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TELENOR PAKISTAN (PVT.) LTD. vs APPELLATE TRIBUNAL INLAND REVENUE, ISLAMABAD Ss — 2024 PTD 619 ISLAMABAD

Case information

Citation
2024 PTD 619 ISLAMABAD
Court
Islamabad High Court
Year
2024
Reporter
PTD
Parties
TELENOR PAKISTAN (PVT.) LTD. vs APPELLATE TRIBUNAL INLAND REVENUE, ISLAMABAD Ss
Subject matter
Tax & Customs

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

TELENOR PAKISTAN (PVT.) LTD. VS APPELLATE TRIBUNAL INLAND REVENUE, ISLAMABAD Ss. 20, 34 & 71---Deductions in computing income chargeable under the head "Income from Business"---Accrual-basis accounting---Unrealized exchange loss---Scope---Taxpayer returned losses with the claim that its deductible expenses exceeded its taxable income--- Taxpayer had deducted from its taxable income, the unrealized exchange loss with the claim that it maintained its account on accrual-basis accounting---Department, after issuance of show cause notice, disallowed such deduction---Order-in-original was assailed before two appellate forums but to no avail---Validity---Section 34 deals with the accrual basis accounting, whereby a person accounting for income chargeable to tax under the head "Income from Business" on an accrual basis shall derive income when it is due to the person and shall incur expenditure when it is payable by the person---An amount shall be payable by a person when all the events that determine liability have occurred and the amount of the liability can be determined with reasonable accuracy---Concept of reasonable accuracy is a primary consideration for determining the question of exchange loss in the accrual basis accounting system---Forums below had rightly held that the loss being notional in nature and not sustained by the taxpayer was not an allowable expense---Exchange loss had rightly been disallowed to the taxpayer---Reference applications were dismissed.

Other judgments reported in 2024 PTD

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