Income Tax Ordinance (XXXI of 1979)---

----S.14(1) and Second Sched., Cl. (102-A)---Exemption---Determination of date of establishment of business --Interpretation---Role of Commissioner of Income Tax is only to the extent of determination of the date of establishment of business as he was not entitled to allow or disallow the exemption---Assessing Officer has to decide the issue on the basis of documents---Case was remanded for re-assessment so as to determine the actual date of establishment by the CIT while other factors mentioned in Cl. (102-A) of Second Sched. of the Income Tax Ordinance, 1979 were to be checked by Assessing Officer whether to allow or disallow exemption.

Muhammad Siddique Mughal for Appellant.

Muhammad Aslam, D.R. for Respondent.

Date of hearing: 26th February, 1997.

ORDER

KHAWAJA FAROOQ SAEED (JUDICIAL MEMBER).---This assessee appeal has been filed for disallowance under clause (102-A) of the Second Schedule of the Income Tax Ordinance, 1979.

The A.R. argued that the disallowance has been made by observing that the machinery has earlier been used in Pakistan. He produced before us vouchers to say that the machinery was imported in 1990 and was not used earlier by either this company or any other organization. It has also been argued that the assessee company was formed in the month of January, 1990 and machinery being purchased after incorporation, the refusal of the exemption was not justified. The D.R. pointed out that the learned CIT(A) has rejected this argument of the assessee in keeping view the fact that the exemption was to be allowed by learned CIT and he refused the exemption hence the ITO was bound to go by the same. He also said that the exemption has rightly been disallowed by CIT and subsequently by ITO and CIT(A).

Before going into the merits of appeal it will be more appropriate to go through the relevant provision of law. Before it was omitted it was as follows:---

"(102) Any income derived by an assessee from the business of poultry farming, poultry processing, fish catching, fish farming, dairy farming and cattle or sheep breeding, where the poultry farm, and cattle or sheep breeding farm is established by the assessee, for the first time, at any time after the thirtieth day of June, 1988, and before the first day of July, 1993, for a period of five years from the date of such establishment, subject to the condition that the said date shall be determined by the Commissioner on an application made by the assessee."

From the bare reading of the above it is clear that the role of the learned Commissioner was only to the extent of determination of the date and he is not entitled to allow or disallow the exemption as such. It is the Assessing Officer who will decide this issue on the basis of the documents of poultry farm and/or hatchery etc. We, therefore, remand back the case for reassessment so as to determine the actual date of its establishment by the learned CIT while other factors/conditions mentioned in clause 102(A) shall be checked by the ITO so as to allow or disallow the exemption. Order accordingly.

C.M.S./416/Trib.Order accordingly.