Law: Income Tax Ordinance, 1979

Section: 65,65(2),26,FourthSched.Rr.5,8

Law: Income Tax Act, 1922

Section: 10(7)

(a) Income Tax Ordinance (XXXI of 1979)---Ss. 65(2) & 55---Expression "Definite information" occurring in S.65(2), Income Tax Ordinance, 1979---Connotation---Definite information includes actual information as well as information about the existence of a binding of a competent Court of law but does not include any information based on a circular issued by Central Board of Revenue whereby an opinion earlier held was modified ---When the notices were served on the assessee which were based upon the interpretation of the relevant provisions of law given in a binding of the High Court, notices so served were valid and did not suffer from any infirmity. The expression "definite information" occurring in subsection (2) of section 65 could include actual information as well as information about the existence of a binding of a competent Court of law but the same would not include any information based on a circular issued by the Central Board of Revenue whereby an opinion earlier held was modified. In the present case, the notices were based upon the interpretation of the relevant provisions of law given by a binding of High Court. There was no doubt that the notices respectively served upon the assessee under the said provision of law were valid and did not suffer from any infirmity. Messrs Central Insurance Co. and others v. The Central Board of Revenue 1993 PTD 766 fol. (b) Income Tax Ordinance (XXXI of 1979)--- ----S.26 & Fourth Sched., Rr. 5 & 8---Insurance Company---Computation of profits and gains of insurance business---Dividend income---Entire income of the assessee included in the profit and loss account, including income from dividends, was liable to be assessed as a single unit and no concession could be claimed in respect of dividend income. By use of the non obstante clause in section 26 of the Income Tax Ordinance, the Legislature manifested a clear intention to place the said section on a higher pedestal when compared to the other provisions of the Ordinance. Income from the profits and gains made from any business of an insurance company other than life insurance, falling under whatever head of income, is to be computed as a single unit of…

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