| Case ID |
307b280a-eb00-4146-a22c-ceb117f708ab |
| Body |
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| Case Number |
D-1166 of 2008 |
| Decision Date |
Feb 11, 2009 |
| Hearing Date |
|
| Decision |
The Sindh High Court dismissed the constitutional petition filed by the petitioners against the refusal of the Federal Board of Revenue to issue an exemption certificate under section 153(4) of the Income Tax Ordinance, 2001. The court held that the petitioners, who manufactured auto parts, did not fall within the ambit of clause 46-A of Part-IV of the Second Schedule of the Income Tax Ordinance, which pertains specifically to manufacturers of iron and steel products. The court ruled that the interpretation of the terms used in the relevant law should adhere to their common parlance meaning. The petitioners were found to be registered as members of the Auto Parts Manufacturer Association and not the Iron and Steel Dealers Association, which further supported the decision that their products could not be categorized as iron and steel products. As a result, the court concluded that the refusal to issue the exemption certificate was valid and upheld the administrative decisions made by the revenue authorities. |
| Summary |
This case revolves around the interpretation of the Income Tax Ordinance, 2001, specifically section 153(4) and clause 46-A of Part-IV of the Second Schedule, concerning the exemption certificate for manufacturers of iron and steel products. The petitioners, Messrs PIRANI ENGINEERING, contended that their manufactured auto parts should qualify for exemption under the stated provisions. However, the court found that the petitioners did not meet the criteria set forth in the law, as their products were not classified as iron and steel products in common parlance. The decision emphasizes the importance of precise legal interpretation and the necessity for petitioners to align their manufacturing classifications with the legal definitions provided in the ordinance. This ruling is significant for manufacturers seeking tax exemptions under similar provisions and underscores the need for clarity in legal definitions and classifications. |
| Court |
Sindh High Court
|
| Entities Involved |
FEDERAL BOARD OF REVENUE,
PIRANI ENGINEERING
|
| Judges |
MUHAMMAD ATHAR SAEED,
ARSHAD NOOR KHAN
|
| Lawyers |
Mr. Rehan-ul-Hassan Naqvi,
Ms. Lubna Pervaiz,
Mr. Altaf Moon
|
| Petitioners |
Messrs PIRANI ENGINEERING through Chief Financial Officer
|
| Respondents |
2 others,
FEDERAL BOARD OF REVENUE
|
| Citations |
2009 SLD 1484,
2009 PTD 809,
(2009) 99 TAX 382,
2010 PTCL 242
|
| Other Citations |
Central Insurance Co. and others v. Central Board of Revenue, Islamabad, and others 1993 PTD 766 = 1993 SCMR 1232,
Collector of Customs (Appraisement), Karachi and others v. Messrs Abdul Majeed Khan and another 1977 SCMR 371,
Tahir Mahmood and 3 others v. Khalid Sharif and 9 others PLD 2007 SC (AJ&K) 119,
Orient Straw Board and Paper Mills Limited v. Commissioner of Income-Tax, Hyderabad 1993 PTD 306,
Messrs Habib Sugar Mills Ltd. v. Additional Collector, Sales Tax, Customs House, Site Hyderabad and 2 others 2007 PTD 171,
Commissioner of Income/Wealth Tax v. Messrs Ravi Plastic Industries (Pvt.) Ltd. 2007 PTD 1227,
Commissioner of Income Tax v. Krudsons Limited, Karachi (1966) 14 Tax 293 (H.C. Kar.),
Commissioner of Sales Tax, Lahore v. General Equipment Merchants, Lahore PLD 1982 SC 107,
C.A. 1891 Unwin v. Hanson At page 115,
Kawther Grain (Pvt.) Limited v. DCIT Guraranwala 80 Tax 262,
Collector of Central Excise, Bombay-I and another v. Messrs Parle Exports (P) Ltd. AIR 1989 Supreme Court 644,
Messrs Hindustan Aluminum Corporation Ltd., Appellants v. The State of U.P. and another AIR 1981 Supreme Court 1649,
Messrs Indian Cable Company Ltd. Calcutta v. Collector of Central AIR 1995 SC 64,
Usmania Glass Sheet Factory Limited, Chittogang v. Sales Tax Officers, Chittagong PLD 1971 SC 205,
Two Hundred Chests of Tea (1) US 6 Lywer's Edn 430
|
| Laws Involved |
Income Tax Ordinance, 2001
|
| Sections |
122B,
153(4),
Second Schedule,
207
|