Law:

Section:

Constitution of Pakistan (1973)-----Art. 185(3)--Income-tax Act (XI of 1922), S. 42(1)--Questions of general public importance--Grant of leave to appeal--Interest earned on securities deposited by a foreign company doing business in Pakistan-­Whether liable to tax--Authoritative opinion of Supreme Court being necessary on questions of general public importance raised by petitioner, leave to appeal granted. Commissioner of Income-tax v. Bansilal Motilal A I R 1930 Bom. 381 ref. Ali Athar, Advocate Supreme Court with Nizam Ahmad, Advocate-­on-Record for Petitioner. Nemo for Respondent. Date of hearing: 4th June, 1985. ORDER ZAFFAR HUSSAIN MIRZA, J.--These six petitions for leave to appeal are by General Bank of Netherland Ltd., which is a foreign company doing banking business in Pakistan and as a common question of law has been raised therein we propose to dispose of these petitions by this order. 2. The petitioner bank is non-resident company having its registered Office in Holland. For the purposes of operating branches in Pakistan the petitioners Head Office had deposited dollar securities in the National Bank of Pakistan in New York. In the six assessment years, namely, 1967-68, 1968-69, 1969-70, 1970-71, 1971-72 and 1973-74, the aforesaid dollar securities had earned interest in New York, which was included by the Income-Tax Officer as taxable income accrued and arising from business connection in Pakistan. The petitioner challenged the six assessment orders passed by the Income-tax Officer, in separate departmental appeals on the ground that the interest earned on the securities in New York is not income either accruing or arising or deemed to accrue or arise to the petitioner in Pakistan within the meaning of section 42(1) of the Income-tax Act, 1922. The Income-tax Appellate Tribunal having rejected the appeals filed by the petitioner regarding the taxability of interest income on the aforesaid securities, they filed separate applications under section 66(1) of the Income-tax Act, 1922, before the High Court of Sind to consider the following question of law:- "Whether in the facts and circumstances of the case the Tribunal is right in holding that the…

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