Law: Income Tax Act, 1922

Section: 10(2A),24

Law: Workers Welfare Fund Ordinance, 1971

Section: 4

(a) Income-tax Act (XI of 1922)---S. 10 (2-A)-Amount in question continued to be trading liability in accounts of assesses in respect of which allowance was made three years prior to year in which same sought to be -tided back under provisions of S. 10 (2-A)-Posting of same in books of accounts, held, would not change complexion of liability as trading liability for which allowance or deduction bad been made three years before relevant previous year. (b) Income tax Act (XI of 1922)- S. 24 - Workers' Welfare Funds Ordinance (XXXVI of 1971), S. 4-Assesses seeking to adjust income from rental looms, against brought forward loss under S. 24-Income-tax Officer declining to adjust same as it was to be adjusted against income of same business and not income derived from a different source and such income was subjected to tax as well as Workers' Welfare Fund-Income-tax Officer, held, not fell into any error in passing order. ORDER MUHAMMAD MAZHAR Au (CHAIRMAN).--(1) . (2) (3) (4) (5) (6) .. . 7. The next griewtnce of the department is that the learned Appellate Assistant Commissioner was not justified in setting aside the order of the Income-tax officer in respect of addition of interest amounting Rs. 7,54,095 by invoking the provisions of section 10 (2-A) of the Income-tax Act, A perusal of the impugned order of the learned Appellate Assistant Commissioner indicates that it was not disputed by the assessee that since the allowance of deduction of the amount in question a period of three years had not elapsed, the only contention raised was that the unpaid interest was added to the principal amount year after year and hence it could not be said that the trading liability in question had not been paid. The learned Appellate Assistant Commissioner found that this aspect of the case was not dealt with by the Income-tax Officer and hence she set aside the impugned order quo ad hoc with a directions to the Income-tax Officer to examine the matter afresh in the light of the observations made by her. 8. Having heard the arguments of the parties representatives and upon appreciation of the material prevalent on record we are convinced that the learned Appellate Assistant…

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