NASIM SIKANDAR, J.---At the instance of the Commissioner of Sales Tax, Central Zone, Lahore, the Lahore Bench of the Income Tax Appellate Tribunal has framed the following question of law as a reference under section 136(1) of the Income Tax Ordinance, 1979 which is said to have arisen out of their order, dated 31-12-1981:--- "Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that delivery charges received by the assessee were not includable in the sale price as defined in the Sales Tax, 1951?"
2. The assessee is a private Limited Company and at the relevant time engaged itself in manufacturing and sale of Ice Cream under the Brand name of "Polka". For the four assessments years involved w.e.f. 1973-74 to 1976-77, the assessee disclosed sales at various sums which did not include delivery charges. After serving the assessee with a notice, the Assessing Officer proceeded to add delivery charges to compute total sales. Earlier it was noted that to arrive at the taxable sales the assessee had deducted delivery charges from them and that the entire amount was taken to profit and loss account. The assessee succeeded before the first appellate authority. The learned A.C. Zone-A, Karachi decided in favour of the assessee on the ground of its having adopted a similar view in the previous order.
3. The Department, however, failed before the Tribunal. By way of the impugned order, it was concluded that delivery charges could not legally be included in the sale price.
4. The learned counsel for the Revenue relies upon a judgment of the Hon'ble Supreme Court of Pakistan in Re: Ittehad Chemicals v. Islamic Republic of Pakistan through Additional Secretary to the Government of Pakistan, Central Board of Revenue, Karachi and 2 others PLD 1993 SC 136 in which it was inter alia found that the items of freight and octroi were to be included for the purpose of computing the price under section 4 (1) of the Centeral Excise and Salt Act, 1944 for the purpose of assessm ent of excise duty and sales tax. Reference is also made to another judgment of Hon'ble Supreme Court of Pakistan in Re: Pakistan through Secretary Finance and another v. Kohat Cement Company and others PLD 1995 SC 659. Lastly a Division Bench judgment of Karachi High Court in Re: K. Rehman Milk Food Industries Ltd. Karachi v.
Commissioner of Sales Tax, Central Zone-A, Karachi is also relied upon for a negative answer to the aforesaid question.
5. After going through the ratio settled in the aforesaid judgments, we will readily agree that the issue in hand already stands decided in favour of the Revenue by the Hon'ble Supreme Court of Pakistan in the first cited case Re: Ittehad Chemicals (supra).
6. That being so, our answer to the said question is in the negative. .