Law: Income Tax Ordinance, 1979

Section: 5,23,23(1),23(1)(x),24,24(1),25,25(a)(a) ,30,30(2)(a),62,62(1),FirstSched.,Second Sched.

Law: Income Tax Rules, 1982

Section: 3,4,18

(a) Income Tax Ordinance (XXXI of 1979)--S. 23(1)(x)---Deductions---Banking Company---Provision for bad debts---Assessing Officer disallowed provision for' bad debts on the ground that assessee had not fulfilled all the conditions for admissibility laid down in S.23(1)(x) of the Income Tax Ordinance, 1979---First Appellate Authority deleted such addition by relying on Appellate Tribunal's s which disapproved such disallowances in case of banks working under the regulatory control of State Bank of Pakistan---Validity---Contention of department that various s of Appellate Tribunal on the issue were conflicting and contradictory in nature carried force but at the same time pre-empting the jurisdiction of High Court by of a larger Bench of the Tribunal would not be appropriate---Appellate Tribunal upheld the decision of First Appellate Authority :deleting the additions made on account of provision- for bad debts. 2002 PTD (Trib.) 1898; (2002) 85 Tax 245 (Trib.); 2003 PTD (Trib.) 1189; R.A. No.349/LB of 2002, I.T.As. Nos.2715 and 2716/LB of 1999; 1997 PTD 71; 2006 PTD (Trib.) 356 and Muhammad Inayatullah Cheema v. Sardar Masood Qazilbash 2002 PTD 1195 rel. I.T.A. Nos. 5531/LB of 1996; Nos. 45, 46, 6362, 88, 89, 6054 to 6057/LB of 2004 and 1985 PTD 413 ref. (b) Income Tax Ordinance (XXXI of 1979)--- -----S. 23(1)-Deductions---Banking company---Interest credited to suspense account---Assessee credited mark-up to suspense account instead of profit and loss account---Assessing Officer rejected assessee's contention that it could be taxed on actual receipt basis but was taxable on accrual basis---First Appellate Authority relying on various s deleted the addition---Department contended that since assessee was maintaining its account in mercantile system the interest was chargeable to tax on accrual basis---Validity---Since deletion of interest credited to suspense account was made on the basis of cases decided by the Appellate Tribunal, order of First Appellate Authority was upheld by the Tribunal. Muslim Commercial Bank v. IAC I.T.A. No.123 of 1999; Habib Bank Ltd. v. DCIT I.T.A. No.270 of 1999; (2002) 85 Tax 245 (Trib.); I.T.A. No. 2715 and 2716/LB of 1999; I.T.A. No.…

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