| Case ID |
7f7f030e-203a-4bdf-9f73-ea5e3b57efa7 |
| Body |
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| Case Number |
Civil Appeal No. 353-K of 1990 |
| Decision Date |
Dec 17, 1991 |
| Hearing Date |
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| Decision |
The Supreme Court of Pakistan upheld the Tribunal's decision, affirming that the wealth tax liability for the assessment year 1972-73 should be recognized as a 'debt owed' by the assessee. The Court emphasized that the liability to pay tax arises at the close of the assessment year and is not dependent on the assessment process. Therefore, the wealth tax, although not claimed in the return, constitutes a legal obligation that can be deducted from the net wealth in the same assessment year. The ruling clarified that the term 'debt owed' under Section 2(m) of the Wealth Tax Act encompasses tax liabilities, allowing deductions for such debts in subsequent assessment years. |
| Summary |
This case revolves around the interpretation of the Wealth Tax Act, specifically Section 2(m), which pertains to liabilities and obligations regarding wealth tax. The Supreme Court of Pakistan's ruling is significant as it clarifies the nature of tax liabilities as debts owed by the taxpayer. In this context, it was determined that wealth tax liabilities should be considered debts owed for the purposes of computing net wealth, even if not explicitly claimed in the tax return for that assessment year. This interpretation aligns with the broader principles of tax law, emphasizing that tax liabilities arise independently of the assessment process. The case references several precedents that elaborate on the nature of debts and tax obligations, thereby reinforcing the Court's stance on the issue. The decision has implications for taxpayers and tax authorities, ensuring a clearer understanding of how tax liabilities are treated under the law. This ruling is likely to influence future cases and tax assessments, making it a critical point of reference in tax law jurisprudence. |
| Court |
Supreme Court of Pakistan
|
| Entities Involved |
Not available
|
| Judges |
AJMAL MIAN,
SAJJAD ALI SHAH,
SALEEM AKHTAR
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| Lawyers |
Not available
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| Petitioners |
Not available
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| Respondents |
Not available
|
| Citations |
1992 SLD 449,
(1992) 65 TAX 262
|
| Other Citations |
C.W.T., Lahore Zone v. Mst. Fauzia Mughis (1988 PTD-629),
C.W.T., Central Karachi v. Paracha Textile Mills Ltd. (1983) 48 TAX 145 (H.C. Kar.),
Kesoram Industries v. C.I.T. AIR 1966 SC 1370,
Wallace Bros. & Co. Ltd. v. C.I.T. 16 ITR 240,
Chathoram v. C.I.T. 15 ITR 302,
Setu Parvati Bayi v. C.W.T. 69 ITR 864
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| Laws Involved |
Wealth Tax Act, 1963
|
| Sections |
2(m)
|