a determination by this Court. Estimation of income etc. evidently involves a factual inquiry, which this Court in exercise of its writ jurisdiction cannot possibly undertake. The petitioner concern, if genuinely aggrieved, can avail of the remedies available under the Income Tax Ordinance, 1979, and it would not be correct to say that a writ petition is the only remedy, which could be invoked for redressal of the grievances in question. There is no worth-while explanation forthcoming to the inordinate delay of two years and two months, with which this Court was approached in the matter. This ground alone will disentile the petitioner to the discretionary relief, for the move made is illintentioned, as also misconceived and the object is to derive an undue advantage, by making the Income Tax Authorities helpless in the matter. I am not at all convinced about the competence of the writ petition, as also bona fides of the petitioner, and proceed to dismiss the petition. Azmat Farooq v. Regional Commissioner of Income Tax Central Region Lahore and another – [1993] 68 TAX 74 (H.C.Lah.) 433.
Writ cannot be entertained where adequate remedy is available.
Be that as it may, it stands admitted that no revision at all was filed by the petitioner before the Commissioner but only a representation was made to the Regional Commissioner of Income Tax who forwarded it to the Commissioner of Income Tax. That being so, the Regional
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Commissioner, to whom the representation was addressed being an officer higher thin the Commissioner of Income Tax, was certainly entitled to interfere. In the end, learned counsel for the petitioner has tried to argue that even on the basis of the material which has been annexed by the respondents alongwith the report to this petition, it is evident that the assertion regarding the undervaluation of the properties is incorrect. If that be so, it is open to the petitioner to demonstrate this fact before the Income Tax Officer and to satisfy him that the properties in question were not undervalued. No interference is, however, called for in the exercise of this Courts Constitutional jurisdiction at this stage. Case applied: Commissioner of Income Tax Zone-D, Karachi v. Jennings Private School [1992] 66 TAX 156 (S.C.Pak).
Zafar Usman v. Income Tax Officer etc. – [1989] 59 TAX 86 (H.C.Kar.) 434.
If Income Tax Officer‟s action is jurisdictional, writ jurisdiction of the High Court cannot be invoked.
We are, therefore, of the view that we cannot at this stage hold that the impugned notice is without jurisdiction as to warrant the interference by this Court in exercise of constitutional jurisdiction and deprive jurisdiction of the hierarchy of the forums provided under the Ordinance. Cases referred to: Arafat Woollen Mills Ltd. v. The Income Tax Officer, Companies Circle C-1, Karachi (C.A. No. 5-K of 1986); Arafat Woollen Mills Ltd. v. The Income Tax Officer, Companies Circle E-1, Karachi [1986] 54 TAX 1 and Wali Traders v. Income Tax Officer, Circle XVIII, East Zone, Karachi [1988] 58 TAX 29.
Brilliant Farbics & Silk Factory, Karachi v. Income Tax Officer, West Zone, Karachi & others – [1987] 56 TAX 24 (H.C.Kar.) 435.
Issue being controversial involving inquiry into is not a fit case to be determined under supervisory constitutional jurisdiction of High Court.
His submission was that the person who had appeared before the Income Tax Officer was not authorised by him. On the other hand we find that Mr. Zakaria Loya had appeared before Income Tax Officer in the first instance and had taken time. Moreover, the receipt of notice issued by the Income Tax Officer on 24th January, 1983 to the petitioner is not denied and, therefore, it was incumbent upon the petitioner to keep track or the case and it could not take shelter under the plea that one Mr. Mansoor Ahmed who had appeared for him before the Income Tax Officer was not entitled to appear. No affidavit
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of Mr. Zakaria Loya has been filed before us to substantiate allegation that Mr. Mansoor was not an associate of Mr. Zakaria Loya. It is common knowledge that different associates of the lawyer firms or be Income Tax Consultants appear before the Courts or the relevant Authorities and they ate allowed to appear as such. The petitioner has not sought any damages from Zakaria Loya & Co. for not having represented the petitioner or for having sent a person who was not authorised to represent Zakaria Loya and Co. or the petitioner for that matter. Therefore, the submission that the petitioner was not property represented is unfounded. The appellate authority has stated that Mr. Mansoor was an associate of Zakaria Lays & Co. and the said finding coming from the concerned department, which has knowledge of such facts, is binding. The position that the petitioner was immune from scrutiny, as shown in this petition, has been taken up by the petitioner from the initial stage, by a letter of 10th, January, 1983/18th January, 1983, is not entirely correct. The Department in its comments has clearly stated that such a letter of the assessee was never received by them and we find that in the rejoinder affidavit filed by the petitioner there is no further contravention in respect of the receipt of the Mid alleged letter of protest allegedly sent by petitioner to the Department. Therefore, this becomes a controversial matter of fact and not fit matter of controversy in the supervisory constitutional jurisdiction. Moreover, in the assessment order passed by the Income Tax Officer and the appellate orders the findings are that petitioner has been guilty of concealment and suppression. These findings are findings of facts and they have not been shown to be completely wrong and, therefore, the petitioner is not entitled to seek the intervention of this Court which has supervisory jurisdiction and it should not exercise its discretion in favour of a wrong door. The learned counsel has also tried to show that certain findings of the Income Tax Officer were not justified but we are afraid that we are not the appellate authority in respect of these findings and, therefore, the same could have been agitated only before the higher income Tax Authorities. Petitioner had three opportunities in the Department but with no success. Arafat Wollen Mills Limited v. Income Tax Officer – [1986] 54 TAX 1 (H.C.Kar.) = 1986 PTD 316 436.
Assessee cannot avail remedy of constitutional petition before High Court being dissatisfied with the notices.
Assessee‟s factory was still in process of erection and installation and had not yet started commercial production. Income Tax Officer made
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assessment after due scrutiny and tax demand created which was paid by the assessee. Assessee filed appeal before Commissioner of Income Tax against the Income Tax Officer‟s order during pendency of appeal Income Tax Officer issued notices which were replied by the assessee. Assessee can not avail remedy of constitutional petition before High Court being dissatisfied with the notices. Commissioner was satisfied on the material placed before him that an action has to be taken against assessee. The question of satisfaction of the Commissioner could not be challenged in writ petition. Proposition that extraordinary jurisdiction of High Court cannot be sought on each and every case where alternate remedy available is not universal proposition of law. In case where an authority had taken action when it had no jurisdiction on subject-matter of dispute and where absence of jurisdiction was apparent on face of record, Constitutional remedy could be availed of. So also where alternate remedy was cumbersome and not effectual and would not give proper relief, in that case also High Court might entertain petition. But while dealing with matter on Constitutional side, basic principle before Court would be that case could be decided on basis of available material and it did not require a detailed enquiry and facts were admitted and only question of law and its interpretation required decision of Court. In cases where no such conditions exist and an alternate remedy is provided under statute then High Court would not entertain writ petition. Judicial Review: OVERRULED by the Supreme Court of Pakistan in 1988 SCC 672
Pakistan Industrial Development Corporation v. Pakistan – [1984] 49 TAX 76 (H.C.Kar.) 437.
High Court cannot examine the question of controversial facts in Constitutional jurisdiction.
The learned counsel for the petitioner attempted to argue that the „free reserves‟ of the petitioner were consisted of several sums of money received by the company through different sources which may also have included scale of some of the capital assets of petitioner and revaluation of some of the capital assets of the company on account of devaluation of Pakistan currency etc. which may not legitimately fall within the meaning of „income‟. No such case is set out by the petitioner in the petition and in the absence of any specific allegation in the petition in this regard we cannot examine the same. We may however, observe that several instructions issued by Central Board of Revenue, issued in this regard were referred by Mr. Khalid Anwar, which laid down the criteria for determining „free‟ and “unfree
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reserves” of the company. If the petitioner feels that its „free reserves‟ were not constituted of those items as arc declared by the Central Board of Revenue as „free reserves‟ he may agitate it before appropriate forum, if available to him under the law. B.P. Biscuit Factory Ltd., Karachi v. Wealth Tax Officer, IICircle, Karachi & another [1982] 45 TAX 17 (H.C.Kar.) = 1981 PTD 217 438.
Remedies available under the law should be exhausted before invoking the extraordinary jurisdiction of the High Court.
They clearly lay down that in such a situation an illegality in the exercise of jurisdiction by the assessing authority would confer jurisdictions on this Court in the Constitutional Petition rather than an assumption alone as has been done in the instant case. It would, therefore, be clear that the assessing authority would in the first instance exercise jurisdiction on the basis of the evidence and the documents before it as to whether the property in question is liable to assessment of taxes and to what extent and that the available remedies are exhausted under the ordinary law before the extraordinary jurisdiction of this court is invoked in the Constitutional petition. Cases referred to: Managing Director Pakistan Agricultural Storage Service Corporation Ltd., Lahore and another v. Nawab Din and two others (1981 CLC 284); Pakistan through Ministry of Defence v. Province of Punjab and others (PLD 1975 S.C. 37); Gulzar Cinema, etc. v. Government of Pakistan and 4 others (PLD 1978 500).
Meraj Sons, Contractors v. Income Tax Officer Contarctors Circle-Il, Lahore – [1982] 45 TAX 2 (H.C.Lah.) 439.
If question of jurisdiction of the assessing officer is not challenged, writ petition is not maintainable.
A preliminary objection has been raised by the learned Deputy Attorney-General that the Writ petition under Article 9 of the Provisional Constitution Order No. I of 1981 is not maintainable unless the petitioner exhausts adequate legal remedies of appeal and revision available under the Ordinance. I agree with the learned Deputy Attorny-General that where there is another adequate and efficacious remedy open to the petitioner, a petition under Article 9 of the Provisional Constitution Order, 1981 would be incompetent unless the legal remedies as well as the remedies provided in the Ordinance are exhausted. There is, however, an ample authority on the proposition that where the question of jurisdiction or the authority passing the impugned order is raised, the remedy of appeal is not
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adequate and efficacious as the writ jurisdiction of the High Court and consequently in such cases, a petition under Article 9 of the Provisional Constitution would be competent. Cases referred to: S.A.Haroon and others v. Collector of Customs, Karachi [PLD 1959 S.C.Pak. 1977]; Lt. Col. Nawabzada Muhammad Amir Khan v. Controller of Estate Duty (PLD 1961 S.C. 119) = (1961) TAX 165 (S.C.); Premier Cloth Mills Ltd., v. The Sales Tax Officer (1972 SCMR 257) = (1974) 29 TAX 199 (S.C.); Salah-ud-Din and others v. Frontier Sugar Mills (PLD 1975 S.C. 244); The Burmah Oil Co. (Pakistan Trading) Ltd., Chittagong v. The Trustee of the Port of Chittagong (PLD 1962 S.C. 113); Pakistan and another v. Qazi Ziauddin (PLD 1962 S.C. 440); Nagina Silk Mills, Lyallpur v. The Income Tax Officer and another (PLD 1963 S.C. 322) = (1963) 7 TAX 442 (S.C.); Abdul Ghani and another v. Subedar Shoedad Khan Company and other (PLD 1968 S.C. 131); Usmania Glass sheet Factory Ltd., Chittagong v. Sales Tax Officer, Chittagong (PLD 1971 S.C. 205) = (1970) 27 TAX 229 (S.C.); and the Muree Brewery Co. Ltd., v. Pakistan etc. (PLD 1972 S.C. 219).
