2008 P T D (Trib.) 32
[Income-tax Appellate Tribunal Pakistan]
Before Jawaid Masood Tahir Bhatti, Judicial Member and Shahid Azam Khan, Accountant Member
I.T.As. Nos. 589/KB and 872/KB of 2005, decided on 26/01/2007.
(a) Income Tax Ordinance (XXXI of 1979)---
----Ss. 80-D & 134---Appeal to Appellate Tribunal---Inclusion of subsidies, donation and exchange gain to total turnover---Assessing Officer, having included subsidies, donation and exchange gain in total turnover, assessee filed appeal before Commissioner of Income Tax (Appeal) against said inclusion, but Commissioner confirmed action of Assessing Officer, on which assessee had filed appeal before Appellate Tribunal---Finding of Commissioner that Assessing Officer had passed a speaking order, was not correct---Assessing Officer had only included the impugned receipts/gains in the turnover without discussing as to how those were included in the turnover as defined in the Explanation to S.80-D of Income Tax Ordinance, 1979---Assessment order on that point was set aside for de novo order.
(b) Income Tax Ordinance (XXXI of 1979)---
----Ss.50(2-A) & 80-B, D---Deduction of tax---Tax paid under S.50(2-A) of Income Tax Ordinance, 1979 was final discharge of tax liability under S.80-B of Income Tax Ordinance, 1979 and could not be allowed as a credit against any other tax liability under Income Tax Ordinance, 1979.
(c) Income Tax Ordinance (XXXI of 1979)---
----Ss.50(2-A), 80-B, D & 134---Appeal to Appellate Tribunal---Refusal to give credit of tax paid against tax liability---Issues raised in the other grounds of appeal were related to Assessing Officer's refusal to give credit of tax paid under S.50(2-A)/80-B of Income Tax Ordinance, 1979 against the tax liability under S.80-D of the Ordinance-First ground of appeal was not very clear as to what issue had been raised therein---Tribunal had already held in appellant's appeal for assessment year 1999-2000 that the tax paid under S.50(2-A) of Income Tax Ordinance, 1979 as a final discharge of tax liability under S.80-D of the Ordinance, could not be allowed credit against any other tax liability---Assessing Officer's action was upheld---Appeal filed by taxpayer/assessee was dismissed being devoid of merit.
Irfan Ahmad for Appellant.
Chaman Lal, D.R. for Respondent.
ORDER
SHAHID AZAM KHAN (ACCOUNTANT MEMBER).---These two appeals have been filed on behalf of assessee against the order of the learned C.I.T. (A), dated 4-5-2005 and 27-5-2005, on the following grounds:-
Assessment Year 1999-2000
* The learned C.I.T. (A) erred in maintaining the determination of Turnover at Rs.12,744,315 which includes the following which are not turnover as defined in Explanation to 80D.
| Subsidies | Rs. 2,791,066 |
| Donation | Rs. 161,301 |
| Profit on SSC | Rs. 417,909 |
| Exchange gain | Rs. 976,218 |
| Total | Rs. 4,346,494 |
* The learned C.I.T. (A) erred in maintaining the amount payable under section 80D at Rs.63,872 which is erroneously' worked out as this amount includes 80D on items not includible amounting to Rs.4,346,494 detailed in para 1 above.
*The learned C.I.T.(A) further erred in not directing the Taxation Officer to consider the tax paid amounting to Rs. 24,443 under section 80B while computing the tax payable under section 80D.
* The learned C.I.T. (A) erred in not directing the Taxation Officer to allow credit for tax paid amounting to Rs.24,443 paid under sections 50(2A)/80B.
Assessment Year 2000-2001
*The learned C.I.T.(A) erred in stating that the order under appeal was served on the appellant's counsel on 29-6-2003 when in fact no such order was served. The affidavits of the appellant and their counsel are attached in this regard.
