Law: Income Tax Ordinance, 2001

Section: 117,161,153(1)(a),153(7)(h)(i),205

Income Tax Ordinance (XLIX of 2001)----Ss. 161, 153(1)(a), 153(7)(h)(i), 205 & 117---Failure to pay tax collected or deducted---Tax year 2009-"Prescribed person "---Status of taxpayer---Association of Persons or Individual---Taxpayer was treated as taxpayer in default for non-deduction of tax under S.153 of the Income Tax Ordinance, 2001 on the ground that annual turnover of the taxpayer for the tax year 2009 exceeded Rs.50(M) and through Finance Amendment Act, 2008, Association of Persons having turnover of Fifty million rupees or above in tax year 2007 and onward fell in the definition of "Prescribed Person "; and taxpayer being a withholding agent was obliged to deduct income tax on raw material purchased and deposit same' into government exchequer as required under S.153(1)(a) of the Income Tax Ordinance, 2001---Taxpayer contended that return for tax year 2009 available on record had been filed in the status of individual and the returns of tax years 2009 and 2010 was also signed by the taxpayer as sole proprietor and was shown as owner of 100% shares of capital investment in the return and provisions of S.153(7)(h) of the Income Tax Ordinance, 2001, did not apply for tax year 2009 as well as tax year 2010, and the status in the returns for tax years 2009 and 2010 as Association of Persons was indicated due to compulsion of e -filing owing to technical reason of delay caused by the PRAL authorities regarding change in constitution and particulars of status in spite of application for which the taxpayer could not be blamed---Department contended that status of taxpayer was of AOP and before First Appellate Authority as well as the Appellate Tribunal, taxpayer changed his stance; that if the Association of Persons was dissolved then the intimation under 5.117 of the Income Tax Ordinance, 2001, was mandatory within fifteen days of its dissolution and that taxpayer being an Association of Persons was a prescribed person who was required to deduct tax under S.153(7)(h) of the Income Tax Ordinance, 2001---Validity---Returns along with other connected documents showed that the returns filed by the taxpayer for tax years 2009 and 2010 were of individual and not…

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