Law: Income Tax Ordinance, 1979

Section: 2,2(12),2(16)(cc),Cl.116

(a) Income Tax Ordinance (XXXI of 1979)-----Ss. 2(12), 2(16)(cc) [as inserted by Finance Act (VII of 1992)] & Second Sched. Cl.116---Modaraba Companies and Modarabas (Floatation and Control) Ordinance (XXXI of 1980), Ss. 14, 15 & 36---Modaraba Companies and Modaraba Rules, 1981, R.22---Capital gains derived from sale of Modaraba certificates prior to 30-6-1992---Taxability---Scope---Modaraba being a company and body corporate would squarely fall under definition of term "company" as defined in Income Tax Ordinance, 1979---Clause (cc) had been inserted in S.2(16) of Ordinance, 1979 through Finance Act, 1992 to remove confusion about status of Modaraba---Beneficial provisions of law would have retrospective effect, unless and until made prospective by their implication---Such amendment, was beneficial to taxpayer--Modaraba would be considered a company even prior to such amendment---Modaraba enjoyed status of company being a body corporate formed under Modaraba Companies and Modarabas (Floatation and Control) Ordinance, 1980---Income from sale of Modaraba certificates falling under Cl.116 of Second Sched. of the Ordinance was exempt from ambit of tax---Principles. Commissioner of Income Tax v. Spring Field Secondary School Karachi 2003 PTD 1264 and Commissioner of Income Tax v. Messrs Lahore Cantt. Cooperative Housing Society 2009 PTD 799 distinguished. Central Insurance Co. and others v. Central Board of Revenue 1993 SCMR 1232 rel. (b) Interpretation of statutes----Beneficial provisions of law would have retrospective effect unless and until made prospective by their implication. Commissioner of Income Tax v. Shahnawaz Ltd. and others 1993 SCMR 73 rel. (c) Interpretation of statutes-----Remedial and curative statutes are always retrospective in nature. Commissioner of Income Tax v. Shahnawaz Ltd. and others 1993 SCMR 73 rel. THIS JUDGMENT DELIVERED BY: IRFAN SAADAT KHAN, J.---This Income Tax Reference (ITR) has been referred by the income Tax Appellate Tribunal (ITAT) vide its order dated 30-9-1993 in R.A. No.276/KB of 1992-93 whereby the ITAT has referred the following question, said to be arising from its order dated 26-12-1992 in I.T.A. No.8095/KB of…

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