Latest Judgments

Newly reported judgments from the Supreme Court of Pakistan, the High Courts and tribunals, added as they are processed — free, full text, updated daily. Judgments marked NEW were added in the most recent update. 232,594 judgments in total.

• Naeem Sher Tareen vs Beenish Ali and others2017 PLJ Quetta 58 · Balochistan High Court · 2017-03-14Read full judgment →
• Naeem Sher Tareen vs Beenish Ali and 4 others2017 PLJ Quetta 58, 2017 CLC 1170 · Balochistan High Court · 2017-03-14
  constitutional petitionvires of statuterepugnancy to Islamjurisdiction of High CourtFederal Shariat Courttransfer of family caseKhula
  Summary & questions settled

  This constitutional petition was filed before the Balochistan High Court by a husband seeking the transfer of a family suit for dissolution of marriage by way of Khula from Islamabad to Quetta, and simultaneously challenging the vires of Section 10(4) of the West Pakistan Family Courts Act, 1964, as amended by Ordinance LV of 2002, alleging it to be repugnant to the injunctions of Islam and the Constitution. The core legal question addressed was whether the High Court has the jurisdiction to examine the repugnancy of a legislative provision to the injunctions of Islam and to issue directions regarding legislation, as well as to transfer a case outside its territorial jurisdiction. The Court held that under Article 203G of the Constitution, the jurisdiction to examine whether any law is repugnant to Islam vests exclusively in the Federal Shariat Court, thereby barring the High Court from entertaining such matters. Furthermore, the High Court held it cannot issue orders or transfer cases to a court located outside its territorial jurisdiction. The petition was accordingly dismissed.

  Questions settled

  • Does a High Court have the jurisdiction to examine and decide whether a provision of law is repugnant to the injunctions of Islam?
  • Can a High Court transfer a family suit pending before a Family Court located outside its territorial jurisdiction?
  • Whether Article 203G of the Constitution places a bar on the jurisdiction of a High Court to entertain proceedings regarding matters falling within the jurisdiction of the Federal Shariat Court?
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• Naeem Shahzad vs The State and others2017 P Cr. L J 1516 · Lahore High Court · 2016-10-21
  emigration fraudconfessional statementplea of guiltyconviction on confessionretracted confessionvoluntary confessionfirst offender
  Summary & questions settled

  This criminal appeal challenges the conviction and sentence of the appellant under Section 22(b) of the Emigration Ordinance, 1979, passed by the trial court following a voluntary confessional statement and a compromise with the complainant. The core legal question was whether a voluntary and true judicial confession can form the sole basis for recording a conviction without corroboration. The Lahore High Court held that a judicial confession, once found to be voluntary, true, and confidence-inspiring, can validly form the sole basis for a conviction, even if retracted or made in the context of a plea bargain, and that no corroboration is strictly required. The court affirmed the conviction while maintaining the lenient sentence of imprisonment already undergone, given that the appellant was a first offender and had made restitution.

  Questions settled

  • Whether a judicial confession can form the sole basis for the conviction of an accused?
  • Does a voluntary confessional statement require corroboration before it can be acted upon by a trial court?
  • Is a confession rendered invalid if the accused subsequently seeks leniency or attempts to retract it?
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• Naeem Sajid and 4 others vs Federation of Pakistan through Secretary, Ministry of Interior and 6 others2017 PLD Sindh 31 · Sindh High Court · 2016-05-24Read full judgment →
• Naeem Noor Muhammad alias Naeem Cyclewala vs The Iind Additional2017 CLC 626 · Sindh High Court · 2015-12-15
  constitutional petitiondefault in rentchange of ownershipejectment applicationpostal money ordermisreading of evidencelandlord and tenant
  Summary & questions settled

  This constitutional petition challenges the appellate court judgment that reversed the rent controller's order and allowed the respondents' ejectment application against the petitioner-tenant on the ground of default in rent payment. The core legal question revolves around whether the tenant committed a willful default in paying monthly rent following a change of ownership notice under section 18 of the Sindh Rented Premises Ordinance, 1979. The Sindh High Court held that the appellate court misread the evidence regarding the tender and refusal of rent through a postal money order and failed to properly apply the timelines prescribed under sections 15(2)(ii), 10, and 18 of the Ordinance. The court ruled that the tenant had timely tendered the rent through a money order after the landlords refused direct payment, and subsequently deposited it in court within the permissible legal timeframe, thereby committing no default. The petition was accordingly allowed, setting aside the appellate court's judgment and restoring the rent controller's dismissal of the ejectment application.

  Questions settled

  • Whether a tenant commits a default in payment of rent under section 18 of the Sindh Rented Premises Ordinance, 1979, if the rent is tendered through a money order and deposited in court within the statutory period after refusal by the landlord?
  • Does the High Court have jurisdiction under Article 199 of the Constitution of Pakistan, 1973 to interfere with findings of an appellate rent court based on non-reading or misreading of evidence?
  • What is the applicable time period for payment of rent by a tenant following a notice of change of ownership under section 18 of the Sindh Rented Premises Ordinance, 1979?
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• Naeem Akhtar Chang vs Federation of Pakistan & Ors2017 SHC 108 · Sindh High Court · 2017-01-11
  disciplinary proceedingsregular inquirymisconductnatural justicefair trialmajor penaltyreduction in rank
  Summary & questions settled

  This consolidated judgment decides three constitutional petitions challenging major penalties of reduction to a lower post/stage imposed on employees of the National Database and Registration Authority (NADRA). The petitioners were accused of misconduct and negligence leading to the illegal processing of CNICs for aliens. Although the petitioners specifically denied the charges, the respondents dispensed with a regular inquiry, relying instead on a fact-finding committee report where the petitioners were questioned as witnesses via a questionnaire. The High Court of Sindh held that when serious allegations of misconduct are specifically denied and cannot be resolved without recording evidence, conducting a regular inquiry is mandatory. Dispensing with a regular inquiry and denying the opportunity to cross-examine witnesses violates the principles of natural justice and the fundamental right to a fair trial under Article 10A of the Constitution. Consequently, the court set aside the impugned penalty orders and directed the payment of back benefits, while allowing the respondents the liberty to initiate a de novo regular inquiry.

  Questions settled

  • Whether a regular departmental inquiry can be dispensed with when an employee specifically denies factual allegations of misconduct?
  • Can a fact-finding inquiry where the accused is examined as a witness serve as a substitute for a regular disciplinary inquiry?
  • Does the failure to conduct a regular inquiry and provide an opportunity to cross-examine witnesses violate the right to a fair trial under Article 10A of the Constitution?
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• Naeem Abbas vs Government of Punjab through Secretary and 4 others2017 PLC (C.S.) 404 · Lahore High Court · 2015-11-30
  promotion rescissionnatural justiceaudi alteram partemservice matterwrit jurisdictionfitness for promotiondisciplinary proceedings
  Summary & questions settled

  This writ petition challenges the rescission of the petitioner’s promotion from Inspector to Deputy Superintendent of Police (DSP) by the Police Department. The core legal questions concern whether the rescission of a promotion order without prior notice violates the principles of natural justice, and whether the High Court possesses jurisdiction to adjudicate this matter despite the bar under Article 212 of the Constitution. The Court held that the impugned notification rescinding the promotion was illegal and without lawful authority. It established that the question of fitness for promotion falls outside the scope of terms and conditions of service barred by Article 212. Furthermore, the Court affirmed that the principle of audi alteram partem mandates that a civil servant cannot be reverted or have their promotion rescinded without being provided an opportunity of defense. Additionally, it ruled that the mere issuance of show-cause notices, absent actual punishment or disciplinary findings, does not legally justify the deferment or cancellation of a promotion. The petition was consequently allowed, and the impugned notification was set aside.

  Questions settled

  • Does the High Court have jurisdiction to hear a service matter concerning the fitness of a civil servant for promotion?
  • Can a promotion order be rescinded without issuing a show-cause notice to the affected civil servant?
  • Does the mere issuance of show-cause notices constitute a valid legal ground to defer or cancel a civil servant's promotion?
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• Nadir Khan and 5 others vs Muqadar Khan and 13 others2017 CLC 277 · Peshawar High Court · 2016-01-22Read full judgment →
• Nadir Ali vs Medical Superintendnet, Civil Hospital, Larkana and 92017 PLD Sindh 448 · Sindh High Court · 2015-12-21
  right to healthfundamental rightshealthcare commissionhospital waste managementpublic interest litigationteaching hospitalsconstitutional petition
  Summary & questions settled

  This constitutional petition addressed systemic failures, corruption, lack of waste management infrastructure, and poor healthcare service delivery across public and private sector medical facilities in Larkana, Sindh. The core legal questions involved the state's constitutional obligation to provide healthcare as an integral component of the right to life under Article 9 of the Constitution of Pakistan, and the effective implementation of statutory regulatory frameworks. The Sindh High Court disposed of the petition with the consent of the parties, issuing comprehensive directions for the operationalization of the Sindh Healthcare Commission, the improvement of hospital management, waste disposal compliance, security for medical staff, decentralization of administrative control over teaching hospitals to universities, and anti-corruption probes. The key principle laid down is that the right to life guaranteed under the Constitution encompasses the right to health and access to proper healthcare facilities with dignity, obligating the state to ensure effective enforcement of health legislation and proper utilization of public funds for public welfare.

