| Citation(s) |
|---|
| 2013 SLG 196 2013 SLD 196 (2013) 108 TAX 154 |
Appellate Tribunal Inland Revenue
I.T.A. No. 2143/LB/2012 (Tax Year 2006), I.T.A. No.2144/LB/2012 (Tax Year 2010), I.T.A No. 2145/LB/2012 (TaxYear 2011). DATE of order 19/07/2013
CH. ANWAR-UL-HAQ, JUDICIAL MEMBER AND MRS. SABIHA MUJAHID, ACCOUNTANT MEMBER
Appellant by Mr. Asim Zulfiqar, FCA alongwith Syed Shabbar Zaidi, FCA, Mr. Shahzad Hussain, FCA and Ms. Uzma Adil Khan, CFO.
Respondent by Khawaja Farooq Saeed, Advocate High Court alongwith departmental officials Khawaja Adnan Zahir, CIR, Mr. Muhammad Ta
I.T.A. No. 2143/LB/2012 (Tax Year 2006), I.T.A. No.2144/LB/2012 (Tax Year 2010), I.T.A No. 2145/LB/2012 (TaxYear 2011). DATE of order 19/07/2013
CH. ANWAR-UL-HAQ, JUDICIAL MEMBER AND MRS. SABIHA MUJAHID, ACCOUNTANT MEMBER
Appellant by Mr. Asim Zulfiqar, FCA alongwith Syed Shabbar Zaidi, FCA, Mr. Shahzad Hussain, FCA and Ms. Uzma Adil Khan, CFO.
Respondent by Khawaja Farooq Saeed, Advocate High Court alongwith departmental officials Khawaja Adnan Zahir, CIR, Mr. Muhammad Ta
M/s. Sui Northern Gas Pipelines Ltd., 21-Kashmir/Egerton Road, Lahore. vsThe Commissioner of Inland Revenue, Zone-III, LTU, Lahore.
Law: Income Tax Ordinance, 2001
Section: 54,60,60B,20,20(1),122(5A),49(4),120
Law: Income Tax Ordinance, 1979
Section: 80DD,23
Law: Constitution of Pakistan, 1973
Section: 165A
[Income Tax Ordinance (XLIX of 2001)]........Sections 120, 122(5A),, Return,, Assessment,.. Amendment,.. Appeal,, Issues of legality of order, dated 25/06/2012 on the point of applicable limitation of time, admissibility of "Gas Development Surcharge (GDS)" paid by appellant to Federal Government, arbitrary enhancement of taxable income, admissibility of "provision for obsolete stores and spares" and eligibility of the appellant to tax credit, admissible to "industrial undertakings" were involved,, First legal issue regarding limitation of time was withdrawn, hence not adjudicated,, (b) Income Tax Ordinance (XLIX of 2001),, Sections 54, 60, 60B, 20, 20(1), 122(5A), 49(4),, Income Tax Ordinance (XXXI of 1979),, Sections 80DD, 23,, Oil and Gas Regulatory Authority Ordinance, 2002, Sections 8(5), 50(5),, Constitution of Islamic Republic of Pakistan, 1973, Article 165A,, Rules of Business of Government of Pakistan, 1973, Rule 14,.. Protection of Economic Reforms Act, 1992,, Finance Act, 1999,, Admissibility of 'gas development surcharge' ('GDS'),, Facts, framework and basis underlying the amount/claim of the appellant, described in the audited financial statements of appellant company was that "Under the provisions of license for transmission and distribution of natural gas granted to the company by OGRA, the Company is required to earn an annual return of not less than 17.50% per annum on the value of its average fixed assets in operation (net of deferred credit), before corporate income taxes, interest and other charges on debt and after excluding interest, dividends and other non operating income,.. Any deficit or surplus on account of this is recoverable from or payable to the Government of Pakistan as differential margin or gas development surcharge",.. It was pointed out by ARs that while receipt of differential margin was reflected as income in the financial statements, CDS was recognized as an expense, the appellant, for the purposes of computing its taxable income, taken into account both the GDS & differential margin in a manner that while GDS was claimed as a deduction, the differential margin was offered as an article of income,, For the tax years…
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