Ghulam Rasool v. Income Tax Officer, Rahimyarkhan and another – [1975] 31 TAX 153 (H.C.Lah.) 440.
Where appeal was dismissed by Appellate authorities on ground of limitation and this order was in accordance with law, held writ petition against such order was not competent.
The Appellate Assistant Commissioner dismissed the appeals holding that the appeals were barred by time as the demand notice was served on 29.1.1971 and the appeals were filed on 9.3.1971. The Appellate Tribunal affirmed the decision and held that the delay in filing appeals before the Appellate Assistant Commissioner remained unexplained and the Appellate Assistant Commissioner rightly refused to interfere with the orders of assessment. On these facts the High Court: Held that the petitioners have not succeeded in bringing their petitions within the ambit of Article 199 of the Constitution. Each one of the orders passed by the authorities in the hierarchy of the Income Tax Department is perfectly within their jurisdiction and in accordance with law. The writ petitions fail and are dismissed. Cases referred to : Commissioner of Income Tax v. Mubarak Ahmad (PLD 1972 Lahore 787); Commissioner of Income Tax v. E.V. Miller (PLD 1959 SC (Pak) 219) = (1959) 1 TAX I (SC); Nagina Silk Mills v. Income Tax Officer (PLD 1963 SC 322) = (1963) 7 TAX 422 (S.C.); Premier Cloth Mills Ltd. v. Sales Tax Officer (1972) SCMR 257; Usmania Glass Sheet Factory v. Sales Tax Officer (PLD 1971 SC 205); Bennet & White, Calgary Ltd. v. Municipal District of Sugar City No. 5 (PLD 1951 PC 78); Provincial Government of Madras v. J S. Basappa (AIR 1964 SC 1873); Yousuf Ali v. Muhammad
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Aslam Zia (PLD 1958 SC Pak. 104) and Sisil Kumar Das Purkhayastha v. State of Assam and others (1957) S.T.C. 416.
Sh. Abdul Hakeem v. Central Board of Revenue, etc. – [1975] 31 TAX 105 (H.C.Lah.) 441.
Writ not maintainable in the presence of adequate and efficacious alternate remedy.
The application dated 19.12.1970 submitted by the Advocate of the petitioner, clearly shows that the petitioner agreed to be assessed on consolidated income for the “years agreed at” and according to the Authorities he has been assessed to tax strictly according to his agreement. If this be the correct position, then even if the impugned order is found to have been passed without lawful authority, the petitioner is nevertheless disentitled to any relief in the exercise of the equitable writ jurisdiction of the Court. Cases referred to: State v. Ziaur Rehman (PLD 1973 (S.C.) 49; Federation of Pakistan v. Saeed Ahmad Khan and others (P.L.J. 1974 S.C. 77); Hafeezuddin v. Mian Khadim Hussain (PLD 1965 Lahore 439); Ghulam Mohyuddin v. Chief Settlement Commissioner (PLD 1964 S.C. 829; Pannalal Binraj and others v. Union of India and others (AIR 1957 S.C. 397) and Rex v. Williams Phillips; Exparte [(1914) I.KB. 608].
Shamim Ali and others v. Govt. of Pakistan and another – [1973] 27 TAX 51 (H.C.Lah.) 442.
Writ is not maintainable where adequate alternate remedy exists
As adequate alternate remedies exists for correcting any assessment made to the detriment of a particular party or made in an unjust and oppressive manner, in a given case, the present writ petition is, therefore, premature. Taj Din Maula Bux, Lahore v. Sales Tax Officer D-Circle Lahore – [1972] 25 TAX 145 (H.C.Lah.)
That remedy provided under Article 98 is a discretionary remedy and when an aggrieved person has an adequate relief elsewhere, there is a bar for the High Court to entertain a petition. Colony Textile Mills Ltd. Lahore v. Income Tax Appellate Tribunal (Pak) & another [1972] 25 TAX 140 (H.C.Lah.)
The Income Tax Act provides a complete machinery for assessment of tax and for obtaining relief in respect of any improper or illegal order passed by the Income Tax authorities and an assessee cannot unless
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the order impugned, is without jurisdiction or in excess of jurisdiction, invoke the jurisdiction of the High Court under Article 98 of the Constitution when he had adequate remedy open to him under the Act itself. _______________
MISCELLANEOUS
Commissioner of Income Tax v. Siemen A.G. – 1991 SCC 773 = PLD 1991 SC 368 443.
Islamic jurisprudence and rules of law are equally applicable to fiscal laws.
So long as the existing statutes were not brought in conformity with the injunction of Islam [Article 227 of the Constitution of Pakistan, 1973] their interpretation, application and enforcement wherein discretionary judicial elements were involved, only that course will be adopted which was in accord with the Islamic philosophy, its common law and jurisprudence. It was noted that the courts were bound to apply Islamic rules of interpretation. Unless excluded otherwise, in preference to the contrary so-called accepted rules of interpretation under the other jurisprudential concepts and fiscal laws were no exceptions in that behalf. As a necessary conclusion drawn from the foregoing, it can be safely held in this case also that on the touchstone of Islamic Rules of Interpretation, which unless excluded otherwise, under the present Constitutional set-up the courts are bound to apply in preference to the contrary so-called accepted rules of interpretation under the other jurisprudential concepts (and the fiscal laws are no exception in this behalf), the income tax authorities cannot change the nature of the contract intended by the parties thereto, under the pretext that the rule of interpretation of a fiscal law in this behalf, is different.” Mian Aziz A. Sheikh v. Commissioner of Income Tax Investigation Lahore – 1989 SCC 718 = [1989] 60 TAX 106 (S.C.Pak) 444.
Islamic jurisprudence and rules of law are equally applicable to fiscal laws.
Neither legislature under the command contained in Article 227(1) of the Constitution has power to enact a law in any field including
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those relating to taxes which is repugnant to injunctions of the Islam nor any other functionary including the Income Tax Authorities have any such power to lay down any un-Islamic rule which has a force of law. 445.
The assessing officer cannot lay down in their judgment a rule which goes against Islamic Law.
Article 227(1) not only requires that all existing laws shall be brought in conformity with the Injunctions of Islam but it also commands as a mandate that “no law shall be enacted which is repugnant to such injunctions”. It is command to all law-making bodies and functionaries. It will be anomalous to assume that although in Article 227 there is a command to all the legislative bodies not to enact any law which is repugnant to Islamic Injunctions, nevertheless it permits the functionaries of the State at all levels to go on enacting rules like those of evidence which have the force of law and which are repugnant to the Injunctions of Islam. It is in this context that the earlier made remarks about the conduct of State functionaries in Pakistan get illustrated, i.e., none would ever assert that he has power or would lay down a rule having the force of law, which is repugnant to Injunctions of Islam. In the context of the present case, neither the legislature, under the command contained in Article 227(1), has the power to enact a law in any field including those relating to Taxes, which is repugnant to Injunctions of Islam; nor any other functionary including the Income Tax Authorities has any such power to lay down any unIslamic rule which has a force of law. It is true that with regard to the statutory enactments Article 227 in its Clause (2) commands that: effect shall be given to the aforediscussed negative command in Clause (1), “only in the manner provided in this part (Part IX)”. And thus it may be argued, it also applies to Statutory Rule. But, this prohibition in Clause (2) of Article 227 does not apply to decisions by functionaries of State where in the judicial, quasi-judicial or other spheres involving exercise of judgment, as distinguished from exercise of law-making or statutory rule-making authority, they take decisions. In other words whatever a decision is contained in any such judgment of any such functionary which lays down a rule of law or declares so as a rule of law the superior Courts, shall be within their competence in a properly instituted proceedings to strike it down both under the general mandate contained in Clause (1) of Article 227 as well as under Article 2A read with the Objectives Resolutions.
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This is in addition to the reasoning which prevailed in the case: Muhammad Bashir v. The State (PLD 1982 S.C. 139) which had approved the judgment of the Lahore High Court in the case of Haji Nizam Khan v. Additional District Judge, Lyallpur and others (PLD 1976 Lahore 930). The approach then was that although it was not possible for the Courts to enforce Islamic Law in those fields which were fully occupied by statutory dispensation, yet, it was not only open to the Courts but they were duty bound to apply common law of Islam, its jurisprudence and philosophy, in fields which were not occupied by statutory dispensation. Various examples of those subjects are enumerated in the concluding part of the judgment of Haji Nizam‟s case. What was held in Muhammad Bashir‟s case and for that matter Haji Nizam‟s case, can now be further supported with reference to Articles 2A and 227(1) of the Constitution; as also, what has been held and enforced from amongst the principles of policy by this Court, in the case of Miss Benazir Bhutto. The foregoing rules of interpretation, would apply to the present case, to the decision of the Income Tax Authorities laying down in their judgment, a rule of evidence which goes against Islamic Law and jurisprudence. It was upheld by the High Court, though with respect wrongly, It has to be set aside and declared as of no effect. That being so, while setting aside the High Court judgment the question referred to the High Court, quoted in Paragraph 5 supra, is answered in the negative. The result is that the Income Tax Tribunal was not „right in holding that the sum of Rs.50,072 was properly included in the income of the assessee under section 16(3)(iii) of the Income Tax‟. Batala Engineering Ltd. v. Income Tax Officer Lahore – 1973 SCC 403 = [1974] 29 TAX 190 (S.C.Pak) 446.
Remedy to be sought within four corners of Act.
In the first place, prima facie, a suit does not lie under section 67 of Income Tax Act. The Income Tax Act is a complete code by itself and any grievance in regard to the assessment can be remedied within the four corners of that Act. Besides, the petitioner had a remedy under the Income Tax Act under section 30 and 33. Munir Ahmad & Others v. Federation of Pakistan – [1998] 78 TAX 217 (H.C.Lah.) = 1998 PTD 3900] 447.
