Law: Income Tax Ordinance, 1979

Section: 22

Income Tax Ordinance (XXXI of 1979)---S. 22---Income from business---Brick kiln ---Assessee returned income--¬Assessing Officer, discarding declared results and basing his order on Inspector's report, took capacity of kiln at 8,00,000 bricks and number of rounds at 3 against 2 and fixed rates of different types of bricks on his own and applied 25% G.P. rate---First Appellate Forum upheld the assessment--¬Held, keeping in view that there had been labour problem and litigation between brick kiln owners and labour, it would be in, fitness of things to adopt number of rounds at 2-1/2 for period under appeal---Capacity of kiln was directed to be adopted as declared by assessee as there had been no change during year under appeal---Rates of bricks adopted as being fair and reasonable called for no interference. I.T.A. No.455/LB of 1991-92 ref. ORDER This appeal by the assessee for the assessment year 1989-90 calls in question the order passed by the A.A.C., Range VI, Lahore dated 5-12-1991. The brief facts of the case are that the appellant, a registered firm, derives income from running a brick kiln at Mohalanwal, Multan Road, Lahore, Return was filed to declare income at Rs. 88,560. The case was processed under normal law as the last assessed income was more than the income declared. The declared results were discarded and on the basis of the Inspector's inquiry report, the capacity of the brick kiln was taken at 8,00,000 bricks against declared at 6,50,000. The number of rounds were adopted at 3 against declared at 2 by taking the price of special brand bricks at Rs. 900 per thousand and 1st class bricks at Rs.700 per thousand, IInd class bricks at Rs.600 per thousand and III rd class bricks at Rs.400 per thousand. The total sales by adopting the usual formula as in the case of brick kiln was determined at Rs. 14,99,500. These were subjected to a G.P. rate of 25 % and after curtailing the profit and loss account expenses claimed, net income was determined at Rs.283,715. Aggrieved with the treatment meted out the appellant went in appeal. The A.A.C. Range-VI Lahore vide the impugned order upheld the assessment. It is against these orders that the appellant has come…

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