| Citation(s) |
|---|
| 2023 SLG 2126 2023 SLD 2126 2023 SCMR 1595 2023 PTCL 839 2023 SCP 193 130 TAX 175 |
Supreme Court of Pakistan
Civil Appeal No. 1275 of 2009, C.M.A. No. 6731 of 2018,Civil Appeals Nos. 1292 to 1296 of 2009 and Civil Appeal No.227 of 2011, decided on 13th March, 2023. Date of hearing:13th March, 2023. (On appeal from the judgment dated09.02.2005 passed by the H
Present: Umar Ata Bandial, C.J., Muhammad Ali Mazhar and Ayesha A. Malik, JJ
Dr. Shah Nawaz, Advocate Supreme Court (via video link from Karachi) for Appellants (in C.A. No. 1275 of 2009). Zafar Iqbal Chaudhry, Advocate Supreme Court and Mrs. Tasneem Amin, Advocate-on-Record (via video link from Lahore) for Appellants (in C.As. No
Civil Appeal No. 1275 of 2009, C.M.A. No. 6731 of 2018,Civil Appeals Nos. 1292 to 1296 of 2009 and Civil Appeal No.227 of 2011, decided on 13th March, 2023. Date of hearing:13th March, 2023. (On appeal from the judgment dated09.02.2005 passed by the H
Present: Umar Ata Bandial, C.J., Muhammad Ali Mazhar and Ayesha A. Malik, JJ
Dr. Shah Nawaz, Advocate Supreme Court (via video link from Karachi) for Appellants (in C.A. No. 1275 of 2009). Zafar Iqbal Chaudhry, Advocate Supreme Court and Mrs. Tasneem Amin, Advocate-on-Record (via video link from Lahore) for Appellants (in C.As. No
The COMMISSIONER OF INCOME TAX, COMPANIES ZONE-II, NEW INCOME TAX BUILDING, SHAHRAH-E-KAMAL ATTATURK, KARACHI and another---Appellants
VS
Messrs PAK SAUDI FERTILIZERS LTD., KARACHI through M.D. and another---Respondents
Law: Income Tax Ordinance, 1979
Section: 80C
Law: Contract, Act, 1872
Section: 182
Law: Sale of Goods Act, (III of 1930)
Section: 19,20
Income Tax Ordinance (XXXI of 1979) [since repealed]------S. 80-C---Contract Act (IX of 1872), S. 182---Sale of Goods Act (III of 1930), Ss. 19 & 20--- Presumptive tax regime--- Fertilizer manufacturing company and marketing company---Whether principal-agent relationship---Income Tax Appellate Tribunal held that as marketing company was an agent of the fertilizer manufacturing company, hence, keeping in view the relationship of agent and principal, the manufacturing company could not claim any benefits under the presumptive tax regime provided under section 80-C of the Income Tax Ordinance, 1979 ('ITO 1979') and was liable to dealt with through normal assessment under section 62 of the I.T.O., 1979---High Court, however, held that the agreement between the two companies envisaged the outright sale of fertilizers manufactured by the manufacturing company to the marketing company, thus, the advance income tax deducted under section 50(4) of the I.T.O., 1979 upon the payments made by the latter to the former qualified to be treated as the income of the manufacturing company under section 80-C of the I.T.O., 1979 and the assessment should be finalized for the year in question under section 80-C of the I.T.O., 1979---Held, that survey and analysis of the terms and conditions of the 'Agreement' between the two companies showed that it was an agreement for outright sale by means of which the payments were being made in full after deduction of the advance income tax by the marketing company for settlement of invoices---Neither substratum of the agreement under lined any characteristics of agency nor contained any provision for agency commission---Even if issue of relationship between the companies was left to one side, section 80-C of the I.T.O., 1979 articulates that any amount received under which tax was deductible under Section 50(4) was deemed to be the total income tax liability of the assessee which was not disputed or resisted by the tax department in the present case, therefore, the amount received after deduction under section 50(4) was rightly deemed to be the total income tax liability and for all practical and legal purposes, the manufacturing company…
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