Law: Income Tax Ordinance, 1979

Section: 14,156

(a) Income-tax-----Principles of res judicata---Application---Principle of res judicata is not applicable in the income-tax proceedings because it is a settled proposition of law that every assessment year is an independent accounting period and a person/assessee claiming exemption will have to establish its claim for every assessment year---An expense allowed or an exemption given in one year cannot be claimed as a matter of right in all subsequent years and the Revenue will be well within its right to require the assessee to establish the claim for exemption whenever it is claimed---Income Tax Ordinance (XXXI of 1979), S.14. (b) Income Tax Ordinance (XXXI of 1979)--- ----S.156---Rectification of mistakes---Principles. 1993 PTD 110 rel. ORDER 1. These miscellaneous applications have been moved at the instance of a Cooperative Society praying that since there were mistakes of facts and law in the consolidated order passed in I.T.A. Nos. 189 to 198/LB of 1988-89 dated 23-2-1995 these may be recalled and rectified in accordance with law. 2. The applicant is a cooperative housing society and is engaged in the business of acquiring land, developing it and selling it to its members in small plots. In response to notices issued by the Assessing Officer returns were filed for the assessment years 1976-77 to 1985-86 at various incomes. However, exemption from levy of income-tax was claimed per provisions of clause (103) of Second Schedule to the Income Tax Ordinance. In respect of interest income as well it was stated that income from this source also stood exempted inasmuch as the society was being operated at no profit no loss basis as per clause (49) of Bye-Laws of the Society. The Assessing Officer rejected the claims and framed consolidated assessments in respect of these years on 23-6-1986. The first appeals taken to C.I.T.(A) Zone III, Lahore succeeded on 23-10-1986. Learned First Appellate Authority allowed the claimed exemption under clause (103) of the Second Schedule to the Ordinance with respect to the income derived from dealing with the members. Income from admission fee demarcation fee, maintenance etc., was also excluded from the assessment on the…

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