Law: Income Tax Ordinance, 2001

Section: 236,161,205,137

[Income Tax Ordinance (XLIX of 2001)].....Sections 236, 161, 205 & 137---Collection of tax and advance tax on amount of `prepaid cards for telephones'---Assessee engaged in the business of operating Public Call Office, had been held by the Taxation Officer as an "assessee in default" of non fulfilling of his obligation as a withholding agent and "prescribed person" under the provisions of S.236(1) of Income Tax Ordinance, 2001; and the tax and advance tax were levied upon him under Ss.161 & 205 of Income Tax Ordinance, 2001---Validity---Smart Card was not similar to a "prepaid card" and both said cards were not one and the same thing---Provisions of S.236(1) (b), (3) Income Tax Ordinance, 2001 were not applicable to the "Payphone operators" as they were not recognized collecting agents in terms of 5.161 of Income Tax Ordinance, 2001, whereas subscriber of telephone, mobile telephone and prepaid telephone cards had been held as "Collecting Agents "---Under S.236(1)(b) of Income Tax Ordinance, 2001 "Prepaid Cards for telephones" did not involve functions prescribed by "Pay Phone Operators" as the business carried out by the `Pay Phone Operators' was completely different and distinguishable---As all the Payphone Operators made payment of advance income tax in terms of S.236(1)(a) of Income Tax Ordinance, 2001 by virtue of fact that they were subscribers to all the lines of which a corporate bill was raised, there was no further rationale to insist on yet another category of levy under the same provisions on the same transaction---Consolidated order passed by Commissioner (Appeals) was upheld, when no legal infirmity, irregularity or illegality was found therein. ORDER SYED MUHAMMAD FAROOQ SHAH (JUDICIAL MEMBER).---Being dissatisfied with the order passed by the learned CIT(A), dated 16-4-2009, under section 129 of the Income Tax Ordinance, 2001, the department has preferred captioned appeals on the following grounds: (i) That the order passed by the learned CIT(A) Karachi is bad in law and on facts of tile case. (ii) That the learned CIT(A) was not justified in relying upon…