Law: Income Tax Act, 1922

Section: 14,2(6c),4,3,4,2(6C),55

Law: Constitution of Pakistan, 1962

Section: ThirdSched..EntryNo.43

(a) Constitution of Pakistan (1962)---Third Sched.. Entry No.43---Finance Act (XII of 1967), Preamble---Finance Act (XI of 1968), Preamble---Constitution of Pakistan (1973), Art.185(3)--¬Leave to appeal was granted to consider the question as to whether the Free Reserve of a company constitutes income within the meaning of Entry No.43 of Third Sched. of the Constitution of Pakistan (1962) and if it did not, whether Finance Act, 1967 and Finance Act, 1968 were not ultra vires in so far as they taxed what was not income.(b) Income-tax Act (XI of 1922)-------Ss.2(6c) & 4---"Income"---Meaning and connotation.Maharajkumar Gopal Saran v. Commissioner of Income Tax (1935) 3 ITR 237; Navinchandra Hafatlal, Bombay v. Commissioner of Income Tax (154) 26 ITR 758; K.P. Varghese v. Income Tax Officer AIR 1981 SC 1922; Mst. Samina Shaukat Ayub Khan v. Income Tax Officer PLD 1981 SC 85 and Commissioner of Income Tax, Rawalpindi v. Messrs Haji Maula Bux Corporation, Sargodha PLD 19% SC 991) ref.(c) Words and phrases-------"Income"---Meaning and connotation.(d) Interpretation of Constitution------- Words should be read in their ordinary, natural and grammatical meaning subject to the rider that in construing the words in the Constitution conferring legislative power, the most liberal construction should be put upon the words so that the same may have effect in their widest amplitude.Navinchandra Mafatlal, Bombay v Commissioner of Income Tax, Bombay City (1954) 26 ITR 758 ref.(e) Interpretation of statutes------ Surest guide to the meanings of words used in the provision.It is true that the words used even in their literal sense, are the primary and ordinarily the most reliable source of interpreting the meaning of. any writing, lie it a statute, a contract or anything else. But it is one of the surest indexes of a mature and developed jurisprudence not to make a fortress out of the dictionary, but to remember that statutes always have some purpose and object to accomplish whose sympathetic and imaginative discovery is the surest guide to their meaning.L.P. Varghese v. Income Tao Officer, Irna Ghulam and others AIR 1981 SC 1922 ref.(f) Interpretation of Constitution-------…