Law: Income-tax Act (XI of 1922)

Section: 10(2) (xvi)

Law: Finance Act, 1976

Section: 3(6), 34(2)

Law: Constitution of Pakistan 1973

Section: 201

(a) Income-tax Act (XI of 1922)  S. 10(2) (xvi) and Insurance Rules, r. 40-Allowable expense---Management expenses in excess, and in contravention, of limits prescribed in such behalf under r. 40 of Insurance Rules-Held, incurred wholly and exclusively for purpose of business and thus allowable expenses. Civil Reference No. 31 of 1966 ; Crescent Star Insurance Company's case (1974) 29 Taxation 111 and Appeals Nos. A. C. A. 472-A/68-69/CC /1 ref. (b) Finance Act (XLVII of 1976) Ss. 3(6) & 34(2) read with Constitution of Pakistan (1973), Art. 201-Superior Court decision-Binding nature of-Decisions of superior Courts of Pakistan--Binding on all subordinate Courts of Pakistan-Highly insolent on part of Assessing Officer to place reliance on foreign authorities to ignore or undermine direct rulings of superior Courts of Pakistan-Assessing Officer, held, pos sessed no authority to differ from legal position spelt out by High Court notwithstanding matter having been taken in appeal to. Supreme Court.                                                                                                                                  ORDER A. A. E.UBERI (MEMBER).-These six Appeals, three at the instance Department and three at the instance of the Assessee, relate to the Assessment years 1972-73, 1973-74 and 1974-75 decided by the learned Appellate Assistant Commissioner .. Range on 2-8-1974 vide Appeal No. 875 of 1974-75 and 1139, 1140 of 1975-76. Excess Management Expenses.-On scruntiny of accounts the Assessing Officer found that the Management Expenses, as claimed by the Assessee, ex-seeded the limit prescribed under rule 40 of the Insurance Act: He, therefore, worked out the excess over the maximum admissible of which Assessee's share came to Rs. 872 in 1972-73, Rs. 56,493 in 1973-74 and Rs. 91,595 in 1974-75. These were disallowed. On…