Power to make rules is subject to certain limitations.
The power has been delegated to the Board to frame rules so as to determine the market value of the asset. The use of the word „market‟ is not without significance, for it requires that the value should be
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such which a willing buyer shall pay to a willing purchaser. If in a rule, valuation fixed has no reference to the market value, it would be ultra vires of the Act as it is against section 46. 448.
Discrimination in rule-making is ultra vires.
The rule provides for working out the market value i.e. break up value of the share. If this measure has been adopted for fixing the value of the share, there could possibly be no objection. Further more, if in the case of listed companies it is either the listed value or the face value whichever is less which constitutes the market value, the same treatment should have been meted out in case of non-listed companies by providing that the value shall be either the face value or the break up value worked out by the Wealth Tax Officer whichever is less. The rule is thus clearly discriminatory. Abbas S. Sharoff and another v. Income Tax Officer and Others – [1998] 78 TAX 119 (H.C.Kar.) = 1998 PTD 2884 449.
Civil suit does not lie against tax authorities unless order is malafide or illegal.
I am of the considered view that a suit seeking setting aside or annulment of an assessment order passed by Income Tax Authority will not be maintainable. In order to maintain a suit challenging any order passed under the Income Tax Ordinance, 1979, it is incumbent upon the plaintiff to show presence of these three elements i.e. mala fides, illegality and absence of jurisdiction to pass such order, otherwise provisions of Section 162 of the Ordinance, 1979 will come into play. Khawaja Textile Mills Ltd. v. Deputy Commissioner of Income Tax & 2 others – [1998] 77 TAX 1 (H.C.AJ&K) 450.
Basis of taxation in Islam.
In so far as the violation of Islamic Provision is concerned, it was argued that money collected a turnover of business become the property of the individual and cannot be snatched away through the imposition of taxes. Even in Islam, the imposition of taxes has a background, Zakat, Ushr, Jaziah are various forms of taxes. Zakat is not realized only on new income of the individuals rather it is levied on the entire belongings of an individual even if there is no income. The tax on the turn over a business is thus of a lesser gravity than that of Zakat. Jaziah is realized from non-Muslims, for defence services rendered by the state. In the present day world, the state is managing various affairs and also provides different services to the people in the shape of, defence,
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health, education and so many other developments for the benefits of the citizens. All this requires a huge sum of money which has to be collected from the people. Without taxes, it is not possible for a Government to defend the country and to provide other services and facilities or perform certain functions for the welfare and well being of the people. Thus the taxes have to be levied for different purposes in different shapes on different classes of persons. The question of classification has been discussed in detail in the judgement delivered by the Supreme Court and justified. The Islamic Shariah does not prohibit the collection of taxes, from any particular class of persons in the Islamic Society. The categorization of the people for the purpose of realizing the tax is not against the injunctions of Islam. The learned council for the petitioners had argued that realization of this type of tax is fraud, lie, deception, cheating, falsification, injustice and switching of the property of the petitioners through „Zulam‟. The various references made by the learned counsel to the books on Islamic jurisprudence, do not support his contention. Baby-own v. Income Tax Officer – 1997 PTD 47 451.
If notice is prima facie defective and error is incurable, the entire proceedings are null and void.
Provisions of section 65 stipulate three conditions for issuance of notice under section 65 of the Ordinance; firstly, the income chargeable to tax has escaped; secondly income has been underassessed; or assessed at too low a rate or has been the subject of excessive relief for a refund and thirdly if assessment is made under section 59(1) and there are reasons to believe that any of the aforementioned defects exists in assessment order. The notice, dated 21.2.1995 under section 65 aforementioned issued to the petitioner does not indicate under what subsection of the section has been issued; when confronted, the learned counsel for the department contended that as already show-cause notice was issued to the petitioner; to which the petitioner had submitted explanation; is understood that the notice has been issued under sub-para (c) of section 65(1) of the Ordinance, which is misconceived; as under the law, the assessing officer is required to apply his mind cautiously and to indicate the assessee under section 65(1) under what reason his assessment is sought to be reopen as reopening of a case to some extent is a penal action, so the assessee be prepared to meet the consequences of reopening of an assessment. As the notice prima facie is defective and the error is not curable as it does not indicate the reason to reassess the said income already
268 Section 1
Income Tax Digest.
assessed in the hands of the petitioner. The entire proceedings are null and void. Hudabiya Engineering (Pvt.) Ltd., Lahore v. Pakistan through Secretary, Ministry of Interior, Government of Pakistan, Islamabad – [1997] 76 TAX 302 (H.C.Lah.) 452.
Provisions of Protection of Economic Reforms Act, 1992 override Income Tax Law to the extent protections are provided in the former enactment.
In our opinion on its plain reading, section 5 not only grants full immunity to the holders of foreign currency accounts but also provides that complete secrecy be maintained in respect of the transactions in these accounts. We are also of the view that section 5 and 9 of the Act have different scope and operate in different fields and are, therefore, not complementary to each other. While section 5 of the Act in itself provides complete code so far as foreign currency accounts are concerned, section 9 applies to transactions other than those in foreign currency. There may be no cavil with the principle of interpretation relied upon by the learned single Judge that various provisions in the Act must be read together and the Act should be construed as a whole but that principle has no application in the present case. Be that as it may, all principles of interpretation of Statutes are nothing but tools which the Courts employ to find true legislative intent which cannot be defeated by relying upon some abstract principle. It will be seen from the above that Protection of Economic Reforms Act, 1992 was promulgated pursuant to the Policy of the Federal Government to protect various economic reforms undertaken by it in order to provide incentives to investors and to encourage inflow of foreign currency into Pakistan. While interpreting such a law relating to economic matters the Courts should so far as possible adopt that interpretation which furthers the object for which the same has been promulgated. The grant of immunity to the foreign exchange accounts is not something new or unique. In the past, the Government time and again introduced various schemes with a view to attract investment particularly in foreign currency in the country. These include the issuance of foreign exchange bearer certificates, foreign currency bearer certificates and foreign deposit bearer certificates. All these measures are part of fiscal policies which a Government is entitled to lay down keeping in view the national and economic interest. It is also to be seen that as section 4 and 5 of the Act, both deal with foreign currency, while interpreting section 5, section 4 of the Act
269 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1
cannot be lost sight of. It provides complete freedom to all citizens of Pakistan and all other persons to bring, hold, sell and take out foreign currency in any form. It specifically provides that no person shall be required to make any foreign currency declared at any stage and also ordains that no one shall be questioned in regard to the same. This clearly brings out the legislative intent that no question can be asked from the person holding any foreign currency in respect of the same. That being so, no inquiry either into the source or the holding of the foreign currency can be initiated or made by any agency especially when non-obstante clause in section 3 of the Act provides that the Act shall over-ride all other laws. On consideration of various provisions of the Protection of Economic Reforms Act, 1992, we have reach the conclusion that so far as foreign currency accounts are concerned, the holders thereof, have complete immunity from inquiry and scrutiny and complete secrecy must be maintained in respect of those accounts which cannot be violated by any Agency or functionary. That being so, neither the Income Tax Authorities nor Federal Investigation Agency had any jurisdiction to hold any inquiry in respect of the transactions in the foreign currency accounts nor could the same be made basis of criminal prosecution. National Electric Co. (Pvt.) Ltd. Gujranwala v. Commissioner of Income Tax Gujranwala Zone – [1996] 74 TAX 89 (H.C.Lah.) _ 453. Powers of CBR Territorial & Administrative Jurisdiction. Learned counsel for the petitioner has argued that the Tribunal was not justified in holding that Central Board of Revenue had exercised its authority with law by assigning the cases to the Inspecting Assistant Commissioner of Central Zone, Lahore. This argument need not be adverted to as almost on the similar ground the petitioner had challenged the order of the Central Board of Revenue by filing writ petition which was dismissed with the following observations: I do not think I can accept the contention of the learned counsel. Apportionment or distribution or work among the various officers of the Income Tax Department is essentially an administrative matter and is to be regulated by considerations mainly of convenience. The Central Board of Revenue stands at the apex in the hierarchy of Income Tax Authorities. Under section 8 of the Income Tax Ordinance it can give binding directions to all other Income Tax Authorities. It is, therefore, difficult to accept the
270 Section 1
Income Tax Digest.
contention of the learned counsel that in exercise of its powers under section 8, it can not transfer a case or a class of cases from one authority to another. The order passed by this court was upheld by the Supreme Court. The petitioner cannot, therefore, be allowed to reagitate the same matter again. METCO Shipbreakers & others v. Federation of Pakistan through Ministry of Finance, Islamabad – [1996] 73 TAX 85 (H.C.Quetta) 454.
Budget speech has no legal sanctity.
We have also focused our attention to the budget speech of the Minister made before National Assembly and the relief claimed for also resolves around it. Insofar as such speeches are concerned, in our view the same are without legal sanctity behind it and the Minister‟s speech is of no importance till the policies as highlighted in such speeches are given legal effect or cover by way of notification or instruction duly issued by Ministry concerned. Such speeches are usually motivated by political consideration and there is considerable difference in between such speeches and that of a policy recognized by some statute or enactment. The possibility of exaggeration in such speeches cannot be ruled out. The pivotal question is whether the points as highlighted in the speech or the policy intended to be formulated was subsequently given effect by issuance of a notification based on some enactment or statute meaning thereby that whether any legal coverage was given or otherwise. The Minister‟s speech can be termed as representation made on behalf of Government to highlight certain fiscal policies intended to be formulated but it must not be lost sight of that a „representation must relate to an existing fact or a past event; mere statement of intention or a promise de futuro does not create an estoppel. A representation, in order to give rise to an estoppel must be a statement which purports to affirm, deny, describe, or which otherwise relates to, an existing fact, circumstances or thing, or any past event. Not doubt that the Minister‟s speech has created false hopes and high expectations which could not be materialized but the speech having no legal sanctity behind it at the best it can be declared as „promise-de futuro‟ which cannot be enforced by invoking the constitutional jurisdiction of this court.
271 SHORT TITLE, EXTENT AND COMMENCEMENT
Section 1
Sanaullah Khan etc. v. Province of Balochistan etc. – [1995] 71 TAX 45 (H.C.Quetta) 455.
Government employees working in non-taxable territories are liable to pay income tax.
