Audit Report 2010-11 & 2011-12 Settled 26.11.2014

MINUTED OF DAC MEETING
AUDIT REPORT 2010-11

IN RESPECT OF REGIONAL TAX OFFICE MULTAN
(HELD ON 26.11.2014 AT LAHORE)
S.#
Para No./
PDP No.
Year
of
Audit
Repor
t
Brief of Para & Amount Involved
Last DAC Directives
Departmental reply as a result of latest

Audit Verification
3.1.1/42
201011
Capital expenditure treated as

revenue expenditure
21.08.2013
The DAC directed the RTO to pursue
the case at appropriate forum for out
of
turn
hearing
and
report
compliance
to
Audit/FBR
by
15.09.2013.
10.11.2014
The matter is still pending at High Court.
Out of Turn hearing has been requested.
M/s. Pak Arab Fertilizer Ltd. Tax Year

2006
Rs. 242.324 M
Charged Rs.282222143/The taxpayer filed appeal before CIR
(A) who annulled the amended order
on 25.06.2011. Department filed 2 nd
appeal before ATIR on 03.10.2011.
The learned ATIR upheld the decision
of CIR (A) vide ITA No.366/LB/2012
dated 05.04.2012
Department has filed reference
before High Court on 03.08.2013.
DAC directives 26.11.2014

of
turn
hearing
and
report
compliance
to
Audit/FBR
by
26.12.2014.
3.1.2/48
2010-11
Wrong adjustment of B.F .Losses
against income
M/s. Arain Mills Ltd
Tax Year 2006
Rs. 4.629 M
The order u/s 122(1)/122(5A) for T.Y
2005 was passed by the Taxation
Officer, LTU Lahore in which the
declared loss was absorbed and
income was assessed. The taxpayer
company went in appeal before CIR
(Appeals-1) Lahore who passed the
appellate order dated 16.04.2010
cancelling the order u/s 122 and
restoring the original income/loss.
Therefore the loss declared for the
Tax Year 2005 has rightly been carried
over and set-off against the income
for T.Y 2006.
DAC directed the RTO to get the

position verified from audit by
15.09.2013.
of turn hearing and report compliance
to Audit/FBR by 26.12.2014.
10.11.2014
As per confirmation letter received from
Add.CIR(H.Q), LTU, Lahore vide No. 5850
dated 08.01.2014 the 2nd Appeal in this
case for Tax Year 2005 has already been
filed. (Proof enclosed for reference and
record)
Subjudice in ATIR
3.1.3/38
2010-11
Under assessment of income

M/s. Pak Arab Fertilizer (Pvt)
Ltd
Tax Year 2009
Rs. 1196.064 M
Remedial action u/s 122(5A)
has been completed on
07.05.2011 creating demand at
Rs.1145.912 (M). The RTO
informed that as against audit
observation
involving
an
amount of Rs.1196.064 (M) an
amount of Rs.1145.912 m was
charged and the balance
Rs.50.152 m was not leviable
which has been accepted by
audit. The DAC settled the
Para to the extent of Rs.50.152
m which was held as not
leviable.
The learned ATIR annulled the
order
of
the
Additional
Commissioner Audit vide ITA
No.369/2012
dated
05.04.2012.
Department has filed reference
before Honorable High Court
Lahore..

the case at appropriate forum for out of
turn hearing and report compliance to
Audit/FBR by 15.09.2013.
the case at appropriate forum for out of
turn hearing and report compliance to
Matter is still subjudice

Out of turn hearing has been requested.
3.1.9/34
2010-11
Short levy of tax due to non allocation of

proportionate expenses Rs.206,823,543/M/s. Bank Al-Habib Ltd
Tax Year 2009
Rs. 143.793 M
Show cause notice u/s 122(5A) was issued on
the issue of un-absorbed depreciation which has
been contested by the taxpayer company before
the Hble High Court and is pending for
adjudication. As soon as the decision from the
Hble Court is received the case will be decided
as per law.
Writ petition of the taxpayer is pending before
Hble High Court. The court has granted stay of
proceedings. A Misc. application for vacation of
stay and early disposal of the petition has been
filed in the court which is pending.
Still subjudice before High Court
The DAC directed the RTO to pursue the

case at appropriate forum for out of turn
hearing and report compliance to
Matter is still subjudice

before High Court.
Out of turn hearing has
been requested.
3.1.9./34
Multan
Zone
2010-11
Short levy of tax due to non allocation of

proportionate expenses Rs.206,823,543/M/s. Gulshin-e- Iqbal Flour Mills
Tax year 2008
Rs. .659 M
The remedial action u/s 122(5A) has been
completed on 30.04.2011 by creating tax
demand Rs.774121/-.Recovery in progress
24.11.2011
Recovery awaited.
The taxpayer moved application with the
request that case may be rectified u/s 221 as
the claim of depreciation has not been allowed.
The mistake was apparent from record. Hence
case has been rectified by given effect of
depreciation. No demand created. Hence para
may be settled.
3.1.9/53
2010-11
Incorrect apportionment of expenses

M/s.Kh. Bashir Ahmad & Co. (Pvt) Ltd
Tax Year 2009
Rs. .928 M
Order u/s 122(9)/122(5) dated 29.06.2011 has
been passed by the audit officer taking into
consideration the apportionment of expenses
as per books of account against the
presumptive income.
DAC directed the RTO to expedite

the recovery and report progress to
Verification pending

The DAC directed the RTO to get the
stance verified from Audit/FBR by
26.12.2014.
The DAC directed the RTO to complete

the proceedings as per law and report
compliance to audit/FBR BY 20.1.2011
26.12.2014.
Order
u/s
122(9)/122(5)
dated 29.06.2011 has been
passed by the audit officer
taking into consideration the
apportionment of expenses
as per books of account
against
the
presumptive
income.
During verification meeting
dated 11.11.2014, it has
been demanded to provide
Copy of order u/s 122(5)
for verification. The same
is now available. The
default amount of Rs.
2673795 has also been
recovered.
Para
may
please be settled
3.2.2/46
2010-11
Short deduction of tax on purchase of
locally produced edible oil
M/s. Gousia Ghee Ind. (Pvt) Ltd
Tax Year 2009
Rs. 6.424
The taxpayer company vide letter No.118
dated 03.11.10 has disclosed that the
company had made purchases canola oil
from locally produce companies and RBD
palm oil/palm oil from importers,List of
importers alonwith NTN has already been
provided to the audit authorities.
DAC directed the RTO revisit the case

and report compliance by audit/FBR by
15.09.2013.
The DAC directed the RTO to complete
legal proceedings as per law by
26.12.2014.
During
verification
meeting
dated
11.11.2014, it has been
demanded by the Audit
Officer
that
the
Department to link the
amount of purchases of
taxpayer importers GDs to
confirm that the taxpayer
has purchased edible oil
from importers.
Meanwhile, the Additional
Commissioner,
Audit
Range has initiated Audit
proceedings
under
section 122(5A) on the
basis of audit observation.
The taxpayer has been
confronted. In response,
3.6.1/50
2010-11
NON LEVY OF WORKERS WELFARE

FUND RS. 9,248,587/M/s. Mahmood Textile Mills Ltd
Tax Year 2009
Rs. 2.539 M
Contested.
The taxpayer paid WWF on the
accounting profit which is greater than the
declared income
(net profit) as
per income tax return. Hence WWF paid
on accounting profit is as per Profit & Loss
Account. Copy of audited account is
attached.
Total Income declared: Rs. 18,175,567
Profit before Taxation: Rs. 190,204,281
(as per audited account)
WWF @ 2 % on higher of
Above:
Rs. 3,804,086
The Taxpayer has rightly offered WWF
payments for Tax Year 2009
DAC directed the RTO revisit the case

and report compliance by audit/FBR by
15.09.2013.
26.12.2014.
the
taxpayer
has
submitted
purchase
Copy invoices
of audited and
accounts
provided
has complete
already details
been
of
supplied.
The Para
importers
fromhaswhom
already
been referred
for
purchases
were made
by
DAC. him. The verification is
under
process
and
conclusive outcome will
Para bemay
please
be
submitted
shortly.
settled
---------under process-----
10
3.6.1/50
2010-11
NON LEVY OF WORKERS WELFARE

FUND RS. 9,248,587/M/s. Fazal Rehman Fabric Ltd
Tax Year 2009
Rs. 2.161 M
Charged Rs.2204098/- .
The taxpayer company filed appeal
before CIR (Appeals) who in the light of
judgment of ATIR reported as 2011 PTD
748 deleted the WWF. Department has
filed 2nd appeal on 27.02.2012 before
ATIR.

Audit/FBR by 15.09.2013
Subjudice before ATIR

been requested.

