Law: Income Tax Ordinance, 1979

Section: 32,66A

(a) Income Tax Ordinance (XXXI of 1979)---S. 32---Computation of income---Application of G.P. rate on the total receipts declared by the assessee was favoured while application of N.P. rate was deprecated by Income-tax Appellate Tribunal. (b) Income Tax Ordinance (XXXI of 1979)--- ----S. 66-A---Loss of revenue resulting from an assessment framed in strict compliance with law---Such loss would not render the assessment to be erroneous in so far as it was prejudicial to the interest of the revenue and would not warrant action under S.66-A---Loss of revenue resulting to the Government on account of assessment based on a strict compliance of the provisions of law could not be considered to be an assessment which was erroneous or prejudicial to the interest of the revenue so as to authorise the I.A.C. to exercise the powers conferred by S.66-A. (c) Income Tax Ordinance (XXXI of 1979)--- ----S. 66-A---Assessing officer departing from the past history yet the assessment did not suffer from any error of law---Such a departure from the- past history, held, would not render the assessment erroneous in so far as it was prejudicial to the interest of the revenue warranting action under S.66-A. The ITO had rightly applied the G.P. rate of 17.5% in finalizing the assessment under section 62/65 of the Income Tax Ordinance and the assessment so framed could not by any stretch of imagination be said to be erroneous or prejudicial to the Revenue inasmuch as the extra revenue which would have resulted in this case by resorting to the previous practice of application of N.P rate on gross receipt would have been earned by not following and adhering to law and the practice and procedure approved by the Tribunal and the resultant gain would be illegal, and stoppage thereof would not amount to an illegality or mistake of the n5ture to warrant action under section 66-A of the Income Tax Ordinance. ORDER SAIYED SAEED ASHHAD (JUDICIAL MEMBER): --This appeal has been filed by the assessee against the order of the learned IAC, Sialkot Range, dated 29-3-90. The grievance of the appellant which led him to file the above appeal is with regard to the finding of the [earned IAC in his above…

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