Law: Income Tax Ordinance, 2001

Section: 28(1)(a),133

Income Tax Ordinance (XLIX of 2001)- -Ss. 28(1)(a) & 133-Reference-Interest free loan to employees- Authorities disallowed markup expenses in terms of S.28(1)(a) of Income Tax Ordinance, 2001, on account of interest free loan advanced to employees for purchase of motorcycles-Validity-Amount advanced/loan given to employees by taxpayer's company was meant for the purposes of purchasing motorcycles to ensure that employees would reach office in time, and such act was to improve punctuality and to increase efficiency of employees to benefit purpose of business of taxpayer's company-Commissioner Inland Revenue (Appeals) rightly observed that such advance of money could not be equated with advances/loan for personal use of employees such as marriage loan, house purchase loan, personal loan etc.-Concurrent findings as recorded by two appellate forums in absence of any material contrary to such facts, did not suffer from any error or illegality nor such findings were either based on misreading or non-reading of evidence- Reference was dismissed in circumstances. THIS ORDER PASSED BY: AQEEL AHMED ABBASI, JUSTICE:---.--- Through instant reference application, the applicant has proposed the following question, which according to learned counsel, is a question law arising from the impugned order dated 03.11.2015 passed by the learned Appellate Tribunal Inland Revenue (Pakistan), Karachi, in Income Tax Appeal No. 974/KB of 2013 (tax year 2010):- "Whether on the facts and circumstances of the case, the learned Tribunal was justified to annul disallowance of mark up expenses made on account of interest free loans to the employees in terms of section 28(1)(a) of the Income Tax Ordinance, 2001?" 2. Learned counsel for the applicant has read out the impugned order passed by the Appellate Tribunal in the instant case as well as the orders of the two authorities below and submits that Appellate Tribunal was not justified to maintain order passed by the Commissioner (Appeals-I) Inland Revenue, for the reasons that the interest free loans advanced to the employees for purchase of Motorbikes has negative effect on the profitability of the taxpayer's company, therefore, cannot be…

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