  Questions settled

  • Whether the right to healthcare falls within the ambit of the right to life guaranteed under Article 9 of the Constitution of Pakistan?
  • Can the constitutional jurisdiction of the High Court under Article 199 be invoked for public interest litigation concerning systemic healthcare deficiencies?
  • What are the statutory responsibilities of the Sindh Healthcare Commission regarding the regulation of healthcare services and the elimination of quackery?
  • To what extent can administrative control of teaching hospitals be entrusted to medical universities to improve medical education, research, and patient care?
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• Nadeem Yousaf vs Sara Nadeem and 3 others2017 MLD 876 · Lahore High Court · 2015-11-19Read full judgment →
• Nadeem Tariq vs Full Board, Board of Revenue (Members Judicial-v &2017 MLD 1947 · Lahore High Court · 2015-01-22Read full judgment →
• Nadeem Raza Abbasi vs Sardar Abu Bakar & 2 others2017 PLJ Islamabad 106 · Islamabad High Court · 2016-03-01Read full judgment →
• Nadeem Javed vs Justice of Peace/A.S.J., Dunyapur, District Lodhran2017 PLJ Lahore 673 · Lahore High Court · 2017-03-09Read full judgment →
• Nadeem Farooq and others vs Newze Land Electronic Trading Co. Lee2017 PLD Supreme Court 95 · Supreme Court of Pakistan · 2016-11-30
  execution of foreign decreereciprocating territorysuperior courtcivil procedureforeign judgmentUAE judicial hierarchy
  Summary & questions settled

  This appeal arose from a judgment of the Lahore High Court, which had allowed a revision petition concerning the execution of a foreign decree. The core legal question was whether a decree passed by a 'Court of First Instance' in the United Arab Emirates could be executed in Pakistan under Section 44-A of the Code of Civil Procedure 1908, given that the relevant notification only recognized the 'Court of Appeal' of the UAE as a 'superior Court'. The Supreme Court examined the statutory framework, specifically Section 44-A, the relevant SRO notification declaring the UAE a reciprocating territory, and the Federal Law No. 03 of 1983 establishing the UAE judicial hierarchy. The Court held that since the decree was passed by a Court of First Instance, which is distinct from the Court of Appeal, it did not qualify as a decree from a 'superior Court' under the applicable notification. Consequently, the Court set aside the High Court's judgment, restored the Executing Court's order, and clarified that such a decree cannot be executed under Section 44-A, though the respondent may pursue a suit under Section 13 of the Code of Civil Procedure 1908.

  Questions settled

  • Can a decree passed by a Court of First Instance in the United Arab Emirates be executed in Pakistan under Section 44-A of the Code of Civil Procedure 1908?
  • Does the definition of 'superior Court' for the purposes of Section 44-A of the Code of Civil Procedure 1908 include a Court of First Instance in a reciprocating territory?
  • Is a suit under Section 13 of the Code of Civil Procedure 1908 the appropriate remedy for enforcing a foreign decree that does not meet the criteria of Section 44-A?
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• Nadeem Amjad vs State & anotherPLJ 2017 Cr.C. (Lahore) 256 · Lahore High Court · 2016-08-31
  post-arrest bailDrugs Actfurther inquiryprohibitory clausespurious medicinesbail bond
  Summary & questions settled

  The petitioner, Nadeem Amjad, sought post-arrest bail in connection with FIR No. 123 dated 26.7.2016, registered under Sections 23 and 27 of the Drugs Act, 1976, regarding the possession of spurious medicines at a pharmacy in Multan. The core legal question was whether the petitioner was entitled to bail given the nature of the offense and the evidence collected during the investigation. The Court observed that the alleged offense carried a maximum punishment of five years, thereby falling outside the prohibitory clause of Section 497, Code of Criminal Procedure 1898. Furthermore, the Court noted that the samples of the recovered medicines were found to be of standard quality by the Government Analyst, and the investigation failed to establish the petitioner's ownership of the shop or that the relevant drug license was issued in his name. Consequently, the Court held that the petitioner's guilt required further inquiry and granted bail, emphasizing that the determination of his status remains a matter for the trial court to decide after recording evidence.

  Questions settled

  • Does an offense punishable by up to five years imprisonment fall within the prohibitory clause of Section 497, Code of Criminal Procedure 1898?
  • Is a positive report from a Government Analyst regarding the quality of medicines a valid ground for granting bail in a case involving alleged spurious drugs?
  • Should bail be granted when the investigation fails to establish the petitioner's ownership of the premises where the alleged offense occurred?
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• Nadeem Ali vs Mohammad Yaseen Atta and another2017 MLD 903 · Sindh High Court · 2016-11-18
  summary suitleave to defendnegotiable instrumentsdishonoured chequetriable issue
  Summary & questions settled

  This first appeal challenged a judgment and decree passed by the Additional District Judge, Hyderabad in a summary suit instituted under Order XXXVII of the Code of Civil Procedure, 1908 regarding a dishonoured negotiable instrument. The core legal question revolved around whether the appellant was denied a fair opportunity to defend the suit and file an application for leave to defend within the stipulated time, and whether a genuine triable issue was raised. The Sindh High Court held that the appellant failed to file the application for leave to defend within the mandatory ten-day period, that his contentions were self-contradictory, and that no genuine triable issue was disclosed to rebut the statutory presumption attached to the cheque under section 118 of the Negotiable Instruments Act, 1881. The Court dismissed the appeal with costs, affirming that failure to seek leave to defend within the prescribed time results in the allegations in the plaint being deemed admitted, entitling the plaintiff to a decree.

  Questions settled

  • What are the legal consequences under Order XXXVII of the Code of Civil Procedure, 1908 when a defendant fails to file an application for leave to defend within the stipulated ten-day period?
  • Whether the time limit for filing an application for leave to defend in a summary suit commences only upon providing the complete set of the plaint and annexures to the defendant?
  • Does a defendant raising vague allegations of cheque tampering without initiating criminal proceedings disclose a genuine triable issue for granting leave to defend?
  • Whether an appellate court can interfere with a summary decree when the trial court has properly applied its judicial mind to the facts and the statutory procedure?
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• Nadeem Akhtar Butt vs The Vith Judicial Magistrate Malir, Karachi2017 MLD 1993 · Sindh High Court · 2015-08-20
  cancelled C class reportcognizance by Magistratepolice report under section 173 Cr.P.C.quashing of FIRpremature acquittalwrongful confinementcriminal miscellaneous application
  Summary & questions settled

  Through this criminal miscellaneous application, the applicant assailed the legality and propriety of an order passed by the Judicial Magistrate rejecting a "C" class police report and taking cognizance against the applicant under Sections 365-A, 342, and 220, P.P.C. The core legal question was whether a Magistrate is bound by a negative or cancelled "C" class report submitted by the police under Section 173, Cr.P.C. and whether an FIR can be quashed after the trial court has already taken cognizance. The Sindh High Court dismissed the application, holding that the opinion of the Investigation Officer is not binding upon the court and a Magistrate is fully empowered to take cognizance of an offence despite a negative report. Furthermore, the court held that once a Magistrate takes cognizance and the matter proceeds, an FIR cannot be quashed under section 566 or similar inherent powers in the face of factual controversies, and the accused must instead seek premature acquittal under sections 249-A or 265-K, Cr.P.C. before the trial court.

