Law: Income Tax Ordinance, 2001

Section: 21(c),21(l),21(m),32,39,67,113,120(1),12 2(5A),122(9),147,149,168(3),237

Law: Income Tax Ordinance, 1979

Section: 80D,80CC

ORDER This consolidated order shall dispose of five appeals, two pertaining to tax years 2006, 2010, at the instance of the taxpayer and three preferred by the department relating to tax years 2010 & 2012. After hearing both the representatives of the rival parties, the appeals are disposed of as under:- Tax year 2006 - Taxpayer's appeal:- In this appeal the taxpayer has assailed the order of CIR(A) dated 11 09.2012 Facts of the case, in brief, are that the return filed by the taxpayer, a public limited company, deriving income from manufacturing and sale of sugar was taken to be treated as order under Section 120(1) of the Income Tax Ordinance, 2001. Later on, the deemed order was considered as it was erroneous in so far as it was prejudicial to the interest of revenue by the Additional Commissioner in terms of Section 122(5A), hence, notice u/s 122(9) was issued. The reply furnished by the A R of the appellant was found unsatisfactory and consequently order u/s 122(5A) was passed by making additions under the heads imposition of minimum tax, proration of other income, apportionment of deduction u/s 67, apportionment of commission, allocation of expenses to dividend income and short credit of tax. On first appeal, the CIR(A) deleted the addition made on account of allocation of expenses to dividend income but maintained the other additions. However, on the issue of short credit of tax, the Assessing Officer was directed to allow full tax credit at the time of appeal effect after verification. The taxpayer being dissatisfied assailed the impugned order on the following grounds:- i. That the learned CIR(A) has legally erred in upholding levy of minimum tax u/s 113 on business turnover representing local sales only instead of aggregate turnover from all sources, by ignoring the legal provisions, decision of Higher Courts and submissions of the appellant His action under the garb of Section 168(3) of the Income Tax Ordinance, 2001 is unlawful and is unsustainable. ii. That the learned CIR(A) has legally erred in holding that the credit of tax deducted on exports could not be allowed against minimum tax liability by ignoring the provisions of Section 113 of the…

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