MINUTES OF DAC MEETING

AUDIT REPORT 2011-12
IN RESPECT OF REGIONAL TAX OFFICE MULTAN

(HELD ON 26.11.2014 AT LAHORE)
#
1
Para No./
PDP No.
Year of Audit
Report
Brief of Para & Amount Involved
Last DAC
Directives
2011-12
Short recovery of tax due to incorrect computation of tax
DAC directed the
Departmental reply as a
result of latest Audit
Verification
5.3.1/
13089/08
M/s. Thal Industries Corporation 225971-7

Tax year 2010
Rs. 24.074 M
Special Zone
Declared results as per original income tax return and revised income
tax return for the above mentioned year are as under:Income Declared
Rs. 171,617,402/Tax @ 35% under NTR
Rs. 60,066,091/Declared turnover
Rs.3,810,842,222/Tax u/s 113 @ 0.5%
Rs. 19,054,211/WWF charged on net profit Rs.307071784/- @ 2%
Rs. 6,141,435/Add tax under NTR
Rs. 60,066,091/Total tax payable
Rs. 66,207,526/Less tax deducted/payment
as per Annexure-C
Rs.78,680,364/Balance refund was determined
(Rs.12,472,838/-)
Therefore, the para may please be treated as settled.
2
2011-12
5.3.2/
13091/03
Special Zone
Non levy of minimum

tax on the income of
certain persons
M/s. Reliance Weaving
Mills Ltd 0133480-6
Tax Year 2010
Rs. 18.606 M
Total tax has been
charged at Rs.
56,321,750/- for tax year
2010. Additional demand
of Rs. 2,126,977/- & Rs.
454,797/- was created
which stands recovered
through cash payment
vide CPR # IT-201201110274-1424806 & IT20120928-03741395129.
WWF Rs.9,574,155/charged vide DCR #
14/131 dated 04-092013 on the declared net
profit of
Rs.478,707,796/-.
Latest Compliance
10.11.2014
Demand stayed by the
ATIR on 09-09-2014
DAC directed the RTO

to expedite the
recovery and report
progress to Audit/FBR
by 15.09.2013.
DAC
directives
26.11.2014
Subjudice. The DAC
directed the RTO to
pursue the case and
report compliance to
Audit/FBR
by
26.12.2014.
RTO revisit the

case and report
compliance to
audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
The DAC directed
the RTO to revisit
the
case
and
report compliance
to Audit/FBR by
26.12.2014.
During the course of

latest verification meeting
dated 11.11.2014, it has
been demanded by the
Audit Officer that the
Department to re-visit the
case with respect to
adjustment of minimum
tax under section 113
prior to Tax Year 2009.
It is apprised that the

Department has rightly
taken up the issue by
passing order under
section 221 of the
Income Tax Ord: 2001
dated 16.01.2012. As a
result of order u/s 221,
Demand stayed by the
ATIR on 09-09-2014 refundable amount
reduced.
Tax charged u/s 113 and
Para may please be
recovered Rs.2126977/and Rs.454797 after settled.
given credit of tax
already paid.
However, WWF of
Rs.9574155/- on
accounting profit not
recovered. Department
to recover the WWF
and intimate the audit
Subjudice
2011-12
5.3.2/
13091/03
Non levy of minimum tax on the income of certain persons

M/s. Allah Wasaya Textile & Finishing Mills Ltd 0101071-9
Tax year 2010
Rs. 1.619 M
Special Zone
WWF demand was created at Rs.1,881,117/-. Out of which

Rs.1,042,000 has been recovered. Later on the CIR(A) Multan
has deleted the WWF as a whole. with the remarks that the DCIR
was not justified to charge WWF by passing order u/s 4(4) of the
W.W.F Ordinance, 1971 as no such authority exists in the said
Ordinance.
24-07-2013
The learned ATIR Lahore Bench Lahore has rejected the
Departmental appeal and confirmed the order passed by the
CIR(A). The para may kindly be treated as disposed off.
09-09-2013
Reference in the Honorable High court was filed.
The DAC directed the

RTO to pursue the
case at appropriate
forum for out of turn
hearing and report
compliance
to
Audit/FBR
by
15.09.2013.
DAC
directives
26.11.2014
Subjudice. The DAC
directed the RTO to
pursue the case and
Audit/FBR
by
26.12.2014.
Still subjudice
been requested.
10.11.2014:
Subjudice
2011-12
5.3.2/
13091/03
Special Zone

M/s Yasrab Model Cotton & Oil Mills (Pvt) Ltd 1540402
Tax year 2010
Rs. 1.208 M
Contested
DAC directed the

RTO revisit the case
and report
compliance to
audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
RTO to revisit the
case
and
report
compliance
to
Audit/FBR
by
26.12.2014.
Department to re-visit
the case on the ground
that cotton seed is
taxable @1.5 % as per
First Schedule of I.Tax
Ord: 2001. Further,
Department to probe the
sale of cotton seed oil
by the taxpayer
The Department has
rightly charged Tax @ 1
% on supplies of cotton
lint in strength of SRO
586(1)/91 dated
30.06.1991 and SRO
600(1)/91 dated
02.07.1991
2011-12
5.3.2/
13091/03
Special Zone

M/s. Colony Mills Ltd 2585135
Tax year 2010
Rs. 7.141 M
Latest Compliance 12.11-2014
a) Remedial action u/s 122(5A) is still pending with the
Additional Commissioner Audit.
b) The ATIR has stayed demand on 05-05-2014.
DAC took serious

concerned for non
finalization the case.
to finalize the
proceeding and report
compliance to
audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
RTO to finalize the
proceeding as per law
and report compliance
to
Audit/FBR
by
26.12.2014.
Additional
Commissioner Audit,
Special Zone has taken
up the issue through
issuance of Notice
under section 122 (5A)
of the Income Tax Ord:
2001. Outcome of the
proceedings shall be
communicated shortly
------under process--
2011-12
5.3.2/
13091/03
Special Zone
M/s. Al-Hilal Industries (Pvt) Ltd 0800582-6

Tax year 2010
Rs. 3.146 M
10.11.2014
2nd Appeal has not been filed by the CIR, Special Zone, RTO, Multan.
As per order sheet entry dated 31-03-2013, the CIR endorsed
Additional Commissioner recommendation for non filing of 2 nd appeal
on the plea that the CIR (Appeals) order was based on solid grounds.
However, it is pertinent to mention here that the CIR, Special Zone,
ordered to initiate proceedings under section 122(5A) of the Income
Tax Ord: 2001.
2011-12
5.3.2/
13091/03
Special Zone

M/s. Fatima Sugar Mills Ltd 0100967-2
Tax year 2010
Rs. 30.669 M
10.11.2014
Audit observation relating to levy of Minimum Tax U/S 113 has
fully been complied with. Moreover, the issue of WWF has
rightly been charged on income Para may kindly be verified
DAC directed to
RTO to inform the
status of filing of
2nd appeal or fix
responsible
against
the
concerned officer
and
report
compliance
to
audit/FBR
by
15.09.2013.

verification meeting
dated, 11.11.2014, it
has been demanded
to provide Outcome
of order passed u/s
122(5A).
Proceedings u/s
122(5A) have been
initiated. Final
outcome would be
submitted shortly.
DAC
directives
26.11.2014
The DAC directed
the RTO to finalize
the proceeding as ------under process--per law and report
compliance
to
Audit/FBR
by
26.12.2014
DAC directed the During course of audit
RTO revisit the verification
dated
case and report 11.11.2014, it has
compliance
to been demand that the
audit/FBR
by Department to revisit
15.09.2013.
the case as WWF is
leviable on accounting
DAC
directives profit
instead
of
26.11.2014
declared income as
Subjudice. The DAC per Circular 13 of
directed the RTO to 2008
and
latest
pursue the case and decision of Sindh High
report compliance to Court.
Audit/FBR
by In this regard, it is
26.12.2014.
submitted that the
Department is unable
to take any action in
the light of judgment
passed
by
the
Honourable
Lahore
High Court in W.P No.
10617
dated
0606.2012,
wherein
the
amendments
made
in
WWF
Ordinance, 1971 in the
years 2006 & 2008
have been declared as
unconstitutional.
Similarly, in view of
latest
judgment
pronounced by the
Honourable Supreme
Court of Pakistan in
Civil Appeals No. 1956
to 1958 of 2006 dated
14.03.2014 wherein it
has been held that
the law which is
enunciated by the
High
Court
under
Article 201 becomes
binding precedent for
all forums within the
province and the law
enunciated by this
court under Article 189
becomes
binding
precedent for all forum
in the country.
5.3.2/
13091/03
Special Zone
2011-12

M/s. Fazal Rehman Fabrics Ltd 2546440
Tax year 2010
Rs. 4.112 M
WWF Rs.3,100,765/- charged on declared net profit of
Rs.155,038,233/- in the light of judgment of the Hble Sind High Court
The Hble High Court Multan bench Multan has further stayed as
per order sheet dated 28-05-2014.
DAC directed the

RTO revisit the
case and report
compliance to
audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
Subjudice. The DAC
directed the RTO to
pursue the case and
Audit/FBR
by
26.12.2014.