  Questions settled

  • Is a Magistrate bound to accept a negative or cancelled "C" class report submitted by the Investigation Officer under Section 173, Cr.P.C.?
  • Can a Magistrate take cognizance of an offence when the police report concludes that the accusation is baseless?
  • Can an FIR be quashed after the trial court has already taken cognizance of the case based on the police report?
  • What is the appropriate remedy for an accused who wishes to avoid a trial after the Magistrate has taken cognizance and the matter has been sent to the trial court?
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• Nadeem Ahmed Rajput vs Chairman, National Accountability Bureau2017 P Cr. L J 1211 · Sindh High Court · 2017-03-07
  plea bargainNational Accountability Ordinancejudicial reviewaccountability courtdiscretionary powercorruptionliability apportionment
  Summary & questions settled

  This petition challenged an order of the Accountability Court, Sukkur, which declined a plea bargain application under Section 25(b) of the National Accountability Ordinance, 1999. The core legal question was whether the Accountability Court correctly rejected the plea bargain on the ground that the agreed amount was lower than the petitioner's total liability. The High Court held that the Chairman, National Accountability Bureau (NAB), possesses the discretion to determine plea bargain amounts based on the specific facts and circumstances of each case, including the apportionment of liability among co-accused. The Court found the Chairman’s decision was well-reasoned and not arbitrary. Consequently, the High Court set aside the impugned order and directed the Accountability Court to accept the plea bargain. The judgment established that while plea bargain offers should generally be definitive and precise, the Accountability Court acts as a watchdog to ensure the Chairman, NAB, exercises discretion fairly. Furthermore, the Court clarified that the statutory "terms and conditions" for plea bargains relate to the mode and manner of payment rather than the determination of the liability amount itself.

  Questions settled

  • Does the Accountability Court have the authority to reject a plea bargain agreement reached between the accused and the Chairman, National Accountability Bureau?
  • Is the Chairman, National Accountability Bureau, empowered to exercise discretion in determining the amount of a plea bargain under Section 25(b) of the National Accountability Ordinance, 1999?
  • What is the scope of the phrase 'on such terms and conditions' within the context of plea bargain provisions under the National Accountability Ordinance, 1999?
  • Can the Accountability Court review the reasonableness of a plea bargain amount determined by the Chairman, National Accountability Bureau?
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• Nadeem Ahmad Khan and others vs Government of Balochsitan through Secretary Local Government, Quetta and another2017 PSC 150 · Supreme Court of Pakistan · 2016-06-01
  local government propertypublic interestconsent orderfactual controversylease agreementcommercial plazareview application
  Summary & questions settled

  The petitioners challenged a Balochistan High Court order that increased the rent of 'Cafe Baldia,' a property leased from the Metropolitan Corporation, Quetta. During the proceedings, the parties attempted to introduce a purported agreement to demolish the cafe and construct a commercial plaza. The Supreme Court rejected this agreement, finding it contrary to public interest and in violation of the Baluchistan Local Government Act, 2010, which mandates that local council properties be used for public purposes and prohibits unauthorized alienation. The Court emphasized that public interest must remain the foremost concern of local authorities. Regarding the rent increase, the petitioners argued that the High Court's order was based on a misunderstanding, as the proceedings did not originally pertain to their cafe. The Court held that this factual controversy regarding the validity of the consent for the rent increase was best addressed by the High Court. Consequently, the petition was transmitted to the High Court to be treated as a review application or an application under Section 12(2) of the Code of Civil Procedure 1908 for determination in accordance with the law.

  Questions settled

  • Can a local council property be alienated or converted for commercial use in violation of the Baluchistan Local Government Act, 2010?
  • What is the appropriate remedy when a party disputes the validity of a consent order based on a factual misunderstanding?
  • Does the Supreme Court have the authority to approve an agreement between private parties and a local government body that contravenes statutory provisions and public interest?
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• Nabid Baig vs Chairman Punjab Publc Service Commission and 5 others2017 PLC (C.S.) 238 · Lahore High Court · 2016-05-24
  age relaxationservice rulesconstitutional petitionpublic employmentpolicy matterdiscriminationfundamental rights
  Summary & questions settled

  This constitutional petition was filed under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973, seeking a direction to the Punjab Public Service Commission to grant age relaxation to the petitioner for the post of Deputy Director Technical (BPS-18) in the Anti-Corruption Establishment Department. The petitioner challenged the minimum age limit of 35 years as discriminatory and requested the court to order an amendment to the service rules to lower the age requirement. The core legal question was whether the court could interfere with the government's policy regarding age eligibility criteria for public employment and whether such criteria violated the petitioner's fundamental rights. The Court dismissed the petition, holding that the fixation of age limits is a policy matter within the prerogative of the competent authority and that the court should not interfere unless there is a gross violation of fundamental rights. The Court affirmed that age relaxation is not a vested right and that the petitioner failed to establish discrimination, as the condition applied uniformly to all candidates.

  Questions settled

  • Can a court direct the government to amend service rules regarding age eligibility for a public post?
  • Is age relaxation for public employment a vested right of a candidate?
  • Does the fixation of a minimum age limit for a public post constitute discrimination if it applies uniformly to all candidates?
  • Should courts interfere with government policy regarding the framing of service rules for public appointments?
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• Nabi Dad and another vs The State2017 MLD 1204 · Balochistan High Court · 2017-04-04
  pre-arrest bailfurther inquiryalibitentative assessmentmalicious prosecutiontribal enmity
  Summary & questions settled

  This is a criminal petition before the Balochistan High Court wherein the applicants sought confirmation of their pre-arrest bail in a case registered under sections 302, 324, 147, 148, and 149 of the Pakistan Penal Code 1860. The core legal question concerned whether the applicants had made out a case for pre-arrest bail, particularly in view of their plea of alibi supported by court security records showing their presence in the High Court premises far from the scene of the crime at the time of the alleged incident, coupled with previous tribal enmity and lack of specific attribution in the FIR. The court held that the applicants successfully established a case for further inquiry under subsection (2) of section 497 of the Code of Criminal Procedure 1898. The key principles laid down include the criteria for granting pre-arrest bail as an extraordinary remedy, the evaluation of alibi and presence in court records during tentative assessment at the bail stage, and the principle that observations made in bail orders are strictly tentative and shall not influence the trial court's independent appraisal of evidence on merits.

  Questions settled

  • Whether an accused person can directly approach the High Court for pre-arrest bail without first approaching the Court of Session?
  • Does the presence of the accused in the High Court premises at the time of the alleged crime constitute a ground for further inquiry under subsection (2) of section 497 of the Code of Criminal Procedure 1898?
  • What are the framework and guidelines governing the exercise of jurisdiction by High Courts and Courts of Session in granting pre-arrest bail?
  • Can observations made by a superior court while deciding a bail application influence the trial court during the subsequent trial?
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• Nabeel Akhtar Chaudhry and others vs Lahore Development Authority2017 CLC 561 · Lahore High Court · 2017-02-02
  Intra Court Appealconstitutional petitionhousing society developmentcompensationwrit jurisdiction
  Summary & questions settled

  This Intra Court Appeal challenges the order passed by the learned Single Judge in a constitutional petition, whereby the petition was disposed of with directions to the concerned respondents to decide the pending application of the petitioners regarding compensation and to look into the grievance concerning the non-development of a housing society within a specified timeframe after hearing all stakeholders. The core legal question was whether the learned Single Judge erred in summarily disposing of the writ petition and referring the matter to the respondents without addressing the factual and legal points raised. The Lahore High Court held that the impugned order was passed in accordance with law, as it provided adequate opportunity for the appellants to agitate their grievances before the competent authorities. The court laid down the principle that an intra-court appeal against the disposal of a constitutional petition with directions for administrative redressal and hearing of stakeholders is unwarranted when no illegality or perversity exists in the impugned order.

  Questions settled

  • Whether an intra-court appeal is maintainable against an order of a Single Judge disposing of a constitutional petition with directions to decide a pending application?
  • Can a High Court direct a competent authority to decide a grievance regarding housing society development after hearing stakeholders?
  • Whether summary disposal of a writ petition by issuing directions for administrative redressal warrants interference in appeal?
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• NAB through D.G., NAB, Lahore vs Judge Accountability Court, etc.2017 MLD 1213, 2017 PLJ Lahore 311, K.L.R. 2017 Criminal Cases 75 · Lahore High Court · 2016-11-16Read full judgment →
• NAB through D.G. NAB Lahore vs Judge Accountability Court, etc.2017 PLJ Lahore 311 · Lahore High Court · 2016-11-16Read full judgment →
• NAB through D.G. NAB Lahore vs Judge Accountability Court and others2017 MLD 1213 · Lahore High Court · 2016-11-16Read full judgment →
• M/s. World Trans Logistics, Etc vs Silk Bank Limited and Others2017 NLR Civil 29 · Supreme Court of Pakistan · 2015-10-27
  pledge of goodsconstructive possessionrecovery suitfinancial institutionscontractual liabilitybanking lawbailment
  Summary & questions settled

  This matter concerns a petition for leave to appeal against a High Court judgment dismissing an appeal in a recovery suit filed by a bank against a borrower. The core legal question was whether a pledgee bank is liable for the loss or misappropriation of pledged goods when the underlying contract grants the pledgor constructive possession, allowing the borrower to retain actual possession and utilize the goods in the ordinary course of business. The Supreme Court held that a valid pledge can be created through constructive possession, and the character of the pledge remains intact despite the lack of physical delivery to the pledgee. The Court determined that where a contract permits the pledgor to retain actual possession and manage the inventory, the pledgor assumes the duty of care and bears the risk of loss. Consequently, the bank was not held accountable for the alleged misappropriation of the goods. The Court affirmed the High Court’s decision, ruling that the contractual terms explicitly indemnified the bank against such losses, thereby dismissing the petition.

