Law: Income Tax Ordinance, 1979

Section: 80C

(a) Income Tax Ordinance (XXXI of 1979)----S. 80-C---C.B.R. Circular No. 12 of 1991, dated 30-6-1991---Constitution of Pakistan (1973), Art. 199---Constitutional petition---Tax on income of contractors---Deduction of income-tax at the rate of five percent. instead of three percent. from the amount of payment made to contractors ---Validity--¬Collection of tax being essential to run the affairs of Government, it has the right to levy and collect the same even though it may be a source of grumble for the concerned quarters---Income-tax at the enhanced rate of 5 percent. was to be collected with effect from 1-7-1995 on the amount being received by assessee contractor from that date and afterwards from the concerned Department---No constitutional right of petitioner (contractor) would be infringed on account of recovery of income-tax at the enhanced rate of 5 percent. ---Recovery of amount by the department for the work done and deduction of the income-tax at the latest rate have to go and to be adopted simultaneously---No Constitutional right of petitioner (contractor) having been infringed and averments contained in Constitutional petition being without merit, petitioner was not entitled to claim relief against deduction of income-tax at the enhanced rate on the amount of payments made to it. (b) Income Tax Ordinance (XXXI of 1979)--- ----S.80-C---C.B.R. Circular No. 12 of 1991, dated 30-6-1991---Finance Act (I of 1995), S.9----Income-tax Circular No.4 of 1995, dated 9-7-1995---Tax on income of contractor---Deduction of tax---Application of rate---It is the year wherein taxable income is to be collected and not the year of alleged agreement which is relevant for determination of rate for deduction of tax from income of the contractor. ORDER M/s. Altaf Construction Company; Dera Ghazi Khan (petitioner) is a contracted; firm and obtained different works in the Highways, Irrigation and District Council at different places after the tenders submitted by the petitioner were approved. Following are the series of the work so obtained by the petitioner before 1-7-1995:-- (i). Highway Department: Construction road work from Lal Garh to Miranpur and Tibbi Solgi and Choti…

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