Law: Income Tax Ordinance, 1979

Section: 24(ff),24(c),50(7B)

(a) Income Tax Ordinance (XXXI of 1979)----Ss. 24(ff), 24(c) & 50(7B)---C.B.R. Circular No. 6 of 1990, dated 15-7-1990---Deductions not admissible---Addition was made by disallowing the claim in respect of rent of premises for the reason that the amount in question was not paid through crossed cheque and was not allowable under S.24(ff) of the Income Tax Ordinance, 1979---Assessee contended that payment of rent of house property was covered both, by Ss.24(c) & 24(ff) of the Income Tax Ordinance, 1979---Since S.24(c) of the Income Tax Ordinance, 1979 did not require payment to be made through crossed cheque, it was more beneficial to assessee and should have been applied to it and the landlady had already paid tax on the rent in question---Validity---Section 24(c) of the Income Tax Ordinance, 1979 was applicable only to such rent of house property which was hired by a Government a company etc. who, in turn, was liable as a payer, to deduct advance tax at the time of making payment of rent---Since assessee did not fall in any category of tax withholding agent specified in S.50 (7B), the provisions of S.24(c) of the Income Tax Ordinance, 1979 were not attracted---Contention that assessee was covered simultaneously by the provisions of Ss.24(c) & 24(ff) of the Income Tax Ordinance, 1979 was incorrect---Beneficial interpretation of law was not relevant---Treatment accorded by the Assessing Officer was correct in law---Order of First Appellate Authority upholding the add-back was confirmed by the Appellate Tribunal ---Assessee must pay the rent through crossed cheque as per law contained in S.24(ff) of the Income Tax Ordinance, 1979 and such rent/payment had no nexus with the amount of tax payable by either of the two parties. 1998 PTD 1908; 1998 PTD 1558 and NTR 1992 HC 46 ref. I.T.As. Nos. 858 to 868/IB of 1996-97 distinguished. (b) Income-tax---- ----Gross profit rate---Rejection of gross profit rate without assessing any reason---Validity---Assessing Officer had accepted the declared sales on the basis of sales certificate issued by the principals of the assessee while no observation at all was recorded about the verifiability or otherwise, of the…

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