  Questions settled

  • Can a valid pledge be created through constructive possession without actual physical delivery of the goods?
  • Does a pledgee bank bear liability for the loss of pledged goods when the contract grants the pledgor actual possession for business use?
  • Does the duty of care under the Contract Act 1872 shift to the pledgor when the pledgor retains actual possession of the pledged goods?
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• M/s. Vital Link Advertisers vs The Commissioner (Appeals), SRB, Karachi2017 SRB 151 · Appellate Tribunal Sindh Revenue Board · 2017-09-25Read full judgment →
• M/s. Telenor Pakistan (Pvt.) Ltd vs Appellate Tribunal Inland Revenue & 32017 P.C.T.L.R. 226 · Islamabad High CourtRead full judgment →
• M/s. Tanveer Spinning & Weaving Mills vs Tariq Saeed, etc2017 [M] C.L.R. 510 · Lahore High Court · 2017-03-20Read full judgment →
• M/s. Tanveer Spinning & Weaving Mills vs Tariq Saeed etc2017 PLJ Lahore 655 · Lahore High Court · 2017-03-20Read full judgment →
• M/s. Tandlianwala Sugar Mills Ltd. vs Province of Punjab, etc.2017 LHC 3259 · Lahore High Court · 2017-10-10Read full judgment →
• M/s. Tandlianwala Sugar Mills Ltd vs Province of Punjab, etc2017 [M] C.L.R. 1746 · Lahore High Court · 2017-10-10Read full judgment →
• M/s. Tandlianwala Sugar Mills Ltd vs Province of Punjab & 5 Others2018 CLC 733, 2017 [M] C.L.R. 1746, 2017 LHC 3259, 2018 PLJ Lahore 194, 2018 PTD 75, PTCL 2018 CL. 474 · Lahore High Court · 2017-10-10
  intra-court appealmaintainabilityexcise dutyconstitutional petitionstatutory viresoriginal orderproceedings
  Summary & questions settled

  This matter involves intra-court appeals filed against the dismissal of constitutional petitions that challenged the levy of excise duty on the manufacture of spirit from molasses under the Punjab Excise Act, 1914, alongside the vires of the empowering statutory provisions and a notification. The core legal question concerns the maintainability of intra-court appeals under the Law Reforms Ordinance, 1972, where the underlying challenge involves demand notices and statutory vires arising under a statute that provides alternate remedies of appeal or revision. The court held that the intra-court appeals are not maintainable because the impugned actions stem from proceedings under a statute providing for adequate departmental remedies such as appeal or revision, thus triggering the statutory bar under the proviso to section 3(2) of the Law Reforms Ordinance, 1972. The key principle laid down is that where an action challenged in a constitutional petition originates from proceedings under a statute providing for an appeal, revision, or review against the original order, an intra-court appeal remains barred under the Law Reforms Ordinance, 1972, regardless of whether constitutional questions or statutory vires are raised.

  Questions settled

  • Whether an intra-court appeal is maintainable under section 3(2) of the Law Reforms Ordinance, 1972, when the constitutional petition arises out of proceedings under a statute providing for an appeal or revision against the original order?
  • Do demand and show-cause notices issued under the Punjab Excise Act, 1914, constitute original orders or steps in proceedings for the purpose of the bar contained in the Law Reforms Ordinance, 1972?
  • Does the challenge to the vires of a statute and legislative competence automatically bypass the bar on intra-court appeals where the challenged provisions are declared intra vires by the single bench?
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• M/s. Sukkur Electric Supply Company Ltd., Sukkur vs The Cir, Rto, Sukkur2017 P.C.T.L.R. 336 · Appellate Tribunal Inland Revenue · 2017-10-05
  sales tax liabilityaudited accountsburden of prooftax assessmentaccounting entriestaxable suppliessales tax audit
  Summary & questions settled

  This Sales Tax Appeal concerns a dispute between the Sukkur Electric Supply Company (SEPCO) and the Inland Revenue Department regarding an alleged sales tax liability of Rs. 12.246 billion. The Department, relying on entries in the appellant's audited accounts, contended that this amount represented unpaid sales tax. The appellant argued that these entries were merely accounting contra-entries reflecting sales tax billed to consumers but not yet realized due to poor collection, and that the tax had already been deposited in the State exchequer. The Appellate Tribunal Inland Revenue examined the appellant's accounting treatment, which was consistent with other power distribution companies, and noted that the Department failed to rebut the appellant's evidence or the explanation provided by its auditors. The Tribunal held that tax liability cannot be determined solely on the basis of misinterpreted accounting entries without regard to the actual taxable supplies and payments made. Consequently, the Tribunal set aside the impugned orders and directed the relevant officer to re-examine the claim of payment strictly in accordance with the law, emphasizing that the burden of proof lies with the Revenue to establish taxability.

  Questions settled

  • Can sales tax liability be assessed solely on the basis of accounting entries in audited financial statements without considering the actual tax payments made?
  • Does the burden of proof lie with the Revenue department to establish that a transaction is chargeable to tax?
  • Is an audit conducted without following the procedural requirements of the Sales Tax Act 1990 legally valid?
  • Can a question of law be raised for the first time at the appellate stage?
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• M/s. State Life Insurance Corporation and others vs Muhammad Imran2017 P.S.C. 536 · Supreme Court of Pakistan · 2016-03-29
  service tribunal jurisdictionstatutory rulesleave to appealservice grievancejurisdictional competence
  Summary & questions settled

  This matter concerns a petition for leave to appeal filed by the State Life Insurance Corporation challenging the jurisdiction of the Service Tribunal to adjudicate a service-related grievance brought by the respondent, Muhammad Imran. The core legal question presented for the Court's consideration is whether the existence of statutory rules governing the employment of the State Life Insurance Corporation ousts the jurisdiction of the Service Tribunal, thereby necessitating that the respondent seek redressal exclusively through the High Court. The Supreme Court, noting the absence of the respondent despite service of notice, granted leave to appeal to examine this jurisdictional issue. The judgment focuses on the interplay between statutory service rules and the tribunal's mandate, specifically addressing whether such rules preclude the Service Tribunal from entertaining service disputes involving the corporation's employees. By granting leave, the Court has determined that the question of whether the High Court is the only appropriate forum for such grievances, rather than the Service Tribunal, warrants a definitive legal determination by the Supreme Court.

  Questions settled

  • Does the existence of statutory rules for the State Life Insurance Corporation oust the jurisdiction of the Service Tribunal?
  • Is the High Court the only appropriate forum for seeking redressal of service grievances for employees governed by statutory rules of the State Life Insurance Corporation?
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• M/s. State Life Insurance Corporation and another vs Sadaruddin Siddiqui2017 P.S.C. 1284 · Supreme Court of Pakistan · 2016-05-04
  Service TribunalJurisdictionCivil ServantStatutory CorporationTerms and Conditions of Service
  Summary & questions settled

  This matter arises from a petition filed by M/s. State Life Insurance Corporation against an employee challenging the judgment of the Service Tribunal which assumed jurisdiction and allowed the employee's appeal against an adverse departmental order. The core legal question is whether employees of the State Life Insurance Corporation fall within the definition of civil servants so as to invoke the jurisdiction of the Service Tribunal. The Supreme Court held that the respondent-employee, being an employee of a statutory corporation, does not qualify as a civil servant under the law, and previous judicial precedents holding the Corporation's regulations to be statutory do not confer civil servant status upon its employees. Consequently, the Service Tribunal lacked jurisdiction to adjudicate the matter. The key principle laid down is that statutory corporation employees are not civil servants and cannot approach the Service Tribunal for the redressal of their service grievances.