verification
meeting
dated 11.11.2014, it
has been demanded
that the Department to
revisit the case as
WWF is leviable on
accounting
profit
instead of declared
income
as
per
Circular 13 of 2008
and latest decision of
Sindh High Court.
It is apprised that the
Department is unable
to take any action in
the light of judgment
passed
by
the
Honourable
Lahore
High Court in W.P No.
10617
dated
06.06.2012, and
latest
judgment
pronounced by the
Honourable Supreme
Court of Pakistan in
Civil Appeals No.
1956 to 1958 of 2006
dated 14.03.2014 .
The complete details
of the judgments has
already been given
above.
2011-12
5.3.2/
13091/03
Special Zone
M/s. Masood Fabrics Ltd 1417347-6
Tax year 2010
Rs.5.063 M
The Hble High Court Multan bench Multan has further stayed as per
order sheet dated 28-05-2014.
10
2011-12
5.3.2/
13091/03
Special Zone

M/s. Roomi Fabrics Ltd 1417359
Tax year 2010
Rs. 7.860 M
Latest Compliance 10-11-2014
The Hble High Court Multan bench Multan has further stayed as per
order sheet dated 28-05-2014.
Amount recovered
Rs.4362543/- and
the same is also
verified by audit.
DAC directed the
RTO to recover the
balance amount
Rs.1526346/- and
report compliance
to audit/FBR by
15.03.2013.
DAC
directives
26.11.2014
Subjudice. The DAC
directed the RTO to
pursue the case and
Audit/FBR
by
26.12.2014.
Charged and
recovered
Rs.4,362,543/through cash
challan. However
WWF of
Rs.1526346/- is still
recoverable.
Amount recovered
Rs.5830997//- and
the same is also
verified by audit.
DAC directed the
RTO to recover the
balance amount
Rs.25400024/- and
report compliance
to audit/FBR by
15.03.2013.
DAC
directives
26.11.2014
Subjudice. The DAC
directed the RTO to
pursue the case and
Audit/FBR
by
26.12.2014.
Charged and
recovered
Rs.5830997/through cash
challan. However
WWF of
Rs.2540024/- is still
recoverable.
The Hble High Court

Multan bench Multan
has further stayed as
per order sheet dated
28-05-2014.
Subjudice
The Hble High Court

Multan bench Multan
has further stayed as
per order sheet dated
28-05-2014.
Subjudice
11
2011-12
5.3.3/
12977/06
Special Zone
Short levy of tax due to incorrect computation of taxable income.

Non filing of statement u/s 115(4) excessive determination of
refund
M/s. Bank Al Habib 709857
Tax year 2010
Rs. 36.236 M
Contested:
The audit observation was confronted to the taxpayer who vide A.R.s
letter dated 19.10.2011 submitted its reply contending that Rule 8A(3)
has retrospective effect and adjustments were to be made in T.Y 2010
when it was inserted by the Finance Act 2010. There is no loss of
revenue; firstly because ijara income for earlier year, though against
the law, has already been added vide order under section 122(1)/177
dated 21.05.2011 and secondly the treatment suggested by audit
authority, though against the provisions of rule 8A of Seventh Schedule
read with sections 18(3) and 22(12) of the Ordinance, instead of
increasing will further reduce the income. It is therefore requested that
audit objection based on misreading of law may kindly be dropped.
The contention of the taxpayer company is supported with the relevant
provisions of law. Therefore, the para may please be treated as settled
The matter has already been referred to DAC
12
5.3.3/12953/02
Special Zone
2011-12
Short levy of tax due to incorrect computation of taxable

income. Non filing of statement u/s 115(4) excessive
determination of refund
M/s. Pak Arab Fertilizer (Pvt) Ltd
0786750
Tax year 2010
Rs. 107.620 M
Case has been referred to Audit for remedial action.
06-05-2013
Asstt; for tax year 2010 has been amended u/s 122(5A) by the
CIR Zone-II, RTO, Multan vide order dated 15-03-2012. The issue
regarding recovery of mark up from sister concern was confronted
to the tax payer. As per reply the interest income was received
from sister concern therefore, reply of the taxpayer was accepted
and no adverse inference has been drawn. Para may be treated
as settled.
DAC directed the

RTO revisit the case
and report
compliance to
audit/FBR by
15.09.2013..
Refer to DAC as
adjustment of ijara
financing is
applicable from T.Y
2011 instead of T.Y
2010.
DAC
directives
26.11.2014
RTO to get the
stance verified from
Audit by 26.12.2014.

to provide the requisite
documents to audit
and get the position
verified by 15,09.2013
DAC
directives
26.11.2014
RTO to get the stance
verified from Audit by
26.12.2014.
Verification pending as
return for tax years
2010 and 2011 alongwith cash flow
statement is required
11.11.2014
Copy of returns and
cash flow to be
provided
The Copy of return
along-with cash flow is
available.
13
5.3.4/12978/01
Special Zone
2011-12
Short levy of tax due to non allocation of proportionate
expenses.
M/s. Shujabad Weaving Mills Ltd
2700524-7
Tax year 2010
Rs. 20.223 M
WWF Rs.2,126,008/- charged vide DCR # 26/134 dated 06-092013 on declared net profit of Rs.106,300,435/- in the light of
judgment of Hble Sind High court.
21-04-2014 : The amount of WWF was stayed by the Hble High
Court on 27-11-2013 with the direction that Notice for the above
date. Till the next date of hearing impugned recovery notice shall
remained suspended.
The Hble High Court Multan bench Multan has further stayed as
per order sheet dated 28-05-2014.
DAC directed the RTO to

inform the status of
filing of 2nd appeal to
audit/FBR by 15.09.2013
DAC
directives
26.11.2014
Subjudice.
The
DAC
directed the RTO to
pursue
the case and
report
compliance
to
The Hble High Court

Multan bench Multan has
further stayed as per
order sheet dated 28-052014.
Department to revisit the
Para on the ground of
observation as issue
relates to propotionation
of expenses & levy of
WWF
Subjudice before High
Court
14
5.3.4/12978/01
2011-12
Special Zone

expenses.
M/s. Pak Arab Fertilizer (Pvt) Ltd
0786750
Tax year 2010
Rs. 337.383 M
Case has been referred to Audit for remedial action.
06-05-2013
Asstt; for tax year 2010 has been amended u/s 122(5A) by the
CIR Zone-II, RTO, Multan vide order dated 15-03-2012. The issue
regarding Apportionment of expenses between normal sales and
export sales /exempt sales was confronted to the taxpayer.
However after considering the reply of the taxpayer the contention
of the taxpayer was accepted vide order dated 15-03-2012. Para
may be treated as settled.
15
5.3.4/13085/05
Special Zone
2011-12

expenses
M/s. Ahmad Hassan Textile Mills 1000978-8
Tax year 2010
Rs. 10.481 M
The matter has been taken up by the Commissioner Inland

Revenue Zone-II, RTO Multan has passed order u/s 122(5A) vide
DCR # 12/02 dated 23-04-202 creating excessive determination
of refund amounting to (Rs.8,289,367/-) The para may please be
treated as settled.
The above order has been vacated by the ITAT, Lahore vide
Order No. ITA No. 601/LB/2014 dated 13.10.2014 received to
RTO on 25.10.2014. Reference will be filed within due course.

revisit the case and
audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
verified from
Audit by
26.12.2014.
DAC took serious

concern for not comply
its previous DAC
directives. DAC directed
RTO to furnish
reply/progress to
audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
Subjudice. The DAC
directed the RTO to
pursue the case and
During Copy of
supporting documents to
be provided
Copy of supporting
documents are now
available
Updated status of
reference to High Court
to be intimated
The Reference to High
Court is being
submitted
16
5.3.4/Special
Zone
2011-12
expenses
M/s. Colony Mills Ltd 2585135
Tax year 2010
Rs.43.673 M
b) WWF Rs.6,656,940/-charged vide DCR # 4/131 dated
02-09-2013 on declared profit of Rs.332,847,000/- in the
light of judgment of the Hble Sind High court.
21-04-2014 :
b) Recovery notice u/s 138(2) was issued for recoverable
amount of WWF on 14-04-2014.
b) The ATIR has stayed demand on 05-05-2014.
DAC took serious

its previous DAC
directives. DAC
directed RTO to furnish
reply/progress to
audit/FBR by 15,09.2013
DAC
directives
26.11.2014
RTO to finalize the legal
proceedings by
26.12.2014.
a) Remedial action u/s

