Commissioner General of Inland Revenue v. Lignocell (Pvt) Ltd. – CA TAX/0016/2017-2022

In Commissioner General of Inland Revenue v. Lignocell (Pvt) Ltd., the court addressed whether coir fibre pith qualifies as “agricultural produce” under Section 16(2)(b) of the Inland Revenue Act No. 10 of 2006, thereby entitling the respondent to an income tax exemption. The dispute centered on whether the respondent’s activities changed the product’s nature such that it would be classified as manufacturing, potentially disqualifying it from exemption, and whether the exemption applies broadly to entities engaged in handling and exporting such produce. It was held that the respondent’s activities constituted preparatory processes rather than manufacturing and that coir fibre pith remained “agricultural produce” for the purpose of the exemption. The findings relied on statutory interpretat