Law: Income Tax Ordinance, 1979

Section: 79

Income Tax Ordinance (XXXI of 1979)----S. 79---Addition---Assessee company was carrying on the business of manufacture and sale of pharmaceutical drugs---Import of raw material by assessee from its associated companies on higher rates as compared to the other sources---Assessing officer therefore, directed the assessee to show cause as to why the purchases made by them may not be estimated and difference be added under S.79 of the Income Tax Ordinance, 1979-Validity---Held, case of assessee fell without the ambit of S.79, Income Tax Ordinance, 1979 and no interference of High Court was called for---Principles. Commissioner of Income Tax v. Pakistan Industrial Engineering Agencies Ltd. 1992 PTD 954; Messrs Industrial Management v. The Commissioner of Income Tax 1978 PTD 208; Lal Muhammad Abdul Sattar acid Co. v. Commissioner of Income Tax 1995 PTD 752; Mehran Girls College v. Commissioner of Income Tax 2001 PTD 987 and Commissioner of Income Tax, Companies-II, Karachi v. Marck Sharp and Dhome of Pakistan Ltd. C.P.L.A. No.159/K of 1989 distinguished. I.T.R.A. No.76 of 2002; I.T.O. v. Beecham Pakistan Ltd. 1988 PTD (Trib.) 447; Smith Kline and French of Pakistan Ltd. v. IAC Range-I, Companies-II, Karachi LT.A. No. 2202/KB of 1987-88; Messrs Bayer Pharma (Pvt.) Ltd. v. I.T.O.. I.T.A. No. 17961KB of 1993-94; Sindh High Court CIT v. Glaxo Laboratories Ltd. 1991 PTD 393; and Galaxo Laboratories Ltd. v. CIT Karachi, Civil Appeal No. 237-K of 1991 ref. ORDER MUHAMMAD ATHAR SAEED, J.---This Income Tax Reference Application has been filed against the order of the Income Tax Appellate Tribunal, dated 29-11-1995 passed in R.A. No. 9/KB of 1995-96 by which the Tribunal had refused to refer eight questions proposed by the applicant for the opinion of this Court. The applicant by this reference application seeks the opinion of this Court on the following proposed questions:-- (i) Whether the learned Appellate Tribunal misdirected himself in law by repelling the contention of the applicants that on the facts and in the circumstances of the case provisions of section 79 of the Income Tax Ordinance, 1979 could not be invoked. (ii) Whether in view of the fact that the parent…

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