CH. IRSHAD AHMAD, JUDICIAL MEMBER.-1. Section 80D of the Income tax Ordinance provides that notwithstanding anything contained in the Ordinance or any other law for the the being in force where no tax is payable or paid by a company or a registered firm resident in Pakistan or the tax payable or paid is less than one half percent of the amount representing its turnover from all sources the aggregate of the declared turnover shall be deemed to be the income of the said company or a registered firm and tax thereon shall be charged in the manner specified in sub- section (2). Explanation below sub-section (2) of section 80D ibid. Provides that "turnover" means gross receipts exclusive of trade discount shown on invoices or bills derived from sale of goods or from rendering, giving or supplying services or benefits or from execution of contracts.
2. During the assessm ent years 1991-92 and 1992-93 the assessee having the status of a company, besides income from business, earned income from property and interest from certain investments. The assessing officer has levied tax under section 80D of the Ordinance on the total income of the assessee including receipts of income from house property and from interest etc.
3. On assessee's appeal, the Appeal Commissioner has directed that the tax under section 80D ibid shall not be charged on assessee's income from house property and interest. The Appeal Commissioner is of the view that tax on turnover under section 80D ibid is payable only in respect of receipts from business and not receipts from other sources.
4. Through these- appeals, the ITO has objected to the order of the Appeal Commissioner on the sole ground that since the Appeal Commissioner had no jurisdiction to entertain appeal against his order made under section 80D of the Ordinance his directions to exclude the rental and interest income from the assessee's turnover are illegal.
5. We have heard Mr. Muhammad Ali Shah, DR for the ITO. None has appeared on behalf of the assessee in spite of the fact that the notice of hearing of appeal has been served on it.
6. The learned D.R has contended that appeal before the Appeal Commissioner lies only in respect of ITO's orders made under specified sections of the Ordinance enumerated in section 129 and since an order under section 80D is not included in the said section, the assessee's appeal before him was not competent. The Department's contention is not well founded. Section 80D is a charging section and forms part of substantive provision of the law and is not the part of the machinery sections. The chargeability of tax under section 80D is of course assessable under section 62 of the Ordinance and any order made by the ITO under section 62 of the Ordinance is appealable before the Appeal Commissioner. We have also examined the merits of the Appeal Commissioner's order. Under section 80D ibid all receipts of an assessee from whatever source derived are not to be charged to tax. Tax under section 80D is chargeable only on "turnover" as defined in the Explanation below sub-section (2) of the said section which reads to mean "gross receipts exclusive of trade discount shown on invoices or bills derived from sale of goods or from rendering, giving or supplying services or benefits, or from execution of contracts". The meanings of the expression "turnover" as given in the above Explanation are to be construed narrowly and strictly for to reasons: firstly, that the definition starts with the word "means" and where any definition begins with the word "means" the meanings are to be confined within the four corners of the words used and secondly, the meanings of the "turnover" would involve burden on the citizen and any provision which imposes any pecuniary burden on the citizen is to be construed strictly.
7. For the reasons given above, we see no force in these appeals. The same are rejected.