Law: Income Tax Ordinance, 2001

Section: 2(22A),113,120,122(5A),133(5),Clause(8) ofPartIII of Second Schedule

NOTES: Notice under Section 122(5A) Short payment of turnover Minimum tax under Section 113 and construing the assessment order as erroneous and prejudicial to the interest of revenue Appeal allowed against the amended assessment order Second appeal filed by department was rejected by Appellate Tribunal Inland Revenue Whether the household electronic goods can be termed as consumer goods for the purpose of clause (8) of Part III of Second Schedule. THIS JUDGMENT DELIVERED BY: SHAHID JAMIL KHAN, JUSTICE:---.--- This judgment shall also decide ITR No. 119 of 2015 as common legal proposition is addressed to answer the proposed question of law. 2. Facts of the instant case are that the taxpayer drove income from wholesale of household goods and filed return for tax year 2012, which was taken to be assessment order under Section 120 of the Income Tax Ordinance, 2001 ("the Ordinance"). Notice under Section 122(5A) was served; confronting short payment of turnover / minimum tax under Section 113 and construing the assessment order as erroneous and prejudicial to the interest of revenue. Reply to the notice was found unsatisfactory; therefore, claim of reduced rate, at 80% of normal rate, under Clause (8) of Part III of The Second Schedule, was declined through amended assessment order. Appeal against the amended assessment order was allowed by first Appellate Authority. Second appeal filed by department was rejected by Appellate Tribunal Inland Revenue ("Appellate Tribunal") by holding the claim of 80% reduced rate as correct, which is assailed through this tax reference. Following question is proposed and pressed:- "Whether on the facts and circumstances of the case, the household electronic goods can be termed as consumer goods for the purpose of clause (8) of Part III of Second Schedule while actual nature of the goods is consumer durables?" 3. Learned counsel for applicant argued that the Clause (8) was to be interpreted by employing principle of "ejusdem generis" He explained that 'electric appliances' could not be read with 'pharmaceutical products', 'fertilizer' or as 'fast moving consumer goods'. He placed reliance on Black's Law Dictionary as well as…

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