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COMMISSIONER OF INLAND REVENUE, LAHORE vs SARITOW SPINNING MILLS LIMITED, LAHORE Ss — 2021 PTD 1572 LAHORE-HIGH-COURT-LAHORE

Case information

Citation
2021 PTD 1572 LAHORE-HIGH-COURT-LAHORE
Court
Lahore High Court
Year
2021
Reporter
PTD
Parties
COMMISSIONER OF INLAND REVENUE, LAHORE vs SARITOW SPINNING MILLS LIMITED, LAHORE Ss
Subject matter
Tax & Customs
Provisions referred to
S. 50; S. 80C; 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 INLAND REVENUE, LAHORE VS SARITOW SPINNING MILLS LIMITED, LAHORE Ss.50 & 80C---Deduction of income tax at source---Payments made to associated companies / undertakings---Essential prerequisite for deduction of tax at source---Scope---Question before High Court was whether taxpayer was liable to deduct income tax at source for supply of material to associated company of taxpayer----Held, that taxpayer's unit which purchase material deducted tax from payment made to a seller in accordance with S.50(4) of Income Tax Ordinance, 1979, but said unit, when transferring stock to associated company / sister concern, at cost, made necessary book entries in relevant ledgers of the units without involvement of any cash --- Since instance of payment had not occurred, therefore tax under S.80C of Income Tax Ordinance, 1979 was not chargeable and accordingly provisions of S.50(4) of said Ordinance were not attracted---Event of tax deduction would come into play only at time of making payment and S.50(4) of Income Tax Ordinance, 1979 would not be applicable unless payment was actually made---Reference was answered, accordingly.

Other judgments reported in 2021 PTD

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