  Questions settled

  • Does the Service Tribunal have jurisdiction to entertain appeals filed by employees of the State Life Insurance Corporation?
  • Are employees of the State Life Insurance Corporation considered civil servants under the law?
  • Does the statutory nature of a corporation's regulations confer civil servant status upon its employees?
  Read full judgment →
• M/s. Squibb Pakistan Pvt. Ltd. vs Commissioner of Income Tax.2017 PTD 1303, 2017 SCMR 1006, 2017 SCP 892, PTCL 2017 CL. 646 · Supreme Court of Pakistan · 2017-04-26
  transfer pricingreference jurisdictionadvisory jurisdictionincome taxarm's length tradingcomparability analysisresident companytax assessment
  Summary & questions settled

  This matter originated from income tax assessments where additions were made to the taxpayers' income under Section 79 of the Income Tax Ordinance, 1979, on account of alleged transfer mispricing between resident companies and their foreign parent entities. The core legal questions concerned the scope of the High Court's reference jurisdiction and the evidentiary requirements for invoking Section 79. The Supreme Court held that the reference jurisdiction under Section 133 of the Income Tax Ordinance, 2001 (as amended in 2005) is appellate in nature and self-executory, allowing the High Court to entertain any question of law 'arising out' of the Tribunal's order, even if not expressly argued below, provided the facts are on record. On the merits, the Court set aside the additions, ruling that the tax authorities failed to conduct a reasonable investigation or provide a comparability analysis to prove that business was 'so arranged' to produce less than ordinary profits. The Court established that the burden only shifts to the taxpayer after the department provides prima facie evidence of transfer mispricing based on an appropriate pricing method.

  Read full judgment →
• M/s. Sixon Pakistan Private Limited vs Ghulam Fareed Zahid2017 PLJ Lahore 487 · Lahore High Court · 2016-12-13Read full judgment →
• M/s. Sino Pak Minerals, Private Limited, Islamabad through Law2017 PLJ Quetta 12 · Balochistan High CourtRead full judgment →
• Najeebullah vs The State2017 MLD 1508 · Balochistan High Court · 2017-04-17
  drugs actplea of guiltquantum of sentencejuvenile offenderappeal against sentencemedical store without licensereduction of sentence
  Summary & questions settled

  This criminal appeal challenges the judgment of the Drugs Court Balochistan Quetta, whereby the appellant was convicted under Section 23(1)(c) of the Drugs Act, 1976 and sentenced to rigorous imprisonment for two months with a fine. The core legal question concerned the quantum of sentence and whether leniency should be shown given the appellant's status as a juvenile and a student who had pleaded guilty. The High Court held that while an accused who pleads guilty has no right of appeal against conviction under Section 412 of the Code of Criminal Procedure 1898 except as to the legality or severity of the sentence, the appellant's juvenile status, student background, voluntary confession, and the nature of the recovered medicines warranted a reduction in sentence. The court laid down the principle that courts should take a lenient view regarding the sentence of a juvenile offender who voluntarily confesses guilt and places himself at the mercy of the court, reducing the substantive imprisonment to the period already undergone while maintaining the fine.

  Questions settled

  • Does an accused who pleads guilty to a charge have the right to appeal against their conviction under Section 412 of the Code of Criminal Procedure 1898?
  • Can an appellate court reduce the substantive sentence of imprisonment to the period already undergone in the case of a juvenile offender who pleaded guilty?
  • Whether running a medical store without a drug sale license attracts conviction under the Drugs Act 1976?
  Read full judgment →
• M/s. Silver Flour Mills vs Karachi Electric Supply Corporation2017 SHC 365 · Sindh High Court · 2017-11-01
  Electricity ActDetection billElectric InspectorMeter tamperingSupplementary billNatural justiceDishonest abstraction of energy
  Summary & questions settled

  This suit concerns a dispute between a consumer and an electricity licensee regarding the issuance of a supplementary detection bill for an allegedly faulty meter. The core legal question is whether the licensee has the authority to unilaterally determine liability and issue a detection bill for a defective meter, or if such a dispute must be adjudicated by the Electric Inspector under the Electricity Act 1910. The Court held that the dispute fell under Section 26(6) of the Electricity Act 1910, as it involved a defective meter rather than dishonest abstraction of energy under Section 26-A. Consequently, the Court declared the impugned bill illegal and cancelled it, directing the licensee to refer the matter to the Electric Inspector for a proper determination. The key principle laid down is that a licensee cannot unilaterally assess liability for a defective meter; such disputes must be referred to the Electric Inspector. Furthermore, the Court emphasized that checking meters without notice to the consumer violates the principles of natural justice, as the licensee cannot act as a judge in its own cause.

  Questions settled

  • Does a licensee have the authority to unilaterally issue a detection bill for a faulty meter without referring the matter to the Electric Inspector?
  • What is the distinction between a dispute regarding a defective meter under Section 26(6) and dishonest abstraction of energy under Section 26-A of the Electricity Act 1910?
  • Is the issuance of a detection bill without prior notice to the consumer and without associating them in the meter testing process violative of the principles of natural justice?
  • Can a licensee act as a judge in its own cause by determining liability for energy consumption without independent adjudication?
  Read full judgment →
• M/s. Shifa International Hospital, Islamabad vs Commissioner of Income2017 P.C.T.L.R. 190, 2017 PLD Supreme Court 134, 2017 PLJ SC 358, PTCL 2017 · Supreme Court of Pakistan · 2017-02-02
  depreciation allowancefiscal statute interpretationincome taxfactory definitionworkshop definitionstrict constructiontax assessment
  Summary & questions settled

  The petitioner, a public limited company operating a hospital, challenged the denial of a 10% depreciation allowance on its hospital building, which the tax authorities had limited to the general 5% rate. The core legal question was whether a hospital building qualifies as a "factory" or "workshop" under the Third Schedule of the Income Tax Ordinance, 1979, thereby entitling the assessee to a higher depreciation rate. The Supreme Court held that while a hospital is a building, it does not fall within the definitions of a "factory" or "workshop," as those terms imply structures used for the manufacture, repair, or assembly of goods. The Court affirmed the High Court's judgment, ruling that the petitioner is entitled only to the general 5% depreciation rate applicable to buildings not otherwise specified. The key principle laid down is that fiscal statutes must be strictly construed, and specific categories like "factory" or "workshop" cannot be expanded to include entities like hospitals that do not engage in manufacturing or industrial activities.

  Questions settled

  • Does a hospital building qualify as a 'factory' or 'workshop' for the purpose of claiming a 10% depreciation allowance under the Income Tax Ordinance, 1979?
  • What is the applicable rate of depreciation for a building that does not fall under the specific categories of 'factory' or 'workshop' under the Third Schedule of the Income Tax Ordinance, 1979?
  • Are foreign judgments regarding the classification of a nursing home as a 'plant' binding on Pakistani courts when interpreting the Income Tax Ordinance, 1979?
  Read full judgment →
• M/s. Shandar Vegetable & Ghee Mills through Chief Executive vs Learned2017 PLJ Lahore 216 · Lahore High CourtRead full judgment →
• M/s. Shama Exports (Pvt.) Ltd., Faisalabad. vs : The Cir(a), Faisalabad andPTCL 2017 CL. 239 · Appellate Tribunal Inland Revenue · 2015-01-14
  input tax refundshow cause noticeblacklisted supplierssales tax liabilityretrospective operationdue processbanking channel payments
  Summary & questions settled

  This appeal concerns the recovery of input tax refunds from a registered taxpayer, M/s. Shama Exports (Pvt.) Ltd., following the subsequent blacklisting of its suppliers. The taxation authorities initiated proceedings to recover refunded amounts, alleging irregularities based on the suppliers' blacklisted status. The Appellate Tribunal Inland Revenue examined whether the tax department could recover input tax from a buyer due to the supplier's default or subsequent blacklisting. The Tribunal held that a show cause notice is a foundational legal document requiring specific, comprehensive details; failure to provide these renders subsequent proceedings void ab initio. Furthermore, the Tribunal ruled that the liability to pay sales tax primarily rests with the supplier. Absent specific notification under Section 3(3A) of the Sales Tax Act, 1990, the burden cannot be shifted to the buyer, especially when the buyer has complied with Section 73 by making payments through banking channels. The Tribunal emphasized that blacklisting cannot operate retrospectively to penalize a buyer for transactions conducted when the supplier was active. Consequently, the Tribunal set aside the lower authorities' orders, affirming the buyer's substantive right to input tax credit.

