KARACHI: The Indus Motor Company Limited has taken legal action by challenging a substantial tax demand amounting to Rs634 million before the Sindh High Court (SHC).
The motor company made this revelation in its annual report for the fiscal year ending June 30, 2023. According to the report, during the year ended June 30, 2022, the company received a show cause notice dated February 23, 2022, under Section 161/205 of the Income Tax Ordinance, 2001, from the Federal Board of Revenue (FBR).
The FBR issued this tax demand of Rs 634 million against the company, alleging non-collection of advance tax under Section 231B of the Income Tax Ordinance, 2001. This tax demand was related to the period spanning from July 2021 to December 2021 and was associated with the sale of 2,966 units of Hilux vehicles, which were sold for purposes other than private use.
In response to the show cause notice, the company took legal action by challenging it in the High Court of Sindh and successfully obtained a stay order against the notice. The matter remains pending for a hearing in the High Court.
The annual report also indicated that the company’s management maintains a high level of confidence that the matter will ultimately be decided in favor of the company. Consequently, no provisions against this tax demand have been made in the financial statements.
This legal dispute underscores the complexities and legal challenges that can arise in the taxation domain for corporations in Pakistan. Stakeholders and investors will be keenly following the developments in this case, as it has financial implications for the company.
For further updates and details on this matter, interested parties are encouraged to refer to the official reports and statements released by the Indus Motor Company Limited.
