Law: Income Tax Ordinance, 1979

Section: FirstSched.,PartIII

Income Tax Ordinance (XXXI of 1979)---First Sched., Part III---Tax liability/tax payable by the assessee could be considered as "retained income" for purposes of the levy of surcharge. Commissioner of Income Tax v. Messrs Pakistan Tobacco Co. Ltd. 1988 PTD 66 fol. JUDGMENT MAMOON KAZI, J.---In this case the learned Income Tax Appellate Tribunal while disposing of the second appeal held that the tax liability/tax payable by the assessee could be considered as retained income for purposes of the levy of surcharge. The department was not satisfied with this decision, and, therefore, it requested the Tribunal to refer the following question to this. Court for determination: "Whether on the facts and in the circumstances of the case the Tribunal was justified in holding that the tax liability/tax payable could be considered as retained income for purposes of the levy of surcharge?" It has been pointed out that the question referred to us is already covered by a decision of another Division Bench of this Court in the case of Commissioner of Income Tax v. M/s. Pakistan Tobacco Co. Ltd. 1988 PTD 66. The relevant observations of the Division Bench which appear at page 81 at para. 14 of the report are as follows:--- "14. From the above inferred definition of the words, "working capital", "current liability" and "current assets", it is evident that MacMillan Dictionary of Accounting by R.H. Parker has excluded provisions for taxation and proposed dividends from the ambit of current liabilities. The other…

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