  Questions settled

  • Can a show cause notice be considered valid if it fails to specify the nature of allegations, the amount of default, and the relevant statutory provisions?
  • Is a buyer liable for sales tax if the supplier defaults after the transaction has been completed through proper banking channels?
  • Can the blacklisting of a supplier be applied retrospectively to deny input tax credit to a buyer for transactions conducted when the supplier was active?
  • Does the tax department have the authority to recover input tax from a buyer solely because the supplier was subsequently blacklisted?
  Read full judgment →
• M/s. Shaikh Naveed Ikhlas, etc vs Shaikh Abdul Hafeez, etc2017 KLR Civil Cases 143 · Lahore High Court · 2017-03-15Read full judgment →
• M/s. Shaikh Naveed Ikhlas etc. vs Shaikh Abdul Hafeez etc.2017 PLJ Lahore 797 · Lahore High Court · 2017-03-15Read full judgment →
• M/s. Servo Motor Oil (Pvt.) Ltd., Multan vs The Cir, Special Zone, Rto, Multan2017 P.C.T.L.R. 173 · Appellate Tribunal Inland Revenue · 2016-04-12
  sales taxremand of casede novo considerationcoram non judiceshow-cause noticeaudit reportsecond round of litigation
  Summary & questions settled

  The registered person preferred appeals against the consolidated order of the Commissioner Inland Revenue (Appeals), which had annulled the Orders-in-Original on the ground that show-cause notices were issued without a mandatory contravention or audit report and were thus coram non judice, but nonetheless remanded the case for fresh appraisal. The core legal question was whether the Commissioner (Appeals) could legally remand a case for de novo consideration, particularly in a second round of litigation, in view of Section 45B(3) of the Sales Tax Act, 1990. The Appellate Tribunal Inland Revenue held that remanding the case after annulling the orders was violative of Section 45B(3) of the Sales Tax Act, 1990, and that the appellate authority should not remand cases in a routine manner to allow the Revenue to fill legal lacunae. The Tribunal established the principle that where an appellate authority finds show-cause notices to be without lawful authority and annuls the adjudication, it must decide the matter rather than ordering a routine remand, especially in subsequent rounds of litigation.

  Questions settled

  • Whether the Commissioner Inland Revenue (Appeals) has the power to remand a case for de novo consideration under Section 45B(3) of the Sales Tax Act, 1990?
  • Can an appellate authority remand a matter to the adjudicating officer in a routine manner during a second round of litigation?
  • Is a show-cause notice issued without a prior contravention or audit report legally sustainable?
  • Does remanding a case after annulling an adjudication order amount to allowing the Revenue to fill in legal lacunae?
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• M/s. Sarwar & Company (Pvt.) Limited vs Appellate Tribunal Inland2017 PLJ Lahore 134 · Lahore High CourtRead full judgment →
• M/s. Saindak Metals Limited, Quetta vs The Cir, Zone-I, Rto, Quetta2017 P.C.T.L.R. 387 · Appellate Tribunal Inland Revenue · 2016-10-14Read full judgment →
• M/s. Qadoos Brothers Poultry Farms vs Judge Banking Court No.12017 LHC 3703 · Lahore High Court · 2017-05-17Read full judgment →
• M/s. Power Construction Corporation of China Limited (previously2017 P.S.C. 187 · Supreme Court of Pakistan
  pre-qualificationjudicial reviewWorld Bank Guidelinespublic policyjudicial restraintconstitutional jurisdictionHydropower Projectinternational financial institution
  Summary & questions settled

  This civil petition for leave to appeal arose from the dismissal of an intra-court appeal by the Lahore High Court, which had upheld the disqualification of the petitioner company from the pre-qualification process for the Dasu Hydropower Project. The petitioner, a Chinese construction company, challenged its disqualification, which followed a request by the International Development Association (IDA)—a part of the World Bank Group funding the project—under the applicable World Bank Guidelines. The core legal question was whether WAPDA's decision to accept the IDA's request to delete the petitioner from the pre-qualified bidders list, and the underlying policy and contractual matters, were amenable to constitutional judicial review. The Supreme Court held that WAPDA's pragmatic commercial decision not to jeopardize vital international funding fell within the realm of public policy and executive discretion, making the petition non-maintainable as courts must exercise judicial restraint in policy matters. The Court laid down that international financial institution guidelines incorporated pursuant to statutory rules and international agreements command deference, and domestic courts will not interfere with executive policy decisions concerning high-cost international development projects absent clear mala fides.

  Questions settled

  • Whether a decision by a public authority to comply with the funding conditionalities and requests of an international financial institution in a major infrastructure project is subject to constitutional judicial review?
  • Can the International Development Association or World Bank be subjected to the constitutional writ jurisdiction of the High Court under Article 199 of the Constitution of Pakistan 1973?
  • Whether domestic courts should interfere in executive policy decisions and commercial choices concerning high-cost international development projects funded by foreign loans?
  • Do international treaties and agreements with international financial institutions prevail over domestic public procurement rules in the event of a conflict pursuant to Rule 5 of the Public Procurement Rules 2004?
  Read full judgment →
• M/s. Pioneer Pakistan Seeds Limited vs Commissioner of Income Tax2017 P.C.T.L.R. 808 · Lahore High Court · 2017-04-17Read full judgment →
• M/s. Pakistan Television Corporation Ltd vs Commissioner Inland2017 PLJ SC 525 · Supreme Court of Pakistan
  withholding taxtax deductiontax collectionbusiness expendituredisallowance of expenseagencyservice feefiscal statute interpretation
  Summary & questions settled

  This matter arose from the disallowance of service charges claimed as business expenditure by Pakistan Television Corporation Ltd. (PTV) under Section 21(c) of the Income Tax Ordinance, 2001. PTV collects television license fees from consumers through monthly electricity bills issued by WAPDA and successor electricity distribution companies (DISCOs). WAPDA/DISCOs retained a portion of the collected fee as service charges and remitted the balance to PTV. The revenue department disallowed this expenditure on the ground that PTV failed to deduct tax under Section 153(1)(b) or collect advance tax under Section 233 of the Ordinance. The Supreme Court of Pakistan held that since PTV made no actual, physical, or practical payment to WAPDA, the obligation to 'deduct' tax under Section 153(1)(b) did not arise, as deduction is impossible without an actual payment. Furthermore, no relationship of principal and agent existed between PTV and WAPDA to trigger Section 233. The Court also ruled that the phrase 'unless the person has paid' in Section 21(c) includes the recipient of the income (WAPDA/DISCOs), and since they declared the service fee in their income, PTV was entitled to the deduction.

  Questions settled

  • Can a taxpayer be required to deduct tax under Section 153(1)(b) of the Income Tax Ordinance, 2001 when no actual or physical payment is made to the service provider?
  • Is there a legal distinction between the terms 'deduct' and 'collect' under the provisions of the Income Tax Ordinance, 2001?
  • Does the phrase 'unless the person has paid' in Section 21(c) of the Income Tax Ordinance, 2001 extend to the recipient of the payment who has discharged their tax liability on that income?
  • Is a relationship of principal and agent a necessary prerequisite for the application of Section 233(2) of the Income Tax Ordinance, 2001?
  Read full judgment →
• M/s. Pakistan Television Corporation Ltd vs Commissioner Inland Revenue2017 PTD 1372, 2017 SCMR 1136, 2017 PLJ SC 525, 2017 SCP 820, 2017 P.C.T.L.R. · Supreme Court of Pakistan · 2017-04-24
  income taxwithholding taxdeductible expenditurestatutory interpretationfiscal statutesservice feeagency relationshiptax assessment
  Summary & questions settled

  The Supreme Court of Pakistan addressed whether Pakistan Television Corporation Ltd (PTV) was entitled to claim service fees retained by electricity distribution companies (DISCOs) as deductible business expenditure under Section 21 of the Income Tax Ordinance, 2001. The revenue department had disallowed the deduction, arguing that PTV failed to withhold tax under Section 153(1)(b) or Section 233. PTV contended that since DISCOs collected the television license fee directly from consumers and remitted only the balance after retaining their fee, no actual payment was made by PTV to trigger withholding obligations. The Court held that the statutory term 'deduct' in Section 153(1)(b) implies a physical payment from which a sum is subtracted; it cannot be extended to 'collection' where no money changes hands from the payer. Furthermore, no agency relationship existed to trigger Section 233. The Court established that fiscal statutes must be interpreted strictly and that the 2003 amendment to Section 21(c) widened the scope to allow deductions if the recipient had otherwise discharged the tax liability. Consequently, the disallowance was set aside.

