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Business Recorder
4 days ago
- Business
- Business Recorder
Sec 179(4) Customs Act: Power of FBR to grant extension ‘narrower': SC
ISLAMABAD: The Supreme Court noted that the power of Federal Board of Revenue (FBR) under Section 179(4) of the Customs Act, 1969 to grant extension of time is much narrower and circumscribed. A three-judge bench, headed by Justice Munib Akhtar, ruled that while hearing an appeal of Director, Directorate General, Intelligence and Investigation (Customs) against the decision of the Sindh High Court (SHC), and dismissed it. Dr Farhat Zafar, representing the petitioner (DG Intelligence and Investigation (Customs) submitted that in this case an extension of time was granted by the FBR and therefore, the impugned decision of the SHC is not sustainable. She relied on paragraphs 11 and 12 of the judgment of larger bench of the Supreme Court, which upheld the principles laid down in the case of Collector of Sales Tax, Gujranwala and others v Messrs Super Asia Mohammad Din and Sons and others 2017 SCMR 1427 (Super Asia). SHC judgment: SC reserves verdict on DG Customs Valuation's pleas The court noted that these paras dealt with Section 74 of the Sales Tax Act, 1990, and considered the possibility of the grant of an extension of time in terms thereof. Section 74 was held to apply in terms as stated in para 12 of the judgment in Super Asia. The judgment said this matter (extension of time) has arisen under the Customs Act, 1969, which Section 179 (4) says; 'The Board shall have the powers to regulate the system of adjudication including transfer of cases and extension of time-limit in exceptional circumstances.' The court noted that the power to grant an extension by the Board under Section 179(4) of the Customs Act, 1969, is circumscribed, and is to be exercised only in 'exceptional circumstances'. On the other hand, Section 74 of the 1990 Act provides that the Board is empowered to grant an extension to the extent found 'appropriate'. The court said that there is an obvious and clear difference between the two provisions; the power under Section 179(4) is much narrower and circumscribed. Therefore, the paragraphs of Super Asia sought to be relied upon by counsel for the petitioner have no relevance. It stated that the Larger Bench has also made some observations with regard to Section 74 of the Sales Tax Act, 1990. The judgment also said that, on a query from the Court, the counsel for the petitioner has candidly stated that the permission/ letter of extension that was granted by the Board was not placed on the record before the Appellate Tribunal. The judgment said that indeed, this was specifically noted by the Tribunal in its order; i.e., 'However, the plea taken by the respondents is that they have taken approval from FBR as mentioned in Section 179(4) but no such approval was placed before the Tribunal'. The court noted that the matter came before it from a tax reference and it is well established that beyond the stage of the Appellate Tribunal, it is only questions of law that can be taken to the High Court. It is also well settled that the record on the basis of which the questions of law can be decided is in terms of the record as it stood before the Appellate Tribunal. The judgment said that record cannot be added to and certainly not on a point that requires factual determination. Since the position is that the FBR letter by which it is claimed extension of time was granted by the Board was never placed on the record before the Appellate Tribunal, it is impermissible for any reliance to be placed on the same in this Court. The Court; therefore, declined to entertain this point, saying; 'Any departure from the well settled position would allow a party to a tax reference to alter the record either before the High Court or this Court which is not permissible.' Copyright Business Recorder, 2025
Business Recorder
30-04-2025
- Business
- Business Recorder
In tax cases substantive changes affecting vested rights apply prospectively: SC
ISLAMABAD: The Supreme Court upholding the decision of the Lahore High Court (LHC) declared that in tax cases substantive changes affecting vested rights apply prospectively unless retrospective effect is expressly or necessarily intended. A three-judge bench, headed by Justice Munib Akhtar and comprising Justice Ayesha A Malik and Justice Aqeel Ahmed Abbasi heard income tax reference of Commissioner Inland Revenue, Faisalabad. The basic contention of the counsel for the petitioner is that Section 2(36) read with Section 100C of the Income Tax Ordinance, 2002 (Ordinance) read with SRO No754 (I)/ 2016 dated 15.08.2016 (SRO) was misconstrued by the High Court. The taxpayer is a welfare society and the relevant tax year is 2019. The taxpayer filed their return on 26.12.2019 after which a show-cause notice was issued on 12.02.2021 under Section 122(9) read with Section 122(5A) of the Ordinance stating therein that the taxpayer was not entitled to tax credit as