Law: Income Tax Ordinance, 1979

Section: 2(11)(29),14(1),22,30,136

Income Tax Ordinance (XXXI of 1979)----Ss. 2(11)(29), 14(1), 22, 30 & 136---Reference to High Court---Question involved in the case was, whether interest earned by assessee company on deposits in the bank, was a "business income" or could be termed as 'income from other sources', liable to tax---Contention of counsel for department was that when the assessee company was engaged in manufacture and sale of textile products and detonators, any interest earned by the assessee through an investment made in bank or financial institution, would be 'income from other sources', which was liable to tax---Contention of counsel for the assessee, on the other hand, was that any interest accruing on a deposit, earned out of the business income, would be 'income from business', within the terms of S.22 of Income Tax Ordinance, 1979, and in circumstances, was not liable to income tax---Validity---Interest earned on such deposits, would essentially be 'income from other sources'---Section 30 of Income Tax Ordinance, 1979, nowhere made any distinction whether investment in a bank or financial institution was made out of an income earned through business or any other source---Such income by no canons of interpretation, could be termed as 'income from business', especially when accrual of interest had no nexus with manufacture or sale of textile products and detonators---Such income in circumstances, was 'income from other sources', liable to be taxed. Commissioner of Income Tax East Pakistan Dacca v. The Liquidator, Khulna Bagerhat Railway Company Ltd., Ahmadabad PLD 1962 SC 128 and Messrs Lakki Cement Ltd., v. Commissioner Income Tax, Tax Reference No. 117 of 2003, decided on 22-11-2005 rel. The Commissioner of Income Tax, Sales Tax, North Zone (West Pakistan) Lahore v. Messrs Agha Textile Mills, Gujranwala PLD 1962 (W.P) Lahore 816 and The Commissioner of Income Tax, East Pakistan v. Messrs Ayurvedic Pharmacy (Dacca), Ltd. PLD 1970 SC 93 distinguished. JUDGMENT EJAZ AFZAL KHAN, C.J.---The Commissioner Income Tax has filed Tax References Nos. 151 of 2003 and 57 of 2004 by urging the question whether on the facts and in the circumstances of the case, the Income Tax Appellate…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492