Law: Income Tax Ordinance, 2001

Section: 39,111,111(1)(d),122,122(5),122(8),122(9 )

NOTES: Amendment of assessments - Income from other sources - Unexplained income or assets - Filing of income tax return by the respondent - Audit conducted - Deemed assessment amended - Complaint - Definite information - Concealment of income - Show Cause Notice - Assessment order re-amended - Dismissal of appeal by the CIR(A) - Allowing of appeal by the Appellate Tribunal - Reference application dismissed by the High Court - Commissioner sought leave to appeal from Supreme Court - Validity- FACTS The assessment order was amended by the department on the receipt of definite information that the taxpayer had concealed income - Appeal was dismissed by the CIR(A), but was accepted by the Appellate Tribunal - Reference application filed by the Commissioner was also dismissed by the High Court – ARGUMENTS Counsel for the Deptt. focused attention on sub-clause (i) of clause (d) of section 111(1) and stated that it was this provision that was applied correctly by the OIR as there had admittedly been suppression. Counsel for the Respondent submitted that the OIR had mis-construed this provision and correct approach was that as taken by the learned Tribunal. DECISION (a) Charge of Tax under clause (d) of section 111(1) of Ordinance, 2001- Validity - To pick out only two types of income (production and sales) and treat those “gross receipts” as liable to tax, out of the vast sea that otherwise constitutes “income” properly so-called (“any amount chargeable to tax”) is in our view not the correct approach. Thus, it is only production or sales chargeable to tax that can be brought within the ambit of clause (d). The categorization made by the Department is artificial and cannot be accepted. The approach taken by the learned Tribunal was correct. (b) Charge of tax on gross receipts or gross income - Scope - The power to amend can be exercised only if the facts and circumstances of the case come within the scope of any of the three clauses and then also, only (for the tax years in question, in the context of the appeals now before us) if there is “definite information” available. Furthermore, the power to amend can only be exercised within a specified period and not…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492