Law: Income Tax Ordinance, 1979

Section: SecondSched.,cl.172

(a) Income Tax Ordinance (XXXI of 1979)------Second Sched., cl. 172---C.B.R. Circular No.9 of 1985---Object and scope of cl. 172 of Second Schedule to Income Tax Ordinance, 1979 and C.B.R. Circular No.9 of 1985---Meaning and scope of word "assessment"---Expression "assessment already finalized" explained. Circular 9 of 1985 has been issued by Central Board of Revenue to clarify and explain legal implications arising from benefit of set off which is conferred upon assessee by addition. of clause 172 in the Second Schedule to Income Tax Ordinance, 1979 which amendment was brought in force on 29-7-1985. Clause 172 of second Schedule to Income Tax Ordinance 1979 provides that set off is allowed against the income, which has not been assessed in respect of any year including and upto assessment year 1984-85. So the intention is to give incentive to bring forward the income which, for any reason, was not declared by the assessee or escaped assessment. Cut off date for income nut assessed is 29-7-1985 when clause 172 was added. Circular 9 of 1985 is to be read in the light of clause 172 of the Second Schedule of Income Tax Ordinance, 1979. Circular 9 of 1985, while clarifying and giving further details of the scheme has classified cases into five categories, which are to get or not benefit of the scheme. First category is of cases pending assessments in which orders of assessment were not passed upto cut off date. Set off could be claimed in such cases. Second category is of cases of re¬opening of assessments in which set off is allowed. Third category is of cases where untaxed sums discovered are less than the investment in the purchase of bonds. Fourth category is of cases of assessments already finalised and pending appeals in which set off is not allowed. Fifth category is of cases of future assessments. Since in Circular 9 of 1985 word "assessment" is repeatedly used and not only that but six categories of cases are specified showing relative importance of different stages of "assessment" vis-a-vis claim of set off, it would be necessary and proper to see whether "assessment" has any legal definition. Word "assessment" is defined under section 2(vii) of Income…

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