Auxiliary Corporate Consulting

24/09/2023

Case Law:

2020 PTD 403



The department has simply assumed that by virtue of having property in Pakistan renders
the appellant as a resident of the country, without concerning the relevant authorities (i.e. the French embassy) or having done any conclusive study into the double tax agreement between the two countries, which provides the taxpayer with relief under Article 4(2)(b) of the Convention between the Government of the French Republic and The Government of
the Islamic Republic of Pakistan For the Avoidance of Double Taxation And the Prevention of Fiscal Evasion with Respect to Taxes on Income (henceforth "The Convention")

It was vehemently submitted by the learned AR that the application of section 111 of the ITO, 2001, is only applicable to individuals who are residents of Pakistan for the Tax- Year as illustrated in section 82 of the ITO, 2001. Attention was drawn to the matters of international tax case law and the residence test, as imposed under the national legislation under section 82(a) of the ITO, 2001. The test laid out in the provision provides that the person to be in Pakistan for a total of 183 days, to attract the tax liability under the provisions. The taxpayer in this regard, has not been a resident of Pakistan for said number of days; as is evident from his passport issued by the French Government. This hereby excludes him from the definition of a "resident" under section 82(a) of the ITO, 2001.

Decision:

It was decided that section 111 of the Income Tax Ordinance, 2001 cannot be invoked on non-resident French National who's habitual abode is in France and have more personal and economic interest in France than Pakistan and has not earned any income from any Pakistan source. The department has failed to discharge it's onus for the reinforcement of Section 111.

In the light of above we hold that the appellant is not taxable in Pakistan and section 111 is not attracted to to non-resident in the presence of tax treaty between Pakistan and France upon applicable tie-breaker text. We therefore, delete the levy of tax under section 111.

23/09/2023

Case Law:

2023 PTD 919

ISLAMABAD HIGH COURT
MESSRS FAIRDEAL EXCHANGE
COMPANY (PRIVATE) LIMITED
VS
FEDERATION OF PAKISTAN
APPLICABLE SECTIONS: 20,
122(9), 171, 177 AND 214C OF
THE INCOME TAX ORDINANCE
(THE ORDINANCE)

22/09/2023

Case Law:

19/09/2023

Minimum Wage Notification

19/09/2023

Circular No. 3 of 2023-24
Further clarification on section 7E

06/06/2023

02/06/2023

S.R.O.642(I)/2023

The Ministry of Commerce Thursday issued Statuary Regulatory Order (SRO), allowing barter trade with Iran and Russia from June 1, 2023 as barter trade with Afghanistan is already in place.

According to the SRO, application for authorization of import and export of goods under the B2B barter trade facility shall be submitted online by traders or their authorized agents through the online BT Module in WeBOC system to the regulatory collector. The application shall contain the following information

(i) name and address of importer
(ii) name and address of exporter;
(iii) description, quantity and value of goods to be imported;
(iv) description, quantity and value of goods to be exported;
(v) validity and expiry dates of the contract; and (vi) declaration that the goods shall originate from the respective countries for which the Barter Trade facility has been allowed.

(2) Copy of the contract duly verified by the Pakistani Mission in the country for which barter trade facility has been authorized, certifying the facts that the subject foreign company, individuals and proposed goods for BT are ‘Non-Sanctioned’, as notified by Ministry of Foreign Affairs from time to time, shall be uploaded in support of the application.

The application shall be reviewed and examined under the provisions of IPO and EPO in vogue and the conditions set out in this Order. If the application is found in order, an approval (authorization) may be accorded by the regulatory Collectorate of Customs and an approval number shall be generated by the system against the NTN of the applicant.

The Ministry of Commerce may impose country or commodity specific conditions or restrictions for imports and exports of goods under this B2B barter trade mechanism. Export and import under this Order shall be allowed in respect of the commodities and from the countries as specified in Appendix-A to this Order.

Trade of goods under a B2B BT arrangement shall be allowed on the principle of “import followed by export”. The export would be made to the extent of value of imported goods, subject to the tolerance mechanism provided hereinafter for any exigency. However, a Pakistani trader

02/06/2023

S.R.O.642(I)/2023

The Ministry of Commerce Thursday issued Statuary Regulatory Order (SRO), allowing barter trade with Iran and Russia from June 1, 2023 as barter trade with Afghanistan is already in place.

According to the SRO, application for authorization of import and export of goods under the B2B barter trade facility shall be submitted online by traders or their authorized agents through the online BT Module in WeBOC system to the regulatory collector.

23/05/2023

CASE LAW:

The Appellate Tribunal held in a judgment that section 129 of the Ordinance limits the power of Commissioner Appeals only to confirm, modify or annul the order where an assessment order is passed.

2023 PTD 467 APPELLATE TRIBUNAL INLAND REVENUE

MESSRS KBS STEEL, GUJRANWALA VS THE COMMISSIONER INLAND REVENUE, LTO, LAHORE

APPLICABLE SECTIONS: 35, 111, 122 AND 129 OF THE INCOME TAX ORDINANCE, 2001 (THE ORDINANCE)

23/05/2023

CASE LAW:

The Appellate Tribunal held in a judgment that annexure "F" is only meant for summary of input tax and excess carry forward amount of sales tax credit. None of the provisions of the Sales Act, 1990 or of the Ordinance has purported to deem these figures of carry forward summary to be the closing stocks as it has miserably failed to serve as a stock statement of a taxpayer/appellant.

2023 PTD 467 APPELLATE TRIBUNAL INLAND REVENUE

MESSRS KBS STEEL, GUJRANWALA VS THE COMMISSIONER INLAND REVENUE, LTO, LAHORE