CHAPTER X

PROCEDURE
PART II: ASSESSMENTS
 ASSESSMENT
Sec 2(5): “assessment” includes
 provisional assessment,
 re-assessment and
 amended assessment
 and the cognate expressions shall be construed accordingly;
 TYPE OF ASSESSMENT
 Deemed Assessment Sections 120(1), 169(3)
 Best Judgment Assessment Section 121
 Amended Assessment Section 122
 Amended assessment on account
of revision of return by the taxpayer. Section 122 (3)
 Amended assessment On the basis of audit
or on the basis of definite information Section 122 (5)
 If the assessment order is considered as
erroneous and prejudicial in the interest of revenue. Section 122 (5A)
 Provisional Assessment Section 123
 Consequential Assessment Section 124 (1)
 New Assessment Section 124 (2)
 Modification Assessment Section 124A
 Assessment in case of disputed property Section 125
 TYPE OF ASSESSMENT (cont..)
DEEMED ASSESSMENT
Section 120
 Original and complete return shall constitute an assessment order on the day the return
is furnished. Section 120 (1)
 If the return is not complete, the Commissioner shall issue notice pointing out the
deficiencies. Section 120 (3)
 In case of non compliance of the notice the return shall be treated as invalid Meaning
thereby – no deemed order. Section 120 (4).
Section 169(3)
 If a taxpayer have no other income except the income subject to final taxation,
assessment shall be treated to have been made under Section 120
 TYPE OF ASSESSMENT (cont..)
BEST JUDGEMENT ASSESSMENT
Section 121: In case of
 non-furnishing of return, in response to Notice u/s 114(3) or 114(4),
 non-furnishing of return in compliance of notice u/s 143, 144
 non-furnishing of statement u/s 116
 or failing to produce accounts, documents and records required to be maintaining u/s
174, the Commissioner may make assessment to the best of his judgment based on
information or material on record. Sec. 121(1)
 An assessment order under this section shall only be issued within six years after the end of
the tax year or the income year to which it relates. . Sec. 121(3)
 TYPE OF ASSESSMENT (cont..)
AMENDMENT OF ASSESSMENT
(1) Subject to this section, the Commissioner may amend an assessment order treated as
issued under section 120 or issued under section 121, by making such alterations or additions
as the Commissioner considers necessary. [S. 122(1)]

(2) No order under sub-section (1) shall be amended by the Commissioner after the expiry of
five years from the end of the financial year in which the Commissioner has issued or
treated to have issued the assessment order to the taxpayer. [S. 122(2)]
 TYPE OF ASSESSMENT (cont..)
AMENDMENT OF ASSESSMENT ON ACCOUNT OF REVISION OF RETURN
(3) Where a taxpayer furnishes a revised return under sub-section (6) or (6A) of section 114 —
(a) the Commissioner shall be treated as having made an amended assessment of the
taxable income and tax payable thereon as set out in the revised return; and
(b) the taxpayer’s revised return shall be taken for all purposes of this Ordinance to be an
amended assessment order issued to the taxpayer by the Commissioner on the day on which
the revised return was furnished.
 TYPE OF ASSESSMENT (cont..)
AMENDMENT OF ASSESSMENT ON THE BASIS OF DEFINITE INFORMATION
(5) An assessment order in respect of tax year, or an assessment year, shall only be amended
under sub-section (1) and an amended assessment for that year shall only be further amended
under sub-section (4) where, on the basis of audit or on the basis of definite information the
Commissioner is satisfied that —

(i) any income chargeable to tax has escaped assessment; or

(ii) total income has been under-assessed, or assessed at too low a rate, or has been the
subject of excessive relief or refund; or
(iii) any amount under a head of income has been mis-classified.
 TYPE OF ASSESSMENT (cont..)
AMENDMENT OF ASSESSMENT WHERE ASSESSMENT IS CONSIDERED AS
ERRONEOUS & PREJUDICIAL TO THE INTEREST OF REVENUE.
(5A) Subject to sub-section (9), the Commissioner may, [ ] amend, or further amend, an
assessment order, if he considers that the assessment order is erroneous in so far it is
prejudicial to the interest of revenue.]
 TYPE OF ASSESSMENT (cont..)
(5AA) In respect of any subject matter which was not in dispute in an appeal the Commissioner
shall have and shall be deemed always to have had the powers to amend or further amend an
assessment order under sub-section (5A).

