Income Tax Ordinance (XXXI of 1979)---

----First Sched., Part III---Provision/liability for tax falls within the purview of the expression "for meeting working capital requirements" as used in First Sched., Part III and is to be excluded from the total income for levy of surcharge.

Commissioner of Income Tax v. Pakistan Tobacco Co. Ltd. 1988 PTD 66 fol..

Sheikh Haider for Applicant.

Saleemuddin Ahmed for Respondent.

Date of hearing: 18th November, 1991

JUDGMENT

NASIR ASLAM ZAHID, J.---On two applications under section 136(1) of the Income Tax Ordinance, 1979 moved by the Department in respect of assessment years 1978-79 and 1979-80 the following question has been referred to by the Income Tax Appellate Tribunal to this Court for opinion:--

"Whether, on the facts and circumstances of the case, the Appellate Tribunal was justified in holding that the provision/liability for tax falls within the purview of the expression `for meeting working capital requirements' as used in Part III of First Schedule and hence it is to be excluded from the total income for levy of surcharge?"

We have heard Mr. Sheikh Haider, learned counsel for the Department, and Mr. Saleemuddin Ahmed, learned counsel for the assessee.

2. Similar questions have been considered previously in various earlier decisions and decided against the department. A detailed judgment of this Court has been given in the case of Commissioner of Income Tax v. Pakistan Tobacco Co. Ltd. 1988 PTD 66. Mr. Sheikh Haider concedes to this position but submits that the department has taken the matter before the Supreme Court where appeals filed by the department are pending.

3. Following our earlier decisions, the question referred to us in the present reference application is also answered in the affirmative.

There will be no order as to costs.

M.B.A./C-260/K Reference answered.