Law: Income Tax Ordinance, 1979

Section: 107

Law: Income Tax Appellate Tribunal Procedure Rules, 1981

Section: R.10

(a) Income Tax Ordinance (XXXI of 1979)------S. 107---Interpretation of S.107, Income Tax Ordinance, 1979---Balancing, modernisation and replacement of plant and machinery---Tax credit---Entire amount having been invested by assessee before 30th June, 1988 during the assessment year 1989-90, it would be entitled to the full tax credit claimed--¬Credit to the extent which represented the amount invested beyond the period fixed by S.107 would not be available to the assessee---No restriction having been provided on investment on machinery locally purchased under any of the provision of S.107, Income Tax Ordinance, 1979, assessee was entitled to allowance of tax credit claimed on such machinery also. (b) Income Tax Appellate Tribunal Rules, 1981--- ----R.10---Appeal before Tribunal---Each ground of appeal has to be concise and clear under distinct heads---Memorandum of appeal containing vague and non-specific grounds would not be in accordance with law, which could be refused to be entertained. JUDGMENT ASAD ARIF (ACCOUNTANT MEMBER).---These two departmental appeals are directed against the separate orders of the learned CIT(A) recorded by him in Appeal No. CIT(A-1)/723/90, dated 10-10-1990 for the assessment year 1989-90 and Appeal No. CIT (A-1)/1395/199, dated 10-1-1991 for the assessment year 1990-91. Objections are taken to the CIT(A)s directions to allow tax credit to the assessee under section 107 of the Income Tax Ordinance, 1979 in both the years under appeal and also to the deletion of certain and backs out of P&L expenses. 2. The brief facts of the case are that the assessee, a public limited company engaged in the manufacture and sale of cotton yarns and cloth claimed tax credit under section 107 of the Income Tax Ordinance, 1979 (hereinafter referred to as the Ordinance) on account of balancing, modernization and replacement of plant and machinery. In the assessment year 1989-90, the claim was for Rs.67,72,164 on the plant and machinery valuing Rs.4,51,47,762 while in the assessment year 1990-91, the claim was for Rs.1,27,71,000 on the value of plant and machinery disclosed at Rs.8,51,40,000. In the assessment year 1989-90, the ITO restricted the…

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