Perusal of above provision manifestly discloses that every Government employee, receiving salary from Federal Government, Provincial Government or any local authority of Pakistan is bound to pay income tax at prescribed rates irrespective of his status of residence, place of posting or nature of work. The question about applicability of Income Tax Ordinance, 1979 in tribal areas has absolutely no relevancy because income tax deductions are based upon entitlement of persons for receiving salaries from State exchequer. Therefore, we are inclined to respectfully observe that reference to above quoted judgment or bar under Article 227 of the Constitution which considering liability of Government employees regarding payment of Income Tax has no nexus with the proposition under consideration. We, therefore, feel no difficulty in concluding that once Government employee is receiving his salary from State exchequer, he automatically becomes liable to pay tax on his income, without any bar of locality, place of service or nature of duties unless specifically exempted. Income Tax Officer, Mirpur & 2 others v. Ch. Muhammad Bashir – [1994] 69 TAX 109 (S.C.AJ&K) 456.
The de facto doctrine.
The de facto doctrine which is to the effect that if an appointment order is found to be defective the acts performed by a functionary are not invalidated. However, it has been clearly laid down in the judgement that this doctrine has no application to a person who has not been appointed to a post and starts functioning without any order, valid or invalid. Coram non judice functions performed by such a person would not qualify for validation under the de facto doctrine. Bashir Sons (Pvt.) Ltd. v. CBR – [1993] 67 TAX 395 (H.C.Lah.) 457.
A notification purports to impose a new liability or obligation cannot operate retrospectively.
It is trite law that a notification which has the effect of imposing liability or obligation cannot operate retrospectively in the absence of any legal sanction in the statute itself.
272 Section 1
Income Tax Digest.
Commissioner of Income Tax v. Olympia – [1988] 57 TAX 46 (H.C.Kar.) 458.
Only natural/legal persons have the vested rights and not the government/state.
We may observe here that when reference is made in any law, legal document, legal language or law book or dictionary, about vested rights, the reference is to the vested right of a person natural or legal, and never to vested right of the state. Legal theories relating to vested rights never contemplate vested rights of state. Highland Manufacturer (Pak) Ltd. v. Commissioner of Income Tax (West) Karachi – [1985] 51 TAX 66 (H.C.Kar.) 459.
It is the duty of the legislature and not of a court to save income from escaping assessment.
We may observe here that the appellate tribunal or the courts can barely assume themselves the position of saving the income from escaping assessment. That jurisdiction vests in the legislature and those problems are, therefore, really for the legislature to solve and not for the courts and tribunals to worry about. Sh. Diwan Mohammad Mushtaq Ahmad, Karachi v. CBR & others – [1969] 19 TAX 198 (H.C.Kar.) 460.
Proceedings under the Income Tax Act are judicial proceedings.
The proceedings under the Income Tax Act, 1922 are judicial proceedings.
273 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
Section 2(1)* Agricultural Income
PAGE NO
SCOPE OF TERM „AGRICULTURE‟
461. 462.
463.
464.
465.
466.
Term „agriculture‟ is used in a narrow sense. = [1959] 1-TAX (III-207) = PLD 1959 SC 453
_
1959 SCC 68 281
“Agricultural purpose” and “Cultivation” of lands and “basic _ operations” explained. 1959 SCC 68 = [1959] 1-TAX (III207) = PLD 1959 SC 453
281
If income received by assessee falls within agricultural income, in what character assessee receives it is immaterial. _ [1948] 16 ITR 380 (PC)
282
Application of human skill and labour are essential _ ingredients of agricultural income. [1948] 16 ITR 433 (Nag.)
283
Unless there is cultivation and employment of skill and labour, land cannot be said to have been used for _ agricultural purposes. PLD 1948 PC 259 = [1948] 16 ITR 330 (PC)
283
In order to determine whether income is agricultural income or not regard must be had to the source of such income. _ [1940] 8 ITR 416 (Pat.)
284
LAND USED FOR AGRICULTURAL PURPOSES
467.
468.
*
Annual rent received for wasteland leased out for housing refugees temporarily held not to be agricultural income. _ [1960] 2-TAX (Suppl.-1) (H.C.Dacca) = 1960 PTD 1050 = PLD 1960 Dacca 34
284
Income derived from pasturage is income “derived from land which is used for agricultural purposes” within the meaning of the section 2(1)(a) of the Income Tax Act and is therefore exempt from assessment under section 14(3)(viii) of the Act. _ 1 ITC 284 (Cal.) = (1924) ILR 51 Cal. 504 = AIR (1924) Cal. 668 = 84 IC 31
285
Corresponding to section 2(1) of the 1922 Act.
274 Section 2(1)
Income Tax Digest. PAGE NO
469.
470. 471.
Income derived from fisheries and from sthaljat (i.e. land used for stacking timber) is not “agricultural income” or income “derived from land which is used for agricultural purposes” within the meaning of the section 2(1)(a) of the Act and is therefore not exempt from tax. Onus to establish agriculture income is on the assessee. _ [1959] 1-TAX (III-207) = 1959 SCC 68 = PLD 1959 SC 453 _ The term “such lands” explained. [1948] 16 ITR 330 (PC)
AGRICULTURAL PROCESS
_
472.
“Market” connotation of.
473.
If there is a market for produce in its original form, no process performed on it can be said to be a process necessary _ for rendering it fit to be taken to market. [1946] 14 ITR 611 (Bom.) _ Ginning of cotton. 4 ITC 375 (Nag.) _ „Flue curing‟ of tobacco. [1944] 12 ITR 1 (Mad.) _ Sisal fibre from aloe plants. 4 ITC 259 (Pat.)
474. 475. 476. 477. 478.
4 ITC 259 (Pat.)
Conditions as to requirement of building as a dwelling _ house, etc. 4 ITC 15 (Pat.)(FB) _ Condition as to vicinity to land. [1946] 14 ITR 356 (Oudh)
285 286 287
287
287 288 289 289 289 290
RENT / REVENUE, CONNOTATION OF
479.
Revenue whilst it may be a species of agricultural income _ has a wider meaning than rent. 4 ITC 15 (Pat.)(FB)
LAND MUST BE SITUATED IN PAKISTAN
480.
In case of land situated in Burma. (Mad.)
_
290
[1945] 13 ITR 122 290
LAND MUST BE ASSESSED TO LAND REVENUE
481.
482.
_ Position prior to Income Tax Ordinance, 1979. [1946] 14 ITR 554 (Sind); [1945] 13 ITR 122 (Mad.); [1955] 28 ITR 732 (Cal.) _ Position prior to Income Tax Ordinance, 1979. [1937] 5 ITR 118 (Cal.)
DIVIDENDS TO SHAREHOLDERS OUT OF „AGRICULTURAL INCOME‟
483.
Dividends distributed by a company to its shareholders out of “agricultural income” are “agricultural income” in the
291 291
275 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
_
hands of shareholders and are exempt from tax. [1960] 2-TAX (Suppl.-49) (H.C.Lah.) = 1956 PLD 45 = 29 ITR 296
PAGE NO
291
SALE OF TREES OF SPONTANEOUS GROWTH – NOT AGRICULTURAL INCOME
484.
485.
486.
487.
488. 489. 490.
Income from the sale of forest trees growing naturally on the soil does not constitute “agricultural income” within the meaning of section 2(1) of the Income Tax Ordinance, 1979 so as to be exempt from income tax under clause (1), Part I of the Second Schedule of the Income Tax Ordinance, _ 1979. [1959] 1-TAX (III-207) = 1959 SCC 68 = PLD 1959 SC 453
293
Income from forest of spontaneous growth without any aid of _ human skill and labour is not agricultural income. [1965] 12 TAX 136 (H.C.Dacca)
293
Income from sale of forest trees of spontaneous growth is not _ _ agricultural income. [1948] 16 ITR 330 (PC); [1949] ITR 445 (PC)
294
Income from sale of forest trees of spontaneous growth and self planted, determination of exempt portion as agricultural _ income held to be necessary. [1945] 13 ITR 74 (Oudh); [1946] 14 ITR 356 (Oudh); [1946] 14 ITR 787 (Oudh); [1947] 15 ITR 98 (All.); [1947] 15 ITR 181 (Oudh); [1947] 15 ITR 235 (All.)
295
Sale proceeds of fruits of trees of spontaneous growth. _ [1946] 14 ITR 788 (Oudh) _ Grass of spontaneous growth. [1946] 14 ITR 788 (Oudh) In case of income from sale of grass, moonj and forest trees _ which were not grown by actual cultivation. [1947] 15 ITR 235 (All.)
298 298
298
INTEREST ON ARREARS OF RENT
491.
492.
Income on arrears of rent payable in respect of land used for _ agricultural purposes is not agricultural income. [1948] 16 ITR 325 (PC); [1943] 11 ITR 532 (Mad.); [1943] 11 ITR 546 (Cal.); [1945] 13 ITR 309 (Pat.); 6 ITC 63 (Mad.); [1940] 8 ITR 460 (Cal.)
298
Income on arrears of rent payable in respect of land used for _ agricultural purposes is not agricultural income. [1940] 8 ITR 460 (Cal.); [1943] 11 ITR 546 (Cal.)
301
276 Section 2(1)
Income Tax Digest. PAGE NO
493.
494.
Income on arrears of rent payable in respect of land used for _ agricultural purposes is not agricultural income. [1943] 11 ITR 532 (Mad.) _ Where loan was repaid in form of agricultural produce. 6 ITC 41 (Rangoon)
301 301
ANNUITY
495.
Where agricultural land is exchanged for annuity, annuity _ is not agricultural income. [1935] 3 ITR 237 (PC)
302
COMMISSION
496.
Commission received by owner for selling agricultural _ produce of tenants is not agricultural income. [1936] 4 ITR 137 (Lahore)
303
SALARY / REMUNERATION
497.
498.
499.
500.
501.
502.
Where portion of income of managed company consists of agricultural income, it does not imply that any part of remuneration paid to managing agent is agricultural _ income. [1948] 16 IR 380 (PC)
303
Allowance paid to co-owner of agricultural land for _ managing land is not agricultural income. [1935] 3 ITR 404 (Lahore)
304
Remuneration to partner of a firm having agricultural income, for managing estate, is not agricultural income in _ partner‟s hands. [1944] 12 ITR 351 (Pat.)
304
Remuneration received by the lambardar for collecting land _ revenue is not agricultural income. [1936] 4 ITR 137 (Lahore)
304
Remuneration paid to mutawalli of wakf having _ agricultural properties, is not agricultural income. [1943] 11 ITR 295 (PC)
305
Where Remuneration to mutawalli held as agricultural _ income. [1942] 10 ITR 267 (All.)