122(5A) is still pending
with the
Additional
Commissioner Audit.
b) The ATIR has stayed
demand on 05-05-2014
Proceedings under
section 122(5A) of the
Income Tax Ord: 2001
has been initiated by the
Additional Commissioner
Audit Range, Special
Zone. The outcome of the
order shall be provided
shortly
------------under process--.
17
5.3.17/
13084/12
2011-12
Special Zone
Loss of revenue for non treating the tax collected or deducted

as final tax.
M/s. Ahmad Hassan Textile Mills Ltd 0100978-8
Tax year 2010
Rs. 2.161 M
order u/s 122(5A) passed creating
excessive determination of refund amounting to
Rs.8,289,367/b) WWF Rs.1,180,703/- (-) Rs.1,156,702/- = Rs.24,001/-was
charged vide DCR # 1/131 dated 02-09-2013

audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
RTO to finalize the legal
proceedings in the light of
discussion in DAC by
26.12.2014.
During course of
verification it has been
demanded that the
Department to revisit
the issue of loss carried
forward discussed in
order u/s 122(5A) dated
23.04.12. Further status
of recovery in respect
of excess refund issued
to be intimated to audit.
It is apprised that
a) Demand of I. Tax
Rs.8289367/- stayed by
ATIR on
21-08-2014 for 45
days.
b) The CIR (A) has
deleted
the
WWF
demand vide order
No.288 dated 11-082014 Rs.24001/- taken
into(-) a/c.
18
5.3.20/
12955/11
Multan Zone
2011-12
Non levy of penalty for non/late filing of returns u/s

182
Adnan Zafar 0102747-6
Tax year 2010
Rs. 40814
CONTESTED.
The Audit Observations to charge penalty u/s 182 in PTR cases
are not applicable for tax year 2010, as the explanation to section
182(1) at Sr. No.1 is inserted by Finance Act, 2011 applicable to
tax year 2012. As per return of total income for tax year 2010, tax
payable is tax chargeable less tax paid/deducted. Tax payable in
all PTR cases as per return is Nil. Hence minimum penalty of Rs.
500/- chargeable.

audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
26.12.2014.
Verification pending.
Refer to DAC as penalty
is chargeable on tax
payable even return filed
u/s 115(4) and tax
deducted as PTR.
19
5.3.20/
12955/11
2011-12
Multan Zone
20
5.3.20/
12955/11
Sahiwal
2011-12

182
Bahu Cotton Factory & Allied Industries 1693357-5
Tax year 2010
Rs. 475494
CONTESTED.
5000/- chargeable.

audit/FBR by
15.09.2013.

182
Chohan Industries Cotton ginning & Pressing Factory Sahiwal
0455837-5
Tax year 2010
Rs 185806
CONTESTED.
5000/- chargeable.

audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
26.12.2014.
DAC
directives
26.11.2014
26.12.2014.
u/s 115(4) and tax
deducted as PTR.
u/s 115(4) and tax
deducted as PTR.
21
5.3.20/
12955/11
2011-12
Multan Zone
22
5.3.20/
12955/11
Multan Zone
2011-12

182
Darishak cotton Industries AOP 0999668-8
Tax year 2010
Rs 192978

audit/FBR by
15.09.2013.
CONTESTED.
5000/- chargeable.
DAC
directives
26.11.2014
26.12.2014.

182
Mushtaq Brothers Cotton Industries Tauns Sahrif AOP 1542916-4
Tax year 2010
Rs. 212320

audit/FBR by
15.09.2013.
CONTESTED.
The Audit Observations to charge penalty u/s 182 in PTR
cases are not applicable for tax year 2010, as the explanation
to section 182(1) at Sr. No.1 is inserted by Finance Act, 2011
applicable to tax year 2012. As per return of total income for
tax year 2010, tax payable is tax chargeable less tax
paid/deducted. Tax payable in all PTR cases as per return is
Nil. Hence minimum penalty of Rs. 5000/- chargeable.
DAC
directives
26.11.2014
26.12.2014.
u/s 115(4) and tax
deducted as PTR.
u/s 115(4) and tax
deducted as PTR.
23
5.3.20/
12955/11
2011-12
Multan Zone
24
5.3.20/
12955/11
Multan Zone
2011-12

182
Sheikh Industries Cotton Ginning and pressing Factory & Oil Mills
AOP 30692218-7
Tax year 2010
Rs. 502458
CONTESTED.
Nil. Hence minimum penalty of Rs. 5000/- chargeable. .

audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
26.12.2014.

182
Pakistan Cotton and Oil Mills DGK 1149058-6
Tax year 2010
Rs. 422625
CONTESTED.

audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
26.12.2014.

u/s 115(4) and tax
deducted as PTR.

u/s 115(4) and tax
deducted as PTR.
25
5.3.20/
12955/11
201112
Multan
Zone
26
5.3.20/
12955/11
2011-12
Multan
Zone
27
5.3.20/
12955/11
Multan Zone
2011-12

182
Hamza Javed Cotton Industries Kot Addu 1416041-2
Tax year 2010
Rs. 512624

audit/FBR by
15.09.2013.
CONTESTED.
5000/- chargeable.
DAC
directives
26.11.2014
26.12.2014.

182
Mobil Cotton Ginning Industries, 1522691-3
Tax year 2010
Rs. 1.605 M
CONTESTED.

audit/FBR by
15.09.2013.

182
A. N.Rice Traders 1507000
Tax year 2010
Rs 46258
CONTESTED.

audit/FBR by
15.09.2013.
DAC
directives
26.11.2014
26.12.2014.
DAC
directives
26.11.2014
26.12.2014.
u/s 115(4) and tax
deducted as PTR.
u/s 115(4) and tax
deducted as PTR.
u/s 115(4) and tax
deducted as PTR.
30
5.3.20/
12955/11
Multan
Zone
201112
Non levy of penalty for non/late filing of returns u/s 182

Al-Noor Cotton Ginning Pressing & Oil Mills 3126488-3
Tax year 2010
Rs. 169970
CONTESTED.
5000/- chargeable.

revisit the case and report
compliance to audit/FBR by
15.09.2013.
The DAC directed the RTO to
get the stance verified from
Audit by 26.12.2014.
Refer to DAC as
penalty is chargeable
on tax payable even
return filed u/s 115(4)
and tax deducted as
PTR.
31
5.4.1/
12979/09
201112
Sahiwal
Zone
32
5.4.1
Special
Zone
201112
Irregular and unlawful issuance of refund

M/s. Bismillah Rice Factory Sahiwal
Tax year 2010
Rs 432479
Charged Rs. 1906921/- u/s 122 (5A) and Taxpayer deposited Rs.
954000/-. Balance recovery awaited.

M/s. Nasir Iqbal cotton Industries (Pvt)Ltd
Tax year 2010
Rs. .544 M
Under process
12.02.2014
As per new jurisdiction, the case has recently been transferred
to E&C Unit-02, Special Zone in October, 2014. Needful will
be done within a fortnight.
Under process

15.09.2013.
Audit by 26.12.2014.
DAC took serious concern for non

finalization the case. DAC directed
the RTO to finalize the proceeding
and report compliance to
audit/FBR by 15.09.2013.
finalize the proceeding and report
26.12.2014.
11.11.2014
Still under process
33
5.4.1/
13086/06
Multan
Zone
201112

M/s. Kanza AG an AOP
Tax year 2010
Rs. 4.240 M
Under process
DAC directed the RTO revisit the

case and report compliance to
26.12.2014.
Under process
34
Special
Zone
5.4.1/
13082/04
201112

M/s. Roomi Industries (Pvt) Ltd
Tax year 2010
Rs. 22.491 M
Latest compliance 06.05.2013

Contested:
Show cause notice was issued vide this office letter No.372
dated 17.10.2011. In response thereto the A.R filed reply on
21.10.2011 and stated the company never imported of
edible oil and packing material and never made any
commercial import . The taxpayer company only imported
canola
seed
for
its
own
industrial
undertaking/manufacturing. The A.R has provided copies of
goods declaration for the entire imports which clearly
indicate that the taxpayer only imported canola seed. The
order u/s 170(4) of the Income Tax Ordinance, 2001 was
finalized and tax was charged as under:Total income as per Income Tax
Return Column No.78
Rs.14,121,108/Less Worker Welfare Fund
charged as above.
Rs. 303,028/Balance taxable income
for the year
Rs.13,818,080/Income Tax @ 35%
Rs. 4,836,328/Minimum tax u/s 113 of the Income Tax Ord.2001 is payable
as under:Total turnover declared Rs.1,138,026,103/Tax payable @ .5%
Rs.5,690,131/Minimum tax u/s 113 is higher than the tax payable as
per
first Schedule as above
Rs.5,690,131/Add final tax @ 1% on supply of cotton lint Rs. 773,867/Add Worker Welfare Fund charged as above Rs. 303,028/Total tax payable for the year
Rs.6,767,026/Less deductions / payments
Tax deducted on imports u/s 148 was claimed
Rs.28,032,570/and verified by the DPU, Multan vide No.220/191 dated
27.01.2011 Rs.25,425,231/Tax deducted on supply of cotton lint was claimed
DAC directed the RTO revisit the

case and report compliance to
26.12.2014.
Department to revisit
the case as taxpayer
itself
has
declared
commercial imports in
sales tax returns for the
period July 09 to
June.10.
11.11.2014
Same audit remarks as
above
The audit observation
has
already
been
communicated
to
taxpayer who totally
denied the observation
and denied for import of
edible oil and packing
material as well as
commercial imports by
the Taxpayer. Verification
regarding
goods
description imported by
the taxpayer during Tax
Year 2010 is being
ascertained.
The
outcome
would
be
reported shortly.
-----under process-----
Rs.760,522/and verified by the DPU, Multan vide No.208/180