they had not obtained the relevant approval required under Section 2(36) of the Ordinance given that the validity of their existing approval dated 05.06.2007 expired in the year 2010 in terms of the SRO. The assessment order dated 01.03.2021 and the appeal before the Commissioner decided the matter against the taxpayer maintaining the contention that they did not have a valid approval under Section 2(36) of the Ordinance. The Tribunal; however, agreed with the contention of the taxpayer that it had a valid approval issued by the Commissioner for which the condition of three years as stipulated by the SRO would commence from 2016 and not retrospectively from 2007. The LHC has maintained the decision of the Tribunal for the same reasons. The judgment authored by Justice Ayesha noted that the matter in issue simply relates to the retrospective applicability of the SRO. The said SRO was issued on 15.08.2016 under Section 237(1) of the Ordinance which essentially made amendments to the Income Tax Rules, 2002. The relevant rule in this case is Rule 214 of the Rules which originally provided that the approval granted under Rule 212 of the Rules will remain in force unless withdrawn under Rule 217 of the Rules. The approval under Rule 212 of the Rules is essentially with reference to the approval sought by the non-profit organization for the purposes of Section 2(36) of the Ordinance. The amendment brought to Rule 214 of the Rules by way of the SRO is that the approval given under Rule 212 of the Rules shall remain in force for the subsequent three years unless withdrawn under Rule 217 of the Rules whichever is earlier. Hence, the question before us is simply whether Rule 214 of the Rules as amended by the SRO will apply retrospectively. A bare reading of Rule 214 clarifies that it will apply for the subsequent three years meaning that it will apply prospectively as the words subsequent three years do not suggest that this amendment will apply retrospectively. The judgment noted that the SRO does not contain any provision which suggests that the said SRO will apply retrospectively. Under the circumstances, the contention of the petitioner that the approval obtained by the taxpayer in the year 2007 is no longer valid, as it expired in 2010, on account of the SRO, is misconceived as the argument suggests a retrospective application of the SRO. This goes against the settled law that retrospective application of the law cannot be made unless specifically provided for, particularly in tax cases. 'Therefore, we find that the SRO was issued on 15.08.2016, the period of three years will be counted subsequent thereof which means that the approval granted in 2007 expired in August 2019.' 'Consequently, the taxpayer did have the relevant approval necessary for claiming tax credit for the tax year 2019 and was entitled to it.' Copyright Business Recorder, 2025
Business Recorder
25-04-2025
- Politics
- Business Recorder
Electricity duty on self generation: SC dismisses review pleas of Punjab govt
ISLAMABAD: The Supreme Court dismissed the review petitions of the Punjab government regarding levy of electricity duty on the companies which produce power from generator of more than 500kW capacity to produce electricity for self-use. A three-judge bench headed by Justice Munib Akhtar and comprising Justice Ayesha A Malik and Justice Aqeel Ahmed Abbasi, heard review petitions of the Punjab government against the SC's decision. The provincial government had filed a total of 46 review petitions. Mian Mahmood Rashid appeared on behalf of most of the textile mills. At the onset of the proceedings, the additional advocate general (AAG), Punjab contended that in the appeals the issue of the applicability of Article 157 of the Constitution was required to be decided. However, the bench referred paragraph 3 of the judgment, wherein, it was categorically observed that the issue of constitutionality of the levy in terms of Article 157 was not pursued by either side and therefore these appeals fall to be decided solely on the ground whether, in the facts and circumstances of the case, Sec 13 of the Punjab Finance Act, 1964 was applicable in terms as sought to be imposed on the respondents in terms of the 2001 notification, whereby, this levy on self-generation and self-use of electricity was imposed on the mills and other commercial establishments including hospitals, etc. The bench members repeatedly asked the AAG to point out any paragraph of the judgment sought to be reviewed, wherein, mistake or error floating on the surface of the judgment. However, the AAG was unable to point out any error or mistake apparent on the face of the record. The bench; therefore, dismissed all the review petitions reinforcing that no electricity duty could be realised on the self-generation of electricity from the generators of 500kW and above. The court in its judgment dated 29-02-24 had ruled that the mills and others, which used private generators of more than 500kW capacity to generate electricity for self-use, are