306
Rent received for site of flour mill is not agricultural income. _ [1936] 4 ITR 137 (Lahore)
307
Rent collected by receiver and paid over to mortgagee of land _ is not agricultural income in mortgagee‟s hands. [1941] 9 ITR 56 (Mad.)
307
RENT
503. 504.
277 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1) PAGE NO
505.
Composite rent for agricultural/non-agricultural land. _ [1940] 8 ITR 550 (Pat.)
INCOME FROM MORTGAGE
_
506.
Income from mortgaged land.
507.
Income received by assessee money-lender from usufructuary _ mortgage of agricultural land, is agricultural income. 3 ITC 33 (Mad.)
308
Where assessee money-lender leases land, usufructuary mortgaged to him, to mortgagor, payment received for such _ lease will not be agricultural income in assessee‟s hands. 2 ITC 152 (Mad.)
308
If a person who lends a sum of money on security of land of which he takes a mortgage with possession on condition that he will receive an annual payment during term of mortgage, does not receive payment stipulated upon, but obtains a further mortgage deed for arrears due and finally purchases land and receives payment by way of deduction from sale money agreed upon of original sum loaned plus annual recurring payment due, sum received in excess of original loan be regarded as interest and not as agricultural income. _ 3 ITC 308 (Lahore)
309
Where assessee-money-lender made loan under a zarpeshgi lease with usufructuary mortgage, and indenture provided that (a) lessor-mortgagor was to convey agricultural lands to lessee-mortgagee, and (b) certain rent was reserved to mortgagor as thika rent and mortgagee was to take balance of profits, profits received by assessee was agricultural _ income. [1935] 3 ITR 305 (PC)
310
Rent received under mortgage, where held as agricultural _ income. [1948] 16 ITR 330 (PC)
311
508.
509.
510.
511.
2 ITC 495 (All.)
308
308
LEASE RENT
512.
513.
Whether lease rent is agricultural income or not has to be determined not with reference to purpose of lease when originally let out but by reference to use to which land has _ been put in relevant previous year. [1940] 8 ITR 378 (Cal.)
312
Income from lease of land for grazing cattle required for _ agricultural pursuits is agricultural income. [1948] 16 ITR 350 (Mad.)
313
278 Section 2(1)
Income Tax Digest. PAGE NO
514.
Unjust exactions made by landlord while renewing lease, _ are agricultural income. [1945] 13 ITR 174 (Mad.)
SALAMI (LUMPSUM PAYMENT)
515. 516.
Salami for letting out agricultural land. 263 (Cal.)
_
313
[1945] 13 ITR
Salami paid to landlord for recognising transfer of land. ITC 158 (Pat.)
_
314 3 314
MAINTENANCE ALLOWANCE
517. 518. 519.
520.
521.
522. 523.
In case of maintenance allowance received by junior member _ / others out of impartible estate. [1935] 3 ITR 356 (Oudh)
314
In case of maintenance allowance received by junior member _ / others out of impartible estate. [1934] 2 ITR 186 (All.)
314
In case of maintenance allowance received by junior member _ / others out of impartible estate. [1937] 5 ITR 569 (Lahore)
314
Maintenance received by widow out of agricultural income of estate of her deceased husband, is not agricultural _ income. 5 ITC 493 (Bom.)
315
Maintenance received by widow out of agricultural income of estate of her deceased husband, is not agricultural _ income. [1933] 1 ITR 379 (Oudh) _ Allowance to daughters. 3 ITC 428 (Mad.) _ Relinquishment of estate for monthly allowance. 9 ITC 35 (Oudh)
315 315 316
„FORESTRY‟ AND „AGRICULTURE‟ NOT SYNONYMOUS
524. 525. 526. 527. 528. 529. 530. 531. 532.
„Forestry‟ and „agriculture‟ not synonymous. (III-207) = 1959 SCC 68 = PLD 1959 SC 453 _ Pasturage. [1948] 16 ITR 350 (Mad.) _ Lac cultivation. [1948] 16 ITR 433 (Nag.) _ Brick-making. 5 ITC 42 (Pat.) _ Quarries. 2 ITC 425 (All.) _ Salt manufacturing. 2 ITC 363 (Mad.) _ Sale of earth. 2 ITC 281 (Pat.)
_
[1959] 1-TAX
Sale of water from Water canal held not to be agricultural _ income. 2 ITC 52 (Lahore) _ Fisheries. [1947] 15 ITR 235 (All.)
316 316 317 317 317 317 318 318 318
279 DEFINITIONS OF „AGRICULTURAL INCOME‟
533. 534. 535. 536. 537. 538. 539. 540.
Section 2(1) PAGE NO
_
Fisheries. [1933] 1 ITR 78 (Mad.) _ Toddy. 2 ITC 470 (Mad.) _ Nazrana. [1942] 10 ITR 322 (All.) _ Dharat. [1936] 4 ITR 114 (Lahore)
318 319 319 _
Jalkar/Hat/Ghattagi/Terries/Moorings. 1 ITC 303 (Pat.) _ Bankar/Lahkar/Phalkar. [1941] 9 ITR 313 (Pat.) _ Malikhana. [1948] 16 ITR 330 (PC) _ Mutation fee. 2 ITC 99 (Cal.)
319 319 319 320 321
TEA MANUFACTURERS
541.
Rule 8 is applicable only in respect of a seller who manufactures tea which he had himself grown and which he _ himself sells. [1946] 14 ITR 287 (Cal.)
321
COFFEE MANUFACTURERS
542.
Although income from coffee growing in certain cases may be treated as income from business, it will still be _ „agricultural income‟. [1939] 7 ITR 48 (PC)
322
SUGAR MANUFACTURERS
543.
Where business income comprises both agricultural and non-agricultural income, expenditure for earning _ agricultural income is not allowable. [1938] 6 ITR 194 (Rangoon)
322
REFERENCE TO THE HIGH COURT
544.
545.
546.
547.
Question as to whether income derived from a business is _ agricultural income or not, is not a question of fact. [1938] 6 ITR 145 (Rangoon)
323
It is entirely a question of fact whether in the year in question the rent was derived from land which was used for _ agricultural purposes. [1940] 8 ITR 378 (Cal.)
323
Question as to whether forest trees are of spontaneous _ growth or not is a question of fact. [1948] 16 ITR 433 (Nag.)
323
Question as to whether the process employed by the assessee agriculturist is a process ordinarily employed by a cultivator to render the produce fit to be taken to market, is essentially _ a question of fact. [1946] 14 ITR 611 (Bom.)
324
280 Section 2(1)
Income Tax Digest. PAGE NO
548.
549.
Conclusion of the Tribunal that process employed by assessee is a process ordinarily employed by a cultivator is _ one of fact. [1946] 14 ITR 611 (Bom.)
324
Question as to whether the process of „flue curing‟ was a process coming within section 2(1)(b)(ii), is a question of _ fact. [1944] 12 ITR 1 (Mad.)
324
281 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
Section 2(1)* Agricultural Income
SCOPE OF TERM „AGRICULTURE‟
Commissioner of Income Tax, East Bengal v. Kumar Ram Narayan Roy Chaudhary & others – 1959 SCC 68 = [1959] 1-TAX (III-207) = PLD 1959 SC 453 461.
Term „agriculture‟ is used in a narrow sense.
Where the assessee has made no contribution by way of cultivation no question can arise either of the land being used for agricultural purposes or of the trees grew on such land and the income they produce being the result of agriculture. The term “agriculture” has been used in the Ordinance in a narrow sense. It means that an operation to qualify as “agricultural” must involve or to be connected with the cultivation of the soil. The word “agriculture” is not used in its extended meaning. No assistance is to be sought from the meaning ascribed to the word “agriculture” in other statutes. 462.
“Agricultural purpose” and “Cultivation” of lands and “basic operations” explained.
Unless there is some measure of cultivation of land, some expenditure of skill and labour on it, it cannot be said to have been used for agricultural purposes. Cultivation in the strict sense of the term is restricted to the tilling of the land, sowing of the seeds, planting and similar operations on the land. The cultivation of land does not comprise merely of raising the products of the land in the narrower sense of the term like tilling of the land, sowing of the seeds, planting and similar work done on the land but also includes the subsequent operations. Basic operations would require the expenditure of human skills and labour upon the land itself. There are, however, subsequent operations *
Corresponding to section 2(1) of the 1922 Act.
282 Section 2(1)
Income Tax Digest.
necessary to be performed after the produce sprout from the land e.g. weeding, digging the soil around the growth, removing of undesirable undergrowths and all operations which foster the growth and preserve the same not only from insects and pets but also from depredation from outside, tending, pruning, cutting, harvesting and rendering the produce fit for the market. The later would all be subsequent operations when taken in conjunction with the basic operations. One cannot dissociate the basic operations from the subsequent operations even though they are divorced from the basic operations. Premier Construction Co. Ltd. v. Commissioner of Income Tax – [1948] 16 ITR 380 (PC) 463.
If income received by assessee falls within agricultural income, in what character assessee receives it is immaterial.
Where an assessee receives income, not itself of a character to fall within the definition of agricultural income contained in the Act, such income does not assume the character of agricultural income by reason of the source from which it is derived, or the method by which it is calculated. But if the income received falls within the definition of agricultural income, it earns exemption, in whatever character the assessee receives it. Note: See also Commissioner of Income Tax v. Raja Bahadur Kamakhaya Narayan Singh [1948] 16 ITR 325 (PC). Judicial analysis: EXPLAINED IN - Commissioner of Income Tax v. Mrs. E.V.H. Miller [1956] 29 ITR 296 (Lahore) with the following observations: “. . . . . What follows from Premier Construction Co. Ltd. v. Commissioner of Income Tax [1948] 16 ITR 380 (PC) is that the source was of no importance if the income itself was not of the character of agricultural income. But if it possessed that character, then it did not matter in what character the assessee received it, that is to say, whether he received it as shareholder or managing agent or mortgagee, or even as a cast-iron moneylender who peeled off agriculturists like Newton apples. It would be agricultural income, if it is derived from land of a certain type.” (p. 317).