Rs. 531,229/Tax deducted on cash withdrawal u/s 231A verified
by Banks
Rs. 578,968/Tax deducted on electricity bills u/s 235
(original bills seen)
Rs.
1,400,193/Tax deducted on telephone bills u/s 236
(original bills seen)
Rs.
2,599/Total verified tax deductions/payments
Rs.27,938,220/Balance refundable amount for the year
Rs.21,171,194/-)
Total tax charged for the year is Rs.6767026/- included tax
on PTR and WWF and minimum tax charged @ 0.5%. The
tax charged u/s 113 is higher than the tax payable under
NTR. The tax payable under PTR was allowed u/s 153 for
supply of cotton lint amounting to Rs.760,522/- out of which
was verified by the DPU, RTO, Multan amounting to
Rs.595,651/-, therefore no PTR tax is allowed for issuance
of refund.
In the light of submission the Para may be treated as settled
10.11.2014
The audit observation was confronted to taxpayer vide
ACIR, E&C Unit-01 vide letter No. 372 dated 17.10.2014.
The Taxpayer furnished reply through his AR on 21.10.2011,
wherein he has denied the observation and denied for
import of edible oil and packing material as well as
commercial imports by the Taxpayer. (Copies enclosed). .
35
5.4.1/
13054/08
2011-12

M/s. Wali Cotton Industries
Tax year 2010
Rs. 22920
Under process

15.09.2013.
finalize the proceeding and
Under process
2011-12

M/s. Rehmania Cotton ginning Pressing & Oil Mills
Tax year 2009
Rs. 443,174
Tax year 2010
Rs. 59076
Under process

15.09.2013.
Under process
2011-12
Short levy of tax resulting excessive determination of

refund.
M/s. Ahmad Hassan Textile Mills 100978-8
Tax year 2010
Rs. 9.446 M

get the position verified
from audit by 15.09.2013
Order u/s 122 5A passed.

Therefore, para may
please be treated as
settled.
Multan
Zone
36
5.4.1/
13054/08
Multan
Zone
37
5.4.2/
13052/09
Special
Zone
The matter has been taken up by the Commissioner Inland

Revenue Zone-II, RTO Multan has passed order u/s 122(5A)
vide DCR # 12/02 dated 23-04-202 creating excessive
determination of refund amounting to (Rs.8,289,367/-). The
para may please be treated as settled.
38
2011-12
5.4.2/
13052/09
Special
Zone

refund.
M/s. Fatima Enterprises Ltd 101073
Tax year 2010
Rs. 6.315
A show cause notice for short levy of WWF and excessive
determination of refund was issued vide this office letter No.382
dated 21.10.2011 for compliance by 24.10.2011. On the due
date adjournment was received from the taxpayer company
upto 20.11.2011. On the due date no reply nor any adjournment


15.09.2013
revisit the case in the light of
the discussion in the DAC by
26.12.2014.
During course of audit

verification
dated
11.11.2014, it has been
demand
that
the
Department to revisit the
case.
In this regard, it is
submitted
that
the
Department is unable to
take any action in the
light of judgment passed
by
the
Honourable
was received. Reminder was issued for early compliance vide

this office letter dated 26.12.2011 for compliance by
04.01.2012.The taxpayer company declared loss for the tax
year 2010 and WWF was charged in the order u/s 4(4) of WWF
Act, 1971 at Rs.3607911/- and the same was recovered
through excess deductions/payments. The taxpayer company
agitated against this treatment and filed appeal before the
CIR(A) who vide his order dated 27.11.2011 deleted the WWF
in the light of judgment of honourable High Court under writ
petition No.8763/2011 wherein Worker Welfare Ordinance,
1971 (WWF Ordinance) through Finance Act 2006 & 2008 has
been quashed. Since the taxable income was not available for
the tax year 2010 after adjustment of brought forward losses.
Therefore , the WWF was not chargeable in this year.
Therefore the para may please be treated as settled.
39
2011-12
5.4.2/
13052/09
Special
Zone

refund.
M/s. Success Industries (Pvt) Ltd 3251892-7
Tax year 2010
Rs. 4.576 M
Contested. The taxpayer company is an industrial undertaking
engaged in assembling of air conditioners and fulfils the
conditions of manufacture as laid down in section u/s 153(9) of
Income Tax Ordinance, 2001.
A visit report of the business premises being manufacturing of
goods was conducted by the ACIR E&C Unit-03, Multan on
01.06.2010 and was duly verified by the CIR Zone-II, RTO,Multan
Lahore High Court in W.P

No.
10617
dated
0606.2012, wherein the
amendments made in
WWF Ordinance, 1971 in
the years 2006 & 2008
have been declared as
unconstitutional.
Similarly, in view of latest
judgment pronounced by
the Honourable Supreme
Court of Pakistan in Civil
Appeals No. 1956 to
1958 of 2006 dated
14.03.2014 wherein it has
been held that the law
which is enunciated by
the High Court under
Article
201
becomes
binding precedent for all
forums
within
the
province and the law
enunciated by this court
under
Article
189
becomes
binding
precedent for all forum in
the country.

from audit by 15.09.2013.
The DAC directed the RTO
to get the stance verified
11.11.2014
Refer to DAC
which is available on record.

A copy of the sales tax registration certificate being declared as a
manufacturer is also available on record. Therefore imports of
the taxpayer are for self consumption and not for commercial
sales.
Therefore, the refund has correctly been issued and order u/s
170(4) of the Income Tax Ordinance, 2001 dated 10.06.2011 is
self-explanation, hence, no loss of revenue is involved and the
para may please be treated as settled.
40
2011-12
5.4.2/
12951/07
Special
Zone
41
5.5.1/
12981/
Sahiwal
Zone
2011-12

refund.
M/s. Qadir Agro Industries 823740
Tax year 2010
Rs. 29.497 M
DAC
took
serious
its
previous
DAC
RTO
to
furnish
reply/progress
to
audit/FBR by 15,09.2013
to finalize the proceeding
Non recovery of WWF

Afzal Cotton Ginning & Allied Industries Haroon abad 2950639
Rs 259295
The RTO seeks time to

submit reply, the DAC
directed the RTO to submit
definite progress in the
matter by 15.03.2012 to
Audit / FBR.
to submit incorporation
certificate from the
concerned RTO and report
26.12.2014.
Additional
commissioner Audit
Range has taken up the
issue. Proceedings
under section 122(5A)
of the Income Tax Ord:
2001 are under way.
Outcome will be
reported shortly.
--------under process-----
Under process
Pertain
to
Bahawalpur
RTO,
42
5.5.1/
12981/
Sahiwal
Zone
201112
Non recovery of WWF

Matloob Brothers Cotton Ginning Chichawatni 2917360-4
Rs 260405
Charged & adjusted against refund. Refund adjustment has
been sent to District Accounts Officer which is awaited.
DAC took serious concerned for

non finalization the case. DAC
directed the RTO to finalize the
proceeding and report compliance
to audit/FBR by 15.09.2013
DAC directives on 26.11.2014
43
5.5.1/
12981/
Sahiwal
Zone
201112
Non recovery of WWF

Rana Brothers Cotton & Oil Industries Sahiwal 1350514
Rs. 333336
The DAC express its serious

concern over the lukewarm attitude
of the RTO. The DAC directed the
Chief Commissioner to personally
look into the matter and report
compliance to Audit/FBR by
26.12.2014.
DAC took serious concerned
for non finalization the case.
report compliance to audit/FBR
by 15.09.2013.
DAC directives on 26.11.2014
The DAC express its serious
concern over the lukewarm
attitude of the RTO. The DAC
directed the Chief Commissioner
to personally look into the matter
Under process
45
5.5.1/
12981/10
201112
Non recovery of WWF

Allied Cotton Ginners Okara 2694297-6
Rs. 226720
Multan
Zone
DAC took serious

concerned for non
finalization the case. DAC
directed the RTO to
finalize the proceeding
audit/FBR by 15.09.2013
Pertain to RTO, Lahore
DAC
directives
26.11.2014
RTO to get incorporation
certificate from the
concerned by
26.12.2014.
46
5.5.1/
201112
Multan
Zone
Non recovery of WWF

Mustaq Brothers Cotton Industries Taunsa 1542919-4
Rs 212335
Charged and recovered Rs.212335/- through refund
adjustment.
47
5.5.1/
Sahiwal
Zone
201112
Non recovery of WWF

Ehsan Cotton Ginners Vehari 0663660-8
Rs 163239
Charged & adjusted against refund. Refund adjustment has been
sent to District Accounts Officer which is awaited.

