SHAHID GUL AND PARTNERS vs DEPUTY COMMISSIONER OF INCOME TAX, AUDIT-V, RTO, PESHAWAR Ss

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

SHAHID GUL AND PARTNERS VS DEPUTY COMMISSIONER OF INCOME TAX, AUDIT-V, RTO, PESHAWAR Ss. 20 & 21---Income from business---Deductible expenses---Burden of proof---Scope---Right has been vested in the taxpayer to claim deductible expenses for the purposes of computing his income---Onus to dispute the said expense, so claimed by a taxpayer, had been cast upon the Revenue department, thus, it was for the Revenue department to show that the expenditure so claimed by the taxpayer was not permissible, or was excluded from deduction under the Income Tax Ordinance, 2001, and in particular, S. 21 thereof. Citation Name: 2021 PTD 299 SUPREME-COURTBookmark this Case SHAHID GUL AND PARTNERS VS DEPUTY COMMISSIONER OF INCOME TAX, AUDIT-V, RTO, PESHAWAR Ss. 20, 21(n), 22(13)(b), 22(15) & Third Sched., Pt. I---Deductible expenses--- Scope--- Depreciable assets--- Unsold improved land---Structural improvements---Cost of land beneath a building---Whether the cost of land beneath a "building" would be included in determining the value of the rate of depreciation specified in the Third Schedule to the Income Tax Ordinance, 2001---Land beneath the structural improvements in the shape of corridors, pavements, roads and other such improvements that were made would not qualify to be included as a cost of the land on which depreciation was sought---Value of the "building" for the purposes of determining the rate of depreciation had to be restricted only to the cost/expenses incurred on the "structural improvements" on the land, and not the costs of land on which it was built upon. Citation Name: 2021 PTD 299 SUPREME-COURTBookmark this Case SHAHID GUL AND PARTNERS VS DEPUTY COMMISSIONER OF INCOME TAX, AUDIT-V, RTO, PESHAWAR Ss. 20(1), 21(n), 22(13)(b), 22(15) & Third Sched., Pt. I---Sale of constructed shops/offices on purchased land---Deductible expenses---Scope---Depreciable assets---Unsold improved land---Structural improvements---[Per Yahya Afridi, J (Majority view): While computing the income of the tax-payer from the sale of the shops so constructed on the purchased land, the cost so incurred from the purchase thereof could be deducted under subsection (1) of S. 20 of the Income Tax Ordinance, 2001 ('the Ordinance')---Tax-payer was also entitled to seek depreciation under S. 22 of the Ordinance on the expenditure incurred by him on structural improvements of unsold improved part of the land for the furtherance of his business, which factual determination was to be undertaken by the assessing officer --- Cost/expenses incurred on the structural improvements on the unsold improved land owned by the tax-payer being utilized for the furtherance of his business would be included in the value of a depreciable asset of the tax-payer within the contemplation of S. 22 of the Ordinance---Cost incurred by the tax-payer for purchasing the unsold land would not be included in the value of the depreciable asset for the purposes of depreciation, within the meaning of S.22 read with the Third Schedule of the Ordinance]---[Per Munib Akhtar, J (Minority view): His Lordship observed that present matter was clinched, insofar as the facts and circumstances of the present case were concerned, by S. 22(13) of the Ordinance, therefore, the discussion as regards the legal meaning of "building" in relation to the land beneath any structure contained in paragraphs 27 to 30 of the present judgment, was not necessary and the matter ought to be regarded as left open for future consideration in an appropriate case]. Citation Name: 2021 PTD 299 SUPREME-COURTBookmark this Case SHAHID GUL AND PARTNERS VS DEPUTY COMMISSIONER OF INCOME TAX, AUDIT-V, RTO, PESHAWAR Ss. 20, 21(n), 22(15) & Third Sched., Pt. I---Deductible expenses---Scope--- Depreciable assets--- Unsold improved land---Structural improvements---Deduction was allowed for depreciation of the taxpayer's depreciable assets used in furtherance of his business in the said tax year---Term "depreciable assets", as explained in subsection (15) of S. 22 of the Income Tax Ordinance, 2001 in essence, referred to any tangible moveable property, immovable property (other than unimproved land), and included "structural improvement" made on the immovable property---"Structural improvement", in relation to the immovable property, was to include the changes made on the unimproved or even the improved land, which transformed its existing shape and was used for any purpose in furtherance of taxpayer's business---Word "building", provided in Part I of the Third Schedule to the Income Tax Ordinance, 2001, would include structural improvements made on unsold land fulfilling the attributes of a depreciable asset, as provided in S. 22 of the Ordinance. Citation Name: 2021 PTD 299 SUPREME-COURTBookmark this Case SHAHID GUL AND PARTNERS VS DEPUTY COMMISSIONER OF INCOME TAX, AUDIT-V, RTO, PESHAWAR Ss. 20 & 24---Sale of immoveable property---Deductible expense---Scope---Income Tax Ordinance, 2001 did not expressly require registration of sales of immovable properties for its cost to be accepted as a deductible expense.

SHAHID GUL AND PARTNERS vs DEPUTY COMMISSIONER OF INCOME TAX, AUDIT-V, RTO, PESHAWAR Ss — 2021 PTD 299 SUPREME-COURT

Case information

Judgment text as reported

Other judgments reported in 2021 PTD