FOLLOWED IN - Commissioner of Income Tax v. Maddi Venkatasubbayya [1951] 20 ITR 151 (Mad.), Raja Bahadur Vishweshwara Singh v. Commissioner of Income Tax [1954] 26 ITR 573 (Pat.), Maharajadhiraj Sir Kameshwar Singh v. Commissioner of Income Tax [1957] 32 ITR 377 (Pat.), S.A. Ramaraj v. CAIT [1969] 71 ITR 108 (Ker.) and Commissioner of Income Tax v. Mahasamund Kissan Co-op. Rice Mill & Marketing Society Ltd. [1976] 103 ITR 499 (MP).
283 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
Beohar Singh Raghubir Singh v. Commissioner of Income Tax – [1948] 16 ITR 433 (Nag.) 464.
Application of human skill and labour are essential ingredients of agricultural income.
Agricultural is the art or science of cultivating the ground. The essence of agriculture, even when it is extended to include „forestry‟ is the application of human skill and labour. Without that it can be neither art nor a science. It is essential that the income should be derived from some activity which necessitates the employment of human skill and labour and which is not merely a product of man‟s neglect or inaction except for the gathering in of the spoils. Not only must he labour to reap the _ harvest - that of course he must do else there could be no income but he must also labour to produce it. The burden being on the assessee to bring himself within the purview of the exemption, and he not having proved that the forest was „cultivated‟ by him in the sense that its produce was due to the skill and labour which he expended on it as opposed to produce which would come in any way from natural causes despite inaction on his part, income arising to the assessee from such land is not agricultural income. Raja Mustafa Ali Khan v. Commissioner of Income Tax – PLD 1948 PC 259 = [1948] 16 ITR 330 (PC) 465.
Unless there is cultivation and employment of skill and labour, land cannot be said to have been used for agricultural purposes.
No assistance is to be got from the meaning ascribed to the word „agriculture‟ in other statutes and, though it must always be difficult to draw the line, yet, unless there is some measure of cultivation of the land, some expenditure of skill and labour upon it, it cannot be said to be used for agricultural purposes within the meaning of the Act. Case review : Yuvarajah of Pithapuram v. Commissioner of Income Tax [1946] 14 ITR 92 (Mad.) and Benoy Ratan Banerji v. Commissioner of Income Tax [1947] 15 ITR 98 (All.) approved. Judicial analysis : EXPLAINED IN - Commissioner of Income Tax, East Bengal v. Kumar Ram Naryan Roy Chaudhry & Other [1959] 1-TAX (III-207) = 1959 SCC 68 by the Honourable Supreme Court of Pakistan in the following words: “The entire finding on points was fully extracted in the statement of the case. From this finding it follows that the trees sold during the years in question were of spontaneous growth without any human effort or skill, and as the Privy Council had held in Raja Mustafa Ali Khan v. Commissioner of Income Tax, [75 I.A. 268;
284 Section 2(1)
Income Tax Digest.
P.L.D. 1948 P.C. 259], the Income from the sale of such trees was not “agricultural” income within the meaning of the Act, there was no necessity for a reference. Nevertheless, the Tribunal on an application of the assessee thought it fit to make a reference.”
Commissioner of Income Tax v. Pandit Dhaneshwardhar Misra – [1940] 8 ITR 416 (Pat.) 466.
In order to determine whether income is agricultural income or not regard must be had to the source of such income.
In order to determine whether the income is agricultural income or not regard must be had to the source of such income. Where the assessee had been granted annual ex gratia amount in 1936 on resumption in 1919 of the thikadari lease given to the assessee‟s ancestors in consideration of some services rendered by them in the remote past, it was held that the ex gratia amount could not be regarded as agricultural income as the source of the income was the order granting ex gratia amount and not land. _______________
LAND USED FOR AGRICULTURAL PURPOSES
Commissioner of Income Tax, Bengal Mufassil v. Burdhan Kuti Wards‟ Estate – [1960] 2-TAX (Suppl.-1) (H.C.Dacca) = 1960 PTD 1050 = PLD 1960 Dacca 34 467.
Annual rent received for wasteland leased out for housing refugees temporarily held not to be agricultural income.
. . . . . the Government took on temporary lease about 500 bighas of waste land of the assessee in order to house and accommodate refugees from Burma and agreed to pay Rs.50,000/- as salami, and Rs.5,000/. as yearly rent to the assessee. The acquisition of the land by the Government was not compulsory. The transaction was purely contractual and the land continued to remain the property of the assessee although burdened with a lease during the period of war. The amount of the salami (Rs.50,000) and the rent (Rs.5,000)/-) received by the assessee was assessed to tax. Assessee‟s contentions that the salami was by way of compensation or in the nature of capital receipt and the rent (even if treated as income) were both agricultural income were overruled both by the Income Tax Officer and Appellate Assistant Commissioner. On a further appeal, the Tribunal agreed with the contentions of the assessee. On a reference, the High Court held that both the items were rightly treated as income and assessed to tax.
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Section 2(1)
Judicial review: It was an established fact in the case that during accounting period the land was not used for “agricultural purposes”. It was held that under section 2(1) of the Act it is the actual use of the land which is to be looked into as the decisive factor and not the purpose of lease. Mustafa Ali Khan v. Commissioner of Income Tax [AIR 36 1949 PC 13] was followed. Cases referred to: Mustafa Ali Khan v. Commissioner of Income Tax AIR 1949 PC 13 and Maharajadhiraj Sir Rijoy Chand Mahtab [1940] 8 ITR 378.
Emperor v. Probhat Chandra Barua – 1 ITC 284 (Cal.) = [1924] ILR 51 Cal. 504 = AIR (1924) Cal. 668 = 84 IC 31 468.
Income derived from pasturage is income “derived from land which is used for agricultural purposes” within the meaning of the section 2(1)(a) of the Income Tax Act and is therefore exempt from assessment under section 14(3)(viii) of the Act.
The question as regard income from pasturage is not now in dispute, and I agree with the Commissioner and the learned Vakil who appears for the Crown in thinking it to be reasonably plain that income from pasturage is “derived from land which is used for agricultural purpose”, and is, therefore, in the case of a permanently settled estate, within the exemption given by section 4, sub-section (3), clause (viii) of the Act to “agricultural income” as defined by section 2, sub-section (1), clause (a). in the circumstance that income is derived from fees realised from graziers who graze their cattle in the forest areas and waste lands there is nothing to render inapplicable the definition of “agricultural income” contained in clause (a). 469.
Income derived from fisheries and from sthaljat (i.e. land used for stacking timber) is not “agricultural income” or income “derived from land which is used for agricultural purposes” within the meaning of the section 2(1)(a) of the Act and is therefore not exempt from tax.
The last question for decision relates to what is called sthaljat or rent received for the use of land for stacking timber. In the application of the assessee it is thus described:“For the purpose of collecting the rent of the forests periodic leases are granted to parties permitting them to fell timber. Rent in kind is realised by a share of the timber felled or by a share of the sale-proceeds thereof. The timber so felled is not subjected to any process of manufacture. The lessees stack the felled timber at places for the purpose of sale and
286 Section 2(1)
Income Tax Digest.
payment of rent and for such stacking they pay rent of the site under the name of sthaljat. Here, again, the question is whether this rent is “derived from land which is used for agricultural purposes” under section 2(1)(a) of the Act. The contention of the assessee is that this rent is part of his income from the forest. That the land is used for purposes of forestry and that forestry is within the meaning of the term “agriculture” as used in Act. The learned Senior Government Pleader declines to concede that there is anything in the Income Tax Act which exempts income derived from forestry and contends that in any case this income is not a part of forestry income. The Commissioner of Income Tax, Assam, in the letter of reference to this court says: The land is used not by the applicant for the sale of his agricultural produce, but by persons to whom the applicant gives the right to cut, convert, transport and sell timber. While the profits arising to the landlord from forestry are exempt from Income Tax, I am of opinion that the profits of the persons who work the timber arise from „business‟ and are therefore assessable to Income Tax. Consequently rent received by the applicant is rent received from business premises and therefore does not come under the head of „agriculture‟ and is taxable”. I am not convinced that the legislature, if it intended to include “even „forestry‟” would have been content to say “agriculture” but in the circumstances I desire to prejudice this question no further than by an expression of this doubt. The contention of the assessee, however, must reach so far as to establish that land rented to purchasers of timber whereon they conduct operations of and incidental to the business of selling timber is land used for agricultural purposes by reason that the timber is bought from him, that the site is within or adjacent to his forest and that the amount due to him is paid there, or is in some manner calculated there. I think that this is to stretch ordinary language beyond its reasonable limits, and that the income in question is liable to assessment. Commissioner of Income Tax, East Bengal v. Kumar Ram Narayan Roy Chaudhary & others – [1959] 1-TAX (III-207) = 1959 SCC 68 = PLD 1959 SC 453 470.
Onus to establish agriculture income is on the assessee.
The language of the section is quite plain, and all that the assessee is required to show for the purpose of earning the exemption is that the
287 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
income in question was derived from the land which is “used for agricultural purposes”. Raja Mustafa Ali Khan v. Commissioner of Income Tax – [1948] 16 ITR 330 (PC) 471.
The term “such lands” explained.
Whether exemption is sought under section 2(1)(a) or section 2(1)(b) of the 1922 Act the primary condition that must be satisfied is that the land in question is used for agricultural purposes; the expression „such land‟ in sub-clause (b) refers back to the land mentioned in sub-clause (a) and must have the same quality. Judicial analysis: FOLLOWED IN - Commissioner of Income Tax v. Burdhan Kuti Wards Estate [1949] 17 ITR 191 (Dacca).] _______________
AGRICULTURAL PROCESS
J.M. Casey v. Commissioner of Income Tax – 4 ITC 259 (Pat.) 472.
“Market” connotation of.
The word „market‟ in section 2(1) implies a real centre of economic exchange and the purchase by jails is merely an artificial condition having no relation to a market for agricultural produce. Brihan Maharashtra Sugar Syndicate Ltd. v. Commissioner of Income Tax – [1946] 14 ITR 611 (Bom.) 473.
If there is a market for produce in its original form, no process performed on it can be said to be a process necessary for rendering it fit to be taken to market.
The produce must retain its original character in spite of the process unless there is no market for selling it in that condition. If there is no market to sell the produce, then any process which is ordinarily employed to render it fit to reach the market, where it can be sold, would be covered by the definition. Where the assessee grew sugarcane, but instead of selling it in raw form it made gur and sold this product, and the finding of fact was that the sugarcane grown by the assessee-company could either be sold to other factories or utilised by the factory to produce gur or sugar: Held that the income from the sale of gur was not agricultural income since there was a market where this sugarcane could be sold without passing through any process.
288 Section 2(1)
Income Tax Digest.