to provide the recovery
to audit by 15.09.2013
DAC
directives
26.11.2014
verified and report
compliance to audit/FBR
by 26.12.2014.
DAC
took
serious
concerned
for
non
finalization the case.
finalize the proceeding
DAC
directives
26.11.2014
verified and report
by 26.12.2014.
48
5.5.1/
201112
Multan
Zone
Non recovery of WWF

Darishak cotton Industries Rajanpur 0999668-7
Tax year 2010
Rs. 102318
Charged Rs.102318/- and recovered through refund adjustment.
49
5.5.1/
Sahiwal
201112
Non recovery of WWF

Silver Fiber Cotton Industries, Chichawatni 1177373-1
Tax year 2010
Rs. 231239
DAC
directed
the RTO to get
the
position
verified
from
audit
by
15.09.2013.
DAC directives
26.11.2014
The DAC directed
the RTO to get
the stance
verified and report
compliance to
audit/FBR by
26.12.2014.
Department has collected the WWF but not

paid to Ministry of Labor & Manpower.
Hence IT 104 may be prepared and sent
to FTO for accounting and transfer of Fund
to the concerned Quarter.
The CCIR, has been requested vide
office letter No. 2818 dated 10.11.2014,
to take up the issue with the Board.
DAC took
serious concern
for not comply
its previous
DAC directives.
DAC directed
RTO to furnish
reply/progress
to audit/FBR by
15,09.2013.
DAC directives
26.11.2014
The DAC directed
the RTO to get
the stance
verified and
report compliance
to audit/FBR by
26.12.2014.
50
5.5.1/
201112
Sahiwal
Zone
Non recovery of WWF

Chohan Cotton Ginning & Pressing Factory Sahiwal 0455837-5
Tax year 2010
Rs. 121850
51
5.5.1/
Sahiwal
Zone
201112
Non recovery of WWF

Data Cotton Ginners Vehari 1640143-3
Tax year 2010
Rs. 157406
Rs. 107406 has been deposited by the Taxpayer . The balance
recovery awaited.
DAC took
serious concern
for not comply
its previous
DAC directives.
DAC directed
RTO to furnish
reply/progress
to audit/FBR by
15,09.2013.
DAC directives
26.11.2014
The DAC directed
the RTO to get
the stance
verified and
report compliance
to audit/FBR by
26.12.2014.
DAC took
serious concern
for not comply
its previous
DAC directives.
DAC directed
RTO to furnish
reply/progress
to audit/FBR by
15,09.2013
DAC directives
26.11.2014
The DAC directed
the RTO to get
the stance
verified and
report compliance
to audit/FBR by
26.12.2014.
52
5.5.1/
2011-12
Non recovery of WWF

Lal Industries Multan 1341444-5
Tax year 2010
Rs. .269
Special
Zone
Compliance 09-09-2013
Notice of non-payment of WWF for Tax Year 2010 was
issued vide No.1426 dated 06-05-2013 in the light of
Hble Sindh High Court Judgment but the taxpayer
company not complied with. WWF Rs.268,885/- charged
vide DCR # 29/135 dated 06-09-2013 on the PTR
declared in the light of judgment of Sind High court
21-04-2014 :
Rs.65,886/- recovered through refund adjustment on
February,2014. Recovery notice u/s 138(2) was issued
on 14-04-2014 for recovery of remaining amount
Rs.202,999/-.
DAC took serious concern

for not comply its previous
DAC directives. DAC
reply/progress to audit/FBR
by 15,09.2013.
get the stance verified and
Department to provide
supporting documents
recovery
Supporting documents are
now available

Rs.19,715/- was adjusted from the refund for the tax
year 2013, during the month of August 2014.
53
2011-12
5.5.1/
Sahiwal
Zone
Non recovery of WWF

Mehtab Flour Mills 2930775-9
Tax year 2010
Rs. 244182
Contested
The taxpayer derives income from flour mill and income
tax return for the tax year 2010 filed by declaring an
income of Rs. 1304000/- against sales of Rs.
305,227,596 under normal tax regime and no turnover
relating to PTR have been declared. WWF on declared
income comes to Rs. 26080 only.

DAC directives. DAC
reply/progress to audit/FBR
by 15,09.2013.
54
5.5.1/
2011-12
Non recovery of WWF

Bismillah Cotton Ginners AOP 0684191
Tax year 2010
Rs 384426
DAC took serious

its previous DAC
RTO to furnish
reply/progress to
audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
verified and report
by 26.12.2014.
Under process
2011-12
Non recovery of WWF

Rana Brothers Cotton & Oil Industries AOP
Tax year 2010
Rs. 333336
DAC took serious

its previous DAC
RTO to furnish
reply/progress to
audit/FBR by
15,09.2013.
DAC took serious

its previous DAC
RTO to furnish
reply/progress to
audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
verified and report
by 26.12.2014.
Under process
Multan Zone
55
5.5.1/
12981/10
Sahiwal
Zone
56
5.5.1/
Multan Zone
Charged & adjusted against refund. Refund adjustment has been

sent to District Accounts Officer which is awaited.
2011-12
Non recovery of WWF

Kh. Muzaffar Mahmood M.Masood 0663291-2
Tax year 2010
Rs. 746477
57
5.5.1/
2011-12
Sahiwal Zone
Non recovery of WWF

Hafiz Cotton Ginners 1270338-9
Tax year 2010
Rs. 335240
The taxpayer has paid WWF Rs.335,240/- with return e-filed
on30.10.2010.
Charged & adjusted against refund. Refund adjustment has been sent to
District Accounts Officer which is awaited.
58
5.5.1/
2011-12
Multan Zone
Non recovery of WWF

Karmanwalay Model Industries AOP 1140719-7
Tax year 2010
Rs. 660782

from audit by 15.09.2013
DAC took serious
its previous DAC
RTO to furnish
reply/progress to
audit/FBR by 15,09.2013.
Department has
collected the WWF
but not paid to
Ministry of Labor &
Manpower. Hence IT
104 may be prepared
and sent to FTO for
accounting and
transfer of Fund to
the concerned
Quarter.
Under process

59
5.5.1/
Multan Zone
2011-12
Non recovery of WWF

Atta ur Rehman Cotton Industries AOP 100989-3
Tax year 2010
Rs. 156793

DAC directives. DAC
reply/progress to
to get the stance verified and
Under process
60
2011-12
5.5.1/
Multan Zone
Non recovery of WWF

Ali Hussain Cotton Industries AOP 1438031-5
Tax year 2010
Rs. 177484
DAC took serious

concern for not
comply its previous
DAC directives. DAC
directed RTO to
furnish reply/progress
to audit/FBR by
15,09.2013.
Under process
DAC
directives
26.11.2014
verified and report
compliance to
audit/FBR by
26.12.2014.
61
5.5.1/
12981/04
Sahiwal
Zone
2011-12
Non recovery of WWF

M/s. Montgomery Modern Flour & Rice Mills
Tax year 2010
Rs. 25425
DAC took serious

concern for not
comply its previous
DAC directives. DAC
directed RTO to
to audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
verified and report
by 26.12.2014.
Under process
62
5.5.1/
Special zone
2011-12
Non recovery of WWF

M/s. Yousaf Oil Mills
Tax year 2010
Rs. .684 M
WWF has already been paid along-with return.
WWF has been paid by the taxpayer along-with return for the Tax
Year 2010
10.11.2014
Contested:
There is no provision with the Taxpayer to separately deposit WWF
amount along-with Income Tax Return. It is further submitted that the
collection of WWF used to be delivered to Ministry of Manpower by
the FBR.
The compliance to Para is not possible at this time. The Para may be
settled.
DAC took serious

concern for not
comply
its
previous
DAC
directives.
DAC
directed RTO to
furnish
reply/progress to
audit/FBR
by
15,09.2013.
DAC
directives
26.11.2014
The DAC directed
the RTO to get the
stance verified and
report compliance
to audit/FBR by
26.12.2014.
Department has collected the

WWF but not paid to Ministry of
Labor & Manpower. Hence IT
104 may be prepared and sent
to FTO for accounting and
transfer of Fund to the
concerned Quarter.
Refer to DAC
63
5.5.1/
2011-12
Multan Zone
Non recovery of WWF

M/s. Saifal flour & General Mills
Tax year 2010
Rs 31004
WWF was charged Rs. 31004 on 09-07-2013
Recovery awaited.
DAC took serious

concern for not
comply its
previous DAC
directives. DAC
directed RTO to
furnish
reply/progress to
audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
The DAC directed
the RTO to get the
stance verified and
report compliance
to audit/FBR by
26.12.2014.
64
5.5.1/
Multan Zone
2011-12
Non recovery of WWF

