By Islamabad High Court Sohail Sarfraz
ISLAMABAD: The Islamabad High Court (IHC) has recently adjudicated three income tax reference applications filed by a company registered with the Securities and Exchange Commission of Pakistan (SECP) under section 42 of the Companies Act, 2017.
The company, which operates schools affiliated with a private housing society, contended that, despite the absence of the Commissioner鈥檚 approval under section 2(36) of the Income Tax Ordinance, 2001 (Ordinance), it is nonetheless entitled to claim a tax credit under section 100C of the Ordinance for the tax years 2015, 2016, and 2017.
The company鈥檚 argument was based on the assertion that its case fell under section 100C(2)(a) of the Ordinance, thereby obviating the need to meet any further conditions for availing the full 100% tax credit. Additionally, the company argued that its registration with the SECP as a non-profit entity should be deemed sufficient to entitle it to the tax credit under section 100C.
Initially, the IHC admitted the company鈥檚 tax refe