not liable to pay the electricity duty on their own self use of the power/ energy generated by their generators of more than 500 kW capacity. The Punjab government on 25-08-2001 issued Punjab Finance Ordinance, 2001 to make changes in Section 13 of the Act that resulted in the application of the levy known as the electricity duty on the respondents. This levy was challenged in the Lahore High Court (LHC) by writ petitions on various grounds. The constitutionality of Section 13 was also brought into play. The provincial government took its stand on constitutionality in terms of Article 157 (2) (b) of the single bench of the LHC had dismissed the petitions. Consequently, the intra-court appeals were filed before a Division Bench of the High Court, which reversed the judgment. Being aggrieved by this decision, the Punjab provincial government approached the apex court. It contended that up to 2001 the respondents may have been entitled to the benefit of the 1985 notification but thereafter the position changed fundamentally on account of the new definition of 'licensee' substituted by the 2001 Ordinance, which stated 'any person generating the electric power from a generator having the capacity of more than five hundred kilowatt for self-use they statutorily became licensees.' Copyright Business Recorder, 2025
Express Tribune
21-04-2025
- Politics
- Express Tribune
Justice Mansoor Ali Shah takes oath as acting CJP
Listen to article Justice Mansoor Ali Shah was sworn in as the acting chief justice of Pakistan on Monday. The oath-taking ceremony was held at the Supreme Court of Pakistan, where Justice Munib Akhtar administered the oath. Senior lawyers and staff of the Supreme Court were present at the oath-taking ceremony. Justice Mansoor Ali Shah assumes the role during the absence of Chief Justice Yahya Afridi, who is on an official visit to China to attend the 20th Conference of Chief Justices of Supreme Courts of SCO Member States. The conference is scheduled to take place in Hangzhou from April 22 to April 26. During the visit, a Memorandum of Understanding (MoU) is expected to be signed between the Supreme Court of Pakistan and the Supreme People's Court of China. The agreement aims to strengthen judicial cooperation, with a focus on training, information exchange, and collaboration in various legal areas including international commercial law, arbitration, cybercrime, financial crimes, climate change, judicial technology, and dispute resolution. The MoU also seeks to enhance legal assistance in civil matters and improve the enforcement of judicial decisions. Both countries have reiterated their commitment to judicial independence and the rule of law.
Express Tribune
08-02-2025
- Politics
- Express Tribune
4 SC judges want 26th amend judged before new judges take bench
ISLAMABAD: Four judges of the Supreme Court of Pakistan, in a letter, demanded putting on hold the process of appointment of eight new judges to the apex court till the challenges to the 26th Amendment were decided. The letter — signed by senior puisne judge Justice Mansoor Ali Shah and justices Munib Akhtar, Athar Minallah and Ayesha Malik — was addressed to Chief Justice of Pakistan (CJP) Justice Yahya Afridi. The Judicial Commission of Pakistan (JCP) is scheduled to meet on February 10 to consider filling eight vacant seats of judges at the Supreme Court. The JCP approves judicial appointments. It was reconstituted to include four members of parliament by the Constitution (Twenty-sixth Amendment) Act, 2024, which brought numerous changes pertaining to the judiciary. The Supreme Court's Constitutional Bench has taken up a number of challenges to the amendment. "It is requested that the scheduled meeting and the appointment of eight new judges be postponed till the challenge to the 26th Constitutional Amendment is decided one way or the other, or at least until the Constitutional Bench decides the applications for convening a full court to hear and determine that challenge and till the matter of the transfer of judges to the Islamabad High Court and their seniority is finally determined on the judicial side since we are given to understand that such challenges have been launched," the letter reads. The judges said the "existing and continuing state of affairs and certain recent developments" had compelled them to make the request. They pointed out that the challenges to the 26th Amendment were lingering and languishing before the Constitutional Bench. "For diverse reasons, which to some are obvious to the point of being self-evident, these challenges needed to be dealt with by the full court urgently and immediately, and ought, therefore, to have been so heard already. "The request to convene a full court was brought on the record by some of us earlier. However, the matters were sent off to the Constitutional Bench, where a first formal hearing was held after a considerable delay. Now, the aforementioned meeting for induction of new judges has been scheduled surprisingly and rather hurriedly before