NASIM SIKANDAR, J.---At the instance of the assessee, a Private Limited Company engaged in manufacturing of tin containers and reinsurance business, the Lahore Bench of the Income-tax Appellate Tribunal has referred the following question of law said to have arisen out of their order, dated 20-11-1983 for the assessm ent year 1980-81:--- "Whether on the facts and in the circumstances of the case the Tribunal was right in holding that tax paid was to be taken as amount retained for capitalization and as such the surcharge otherwise leviable under clause (a)(b)(ii) of Part III of the First Schedule to the Income Tax Ordinance, was not leviable on such amount?"
2. The Income-tax Officer calculated surcharge on the profits worked out after deducting the dividend distribution i.e. On the taxes worked out leviable on the amount retained by the Company.
The contention of the appellant that surcharge should be worked out on the basis of unretained income was not granted. The First Appellate Authority maintained the treatment meted out to the assessee and attempted to distinguish the case from the earlier view declared by the Tribunal in various cases. However, the Tribunal further directed that surcharge should be charged in accordance with their earlier view.
3. A Karachi Bench of the Tribunal in re: C.I.T. v. Messrs Facto Sugar Mills Ltd., Karachi appears to have treated the issue for the first time, which was unsuccessfully challenged in a reference by the Revenue. The judgment of the High Court maintaining the view of the Tribunal was upheld by the Hon'ble Supreme Court of Pakistan while hearing a number of similar appeals in a case reported as 1993 PTD 343 re: C.I.T. v. Messrs Habib Sugar Mills Ltd.
4. The learned counsel agrees that the issue in hand having finally been settled by the Hon'ble Supreme Court of Pakistan the answer to the question needs to be given in the affirmative.
5. Accordingly answered in affirmative. .