| Case ID |
0407a0ce-1caa-47e9-bbec-8592189feebc |
| Body |
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| Case Number |
W.T.As. Nos. 132/1B to 136/1B of 1997-98 |
| Decision Date |
Jun 24, 1999 |
| Hearing Date |
|
| Decision |
The Appellate Tribunal Inland Revenue adjudicated that the flour mills owned by the appellant, which had been leased out to a third party, qualifies as immovable property under the Wealth Tax Act, 1963. The Tribunal ruled that the machinery and plant of the flour mills, being permanently affixed to the land, are deemed immovable assets and, hence, subject to wealth tax. The assessment made by the Assessing Officer, which was later confirmed by the learned CIT(A), was upheld, emphasizing that the property was being held for the purpose of business letting. Furthermore, the Tribunal clarified that paid-up capital is not considered a debt under the Act and thus not deductible from the company's wealth for tax purposes. The appeals were ultimately dismissed. |
| Summary |
In the case of M/s. United Roller Flour Mills (Pvt. ) Ltd., the Appellate Tribunal Inland Revenue addressed the issue of whether the flour mills leased to a third party constituted immovable property liable for wealth tax under the Wealth Tax Act, 1963. The Tribunal clarified that assets attached to the land for permanent beneficial enjoyment are classified as immovable property. The case hinged on the interpretation of section 2(2)(e)(ii) of the Act, which defines such properties. The Tribunal ruled that the machinery and plant of the flour mills, permanently affixed to the land, fell under this definition and were subject to wealth tax. Additionally, the Tribunal dismissed claims regarding paid-up capital being a deductible debt, reaffirming its non-debt status. This ruling reinforces the importance of understanding the definitions and classifications of properties within tax law, particularly for businesses involved in leasing operations. The decision serves as a significant reference for future cases concerning wealth tax assessments and asset classifications in Pakistan. |
| Court |
Appellate Tribunal Inland Revenue
|
| Entities Involved |
M/s. United Roller Flour Mills (Pvt. ) Ltd.
|
| Judges |
MR. KARAMAT HUSSAIN NIAZI, JUDICIAL MEMBER,
MR. MUHAMMAD DAUD TAHIR, ACCOUNTANT MEMBER
|
| Lawyers |
Mr. Javed A. Qureshi, Advocate,
Mr. Muhammad Ali Shah, D.R
|
| Petitioners |
Not available
|
| Respondents |
Not available
|
| Citations |
2001 SLD 716,
2001 PTCL 71
|
| Other Citations |
1981 PTD 211
|
| Laws Involved |
Wealth Tax Act, 1963
|
| Sections |
2(2)(e)(ii)
|