  Read full judgment →
• M/s. Orient Electronics Versus: Cir, (Pvt.) Limited, Lahore. vs Zone-I, Ltu,PTCL 2017 CL. 772 · Appellate Tribunal Inland Revenue · 2017-05-26Read full judgment →
• M/s. Oilco Trading Company, Faisalabad vs The Cir, Rto, Faisalabad2017 P.C.T.L.R. 869 · Appellate Tribunal Inland Revenue · 2017-03-06Read full judgment →
• M/s. Oil & Gas Development Company Limited vs M/s. Excel Techno2017 [M] C.L.R. 368 · Islamabad High CourtRead full judgment →
• M/s. Nirvana House Day Spa & Saloon vs The Additional DirectorPTCL 2017 CL. 191 · Lahore High Court · 2016-11-09Read full judgment →
• M/s. Mustafa Impex, Karachi. vs The Government of Pakistan throughPTCL 2017 CL. 456 · Supreme Court of Pakistan · 2016-08-18
  Federal GovernmentRules of BusinessCabinet responsibilitySubordinate legislationFiscal notificationsUltra viresSales tax exemptionConstitutional interpretation
  Summary & questions settled

  This matter concerns appeals against the dismissal of constitution petitions challenging sales tax notifications issued by the Revenue Division without Cabinet approval. The core legal question was whether such notifications, issued by the Secretary or Advisor rather than the Cabinet, were legally valid, and specifically, what constitutes the "Federal Government" under the Constitution of Pakistan, 1973. The Supreme Court held that the "Federal Government" is the collective entity comprising the Prime Minister and the Federal Ministers (the Cabinet). Consequently, notifications issued without Cabinet approval are invalid. The Court ruled that the Rules of Business, 1973, are mandatory and binding; therefore, Rule 16(2), which permitted the Prime Minister to bypass the Cabinet, was declared ultra vires. The judgment establishes that the Cabinet is the supreme executive body, and the Prime Minister cannot unilaterally exercise powers vested in the Federal Government. Fiscal powers and subordinate legislation require collective Cabinet decision-making to satisfy constitutional requirements. The impugned notifications were declared ultra vires and struck down, emphasizing that the Cabinet cannot be reduced to a rubber stamp.

  Questions settled

  • Does the term 'Federal Government' under the Constitution of Pakistan, 1973, refer to the Prime Minister and the Federal Ministers collectively as the Cabinet?
  • Are the Rules of Business, 1973, mandatory and binding on the executive branch of the government?
  • Can the Prime Minister unilaterally exercise powers vested in the Federal Government without the approval of the Cabinet?
  • Is Rule 16(2) of the Rules of Business, 1973, which allows the Prime Minister to bypass the Cabinet, constitutionally valid?
  Read full judgment →
• M/s. Muhammad Yousuf Adil vs Deputy Commissioner SRB, Karachi2017 SRB 158 · Appellate Tribunal Sindh Revenue Board · 2017-10-03Read full judgment →
• M/s. Mubashir Enterprises, Karachi. vs 1. The Collector of Customs, ModelPTCL 2017 CL. 294 · Customs Appellate Tribunal · 2017-01-03Read full judgment →
• M/s. MKB Spinning Mills Pvt. Ltd vs Federation of Pakistan etc2018 PTD 2364, PTCL 2017 CL. 178 · Lahore High Court · 2017-01-07
  sales taxzero ratingfurther taxstatutory interpretationnon-obstante clauseharmonious constructionexport-oriented sectorsshow cause notice
  Summary & questions settled

  This writ petition challenged show cause notices issued under Section 11(2) of the Sales Tax Act, 1990, demanding 'further tax' under Section 3(1A) on supplies made to unregistered persons by textile manufacturers. The core legal question was whether entities entitled to zero-rating under Section 4(c) of the Sales Tax Act, 1990, via SRO 1125(1)/2011, remain liable for 'further tax' under Section 3(1A). The Court held that the zero-rating facility provided under Section 4 is absolute, and the non-obstante clause therein gives it overriding effect over Section 3. Consequently, the demand for further tax on zero-rated supplies was declared illegal and without lawful authority. The Court established that 'further tax' is a species of sales tax, but the legislative scheme does not permit its imposition on zero-rated supplies. Applying the rule of harmonious construction, the Court determined that the proviso to Section 3(1A) must be read in conjunction with Section 4(c) to ensure the zero-rating regime remains effective, thereby precluding the imposition of further tax on the specified export-oriented sectors.

  Questions settled

  • Whether supplies made by export-oriented sectors under the zero-rating regime of Section 4 of the Sales Tax Act, 1990, are subject to 'further tax' under Section 3(1A)?
  • Does the non-obstante clause in Section 4 of the Sales Tax Act, 1990, provide an overriding effect against the imposition of 'further tax' under Section 3(1A)?
  • Is 'further tax' as defined in Section 3(1A) of the Sales Tax Act, 1990, a species of sales tax?
  Read full judgment →
• M/s. Mia Corporation (Pvt.) Limited vs Pakistan PWD and others2017 C.L.R. 1 · Islamabad High Court · 2016-09-30Read full judgment →
• M/s. Makma Steel Craft (Pvt.) Ltd. and 13 others vs Allied Bank Limited2017 PLJ Lahore 677 · Lahore High Court · 2016-03-09Read full judgment →
• M/s. Magna Processing Industries (Pvt.) Ltd. vs Appellate Tribunal Inland2017 P.C.T.L.R. 770 · Lahore High CourtRead full judgment →
• M/s. Leo Communications (Pvt.) Ltd., etc vs The Federation of Pakistan, etc2017 [M] C.L.R. 1192 · Lahore High Court · 2017-05-18Read full judgment →
• M/s. Leo Communications (Pvt.) Ltd, etc. vs The Federation of Pakistan, etc.2017 LHC 2716 · Lahore High Court · 2017-07-18Read full judgment →
• M/s. Kohsar Marble & Tiles, Faisalabad vs Cir, Rto, Faisalabad2017 PLJ Tr.C. (Inland Revenue) 157 · Appellate Tribunal Inland Revenue · 2016-11-22Read full judgment →
• M/s. Iqbal and Sons. vs Federation of Pakistan and 3 others.PTCL 2017 CL. 627 · Lahore High Court · 2016-09-27Read full judgment →
• M/s. Industrial Development Bank of Pakistan vs (1) Agha Saiyed2017 SHC 137 · Sindh High Court · 2017-02-17Read full judgment →
• M/s. Flying Cement Company Ltd vs The Appellate Tribunal Inland RevenuePTCL 2017 CL. 146 · Lahore High CourtRead full judgment →
• M/s. Fateh Textile Mills, Hyderabad vs The Collector, Model CustomsPTCL 2017 CL. 113 · Customs Appellate Tribunal · 2016-04-30Read full judgment →
• M/s. Eden Developers (Pvt.) Limited vs Government of the Punjab, etc2017 KLR Revenue Cases 14 · Lahore High Court · 2010-01-12Read full judgment →
• M/s. Dewan Petroleum (Pvt.) Limited vs Executive Director, SECP and2017 P.C.T.L.R. 599 · Islamabad High CourtRead full judgment →
• M/s. Colony Sugar Mills Ltd. vs Province of Punjab and others2017 PLJ Lahore 21 · Lahore High Court · 2016-05-02Read full judgment →
• M/s. China Machinery Engineering Corporation (Cmec), Association of2017 P.S.C. 1248 · Supreme Court of Azad Jammu and KashmirRead full judgment →
• M/s. Chiltan Ghee Mills,Quetta and Others. vs Deputy Collector of Sales TaxPTCL 2017 CL 217 · Supreme Court of Pakistan · 2016-10-03
  sales taxinput tax adjustmentexempt suppliestax refundstatutory interpretationtax exemption
  Summary & questions settled

  The petitioner, a manufacturer of ghee and tin containers, sought a refund of sales tax paid on raw materials (tin plates) used to manufacture tin containers, arguing that because its final product (ghee/containers) was exempt from sales tax under S.R.O. 580(1)/91, the input tax paid on raw materials should be refundable. The Sales Tax Department rejected this claim, citing the prohibition against input tax adjustments for exempt supplies. The Appellate Tribunal and the High Court upheld the Department's decision. The Supreme Court dismissed the petition, holding that under the Sales Tax Act, 1990, input tax adjustment or refund is only available for 'taxable supplies.' The Court clarified that Section 8(1)(a) explicitly prohibits claiming input tax paid on goods used to manufacture supplies that are exempt from sales tax under Section 13. The Court affirmed that an exemption from sales tax on final supplies does not entitle a manufacturer to a refund of input tax paid on raw materials used in the production of those exempt goods.