Channu Flour Mills
Tax year 2010
Rs 18029
DAC took serious

concern for not
comply its
previous DAC
directives. DAC
directed RTO to
furnish
reply/progress to
audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
The DAC directed
the RTO to get the
stance verified and
report compliance
to audit/FBR by
26.12.2014.
Under process
65
5.5.1/
2011-12
Multan
Zone
Non recovery of WWF

Jameel Akhtar
Tax year 2010
Rs 180681
DAC took serious

concern for not
comply its previous
DAC directives. DAC
directed RTO to
furnish
reply/progress to
audit/FBR by
15,09.2013.
Under process
DAC
directives
26.11.2014
verified and report
compliance to
audit/FBR by
26.12.2014.
66
5.5.1/
Multan zone
2011-12
Non recovery of WWF

Sun Crop Pesticides
Tax year 2010
Rs 551559
WWF Rs. 563421 has been paid through return of total
income for Tax Year 2010.
DAC took serious

concern
for
not
comply its previous
DAC directives. DAC
directed
RTO
to
furnish
reply/progress
to
audit/FBR
by
15,09.2013
DAC
directives
26.11.2014
verified and report
compliance to
audit/FBR by
26.12.2014.
67
5.5.1/
2011-12
Multan Zone
Non recovery of WWF

Golden Lubricants 1301398-0
Tax year 2010
Rs 38919
WWF Rs. 39713 has been paid through return of total income for
Tax Year 2010.
DAC
took
serious
concern
for
not
comply its previous
DAC directives. DAC
directed
RTO
to
to
audit/FBR
by
15,09.2013.
DAC
directives
26.11.2014
verified and report
by 26.12.2014.
68
5.5.1/
Multan zone
2011-12
Non recovery of WWF

Crystal Feed Industry 1017310-2
Tax year 2010
Rs 24419
DAC took serious

concern for not
comply its previous
DAC directives. DAC
directed RTO to
to audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
verified and report
by 26.12.2014.
Under process
69
5.5.1/
2011-12
Non recovery of WWF
Anees Textile Mills 1281962-2
Tax year 2010
Rs. 18490
Special
Zone
09-09-2013
Order u/s 122(1) was passed on 10/32 dated 13-08-2012
creating total tax payable Rs.191765/- including WWF
Rs.8160/-. The balance tax payable Rs.125953/- was
recovered after allowing credit of tax deductions claimed as
per return Rs.65812/- vide CPR # IT-20130628-14902363139 dated 28-06-2013 and IT-20130704-0374-2652524
dated 04-07-2013. Para may please be treated as settled.
70
5.5.1/
12981/04
Multan
Zone
2011-12
Non recovery of WWF

Chaudhry Abdul Majid 0105862-2
Tax year 2010
Rs 32100
Recovery awaited.
DAC took serious

concern for not
comply its previous
DAC directives. DAC
directed RTO to
to audit/FBR by
15,09.2013.
Department to provide
supporting documents
Supporting documents are
now available
DAC
directives
26.11.2014
verified and report
by 26.12.2014.
DAC took serious
concern for not
comply its previous
DAC directives. DAC
directed RTO to
to audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
verified and report
compliance to
audit/FBR by
26.12.2014.
71
5.5.1/
2011-12
Multan Zone
Non recovery of WWF

Ghazala Sohail 0105349-3
Tax year 2010
Rs .133 M
DAC took serious

concern for not
comply its
previous DAC
directives. DAC
directed RTO to
furnish
reply/progress to
audit/FBR by
15,09.2013.
Under process
DAC
directives
26.11.2014
The DAC directed
the RTO to get the
stance verified and
audit/FBR by
26.12.2014.
72
5.5.1/
Multan zone
2011-12
Non recovery of WWF

Exin Chemicals Corporation 113387-4
Tax year 2010
Rs. .041 M
DAC took serious

concern for not
comply its
previous DAC
directives. DAC
directed RTO to
furnish
reply/progress to
audit/FBR by
15,09.2013
DAC
directives
26.11.2014
The DAC directed
the RTO to get the
stance verified and
audit/FBR by
26.12.2014.
WWF amount charged

amounting to Rs. 41,514 by
passing order under section
4(4) of Worker Welfare Ord:
1971 dated 05.09.2013.
73
5.5.1/
2011-12
Multan
Zone
Non recovery of WWF

Adil Flour Mills 2733252-7
Tax year 2010
Rs. 20,089
DAC took serious concern for not

comply its previous DAC directives.
DAC directed RTO to furnish
reply/progress to audit/FBR by
15,09.2013.
Under process

stance verified and report compliance
to audit/FBR by 26.12.2014.
74
2011-12
5.5.1/
Multan
Zone
Non recovery of WWF

Al-Khair Flour Mills 2394405-6
Tax year 2010
Rs 24018
Recovery awaited.
75
5.5.1/
2011-12
Multan Zone
Non recovery of WWF

Karim Sons Flour Mills 2168694-7
Tax year 2010
Rs 11506
Charged Rs. 11506. Recovered through refund adjustment.
CPR# 2168694 dated: 30.09.2013

comply its previous DAC
directives. DAC directed RTO to
furnish reply/progress to audit/FBR
by 15,09.2013.
Verification
pending

by 15,09.2013.
Under process

76
5.5.1/
Multan Zone
2011-12
Non recovery of WWF

Hameed Flour Mills 2140670-7
Tax year 2010
Rs 10055
Recovery awaited

by 15,09.2013
Verification
pending
77
5.5.1/
2011-12
Multan
Zone
Non recovery of WWF

Muhammad Younas 0102956-8
Tax year 2010
Rs 16500
WWF Charged Rs. 16500
Recovery awaited.
78
2011-12
5.5.1/
Multan
Zone
Non recovery of WWF

Channu flour Mills AOP 124340
Tax year 2010
Rs 18029

by 15,09.2013
Verification
pending

by 15,09.2013
Under process

79
2011-12
5.5.1/
Special
Zone
Non recovery of WWF

Amir Fine Exports (Pvt) Ltd 1338626
Tax year 2010
Rs. .280 M

by 15,09.2013
Under process
80
5.5.1/
2011-12
Multan Zone
Non recovery of WWF

Mubarak Flour Mills AOP 3062483-5
Tax year 2010
Rs 12119

15,09.2013
Under process

81
5.5.1/
2011-12
Multan zone
Non recovery of WWF

Rao & Sons Lessee Beno flour Mills AOP 3041073-8
Tax year 2010
Rs 14020

15,09.2013
Under process

82
Multan Zone
2011-12
Non recovery of WWF

Meran Flour Mills AOP 1329053-3
Tax year 2010
Rs 15000
WWF Charged Rs. 15000
Recovery awaited.

15,09.2013

83
Multan Zone
2011-12
Non recovery of WWF

Saifal Flour Mills AOP 124340-3
Tax year 2010
Rs 31004
Recovery awaited.

15,09.2013
84
Special
Zone
2011-12
Non recovery of WWF

Fatima Sugar Mills Ltd 0100967-2
Tax year 2010
Rs. 28.630 M
Show cause notice has been issued to the taxpayer company
vide this office letter No.363 dated 13.10.2011 for compliance by
19.10.2011. Reply received from the taxpayer company stated
that during the course of Audit by the DCIR Audit-01, RTO,
Multan amended assessment order u/s 122 was finalized dated
04.08.2011 wherein net refund determined Rs.8174306/- after
deducting tax liability Rs.15096451/- and WWF payable
Rs.8023214/- out of total available tax credit of Rs.31293412/-.
Further the taxpayer company produced judgment of Honorable
High Court, Lahore under write petition No.8763/2011 wherein
amendments made in WWF Ordinance, 1971 through Finance
Act 2006 & 2008 have been quashed. In the light of foregoing
lines, the para may please be treated as settled.
This Department is unable to contest the judgment of
Honouable Lahore High Court. Para may kindly be treated
as, Settled.
DAC took serious

concern for not
comply its
previous DAC
directives. DAC
directed RTO to
furnish
reply/progress to
audit/FBR by
15,09.2013.
DAC
directives
26.11.2014
The DAC directed
the RTO to get the
stance verified and
report compliance
to audit/FBR by
26.12.2014.
During course of audit verification dated

11.11.2014, it has been demand to furnish
latest update of recovery.
It is submitted that the Department is
unable to take any action in the light of
judgment passed by the Honourable Lahore
High Court in W.P No. 10617 dated
0606.2012, wherein the amendments made
in WWF Ordinance, 1971 in the years 2006
& 2008 have been declared as
unconstitutional.
Similarly, in view of latest judgment
pronounced by the Honourable Supreme
Court of Pakistan in Civil Appeals No. 1956
to 1958 of 2006 dated 14.03.2014 wherein
it has been held that the law which is
enunciated by the High Court under Article
201 becomes binding precedent for all
forums within the province and the law
enunciated by this court under Article 189
becomes binding precedent for all forum in
the country.
85
5.5.1/
12980/04
2011-12
Special
Zone
Non recovery of WWF
Thal Industries Corporation Ltd 225971-7
Tax year 2010
Rs. 6.141 M
DAC took serious

concern for not
comply its
previous DAC
directives. DAC
directed RTO to
furnish
reply/progress to
audit/FBR by
15,09.2013
DAC
directives
26.11.2014
The DAC directed
the RTO to get the
stance verified and
report compliance
to audit/FBR by
26.12.2014.
86
Special
Zone
2011-12
Non recovery of WWF