Judicial analysis: EXPLAINED IN - Sakarlal Naranlal v. Commissioner of Income Tax [1965] 56 ITR 503 (Guj.) with the following observations: “ . . . . . In Brihan Syndicate‟s case [1946] 14 ITR 611, Kania J., as he then was, after referring to section 2(1)(b)(iii), said: „Reading the words used in the definition section with their natural meaning they must mean that the produce must retain its original character in spite of the process unless there is no market for selling it in that condition. If there is no market to sell the produce then any process which is ordinarily employed to render it fit to reach the market, where it can be sold, would be covered by the definition . . .‟ The learned judge agreed with the Patna High court in J.M. Casey‟s case AIR 1930 Pat. 44 that market must mean a ready and available market where produce of the kind grown by the assessee is bought and sold and observed that since the statement of the case itself showed that there was a market for sugarcane, the process employed by the assessees in converting it into gul could not be said to be a process ordinarily employed to render it fit to be taken to market where it can be sold. Now it must be conceded straightaway that, in view of the decision of the Supreme Court in Dooars Tea Company Ltd.‟s case [1962] 44 ITR 6 (SC), the statement contained in the passage quoted above can no longer be regarded as good law in so far as it says that if there is no market for selling the produce in its original character, the character of the produce may be altered by performing a process necessary to render it fit to be taken to market and such a process too would be covered by section 2(1)(b)(ii). It is now clear that the produce must retain its original character and if the effect of the process is to alter the character of the produce, the process would not be a process within the intendment of section 2(1)(b)(ii). But this much is certainly established by this decision, namely, if there is a market for the produce, no process performed on it can be said to be a process necessary for rendering it fit to be taken to market.” (pp. 515-516)
Seth Sheolal Ramlal v. Commissioner of Income Tax – 4 ITC 375 (Nag.) 474.
Ginning of cotton.
Although it may be distinctly advantageous, even from the mere point of view of transport to have the cotton ginned first, it cannot be said that ginning cotton is essential in order to enable the produce to be „fit to be taken to market‟.
289 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
Commissioner of Income Tax v. Katragadda Madhusudhana Rao – [1944] 12 ITR 1 (Mad.) 475.
„Flue curing‟ of tobacco.
Process of „flue curing‟ can be termed as the process ordinarily employed by the cultivator of virginia tobacco to render it fit to be taken to the market. J.M. Casey v. Commissioner of Income Tax – 4 ITC 259 (Pat.) 476.
Sisal fibre from aloe plants.
The assessee among other activities of an agricultural nature cultivated aloe plants and from them by means of machinery prepared sisal fibre which he sold in the market. The department did not claim to recover tax on such portion of his profits as was attributable to the production of the aloe leaves but it was contended that the manufacture of the fibre from these leaves constituted a manufacturing process as opposed to an agricultural process the profits from which were not exempt as agricultural income. Held that the department‟s case was not sustainable. Raja Rajendra Narayan Bhanja Deo v. Commissioner of Income Tax – 4 ITC 15 (Pat.)(FB) 477.
Conditions as to requirement of building as a dwelling house, etc.
The word „requires‟ in proviso to section 2(1)(c) means that the assessee demands to appropriate the building for the purpose of a dwelling house, or as a store house, or other out-building and the words „by reason of his connection with the land‟ mean that only the fact of his being a receiver of rent or revenue or the fact of his being a cultivator, or the fact that he is a receiver of rent in kind entitles him to claim any building as a dwelling house, a store house or an out-building. If he should not occupy any of these positions in connection with the land he is not entitled to claim, as tax free accommodation of the kind specified. In other words, the expression „by reason of this connection with the land‟ is merely used to explain the nature of the class of persons entitled to exemption. it has been said that punctuation must not be used in construing a statue other than as a mere temporanea expositio, and for this limited purpose it may be noticed that the words are not separated by a comma or otherwise from the words „the receiver of the rent or revenue or the cultivator or the receiver of the rent in kind.‟ Whereas the very „requires‟ is separated by a comma from the grammatical subject and the phrase „by reason of his connection with the land‟. Thus, the conclusion is that this phrase has a qualitative and not a quantitative significance. Of course there must be a bona fide use
290 Section 2(1)
Income Tax Digest.
of the building as a dwelling house, store house or out-building and the assessee is not at liberty to claim arbitrarily the exemption of any building which he may at his own choice describe as dwelling house, store house or out-building without regard to the actual facts. Further held that on the finding that the building is required by the assessee by reason of his connection with the land, the Income Tax authorities have no jurisdiction to determine what portion of the building is as a matter of the fact required by the assessee in his capacity of receiver of rent or revenue and that the assessee is entitled to claim the entire annual value as agricultural income within the meaning of section 2(1)(c). Nawab Nawazish Ali Khan v. Commissioner of Income Tax – [1946] 14 ITR 356 (Oudh) 478. Condition as to vicinity to land. Where the finding of fact was that the residential house was at a distance of 16 miles from land, it was held that the Tribunal was right in not allowing exemption as the building could not be deemed to be in the immediate vicinity of land. _______________
RENT / REVENUE, CONNOTATION OF
Raja Rajendra Narayan Bhanja Deo v. Commissioner of Income Tax – 4 ITC 15 (Pat.)(FB) 479. Revenue whilst it may be a species of agricultural income has a wider meaning than rent. The word „revenue‟ is not to be construed as ejusdem generies, with rent. „Rent‟ has characteristics which are well known to lawyers. „Revenue‟ whilst it may be a species of agricultural income has a wider meaning than rent. _______________
LAND MUST BE SITUATED IN PAKISTAN
Chockalingam Chettiar v. Commissioner of Income Tax – [1945] 13 ITR 122 (Mad.) 480. In case of land situated in Burma. Income from agricultural land in Burma is not covered by the definition given in section 2(1)(a). Note:
It refers to repealed Act of 1922. The same definition is contained in section 2(1) of the Income Tax Ordinance, 1979. _______________
291 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
LAND MUST BE ASSESSED TO LAND REVENUE
Commissioner of Income Tax v. Jhamandas Devkishendas [1946] 14 ITR 554 (Sind); A. Chockalingam Chettiar v. Commissioner of Income Tax [1945] 13 ITR 122 (Mad.); Kumar Jagadish Chandra Sinha v. Commissioner of Income Tax [1955] 28 ITR 732 (Cal.) 481.
Position prior to Income Tax Ordinance, 1979.
For the purposes of section 2(1) for a land to be assessed to land revenue in British India or subject to a local rate, it must be land situated in British India and rate should be collected by officers of the Crown (Government of India). Accordingly, where the produce of agricultural land situated in native State was sold in British India, the income derived from sale was not agricultural income. Note: Kumar Jagadish Chandra Sinha v. Commissioner of Income Tax [1955] 28 ITR 732 (Cal.) was approved in Commissioner of Income Tax v. Carew & Co. Ltd. [1979] 120 ITR 540 (SC).
Mohanpura Tea Co. Ltd., In re [1937] 5 ITR 118 (Cal.) 482.
Position prior to Income Tax Ordinance, 1979.
Section 4(3)(viii) of the 1922 Act did not exempt income derived from lands assessed to land revenue in an Indian State. _______________
DIVIDENDS TO SHAREHOLDERS OUT OF „AGRICULTURAL INCOME‟
Commissioner of Income Tax v. Mrs. E. V. H. Miller / Mitchell R. (c/o The Colyana Estate, Okara) [1960] 2-TAX (Suppl.-49) (H.C.Lah.) = 1956 PLD 45 = 29 ITR 296 483.
Dividends distributed by a company to its shareholders out of “agricultural income” are “agricultural income” in the hands of shareholders and are exempt from tax.
The dividends declared out of agricultural income of the Company were included by the Income Tax Officer in the total income of the assessee, a shareholder. On appeal the Tribunal held that the dividends declared out of agricultural income retained the character of agricultural income and as such was not assessable, On a reference by the Department it was „held that, Per KAYANI, A.C. J. (as he was then).-The dividends distributed by a Company to its shareholders out of agricultural income is agricultural income in the hands of such
292 Section 2(1)
Income Tax Digest.
shareholders within the meaning of section 4(3)(viii) of the Income Tax Act. Per AKHLAQUE HUSAIN, J.(i)
The definition of “dividend” in subsection (6-A) of section 2 clearly indicates that it is the profits of „the Company which are distributed amongst its shareholders, that is to say, it is agricultural income itself which, in part or in whole, is distributed amongst its shareholders. Provisions in the Act entitling a shareholder to benefit, or refund, of the Income Tax paid by the Company also unmistakably point to the conclusion that the Act treats the income of a shareholder received by way of a dividend the same as the income of the Company;
(ii)
The dividend out of the agricultural income of a Company is agricultural income in the hand of a shareholder because the latter receives it in recognition of his right to it; and
(iii)
The real test in all cases is whether the recipient has received the income of the Company in pursuance of a right to receive it as such. It is wholly immaterial for the purposes of the Act whether the agricultural income has been received directly or indirectly, mediately or immediately, it is enough that it has been received as of right.
Judicial analysis : The main principle highlighted was that agriculture income is exempt in every one‟s hands received directly or indirectly. Since the sharesholders have right to participate in the income of a company, the dividends arising out of agricultural income of a company received by them are nothing but agricultural income. Later on, the department on the strength of section 151, specifically inserted in the Income Tax Ordinance, 1979 in the wake of this decision to nollify its effect, tried to argue that this case is no more valid. The Honourable Apex Court, however, in Julian Hoshange Dinshaw Trust v. Income Tax Officer (1992) 65 TAX 102 (S.C.Pak) = 199 SCC 777 observed that “if receipt is basically outside the purview of taxing statute, this section [section 151] has no validity at all as such a receipt cannot be brought under chargeability when received for the second time by a person other than the original recipient”. Judicial review: UPHELD by the Honourable Supreme Court (1959) 1-TAX (III-1) = 1959 SCC 53. Cases referred to: Commissioner of Income Tax v. Hungerford InvestmenI Trust [1936 P.C. 219]; Governor-General v. Raleigh Investment Co. [1944 ITR 265]; Mrs. Bacha F. Guzdar v. Commissioner of Income Tax (1955) 27 ITR 1; Mrs. Bacha F. Guzdar v. Commissioner of Income Tax (1952) 22 ITR
293 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
158; Vishweshwar Singh v. Income Tax Commissioner (AIR 1954 Pat. 581); Canadian Eagle Oil Company Ltd. v. The King (L.R. 1946 A.C. 119); Makund Sarup v. Commissioner of Income Tax, U. P. [1928 ITR 50 All. 495], Gresham Life Assurance Society v. Style [1892 A.C. 309]; F.H. Hamilton v. Commissioners of Inland Revenue (16 T.C. 213); Maharajkumar Gopal Saran Narain Singh v. Commissioner of Income Tax, Bihar & Orissa [1935 ITR 237]; Nawab Habibulla v. Commissioner of Income Tax [1943 ITR 295 and The Premier Construction Co. v. Commissioner of Income Tax, Bombay City [PLD 1948 P.C. 178]. Cases distinguished : Canadian Eagle Oil Co. v. The King [1946 A.C. 119] and Income Tax Commissioner, Bihar & Orissa v. Kamakhaya Narayana Singh (PLD 1948 P.C. 224). _______________
SALE OF TREES OF SPONTANEOUS GROWTH - NOT AGRICULTURAL INCOME
Commissioner of Income Tax, East Bengal v. Kumar Ram Narayan Roy Chaudhary & Others – [1959] 1-TAX (III-207) = 1959 SCC 68 = PLD 1959 SC 453 484.
