Law:

Section:

(a) Income Tax Ordinance (XXXI of 1979)--- ----Second Sched., Part-IV, Cl. (9-A), Ss.80-C & 50(4)---Tax on income of contractor---Non-resident---Scope---Clause (9-A), Part-IV, Second Schedule, Income Tax Ordinance, 1979 is applicable only to those non-residents who fall within the ambit of S.80-C(2)(b) of the Ordinance---Section 80-C, Income Tax Ordinance, 1979 provides that only those payments fall within the ambit of the presumptive tax regime which are received by non-resident on account of execution of a contract for construction, assembly or like projects in Pakistan on which tax is deductible in Pakistan under S.50(4), Income Tax Ordinance, 1979---Proviso (a) to S.50(4) of the Ordinance provides that a number of payments made to a non-resident including payment for any contract or services have been subjected to withholding tax---Contract executed for rendering of the service of O & M contractor does not fall within the ambit of S.80-C(2)(b) of the Ordinance---No conflict exists between S.80-C(2)(b) and clause 9-A, Part-IV of Second Schedule to the Income Tax Ordinance, 1979. (b) Interpretation of statutes--- ----Conflict between main statute and Schedule of the statute---Provisions of main statute to prevail. Shahnawaz Junejo v. The State 2001 YLR 197 fol. (c) Income Tax Ordinance (XXXI of 1979)--- ----Second Schedule, Part-IV, Cl. (9-A) & S.80-C(2)(b)---Tax on income of contractor---Non-resident---Option under the Schedule cannot be provided to a person to opt to be assessed under a particular system unless he qualifies otherwise to be assessed under that System---Only by reading Cl. (9-A), Part-IV, Second Schedule, and S.80-C(2)(b), Income Tax Ordinance, 1979 together with a harmonious interpretation would lead to the conclusion that only those non-residents can opt under Cl.9-A, Part-IV, Second Schedule of the Ordinance to be assessed under S.80-C(2)(b) of the Ordinance who otherwise qualify to be assessed under S.80-C(2)(b)---If the applicant was entitled to be assessed under the presumptive tax regime under Cl.9-A, Part-IV of the Second Schedule, then there was no necessity of incorporation of Cl.10 in Part-II of Second Schedule of the…

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