*The learned CIT. (A) erred in not considering the tax amounting to Rs.73,281 paid under section 50(2A) while determining the minimum tax under section 80D at Rs.91,344 on the ground that the tax deducted under section 50(2A) on interest income is full and final discharge of tax liability on that income although the tax charged under section 80D is the minimum tax payable after including tax on all sources of income and as such the learned C.I.T. (A) erred in not ordering adjustment of tax paid under section 58(2A) against tax liability under section 80D.
*Without prejudice to the ground No.2 above, the learned C.I.T. (A) further erred in not directing the adjustment of the tax amounting to Rs.77,268 paid under section 50 against the demand amounting to Rs.91,344 under section 80D.
2. The learned representatives of both the sides are present and heard. Both the appeals of the taxpayer are taken up as follows:
Assessment Year 1999-2000
3. In the appeal for this year the taxpayer has raised two issues that include determination of turnover for the levy of tax under section 80D and the credit of tax paid under sections 50(2A)/80-B again tax payable under section 80D of the repealed Income Tax Ordinance, 1979. The taxpayer filed return of income declaring Nil income for the year claiming exemption under clauses (93) and (94) of the Second Schedule to the repealed Ordinance being social welfare organization and also filed a statement under section. 143-B of the repealed, Ordinance declaring profit from bank account at Rs.244,426 on which tax paid/deducted under section 50(2A) was claimed at Rs.24,443. The Assessing Officer ignored the accumulated loss declared by the assessee and proceeded to charge minimum tax of Rs.63,872 under section 80D on the turnover determined by him as under: ---
| Patients | 7,679,696 |
| Subsidies | 2,791,066 |
| Donation | 161,301 |
| | 10,632,063 |
| Profit on Special Saving Certificates | 417,909 |
| Exchange gain | 979,218 |
| Profit on Sale of fixed assets | 648,135 |
| Other receipts | 99,990 |
| | 12,774,315 |
The Assessing Officer allowed credit of tax already paid under section 80D at Rs.13,955 and accepted the bank interest declared under section 80-B in the statement under section 143-B.
4. The assessee objected to inclusion of subsidies, donation and exchange gain to total turnover through appeal before the learned C.I.T.(A) who has confirmed the Assessing Officer's action in the following words:--
"I have examined the facts of the case. Heard the argument of the appellant and has also gone through the assessment order. It is noted that in the instant case Taxation Officer has passed a speaking order wherein all aspects of the case have been discussed. Arguments of the appellant are of general nature which cannot rebut the findings of the Taxation Officer. In this matter order passed by the Taxation Officer calls for no interference from this forum which is confirmed and upheld."
We have found that the learned C.I.T. (A) finding that the Assessing Officer has passed a speaking order is not correct. The Assessing Officer has only included the impugned receipts/gain in the turnover without discussing as to how these are included in turnover as defined in the explanation to section 80-D. Accordingly, we deem it necessary to set aside the assessment order on this point for de novo order after confronting the taxpayer as to how the impugned items of receipts/gain fall within the definition of turnover and reply by the taxpayer.
5. On the issue of credit of tax paid under sections 50(2A)/80-B against the tax liability under section 80-D, the arguments of the learned AR are not acceptable. The tax paid under section 50(2A) is final discharge of tax liability under section 80-B and cannot be allowed as a credit against any other tax liability under the repealed Ordinance. Accordingly, appellant's grounds of appeal on this issue dismissed being devoid of merit.
Assessment Year 2000-2001
6. The first ground of appeal is not very clear as to what issue has been raised therein. The learned A.R. of the appellant has also not been able to explain this ground of appeal which is dismissed being vague and unexplainable. The issues raised in the other grounds of appeal relate to Assessing Officer's refusal to give credit of tax paid under sections 50(2A)/80-B against the tax liability under section 80-D. We have already held in the appellant's appeal for assessment year 1999-2000 that the tax paid under section 50(2A) as a final discharge of tax liability under section 80-B cannot be allowed credit against any other tax liability under the repealed Ordinance. Therefore, the Assessing Officer's action is upheld. Accordingly, the appeal filed by the taxpayer is dismissed being devoid of merit.
7. Both the captioned appeals of the taxpayer are decided as indicated above.
H.B.T./132/Tax (Trib.)Order accordingly.