Allowances

Question before Appellate Tribunal was whether the "Special Judicial Allowance" was "part of the salary" or an allowance solely expended in the performance of the employee's duties of employment within the meaning of S. 12(2)(c) and Cl. 39 of Part I of Second Schedule to the Income Tax Ordinance, 2001

Validity

Special Judicial Allowance was extended to staff and officers of the judiciary by the Chief Justice of High Court, therefore, as per the definition mentioned in S.12(2)(c) of Income Tax Ordinance, 2001, the allowance was expended in the performance of the staff on account of their performance

"Special Judicial Allowance" did not fall within the scope of salary, as such, the same was not chargeable to income tax

Impugned orders were set aside and the appeals were accepted.