Law:

Section:

Foreign Exchange Repatriation Regulation, 1972 [M.L.R. 104]---Foreign Assets Declaration Regulation, 1972 [M.L.R. 1051--Exemption of remittances--Only such remittances were exempted from tax under M.L.R. 105 which otherwise were taxable in Pakistan--If the remittance was' not in the nature of income or revenue profit but capital receipt it could n be charged to tax.JUDGMENT SALEEM AKHTAR, J.--The respondent derives her income from interest and dividends. In her return of income for the assessment year 1973-74 she declared' an amount of Rs.1,25,401 representing casual income. The return was revised in March, 1976 in which the respondent showed this amount as income exempted from tax. The respondent maintained that as this amount was declared under M.L.R. 105, it is not an income and cannot be taxed under the income Tax Act. The Income Tax Officer rejected the claim and added it to the income. The appeal filed by the respondent was dismissed by the Appellate Assistant Commissioner. The respondent filed a second appeal before the Tribunal, which was allowed and it was observed that the receipts were not taxable and could not be included in the total income of the respondent. The applicant filed application under section 66 (1) of the Income Tax Act for referring the following questions. (1) Whether upon the facts and in the circumstances of the case the assessee was entitled to the exemption from income tax under M.L.R. 104/105 in spite of the fact that he she failed to remit the funds to Pakistan before the specified date? (2) Whether the Hon'ble Tribunal was justified in holding that the repatriated amount was not liable to tax under the Income Tax Act, 1922?". This application was dismissed with the observation that the first question does not arise from the order of the Tribunal and the main reason for granting exemption was that the repatriated amount was not a revenue receipt…