| Case ID |
03f1b30d-5b7e-46ca-970e-671ada502993 |
| Body |
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| Case Number |
Income-tax Cases Nos. 743 and 744 of 1972 |
| Decision Date |
Dec 01, 1983 |
| Hearing Date |
Nov 30, 1983 |
| Decision |
The Appellate Tribunal concluded that the subletting contract was valid and entered into between two genuine parties. The Income Tax Officer's interpretation, which deemed the sublet as a sham and the sublettee as a Benamidar, was not supported by the terms of the contract or the evidence presented. The Tribunal found that the sublettee had been an independent contractor assessed to tax for years. Therefore, only a portion of the profits (5%) was to be assessed in the hands of the respondent, affirming the Tribunal's different view from that of the Income Tax Officer. |
| Summary |
In the case of Income-tax Cases Nos. 743 and 744 of 1972, the Sindh High Court deliberated on the legality of a subletting contract under the Income Tax Act, 1922. The case arose when the Income Tax Officer assessed the entire profits from a contract to the respondent company, contending that the sublettee acted merely as a Benamidar. However, the Income Tax Appellate Tribunal found that the subletting agreement was genuine and legally binding, with both parties acting independently. The Tribunal's ruling emphasized the importance of contractual interpretation and the validity of agreements made between two genuine parties. This case highlights the significance of proper documentation and adherence to legal standards in contractual agreements, particularly in tax assessments. Keywords: Income Tax Act, subletting contract, legal interpretation, genuine parties, tax assessment. |
| Court |
Sindh High Court
|
| Entities Involved |
C. D. A.,
Muhammad Rasool Khan & Co.
|
| Judges |
MUHAMMAD ZAHOORUL HAQ,
ALI NAWAZ BUDHANI
|
| Lawyers |
Nasrullah Awan,
Hassan Inamullah
|
| Petitioners |
THE COMMISSIONER OF Income Tax (INVESTIGATION), KARACHI
|
| Respondents |
MESSRS MUSTAFA PRESTRESSED, R. C. C. PIPE WORKS LTD. KARACHI
|
| Citations |
1984 SLD 39,
1984 PTD 187,
(1984) 50 TAX 201
|
| Other Citations |
Not available
|
| Laws Involved |
Income Tax Act, 1922
|
| Sections |
23,
33
|