Law: Income Tax Ordinance, 1979

Section: 13,13(1)(a),30,50(5),62,80C,80C(5),80C(4 ),80CC

THIS ORDER PASSED BY: MUHAMMAD MUNIR QURESHI (ACCOUNTANT MEMBER):------- This miscellaneous application by a limited company arises out of order of the Tribunal bearing I.T.A. No.2179/LB of 1999 (Assessment Year, 1994-95), dated 5-11-2002. It is the applicants' contention that the Tribunal has wrongly held that the applicant company produced no evidence before the Assessing officer to establish that its excess income over imputable income as per computation of income for the year arises from the normal business activities of the company in the period relevant to the assessment year under reference. It is the applicants' contention that a written reply was duly filed before the Assessing officer clarifying all pertinent aspects as evident from the assessment order itself. Thus statedly prima facie, there was an error floating on the face of Tribunal impugned order that was required to be recalled/ rectified. Briefly stated, the relevant facts in this case that the assessee company falls in the presumptive tax regime and has made total sales aggregating Rs.518,687,063 in assessment year, 1994-95, comprising exports Rs.12,037,045 and supplies (within Pakistan) Rs.506,650,018 and total tax deducted at source under sections 80-C/80CC amounts to Rs.12,756,528. An additional amount of tax amounting to Rs.376,924 has been deducted under section 50(5) on imports of Rs.18,846,204 made by the company in the context of its normal commercial operations. On workback basis therefore, the total income imputable to the tax so deducted comes to Rs.26,802,963. As against this the net profit declared by the company before taxation as per final accounts is cited at Rs. 137,058,816 and after adjustments has been determined by the Assessing officer at Rs.153,578,877. Thus prima facie there is a difference of Rs.126,775,914 and this excess income over imputable/ presumptive income has been held by the Assessing officer to have been not offered by the assessee company for levy of income-tax. The assessee company was formally required by the Assessing officer to explain the fate of the book profit over and above the presumptive income'. It is the Assessing officer's finding that the…

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