Preliminary Chapter- 04
(c) promoting products where such products are yet to be supplied to, or sold in, Pakistan;
(d) promoting technical and financial collaborations between its principal and taxpayers in
Pakistan; or
(e) provision of technical advice and assistance."Liquidation" [U/s 2(31)] in relation to a company, includes the termination of a trust;
Explanation: This is an inclusive definition that in addition to the term 'liquidation' in relation to a company
also covers the termination of a trust.
"Local Government" [U/s 2(31A)] “Local Government” shall have the same meaning for respective
provisions and Islamabad Capital Territory as contained in the Balochistan Local Government Act, 2010 (V
of 2010), the Khyber Pakhtunkhwa Local Government Act, 2013 (XXVIII of 2013), the Sindh Local
Government Act, 2013 (XLII of 2013), the Islamabad Capital Territory Local Government Act, 2015 (X of
2015) and the Punjab Local Government Act, 2019 (XIII of 2019) ;
Explanation: The expression, "Local Government" has been inserted, replacing the term "local authority"
wherever it appears in the Ordinance. These two expressions are different in scope under their respective
laws. The expression "local authority" as denned in Section 2(28) of the General Clauses Act, 1897 has
peculiar legal connotations to cover even "local government" institutions. Definition of the term "Local
Governments" which is a system of governance introduced in 2001 cannot be a substitute for "local
authority".
"Member" [U/s 2(32)] in relation to an AOP, includes a partner in a firm;
Explanation: This is in relation to an AOP which also now includes partner in a firm as u/s 80 firms under
the Partnership Act are now included in the term 'AOP'-
"Minor child" [U/s 2(33)] means an individual who is under the age of 18 years at the end of a tax year;
Explanation: This is a new definition prescribing the age of 18 years for minority at the end of the tax year.
"Modaraba" [U/s 2(34)] means a modaraba as defined in the modaraba Companies and Modarabas
(Floatation and Control) Ordinance, 1980;
Explanation of u/s 2(34)"modaraba"
It means a Modaraba as defined in the Modaraba Companies and Modarabas Ordinance, 1980. The
definition of the term in the said law reads as under:
"Modaraba" means a business in which a person participates with his money and another with his efforts or
skill or both his efforts and skill and shall include Unit Trusts and Mutual Funds by whatever name called;
"Modaraba certificate" [U/s 2(35)] means a modaraba certificate as defined in the Modaraba Companies
and Modarabas (Floatation and Control) Ordinance, 1980;
Explanation: It has the same meaning as under the relevant law i.e. Modaraba Companies and
Modarabas Ordinance of 1980., which says;
"Modaraba Certificate" means a certificate'' of definite denomination issued to the subscriber of the
Modaraba acknowledging receipt of money subscribed by him;
"modaraba company" means a company engaged in the business of floating and managing modaraba;
"Mutual Fund" [U/s 2(35A)] means a mutual fund registered or approved by the Securities and Exchange
Commission of Pakistan;
Explanation: The definition of "mutual fund" cover only such funds that are approved by the Securities and
Exchange Commission of Pakistan (SECP). Previously this condition was not imposed.