COMMISSIONER OF INCOME TAX, LARGE TAXPAYERS UNIT, LEGAL DIVISION, LAHORE vs SERVICE INDUSTRIES LIMITED, SERVICE HOUSE, MAIN GULBERG, LAHORE Ss — 2021 PTD 1153 LAHORE-HIGH-COURT-LAHORE

Case information

Citation: 2021 PTD 1153 LAHORE-HIGH-COURT-LAHORE
Court: Lahore High Court
Year: 2021
Reporter: PTD
Parties: COMMISSIONER OF INCOME TAX, LARGE TAXPAYERS UNIT, LEGAL DIVISION, LAHORE vs SERVICE INDUSTRIES LIMITED, SERVICE HOUSE, MAIN GULBERG, LAHORE Ss
Subject matter: Tax & Customs
Provisions referred to: Income Tax Ordinance

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

Judgment text as reported

COMMISSIONER OF INCOME TAX, LARGE TAXPAYERS UNIT, LEGAL DIVISION, LAHORE VS SERVICE INDUSTRIES LIMITED, SERVICE HOUSE, MAIN GULBERG, LAHORE Ss.2(24), 15 & Third Sched., Cl. 7(b)(i) & 8---"Slump transactions", concept of---Disposal of assets and treatment of resultant gains and losses ----Scope---Department impugned order of Appellate Tribunal whereby sale / transfer of shares by taxpayer to a joint-venture company was declared as a slump transaction and addition made in income of taxpayer on basis of same, was set aside---Validity---Concept of a "slump transaction" / sale / trade; was alien to the Income Tax Ordinance, 1979 (since repealed) as well as to Income Tax Ordinance, 2001 and therefore jurisprudence / principles developed on the same, in Indian Case Law, shall have no applicability in the present case---Transaction, in the present case, was covered squarely by Cl. 7 read with Cl.8 of Third Schedule to the Income Tax Ordinance, 1979 and no provision within the law exempted said transaction from payment of tax---Even otherwise, in order for a transaction to qualify as a "slump sale", it needed to be proved that undertaking of business as a whole was transferred as a going concern, along with its goodwill, assets liabilities etc., and a simple sale of assets would not suffice, thus present transaction did not qualify as such---High Court held that impugned order had erroneously declared the transaction as a "slump sale" and addition made by assessing officer was therefore, correct --- Reference was answered, accordingly.

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