the next date of hearing in the said matters before the Constitutional bench." The judges said the development could "further imperil and erode the public trust and confidence reposed in the institution". They pointed out that public trust in the judiciary presently hinged "crucially" on how pleas against the amendment were dealt with. "The induction of new judges, at this stage, who are clearly beneficiaries of the amendment, will weigh heavily on the faltering public trust enjoyed by the institution today and unnecessarily make matters more complicated," they added. "The dilemma that will be created if the meeting goes ahead to reach its stated objective can be stated as follows. If the Constitutional Bench accepts the applications and directs the convening of the full court to hear and decide the challenges to the amendment, the question will then inevitably arise as to who will comprise the full court for such purpose. "This is so because if by that time eight new Judges have assumed office as proposed it would create an anomalous situation. On one view the full court would include the new appointees. But they would have come in under the amendment itself. This will, inter alia, give rise to a public perception of court-packing, which would severely damage the image of the highest institution of justice in the country as to its impartiality and independence. "On the other view, the full court for the purposes at hand could only be the judges on the court at the time of the enactment of the amendment, and still in office. But that, some might argue, would not be the full court and contend that in the altered circumstances the full court cannot sit at all for considering the challenges to the amendment. This will again create the perception of court-packing, though this time from different perspective, i.e. to preclude at all a sitting of the full court, which will further dent and erode public confidence in the institution. The net result may be to create an impression of the inevitability of the challenges being heard only by the Constitutional Bench That would reinforce the negativities that, unfortunately, already swirl around the court," the letter reads. The judges questioned why the court was being placed in such a position and "whose agenda and interests are served in so exposing the court to indignity and perhaps even we regret to say ridicule? "Why place the court on the horns of an avoidable dilemma? Is it not therefore imperative that the matter of induction of new judges be reassessed and, for the time being, put to one side? These questions, we believe, answer themselves." The four judges urged that the apex court must carefully consider the full court's timing and composition to preserve its integrity and credibility, which was not just that of the highest judicial institution but of the entire legal system. "Yet, the holding of the meeting may preclude, if not effectively eliminate, precisely any such possibility. Any decision rendered by the full court, if at all constituted after the induction of new judges, may well fail to command public trust and confidence. The only viable solution and option in the present circumstances is therefore to postpone the meeting," the judges reasoned. The letter also detoured to recent developments in the IHC that saw the transfer of new judges and a reshuffling of the seniority order. It said the absence of an oathtaking ceremony made the transfers "suspect". "It appears that the current chief justice of the IHC has taken it upon himself to accord seniority to the transferred judges oblivious to all of the above and other legal and constitutional points which prima facie may well apply," the letter said, pointing to the fact that Justice Sarf¬a¬raz Dogar was now being regarded as the IHC's senior puisne judge. The apex court judges said the developments in the IHC had "certain consequences" for the JCP meeting since nominations for Supreme Court justices are made from the five most senior judges of each high court. "The consequence of the foregoing is that now the judge from the Lahore High Court, having been determined to be the senior puisne judge of the IHC, has become eligible for nomination and appointment as a judge of the Supreme Court at the meeting. "How can this be? How can a judge who would and could not possibly have been eligible for any such consideration at all in his own high court, suddenly and in consequence of the alchemy of a prima facie constitutionally suspect and defective transfer become eligible to be considered for the Supreme Court? What cannot be done directly cannot be done indirectly. "Quite obviously, the slate of candidates, if we may put it so, for consideration at the meeting appears to be constitutionally defective as both including a judge who ought not to be there and excluding one who ought to be (i.e., the fifth senior judge of the IHC). A legally permissible consideration of candidates appears therefore not to be possible in the present circumstances," the letter concluded.
