Law: Income Tax Ordinance, 1979

Section: 12(18)

Law: Income Tax Ordinance, 2001

Section: 39(3)

Income Tax Ordinance (XXXI of 1979)---S. 12(18)---Income Tax Ordinance (XLIX of 2001), S. 39(3)---C.B.R. Circular No.6 of 1987, dated 5-7-1987---Income deemed to accrue or arise in Pakistan---Advance received from purchaser out of total sale consideration of shop---Taxation---Validity---Intention of the legislature while enacting S.12(18) of the Income Tax Ordinance, 1979 was to discourage fictitious loans, advances and gifts---Assessing Officer as well as First Appellate Authority failed to establish the element of fictitious transaction---Amount in question had been paid through government functionary i.e. Sub-Registrar, who had verified the payment of amount which had been mentioned in the Revenue Record also---Evidence in that regard had also been placed before the Taxation Officer as well as before First Appellate Authority---Treatment meted out by the Taxation Officer to the case was ill-founded, misconceived and on wrong assumption of facts and application of S.12(18)of the Income Tax Ordinance, 1979---No fictitious element in the transaction having been involved, there was no justification for application of S.12(18) of the Income Tax Ordinance, 1979---Assessment order as well as the order of First Appellate Authority were vacated and addition made was deleted by the Appellate Tribunal. 1995 PTD 1176; 1997 PTD 453; 2002 PTD 63 and 2002 PTD 2594 rel. 2002 PTD (Trib.) 827 and 2003 PTD (Trib.) 835 ref. ORDER JAWAID MASOOD TAHIR BHATTI (JUDICIAL MEMBER).--Through this appeal, the appellant has objected to the impugned order of the learned CIT(A), dated 2-2-2004 for the assessment year 2001-2002 upholding the addition made by the Taxation Officer under section 12(18) of the repealed Income Tax Ordinance, 1979. Brief facts leading to the present appeal are that during the assessment year under review, the assessee has received an advance amount of Rs.2,50,000 from the purchaser out of total sale consideration of his shop and the Assessing Officer has taxed the same under section 12(18)of the repealed Income Tax Ordinance, 1979. It has been contended on behalf of the assessee that the purchaser of the shop has paid a token money in the shape of cash to the…

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