Law: Income Tax Ordinance, 1979

Section: 66,62,34

(a) Income Tax Ordinance (XXXI of 1979)---S.66-A---Powers of Inspecting Additional Commissioner to revise Deputy Commissioner's order---Jurisdiction---Assessment modified under S. 66A of the Income Tax Ordinance, 1979 was cancelled by the Tribunal as the assessment was made by an officer of the same rank i.e. Inspecting Additional Commissioner. 2001 PTD 1467 rel. (b) Income Tax Ordinance (XXXI of 1979)--- ----Ss. 66-A, 62 & 34---Protection of Economic Reforms Ordinance (XII of 1992), Preamble---Set-off of loss---Foreign exchange gain and loss--¬Assessee showed foreign exchange gains as exempt under the Protection of Economic Reforms Ordinance, 1992. and exchange loss was claimed as an expense which was allowed by the Assessing Officer---Inspecting Additional Commissioner modified the assessment on the ground that assessee had set off exchange gain and losses for the accounts purposes whereas for the income-tax purposes the assessee had claimed exemption on the exchange gain and had separately claimed the exchange loss and addition was made on account of exchange fluctuation ---Validity--¬Assessee had made the payments from the foreign currency deposits the exchange gain from which had been covered against the exchange losses in the books of accounts---Since the notional exchange gain on transaction of payments due to time lag was emanating from the same source i.e. foreign currency deposits, the accounting treatment was accurate treatment and the assessee had no case for the allowance of exchange loss from such transaction separately---Exchange gain on foreign currency deposits should not be considered separately and independently as compared to the exchange loss incurred/recorded at the time of payments. ORDER INAM ELLAHI SHEIKH (CHAIRMAN). ---These are three appeals of a public company directed against the orders one dated 26-4-2000 and two dated 11-5-2001, recorded by the learned I.A.C. of Income-tax, Range-IV, Companies-V, Karachi whereby the assessments originally framed under section 62 of the Income Tax Ordinance, 1979 (hereinafter called the 1979 Ordinance') were modified. 2. The relevant facts in brief are that in the assessment year 1995-96 the…

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