Law: Income Tax Ordinance, 1979

Section: 136(1),136,62

(a) Income Tax Ordinance (XXXI of 1979)--- ----S. 62 [before amendment of 1993]---Rejection of accounts ---Assessment--­Held, there was no provision t9 issue notice under S.62, before its amendment in 1993 Income Tax Ordinance, 1979 to the assessee before disagreeing with his accounts and to provide an opportunity to the assessee to explain his point -of view prior to finalizing the assessment order. (b) Income Tax Ordinance (XXXI of 1979)--- ----Ss. 61 & 62 [as amended by Finance Act (X of 1993)]---Rejection of accounts---Notice under S.62, Income Tax Ordinance, 1979 before disagreeing with assessee's accounts was mandatory in view of the amendment introduced in Ss.61 & 62, Income Tax Ordinance, 1979 by the Finance Act, 1993 effective from July, 1993---Such mandatory notice, however, was neither necessary nor required during the assessment years prior to the introduction of amendment of 1993. (c) Income-tax--- ----Agreed assessment---Contention that assessee had a history of acceptance of the declared version was of no help to the assessee for the very fact that the assessment in the preceding years were made on agreed basis. JUDGMENT AHMAD SAEED AWAN, J.---This judgment will dispose of Reference Case No. C.T.R. 68 of 1993 filed under section 136 (1) of the Income Tax Ordinance, 1979 and P.T.R. No.7 of 1993 filed by the petitioner in respect of assessment years 1989-90 and 1990-91. 2. Briefly the facts of the reference are that the applicant, a private limited company derives income -from manufacture and sale of M.S. Bars and Iron ingots etc. The applicant for the assessment year 1989-90 declared total sales at Rs.1,71,45,994, declaring gross profit of Rs.15,01,696 which worked out G.P. a 8.75 % . The Chairman, Panel while framing the assessment for the aforementioned year discarded the declared version and estimated sales at Rs.1,75,00,000 to bring the gross profit @ Rs.12.66% as declared by the assessee and applied in the assessment year 1987-88. The applicant being aggrieved by the estimate of sales at Rs. 1,75,00,000 and application of G.P. @ Rs.12.66% for the year filed an appeal before the C.I.T. Appeals; the learned C.I.T. Appeals upheld the…

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