Law: Income Tax Ordinance, 1979

Section: 66A,Sched.III,8(8)(b),129

(a) Income-tax Ordinance (XXXI of 1979)----S. 66-A--Powers of Inspecting Assistant Commissioner--Inspecting Assistant Commissioner is empowered to examine the record of any proceedings under the Ordinance and revise any order passed therein by the Income-tax Officer if he considers it erroneous and prejudicial to the interest of the revenue--Words any proceedings are to be read in conjunction with the words Income-tax Officer--In order to invoke the section, the prerequisite is that the order which is to be revised, must be an order of an Income-tax Officer--Where the original order is modified by the A.A. C., the original order of the assessment stands merged with the appellate order and hence the appellate order holds field and not the original assessment order. 1985 P T D 874 fol. (b) Income-tax Ordinance (XXXI of 1979)-- ---Sched. III, Item 8(8)(b)--Depreciation--Tax credit--While computing the actual cost of an asset for the purposes of initial depreciation, tax credit is not to be deducted from the value of the plant or machinery--Both tax credit and deduction or allowances stand on altogether different footing because former is deducted from the tax payable either in relevant assessment year or future year or years, as the case must, be, whereas the allowances or deductions are made from the total Income--Word tax credit is not synonymous with word allowance: or deduction. Col. I.T.A. No. 118/KB of 1983-84 and 1987 P T D (Trib.) 116 (c) Income-tax Ordinance (XXXI of 1979)-- ---S. 107--C.B.R. Circular No. 1(40)/ITI/79, dated 5-2-1983--Tax credit under S.107 when admissible. Tax credit under section 107 of the Income-tax Ordinance, 1979 is admissible only on amount invested in the purchase of plant and machinery for installation. If the investment is made for purchase of machinery not intended for installation, the concession will not be allowed. The legislature has thus clearly made distinction between: (a) Machinery purchased for installation; and (b) Machinery purchased not for installation (for sale etc.). In the former case rebate under section 107 is allowable, while in the latter it is not. In order to qualify for the concession, the investment made…

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