Al-Hamd Corporation (Pvt) Ltd 101016-6
Tax year 2010
Rs. 7.579 M

recover the balance amount
Rs.763130/- within a month and
report compliance to Audit /
FBR.
The taxpayer company has already deposited

an amount of Rs.6,816,035/- vide CPR No. IT20101230-0374-1523002 and remaining
mount of Rs.763,130/- has been adjusted
against the excess payment of tax during the
year i.e (1027219/- 763130/-).

by 26.12.2014.
Remaining amount of Rs.763,130/- has

recovered on 08-04-2014 Para may please be
treated as settled.
During the course of Audit Verification dated

11.11.2014 , it has been demanded to report
about the recovery of WWF.
In this regard, it is submitted that the
Department has already charged WWF
amounting to Rs. 6,141,434/- and also
recovered the same through IT-104 against
refundable amount for the Tax Year 2010.
The proof of adjustment IT-104 for an amount
of Rs. 6,141,434/- is avaible.
Para may kindly be settled.
Documents have already been supplied. Para

may please be settled.
87
Multan
Zone
2011-12
Non recovery of WWF

Al-Noor flour Mills AOP 2475484-6
Tax year 2010
Rs 18821
DAC took serious concern for

not comply its previous DAC
directives. DAC directed RTO
to furnish reply/progress to
Under process

by 26.12.2014.
88
Special
Zone
2011-12
Non recovery of WWF

Reliance Commodities (Pvt) Ltd 1334812
Tax year 2010
Rs. 4.740 M

by 26.12.2014.
Progress Report to be provided

The perusal of return filed by the taxpayer shows
that the taxpayer has declared exports receipts
and property income only. No
manufacturing/trading activity has been declared.
Exports declared
Rs. 1,088,681,293
Profit before taxation as per audited accounts: Rs.
236,987,460/-.
Audit observation were confronted to taxpayer
regarding non payment of WWF @ 2 %
amounting to Rs. 4.740 million. In response, the
taxpayer contested and replied that WWF is
leviable to Industrial Undertaking as provided in
Section 4 of WWF Ord: 1971 read with definition
given in clause (f) of Section 2 of WWF Ord: 2001.
As per online registration particular, Principal
business activity of taxpayer is registered as,
Non-specialized wholesale trade and business
nature is registered as, Importers/exporters/
wholesaler.
The issue is being scrutinized carefully and
outcome would be reported shortly.
-----under process-----
44
22
5.5.1/
12981/
Multan
Zone
5.3.20/
12955/11
Multan
Zone
2011-12
2011-12
Non recovery of WWF

Prime Cotton Industries Khanewal
2144909-7
DAC directed the RTO to get

the position verified from
audit by 15.09.2013
RS 301407
Charged Rs.301,407/- and recovered

through refund adjustment.

Non levy of penalty for non/late

filing of returns u/s 182
Mushtaq Brothers Cotton Industries Tauns
Sahrif AOP 1542916-4
Tax year 2010
Rs. 212320
CONTESTED.
The Audit Observations to charge penalty
u/s 182 in PTR cases are not applicable for
tax year 2010, as the explanation to
section 182(1) at Sr. No.1 is inserted by
Finance Act, 2011 applicable to tax year
2012. As per return of total income for tax
year 2010, tax payable is tax chargeable
less tax paid/deducted. Tax payable in all
PTR cases as per return is Nil. Hence
minimum penalty of Rs. 5000/- chargeable.
DAC directed the RTO revisit

the case and report
15.09.2013.
Audit by 26.12.2014.
Refer to DAC as penalty is chargeable on tax
payable even return filed u/s 115(4) and tax
deducted as PTR.
21
5.3.20/
12955/11
2011-12
Multan
Zone
22
5.3.20/
12955/11
Multan
Zone
2011-12

Darishak cotton Industries AOP 0999668-8
Tax year 2010
Rs 192978
CONTESTED.
The Audit Observations to charge penalty u/s
182 in PTR cases are not applicable for tax
year 2010, as the explanation to section
182(1) at Sr. No.1 is inserted by Finance Act,
2011 applicable to tax year 2012. As per
return of total income for tax year 2010, tax
payable is tax chargeable less tax
paid/deducted. Tax payable in all PTR cases
as per return is Nil. Hence minimum penalty of
Rs. 5000/- chargeable.
Mushtaq Brothers Cotton Industries Tauns
Sahrif AOP 1542916-4
Tax year 2010
Rs. 212320
CONTESTED.
The Audit Observations to charge penalty
u/s 182 in PTR cases are not applicable for
tax year 2010, as the explanation to
section 182(1) at Sr. No.1 is inserted by
Finance Act, 2011 applicable to tax year
2012. As per return of total income for tax
year 2010, tax payable is tax chargeable
less tax paid/deducted. Tax payable in all
PTR cases as per return is Nil. Hence
minimum penalty of Rs. 5000/- chargeable.

the case and report
15.09.2013.
deducted as PTR.

Audit by 26.12.2014.

the case and report
15.09.2013.
Audit by 26.12.2014.
deducted as PTR.
31
5.4.1/
12979/09
2011-12

M/s. Bismillah Rice Factory Sahiwal
Tax year 2010
Rs 432479
Charged Rs. 1906921/- u/s 122 (5A) and
Taxpayer deposited Rs. 954000/-. Balance
recovery awaited.

the case and report
15.09.2013.
Audit by 26.12.2014.
2011-12
Non recovery of WWF

Kh. Muzaffar Mahmood M.Masood 0663291-2
Tax year 2010
Rs. 746477

by 26.12.2014.
Under process
2011-12
Non recovery of WWF

Karmanwalay Model Industries AOP 11407197
Tax year 2010
Rs. 660782

Under process
Sahiwal
Zone
56
5.5.1/
Multan
Zone
58
5.5.1/
Multan
Zone

by 26.12.2014.
59
5.5.1/
2011-12
Non recovery of WWF

Atta ur Rehman Cotton Industries AOP
100989-3
Tax year 2010
Rs. 156793

by 26.12.2014.
Under process
2011-12
Non recovery of WWF

Ali Hussain Cotton Industries AOP 1438031-5
Tax year 2010
Rs. 177484

Under process
Multan
Zone
60
5.5.1/
Multan
Zone

by 26.12.2014.

Audit Report 2010-11 & 2011-12 Settled 26.11.2014

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Audit Report 2010-11 & 2011-12 Settled 26.11.2014

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MINUTED OF DAC MEETING

AUDIT REPORT 2010-11

Brief of Para & Amount Involved

Last DAC Directives

Departmental reply as a result of latest

Capital expenditure treated as

M/s. Pak Arab Fertilizer Ltd. Tax Year

DAC directives 26.11.2014

DAC directed the RTO to get the

Under assessment of income

The DAC directed the RTO to pursue

Matter is still subjudice

Short levy of tax due to non allocation of

The DAC directed the RTO to pursue the

Matter is still subjudice

Short levy of tax due to non allocation of

Incorrect apportionment of expenses

DAC directed the RTO to expedite

DAC directives 26.11.2014

The DAC directed the RTO to complete

DAC directed the RTO revisit the case

NON LEVY OF WORKERS WELFARE

DAC directed the RTO revisit the case

NON LEVY OF WORKERS WELFARE

The DAC directed the RTO to pursue the

Subjudice before ATIR

DAC directives 26.11.2014

MINUTES OF DAC MEETING

IN RESPECT OF REGIONAL TAX OFFICE MULTAN

Brief of Para & Amount Involved

Short recovery of tax due to incorrect computation of tax

DAC directed the

M/s. Thal Industries Corporation 225971-7

Non levy of minimum

DAC directed the RTO

RTO revisit the

During the course of

It is apprised that the

Non levy of minimum tax on the income of certain persons

WWF demand was created at Rs.1,881,117/-. Out of which

The DAC directed the

Non levy of minimum tax on the income of certain persons

DAC directed the

Non levy of minimum tax on the income of certain persons

DAC took serious

M/s. Al-Hilal Industries (Pvt) Ltd 0800582-6

Non levy of minimum tax on the income of certain persons

During the course of

Non levy of minimum tax on the income of certain persons

DAC directed the

During the course of

Non levy of minimum tax on the income of certain persons

The Hble High Court

The Hble High Court

Short levy of tax due to incorrect computation of taxable income.

Short levy of tax due to incorrect computation of taxable

DAC directed the

DAC directed the RTO

DAC directed the RTO to

The Hble High Court

Short levy of tax due to non allocation of proportionate

Short levy of tax due to non allocation of proportionate