Law: Income Tax Ordinance, 1979

Section: 10,85,136,FirstSched.,Part-III

Income Tax Ordinance (XXXI of 1979)-----Ss. 10, 85, 136 & First Sched., Part-III---Reference to High Court---Levy of Surcharge---Basis---Held, when the provisions contained in S.10 were read with First Sched. Part-III of the Income Tax Ordinance, 1979, it would become clear that the basis for levy of surcharge was the total income as assessed for the purpose of income-tax---Total income was for the entire assessment year, on the basis whereof the income-tax and super tax were charged regardless of the payment of, any advance tax---Surcharge was to be calculated on the amount of income-tax and super tax payable on the income-tax for the year and not the tax payable after adjustment of the advance taxes---Principles. JUDGMENT KHILJI ARIF HUSSAIN, J.---The Income Tax Appellate Tribunal has referred the following common question of law in respect of assessment years 1980-90 and 1990-91 through I.T.R. No.35 of 1997 for our opinion. "Whether on the facts and in the circumstances of the case, the learned ITAT was right in confirming the levy of surcharge under section 10 of the Income Tax Ordinance, 1979, without considering the provision of Part-III of the First Schedule of the Income Tax Ordinance, 1979?" 2. The I.T.A. No.778 of 2000 was admitted to consider the similar question of law. Both the cases are decided by this common judgment. 3. Heard Mr. Muhammad Farid, learned counsel for the applicant and Mr. Jawaid Farooqi, learned counsel for the respondent. 4. The learned counsel for the applicant has contended that in all the three assessment years, the Assessing Officer wrongly levied the surcharge under section 10 of the Income Tax Ordinance, 1979, without taking into consideration the provision contained in Part-III of the First Schedule to the Income Tax Ordinance. 5. The relevant facts are that in the case of Messrs Dawood Corporation (Pvt.) Ltd., the Assessing Officer computed business income for the assessment year 1989-90 at Rs.4,35,95,229 and determined the tax payable by the assessee at Rs.2,02,39,620 and levied surcharge at 10% amounting to Rs.20,23,962. In the assessment year 1990-91 the tax payable was determined at Rs.3,95,04,1000 and the…

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