(5B) Any amended assessment order under sub-section (5A) may be passed within the time-
limit specified in sub-section (2) or sub-section (4), as the case may be.
 TYPE OF ASSESSMENT (cont..)
(4) Where an assessment order (hereinafter referred to as the “original assessment”) has been
amended under sub-section (1), (3) or (5A), the Commissioner may further amend, as many
times as may be necessary, the original assessment within the later of —

(a) five years from the end of the financial year in which the Commissioner has issued
or is treated as having issued the original assessment order to the taxpayer; or

(b) one year from the end of the financial year in which the Commissioner has issued
or is treated as having issued the amended assessment order to the taxpayer.
 TYPE OF ASSESSMENT (cont..)
(6) As soon as possible after making an amended assessment under subsection (1), sub-
section (4) or sub-section (5A), the Commissioner shall issue an amended assessment order to
the taxpayer stating –
(a) the amended taxable income of the taxpayer;
(b) the amended amount of tax due;
(c) the amount of tax paid, if any; and
(d) the time, place, and manner of appealing the amended assessment.

(7) An amended assessment order shall be treated in all respects as an assessment order for
the purposes of this Ordinance, other than for the purposes of sub-section (1).
 TYPE OF ASSESSMENT (cont..)
(8) For the purposes of this section, “definite information” includes information on sales or
purchases of any goods made by the taxpayer, receipts of the taxpayer from services rendered
or any other receipts that may be chargeable to tax under this Ordinance, and on the
acquisition, possession or disposal of any money, asset, valuable article or investment made or
expenditure incurred by the taxpayer.
 TYPE OF ASSESSMENT (cont..)
(9) No assessment shall be amended, or further amended, under this section unless the taxpayer has been
provided with an opportunity of being heard:

Provided that order under this section shall be made within one hundred and eighty
days of issuance of show cause notice or within such extended period as the Commissioner may, for
reasons to be recorded in writing, so however, such extended period shall in no case exceed ninety days.
This proviso shall be applicable to a show cause notice issued on or after the first day of July, 2021.

Provided further that any period during which the proceedings are adjourned on account
of a stay order or Alternative Dispute Resolution proceedings or agreed assessment proceedings under
section 122D or the time taken through adjournment by the taxpayer not exceeding sixty days shall be
excluded from the computation of the period specified in the first proviso.
 TYPE OF ASSESSMENT (cont..)
PROVISIONAL ASSESSMENT
Section 123
If any concealed assets which in the opinion of the Commissioner was acquired by a person
from any income subject to Income Tax, the Commissioner before issuing order u/s 121 or 122
can finalize provisional assessment order.

In this section, “concealed asset” means any property or asset which, in the opinion of the
Commissioner, was acquired from any income subject to tax under this Ordinance.
 TYPE OF ASSESSMENT (cont..)

CONSEQUENTIAL ORDER AFTER APPEAL

Section 124(1)
To give effect to the order passed by CIT (Appeal) Tribunal, High Court or Supreme Court. The
Commissioner is bound to issue amended order within 2 years from the end of the financial
year in which the said order was served on him.
 TYPE OF ASSESSMENT (cont..)

NEW ASSESSMENT
Section 124(2)
If against the remand order (Set aside order) passed by CIT (Appeal), Tribunal or High Court if
no further appeal has been filed the Commissioner is obliged to pass new order within one year
from the end of the financial year in which such order was served.
 TYPE OF ASSESSMENT (cont..)

MODIFIED ORDER
Section 124A
In case any question of law has been decided in favor of the taxpayer by High Court or Tribunal
the Commissioner may follow the said order irrespective of the fact that any further appeal or
reference has been filed by the Commissioner against the said order. The said order shall be
subjected to reversal if the question of law so decided is reversed or modified.
 TYPE OF ASSESSMENT (cont..)

ASSESSMENT IN CASE OF DISPUTED PROPERTY

Section 125
Where the ownership of any property the income from which is chargeable to tax under this
Ordinance is in dispute in any Civil Court in Pakistan, an assessment order or amended
assessment order in respect of such income may be issued at any time within one year after
the end of the financial year in which the decision of the Court is made.
.