Law: Income Tax Ordinance, 1979

Section: SecondSched

Income Tax Ordinance (XXXI of 1979)---Second Sched., cl.(118-C(1))---C.B.R. Circular No.5 of 1991, dated, 103-1991--- Exemption---Date of setting up or commencement of industrial undertaking, date of commencement of semi-finished product and date of commencement of fully manufactured product---Distinction drawn between semi-finished and fully manufactured product would not in any way prove that the industrial undertaking had not gone into production. 1979 PTD 612 and 1998 PTD (Trib.) 3742 rel. ORDER At the time of hearing of appeal filed on behalf of the appellant the learned A.R. of the asses see/appellant stated at the outset that he would not press Ground No.2 pertaining to the assumption of jurisdiction by the Assessing Officer. The instant appeal is accordingly disposed of on the issue of date of comment of the exemption period on the basis of requirements of clause 118C(1) of the Second Schedule to the Income Tax Ordinance, 1979. 2. The action of the Assessing Officer under section 156 determining the date of start of commercial production from July, 1991 has been challenged to be without meeting the requirements of law inasmuch as the date of setting up of undertaking, the date of the commencement of commercial production and which of the two above is latter have not been determined in facts of the case. The order of the CIT(A), dated 25-10-2000 in confirming the order under section 156 has been assailed to be without meeting the requirements of law mentioned above.. 3. The relevant facts briefly, are that first return of income for the assessment year 1991-92 was filed on 1-1-1992 declaring income with remarks "exempt under clause 118C(1) of Second Schedule Part I". Nil income declared was accepted vide order under section 62, dated 14-3-1992 with remarks that "factory was still at the installation stage". However, there was no discussion about the claim of exemption etc,' Return for the assessment year 1992-93 was filed on 31-12-1992 declaring income of Rs.158,603 claimed exempt under clause 118C of the Second Schedule. Vide order under section 62, dated 12-1-1994 claim of exemption was accepted subject to tax under section 80-D. For the subsequent…

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