Law: Income Tax Ordinance, 1979

Section: 26,62,62B,136

Income Tax Ordinance (XXXI of 1979)--Ss. 26, 62-B & 136---Depreciation allowance---Computation of---Appeal to High Court---Assessee company, which had been following calendar year as its income year, filed its return covering 12 months' period commencing from 1-1-1994 to 31-12-1994---Return of income showed a sum of Rs.98,961,619 as 12 months' depreciation allowance---Assessee company had also filed return covering the entire 18 months' period starting from 1-1-1994 and ending 30-6-1995 wherein a total sum of Rs.35,27,08,833 was claimed as 18 months' depreciation allowance worked out on the basis of written down value of the assets as stood on 1-1-1.994---Validity---Depreciation was to be computed on the basis of "income year" as defined in Finance Act, 1995 which for the purposes of assessment year 1995-96, covered the entire period of 18 months, without any break in the computation---Said 18 months, on account of transaction in the income year i.e. from calendar to financial year, had to be treated as one income year---No lawful justification was available to split the income year into two parts, first comprising 12 months and the second 6 months and then compute depreciation, which obviously would give different quantum of depreciation. ORDER FAISAL ARAB, J.---Prior to the amendments made under the Finance Act, 1995 in Income-tax Ordinance, 1979, taxpayers had the opinion to choose calendar year as their income year under section 2(26)(b) of the Income Tax Ordinance, 1979. In order to bring uniformity in the income year for all taxpayers and to facilitate information matching, section 2(26)(b) was omitted through Finance Act, 1995, whereby the option to adopt calendar year as income year stood withdrawn. Pursuant to such amendment, all taxpayers had to follow financial year as their income year, except of course where special income year is prescribed by C.B.R. under section 2(26)(c) of the Income Tax Ordinance, 1979. However, the question of special income year is not part of the controversy in the present case. To facilitate this transition in the income year, all such taxpayer who were hitherto following calendar year as income year, required to…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492