KOHINOOR SPINNING MILLS LTD. vs COMMISSIONER INLAND REVENUE S — 2022 PTD 1727 SUPREME-COURT

Case information

Citation: 2022 PTD 1727 SUPREME-COURT
Court: Supreme Court of Pakistan
Year: 2022
Reporter: PTD
Parties: KOHINOOR SPINNING MILLS LTD. vs COMMISSIONER INLAND REVENUE S
Subject matter: Tax & Customs
Provisions referred to: S. 21; 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

KOHINOOR SPINNING MILLS LTD. VS COMMISSIONER INLAND REVENUE S. 21(e)---Income from business, computation of---Deductions not allowed---Contributions made by tax-payer company to an unapproved gratuity fund---Section 21(e) of the Income Tax Ordinance, 2001 clearly stipulates that the contributions to an unapproved gratuity fund cannot be deducted while computing the income tax of a person under the head "Income from Business"---Admittedly, in the present case, the gratuity fund has not been approved---Contention of the counsel for the tax-payer that once the contribution is made to a gratuity fund, section 21(e) is not applicable, is an absurd argument and totally negates the purpose and object of the statutory requirement of an approved gratuity fund---If the argument of the counsel were to hold true, the requirement of an approved gratuity fund is rendered totally meaningless, if the taxpayer simply states making the contribution to an unapproved gratuity fund and thereafter seeks deduction from the income from business---Such an interpretation is not only absurd but is also unsustainable in law---Petition for leave to appeal was dismissed and leave was refused.

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