Income from the sale of forest trees growing naturally on the soil does not constitute “agricultural income” within the meaning of section 2(1) of the Income Tax Ordinance, 1979 so as to be exempt from income tax under clause (1), Part I of the Second Schedule of the Income Tax Ordinance, 1979.
The income from the sale of forest trees growing naturally on the soil does not constitute “agricultural income” within the meaning of section 2(1) of the Income Tax Ordinance, 1979 so as to be exempt from income tax under clause (1), Part I of the Second Schedule of the Income Tax Ordinance, 1979. Commissioner of Income Tax, Dacca v. Suresh Prosad Lahiri Chowdhury, Mymensingh – [1965] 12 TAX 136 (H.C.Dacca) 485.
Income from forest of spontaneous growth without any aid of human skill and labour is not agricultural income.
The assessee leased out its forest to the Government and derived income in various kinds. The income so derived was charged to tax by the Income Tax Officer on the ground that as admitted by the assessee himself “the forest was of spontaneous growth without any aid of human skill and labour.” On appeal the Appellate Assistant Commissioner excluded the forest income from the assessment. The Appellate Tribunal affirmed the order of the Appellate Assistant Commissioner. On a reference, at the instance of the department:
294 Section 2(1)
Income Tax Digest.
Held, that it is claimed even on behalf of the assessee that “forest is of spontaneous growth without any aid of human skill and labour”. This would not constitute an agricultural income. Case applied : Commissioner, of Income Tax, East Bengal v. Kumar Ram Narayan Roy Chaudhury and others (1959) 1-TAX 207 (S.C.). Case referred to : Gopal Das Choudhury v. Commissioner of Agricultural Income Tax, East Bengal [4 P.L.R. 439 (Dacca)].
Raja Mustafa Ali Khan v. Commissioner of Income Tax – [1948] 16 ITR 330 (PC) 486.
Income from sale of forest trees of spontaneous growth is not agricultural income.
Where there was nothing to show that the assessee was carrying on any regular operations in forestry and that the jungle from which trees had been cut and sold was of spontaneous growth, it was held that income from the sale of trees was not agricultural income. Case review: Decision of the Oudh High Court in Raja Mustafa Ali Khan v. Commissioner of Income Tax [1945] 13 ITR 98 affirmed. Judicial analysis : FOLLOWED IN - Commissioner of Income Tax, East Bengal v. Kumar Ram Narayan Roy Chaudhary & Others [1959] 1-TAX (III207), 1959 SCC 68, Commissioner of Income Tax v. R.B. Rai Shamsherjang Bahadur [1953] 24 ITR 1 (All.) and Raja Benoy Kumar Sahas Roy v. Commissioner of Income Tax [1953] 24 ITR 70 (Cal.) DISTINGUISHED ON FACTS IN - Vikram Deo Varma, Maharaja of Jeypore v. Commissioner of Income Tax [1956] 29 ITR 76 (Orissa) on the ground that in the case before the Prvy Council, it was admitted that the trees grew without the intervention of human agency and the forest was of spontaneous growth, whereas in the case on hand, if was not only admitted that the trees had grown on land naturally, but the assessee had claimed that he was carrying on regular operations in forestry under expert advice. (pp. 95-96)
Sri Rajah Ravu Venkata Mahipathi Gangadhara Rama Rao Bahadur, Yuvarajah of Pithapuram v. Commissioner of Income Tax – [1949] ITR 445 (PC)
Income derived from the sale of forest trees growing on land naturally and without the intervention of human agency, even if the land is assessed to land revenue, is not „agricultural income‟ within the meaning of section 2(1) of the 1922 Act and is not, therefore, exempt from income tax under clause (1) Part 1 of the Second Schedule to the Income Tax Ordinance, 1979.
295 DEFINITIONS OF „AGRICULTURAL INCOME‟
Section 2(1)
Case review: Decision of the Madras High Court in Yuvarajah of Pithapuram v. Commissioner of Income Tax [1946] 14 ITR 92 affirmed. Judicial analysis: FOLLOWED IN - Viswanatha Cettiar v. Agl. Income Tax Officer [1965] 55 ITR 692 (Mys.)
Maharaja of Kapurthala v. Commissioner of Income Tax – [1945] 13 ITR 74 (Oudh); Nawab Nawazish Ali Khan v. Commissioner of Income Tax – [1946] 14 ITR 356 (Oudh); Rani Tara Kumari Devi v. Commissioner of Income Tax – [1946] 14 ITR 787 (Oudh); Benoy Ratan Banerji v. Commissioner of Income Tax – [1947] 15 ITR 98 (All.); Maharaj Sir Pateshwari Prasad Singh v. Commissioner of Income Tax – [1947] 15 ITR 181 (Oudh); Raja Bahadur Major Raja Durga Narain Singh v. Commissioner of Income Tax – [1947] 15 ITR 235 (All.) 487.
Income from sale of forest trees of spontaneous growth and self planted, determination of exempt portion as agricultural income held to be necessary.
Mere regeneration and preservation of trees cannot be said to be expenditure of human skill and labour upon the land itself, and the land cannot under the circumstances be held to be used for agricultural purposes nor can it be held that any process of agriculture is being carried on It is agreed on all hands that products which grow wild on the land or are of spontaneous growth not involving any human labour or skill upon the land are not products of agriculture and the income derived therefrom is not agricultural income. There is no process of agriculture involved in the raising of these products from the land. There are no agricultural operations performed by the assessee in respect of the same, and the only work which the assessee performs here is that of collecting the produce and consuming and marketing the same. No agricultural operations have been performed and there is no question at all of the income derived therefrom being agricultural income within the definition given in section 2(1) of 1922 Act. Where, however, the assessee performs subsequent operations on these products of land which are of wild or spontaneous growth, the nature of those operations would have to be examined to see if they are performed in conjunction with the basic operations of cultivation of the land. If so, the product can be treated as agricultural product. The assessee owned an area of 6,000 acres of forest land assessed to land revenue and grown with sal and piyasal trees. The forest was
296 Section 2(1)
Income Tax Digest.
originally of spontaneous growth, not grown by the aid of human skill and labour and it had been in existence for about 150 years. Considerable income was derived by the assessee from sale of trees from this forest. The tribunal had found that the forest was occasionally parcelled out for the purposes of sale and space from which trees sold were cut away, was guarded by forest guards to protect offshoots. It had been satisfactorily proved that considerable amount of human labour and care was being applied year after year for keeping the forest alive as also for reviving the portions that get denuded as a result of destruction by cattle and other causes. The staff was employed by the assessee to perform the following specific operations: (a) pruning, (b) weeding, (c) felling, (d) clearing, (e) cutting of channels to help the flow of rain water, (f) guarding the trees against pests and other destructive elements, and (g) sowing of seeds after digging of the soil in denuded areas. The Tribunal found that the employment of human labour and skill on items (a) to (f) was necessary for the maintenance and upkeep of any forest of spontaneous growth. Regarding item (g), however, it found that the said operation had been performed only occasionally and over a small fraction of the area where the original growth had been found to have been completely denuded. Such occasions were, however, few and far between; the normal process being that whenever a tree was cut, a stump of about 6” height was left intact which set forth offshoots all round bringing about fresh growth in course of time. This went on perpetually unless an area got otherwise completely denuded. The question was whether the impugned income was agricultural income. Held that forest in question was of spontaneous growth. If there were no other facts found, that would entail the conclusion that the income was not agricultural income. But then, it had also been found by the Tribunal that the forest was more than 150 years‟ old, though portions of the forest had from time to time been denuded, that is to say, trees had completely fallen and the proprietors had planted fresh trees in those areas, and they had performed operations for the purpose of nursing the trees planted by them. It could not be denied that so far as those trees were concerned, the income derived therefrom would be agricultural income. In view of the fact that the forest was more than 150 years‟ old, the areas which had thus become denuded and replanted could be considered to be negligible. The position, therefore, was that the whole of the income derived from the forest could not be treated as non-agricultural income. If the enquiry had been directed on proper lines, it would have been possible for the Income Tax authorities to ascertain how much of the income was attributable to
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Section 2(1)
forest of spontaneous growth and how much to trees planted by the proprietors. But no such enquiry had been directed, and in view of the long lapse of time, it was not desirable to direct any such enquiry now. The expenditure shown by the assessee for the maintenance of the forest was about Rs.17,000 as against a total income of about Rs.51,000. Having regard to the magnitude of this figure, a substantial portion of the income must have been derived from the trees planted by the proprietors themselves. As no attempt had been made by the department to establish which portion of the income was attributable to forest of spontaneous growth, the impugned income was agricultural income. Case review : Decision of the Calcutta High Court in Raja Benoy Kumar Sahas Roy v. Commissioner of Income Tax [1953] 24 ITR 70 affirmed. Judicial analysis : The following are the significant observation of Commissioner of Income Tax v. Raja Benoy Kumar Sahas Roy [1957] 32 ITR 466 (SC): “The expenditure shown by the assessee for the maintenance of the forest is about Rs.17,000 as against a total income of about Rs.51,000. Having regard to the magnitude of this figure, we think that a substantial portion of the income must have been derived from trees planted by the proprietors themselves. WERE EXPLAINED IN - Commissioner of Income Tax v. Ramakrishna Deo [1959] 35 ITR 312 (SC) in the following words: “. . . . . These observations do not lay down that if considerable amounts are expended in the maintenan
