| Case ID |
14e0f565-6159-4602-8dfa-78a4273f2572 |
| Body |
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| Case Number |
Income Tax Cases No.343 of 1990 |
| Decision Date |
Mar 14, 1991 |
| Hearing Date |
|
| Decision |
The court ruled that the amount of tax paid by the assessee should be treated as retained income for meeting the working capital requirement of the business. The court found itself in agreement with a previous ruling regarding the inclusion of income tax liability for the relevant assessment year in the calculation of retained income for the purpose of levy of surcharge. The decision reinforced the principle that taxes not in the hands of the assessee should not attract surcharges. |
| Summary |
In the landmark case of Income Tax Cases No.343 of 1990, the Sindh High Court examined the nuances of tax liabilities under the Income Tax Ordinance of 1979. The case arose from a surcharge imposed on the assessee by the Commissioner of Income Tax, amounting to Rs.7,82,517, which had been contested based on the treatment of un-retained income. The court's decision emphasized the treatment of income tax liability as retained income for business operational needs, a significant aspect for businesses seeking clarity on tax obligations. This case is vital for understanding the implications of tax law on business finance, particularly in the context of retained income calculations and surcharges. The ruling aligns with previous decisions, reinforcing the need for coherence in tax legislation interpretations. Legal practitioners and businesses alike should take note of this ruling, as it sets a precedent for future tax liability cases, ensuring that businesses are not unduly penalized for taxes that are not under their direct control. |
| Court |
Sindh High Court
|
| Entities Involved |
Commissioner of Income Tax,
Brooke Bond Pakistan Limited,
Pakistan Tobacco Company Limited
|
| Judges |
MAMOON KAZI,
SALAHUDDIN MIRZA
|
| Lawyers |
Shaikh Haider,
Khalifa Salah-ud-Din
|
| Petitioners |
COMMISSIONER OF INCOME TAX, KARACHI
|
| Respondents |
BROOKE BOND PAKISTAN LIMITED
|
| Citations |
1991 SLD 157,
1991 PTD 912,
(1991) 64 TAX 123
|
| Other Citations |
Commissioner of Income-tax v. Pakistan Tobacco Company Limited 1988 PTD 66
|
| Laws Involved |
Income Tax Ordinance, 1979,
Finance Ordinance (XXV of 1990)
|
| Sections |
136,
Sched. I, Part III, Para. A, Explanation(a)
|