Law: Income Tax Ordinance, 1979

Section: SecondSched.,PartI,Cls.(122C),(118C)

Income Tax Ordinance (XXXI of 1979)-----Second Sched., Part I, Cls. (122-C) & (118-C)---Exemption, grant of---Conditions---Grant of concession in the nature of exemption from payment of duties must be given strict interpretation and the person getting such benefit must satisfy all conditions for such exemption but once the required conditions are complied with, the exemption available to a person under the law cannot be taken away by the concerned authorities in their discretion. Federation of Pakistan v. Zaman Cotton Mills 2001 SCMR 563 distinguished. THIS JUDGMENT DELIVERED BY MUHAMMAD NAWAZ ABBASI, J.---These two connected petitions under Article 185(3) of the Constitution have been directed against the consolidated judgment dated 12-6-2007, involving common question of law and facts, rendered by a learned Division Bench of the Peshawar High Court, Peshawar in Tax References. 2. The precise question involved in the appeal before the Income Tax Appellant Tribunal, was whether the assessee would be entitled to tax holiday under Clause 122-C of Part-I of the 2nd Schedule to the Income Tax Ordinance, 1979 or his case would fall within the ambit of Clause 118-C of the said Schedule. The Tribunal having discussed the matter in detail, rendered its decision as under: We have considered all the relevant facts and materials. It has been noted that originally exemption was allowed under clause(118-C) of Second Schedule to the Income-Tax Ordinance, 1979. While for subsequent year it was allowed under clause (122-C) of Part-I of Second Schedule to the Ordinance. In order to remove this mistake a rectification application under section 156 of the Ordinance was filed to claim that respondent-Company is exempt from payment of tax under clause (118-C) instead of clause (122-C). This application was turned down by assessing officer, while on appeal the First Appellate Authority accepted the plea of respondent-Company and allowed exemption under clause (118-C) of Second Schedule to the Ordinance, Department later on approached the Income Tax Appellate Tribunal and the matter was decided vide I.T.A. No.308 (PB) of 96-97 dated 17-2-1997 once again in favour of…

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