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Income‑tax Case No. 759 of 1972, decided on 23^rd February, 1984.

‑‑‑S.23‑‑Assessment‑‑Refund of sales tax‑‑Whether income‑‑Apportion ment of amount of refund in relevant preceding years‑‑Validity of‑ Assessee becoming entitled to refund of sales tax paid for certain preceding years‑‑I.‑T.O. treating entire amount as income of succeeding year when it accrued to assessee‑‑Apportionment of refunded sales tax amount in more than one assessment year, held, was made in accordance with law.

Waheed Faruqui for Appellant.

Nemo for Respondent

Date of hearing: 23rd February 1984.

‑ The present Income‑tax Reference raises the following point of law:‑

"Whether on the facts and in the circumstances of the case any portion of .the income of Rs.6,46,869, which accrued and was received in the assessment year 1966‑67 could be taxed in any earlier years as allowed by the learned Tribunal."

The brief facts leading to the filing of the above reference are that the respondent is a registered firm and was dealing in the export of cotton waste during the relevant years in question from 1960 onwards. It seems that under the Sales Tax Act, the respondent became entitled to claim refund of certain amount of sale tax paid for the above period. The respondent applied for the above refund in the month of December, 1965 for a sum of Rs.6,46,869, which amount they received in the same month i.e. in December, 1965. The Income‑tax Officer treated the above entire amount of Rs.6,46,869 as an income for the assessment year 1965‑66. However, the Tribunal upon an appeal filed by the respondent through its order, dated 24‑2‑1972 divided the above amount for income‑tax purpose in the assessment years 1964‑65 and 1965‑66 as the assessment upto the year 1963‑64 was already finalized by the time the respondent received the above refund. The applicant being aggrieved by the above order has filed the present reference on the above‑quoted legal question.

2. Mr. Waheed Farooqui, learned counsel for the applicant has candidly invited our attention to a judgment, dated 7‑9‑1983 given by a Division Bench of this Court in I.‑T.R. No. 554/72 namely, M/s. Hamdard Thread House, Karachi v. The Commissioner of Income tax (East) Karachi, in which it was held that the apportionment of the sale tax amount refunded in more than one assessment year made by the Tribunal was in accordance with law. Mr. Waheed Farooqui, learned counsel for the applicant has submitted that the only distinguishing feature in the present case is that the application for refund was made in December, 1965 and not earlier, and, therefore, unless an application would have been filed, the respondent could not have claimed the refund. In our view, the above fact simpliciter does not distinguish the present case as to make above judgment of the Division Bench inapplicable. The respondent's right to claim the above refund was relatable to the relevant notification or to the relevant provision of law, and was not dependent or. the factum, whether application for refund was filed promptly. We see no reason to deviate from the view found favour with the Division Bench of this Court in the above unreported judgment, dated 7‑9‑1983 in I.‑T.R. No. 554 of 1972.

3. We, therefore, answer the above question in affirmative.

In the circumstances all the case, there will be no order as to costs.

M. B.A. Question answered in affirmative.

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