2002 PLP 473 (PTD)
COMMISSIONER OF INCOME-TAX, COMPANIES ZONE-1, LAHORE Versus Messrs LASANI STEEL MILLS (PVT.), LAHORE
| Citation | 2002 PLP 473 (PTD) |
| Forum / Court | Lahore High Court |
| Bench Members | Nasim Sikandar and Mansoor Ahmad, JJ |
| Parties | COMMISSIONER OF INCOME-TAX, COMPANIES ZONE-1, LAHORE Versus Messrs LASANI STEEL MILLS (PVT.), LAHORE |
| Primary Law | (b) Income Tax Ordinance (XXXI of 1979), (a) Income Tax Ordinance (XXXI of 1979) |
Q1: What are the key laws and sections cited in 2002 PLP 473 (PTD)?
This judgment primarily cites: (b) Income Tax Ordinance (XXXI of 1979), (a) Income Tax Ordinance (XXXI of 1979) as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2002 PLP 473 (PTD)?
The case was heard and decided by the Lahore High Court bench comprising: Nasim Sikandar and Mansoor Ahmad, JJ.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2002 PLP 473 (PTD) (COMMISSIONER OF INCOME-TAX, COMPANIES ZONE-1, LAHORE Versus Messrs LASANI STEEL MILLS (PVT.), LAHORE). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Representation
- Muhammad Ilyas Khan for Petitioner/Revenue.
- Muhammad Iqbal Khawaja for Respondent.
Headnotes / Summary
S.136(2)
Issue involved directly relating to valuation of land in question, can hardly be a subject-matter of reference to High Court.
S.13(1)(d)
Difference between the market value of the investment and book value
Deemed income
Addition of the kind could not be wade without pointing out the source wherefrom the alleged investment was made
No mention of market value appeared in the provisions of S.13 of the Income Tax Ordinance, 1979 which were invoked to make the addition.
Judgment & Decree
NASIM SIKANDAR, J.
This reference under section 136(2) of the Income Tax Ordinance, 1979 has been made at the instance of the Commissioner of Income-tax/Wealth Tax, Companies Zone-1, Lahore. Following question of law is said to have.arisen out of an order recorded by the Tribunal on appeal of the respondent-assessee on 12-6-1996:
"Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that where an assessee has made any investment the difference between the market value of the investment and the amount recorded by the assessee in the books of accounts as consideration for such investment would not be deemed as income of the assessee?"
2. The assessee is a private limited company and at the relevant time in the assessment year 1990-91derived income from iron re-rolling. A return was filed on 31-12-1990 declaring loss at Rs.8,79,
069. The Assessing Officer however, framed an assessment at total income for the year at Rs.1,56,35,
366. In the process inter alia an addition of Rs.22,40,000 was made by resort to the provisions of section 13(1)(d) of the Ordinance. Earlier it was noted that balance-sheet , of the assessee company indicated purchase of 24 Kanals of land at 16 K.M. G.T. Road, Lahore through registered deed, dated 27-6-1990. The disclosed price at Rs.41,667 per Kanal was found understated and accordingly enhanced to Rs.1,35,000 per Kanal. The difference between the disclosed and the estimated value of Rs.22,40,000 was deemed income under the said provisions of the Ordinance.
3. Learned First Appellate Authority/C.I.T., Lahore reduced the estimated value to Rs.90,
000. However, a Division Bench of the Tribunal on further appeal directed deletion of the addition on the ground that the kind of addition was not exigible under the said provisions which were invoked to make the addition. Thereafter, the assessee made an application for reference which was refused by the Tribunal on 16-2-1997.
4. After hearing the learned counsel for the parties at pre admission state, we are not inclined to entertain the reference application. In the first instance the issue involved directly relates to valuation of land in question which can hardly be a subject-matter of reference to this Court. Secondly we will agree with the learned counsel for the respondent that addition of the kind could not be made without pointing out the source wherefrom the alleged investment was made. In the case in hand the company purchased land from a Director of the Company and there hardly appears any good reason for either of them the seller director as well as the purchaser company an understate the value. Therefore, we will agree with the observations of the learned Tribunal which it made while refusing the reference application that there was no mention of market value in the relevant provisions of section 13 of the Income Tax Ordinance, 1979 which were invoked to; make the impugned addition.
5. That being so, as said earlier, the question as framed cannot be entertained for consideration and reply.
6. Dismissed. C.M.A./M.A.K./C-132/L Application dismissed.