Residual commission

Taxpayer contended that residual commission fell within the domain of subsection (1) of S.233 of the Income Tax Ordinance, 2001 and was assessable under the Presumptive Tax Regime on the basis of provisions of subsection (3) of S.233 of the Income Tax Ordinance, 2001 whereas upfront commission, being subject matter of subsection (2) of S.233 of the Income Tax Ordinance, 2001 was not assessable under Presumptive Tax Regime because S.233(3) of the Income Tax Ordinance, 2001 provided for Presumptive Taxation in respect of only those commission receipts which fell within the ambit of subsection (1) of S.233 of the Income Tax Ordinance, 2001

Validity

Entire income earned by the taxpayer whether falling within the domain of subsection (1) or subsection (2) of S.233 of the Income Tax Ordinance, 2001 was the commission income

Subsection (2) of S.233 of the Income Tax Ordinance, 2001 having treated the amount retained by the agent as commission or brokerage paid by the principal, the amount mentioned in subsection (2) of S.233 of the Income Tax Ordinance, 2001 was thus imbued with all the characteristics of the amount mentioned in subsection (1) of S.233 of the Income Tax Ordinance, 2001 and had to be treated as an integral part of the amount mentioned in subsection (1) of S.233 of the Income Tax Ordinance, 2001 for the purpose of taxation

Taxation Officer did not take cognizance of the revised assessment under S.122(3) of the Income Tax Ordinance, 2001 and on the first page of the amended assessment order referred to the assessment under S.122(3) of the Income Tax Ordinance, 2001 and held to be erroneous in so far as it was prejudicial to the interest of revenue

Contention of the taxpayer that the Taxation Officer based his proceedings entirely on the order passed under S.120(1) of the Income Tax Ordinance, 2001 was not found to be correct

Omission of subsection 233(2) in S.233(3) of the Income Tax Ordinance, 2001 did not support the case of the taxpayer because the amount falling within the domain of subsection (2) of S.233 of the Income Tax Ordinance, 2001 was also to be treated as an integral part of the amount assessable under subsection (1) of S.233 of the Income Tax Ordinance, 2001

Order of First Appellate Authority was upheld by the Appellate Tribunal and appeal filed by the taxpayer failed.