  Questions settled

  • Is a registered person entitled to claim a refund of input tax paid on raw materials used in the manufacture of goods that are exempt from sales tax?
  • Does the exemption of a final product from sales tax under an S.R.O. automatically entitle the manufacturer to a refund of input tax paid on raw materials?
  • Can input tax adjustment be claimed for goods used in the production of exempt supplies under the Sales Tax Act, 1990?
  Read full judgment →
• M/s. Chiltan Ghee Mills, Quetta etc vs Deputy Collector of Sales TaxPTCL 2017 CL 217, 2017 PTD 138, 2017 PLJ SC 35 · Supreme Court of Pakistan · 2016-10-03
  sales taxinput tax refundexempt suppliesraw materialpromissory estoppeltax exemption
  Summary & questions settled

  The petitioner, engaged in manufacturing ghee and tin containers, sought a refund of sales tax paid on the purchase of tin plates used for making containers, relying on a tax exemption SRO and the doctrine of promissory estoppel. The Sales Tax Department, Appellate Tribunal, and High Court all rejected the claim. The core legal question was whether a registered person making exempt supplies is entitled to claim a refund of input tax paid on raw materials under the Sales Tax Act, 1990. The Supreme Court of Pakistan dismissed the petition, holding that input tax adjustment or refund is only available for taxable supplies and cannot be claimed where the finished goods or supplies are exempt from sales tax under Section 8(1)(a) read with Section 7 and Section 13 of the Sales Tax Act, 1990. The key principle laid down is that tax exemption on supplies does not carry any implied promise or statutory right to a refund of input tax paid on raw materials used in manufacturing exempt goods.

  Questions settled

  • Is a registered person entitled to claim a refund of input tax paid on raw materials used in the manufacture of goods that are exempt from sales tax?
  • Does an exemption from sales tax on supplies create a right to the refund of tax paid on raw materials under the Sales Tax Act, 1990?
  • Can the principle of promissory estoppel be invoked to claim a refund of input tax on exempt supplies?
  Read full judgment →
• M/s. Chaudhry Sugar Mills Ltd vs The Province of Punjab, etc2017 LHC 3082 · Lahore High Court · 2017-09-11Read full judgment →
• Najamuddin Bhatti and another vs The State2017 YLR 741 · Sindh High Court · 2016-08-01
  post-arrest bailanti-corruptionillegal gratificationtrap raidfurther inquiryprohibitory clause
  Summary & questions settled

  This is a post-arrest bail application filed by the applicants, Najamuddin Bhatti and Tarique Hussain Khaskheli, seeking bail in Crime No. 03 of 2016 registered under Section 161 read with Section 34 of the Pakistan Penal Code 1860 and Section 5(2) of the Prevention of Corruption Act 1947 at Police Station ACE Larkana. The core legal question was whether the applicants were entitled to post-arrest bail where the offences did not fall within the prohibitory clause of Section 497 of the Code of Criminal Procedure 1898, and where further inquiry was warranted regarding the recovery of tainted money and allegations of mala fide and personal grudge. The Sindh High Court held that the case against the applicants called for further inquiry under Section 497(2) of the Code of Criminal Procedure 1898, as the offences did not fall within the prohibitory clause, the trap party did not witness the actual delivery of money, and the defense plea of mala fide carried weight. Consequently, post-arrest bail was granted to both applicants. The key principles laid down include that bail should be granted as a rule where an offence does not fall within the prohibitory clause and where recovery and complicity present arguable points for further inquiry.

  Questions settled

  • Whether post-arrest bail should be granted when an offence does not fall within the prohibitory clause of Section 497 of the Code of Criminal Procedure 1898?
  • Does a trap party's failure to witness the actual delivery of tainted money create a case for further inquiry?
  • Can allegations of mala fide and personal grudge by a raiding officer form a sufficient ground for granting bail?
  Read full judgment →
• M/s. Catalyst Communications Pvt. Ltd vs M/s. National2017 C.L.R. 31 · Islamabad High CourtRead full judgment →
• M/s. Butt Flour Mills vs Govt. of Punjab etc2017 LHC 3174 · Lahore High Court · 2017-09-19Read full judgment →
• M/s. Burj Bank Limited vs The Commissioner (Appeals) SRB2017 SRB 106 · Appellate Tribunal Sindh Revenue Board · 2017-03-27Read full judgment →
• M/s. Bin Sadiq International vs The Sindh Revenue Board2017 SRB 88 · Appellate Tribunal Sindh Revenue Board · 2017-01-30Read full judgment →
• M/s. Bhatti Brothers Rice Mills vs Summit Bank Limited2017 PLJ Lahore 145 · Lahore High Court · 2016-03-16Read full judgment →
• M/s. Bestway Cement (Pvt.) Ltd., Islamabad vs Cir, Ltu, Islamabad2017 P.C.T.L.R. 814 · Appellate Tribunal Inland Revenue · 2016-10-04
  withholding taxassessee in defaulttime limitationrecord retentionIncome Tax Ordinance 2001procedural fairnessaudit vs enforcement
  Summary & questions settled

  This appeal concerns a challenge by a taxpayer against an order passed under Section 161/205 of the Income Tax Ordinance 2001, which declared the taxpayer an assessee in default for failing to withhold tax. The core legal question was whether proceedings under Section 161 are subject to a time limitation, specifically the five-year record-keeping period prescribed in Section 174(3). The Appellate Tribunal Inland Revenue held that there is no statutory time limitation for initiating or passing an order under Section 161, as established by binding precedents from the Supreme Court and Islamabad High Court. The Tribunal clarified that Section 174(3), which pertains to the maintenance of records, does not restrict the tax authorities' power to enforce withholding tax provisions. Furthermore, the Tribunal rejected the taxpayer's procedural objections regarding jurisdiction and lack of opportunity, noting that the order was issued by the correct enforcement division and that the taxpayer had been granted sufficient opportunity to produce records but failed to do so. The appeal was consequently dismissed.

  Questions settled

  • Is there a statutory time limitation for passing an order declaring a person an assessee in default under Section 161 of the Income Tax Ordinance 2001?
  • Does the five-year record retention period prescribed in Section 174(3) of the Income Tax Ordinance 2001 restrict the time for initiating proceedings under Section 161?
  • Does a clerical error mislabeling the issuing division on an order invalidate the order itself?
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• M/s. Bahawalpur Cotton Company vs United Bank Limited2017 P.C.T.L.R. 277, 2017 LHC 1105 · Lahore High Court · 2017-03-08Read full judgment →
• M/s. Bahawalpur Cotton Company through its Partners and others vs2017 P.C.T.L.R. 277 · Lahore High CourtRead full judgment →
• M/s. Aroma Travel Services (Pvt.) Ltd. & others vs Faisal Al Abdullah Al2017 SHC 126 · Sindh High Court · 2017-01-30Read full judgment →
• M/s. Apm Terminals Pakistan (Pvt.) Ltd. Karachi vs The AssistantPTCL 2017 CL. 864 · Appellate Tribunal Sindh Revenue Board · 2015-09-28Read full judgment →
• M/s. Amreli Steels Ltd., Karachi vs The Commissioner Inland Revenue,PTCL 2017 CL. 166 · Appellate Tribunal Inland Revenue · 2016-05-17
  Workers' Welfare Funddefault surchargetax refundIncome Tax Ordinance 2001fiscal legislationtax assessment
  Summary & questions settled

  This matter concerns appeals filed by a taxpayer against the Commissioner Inland Revenue (Appeals) regarding the imposition of default surcharge for the non-payment of Workers' Welfare Fund (WWF) at the time of filing tax returns for the tax years 2011 and 2012. The core legal question was whether default surcharge could be validly levied under the Income Tax Ordinance, 2001, when the taxpayer had sufficient income tax refunds due from the government to cover the WWF liability. The Appellate Tribunal Inland Revenue held that the default surcharge was unjustified and vacated the orders of the lower authorities. The Tribunal reasoned that because the Revenue department held the taxpayer's legitimate funds as refundable amounts, the taxpayer was not in default in a manner justifying a surcharge. The judgment establishes the principle that fiscal laws are remedial in nature rather than penal, and deterrent provisions should not be applied to generate revenue when the taxpayer has sufficient credit to its account. Consequently, the appeals were allowed, and the default surcharge was deleted.

  Questions settled

  • Can default surcharge be levied for non-payment of Workers' Welfare Fund when the taxpayer has sufficient refunds due from the Revenue department?
  • Are fiscal laws considered penal or remedial in nature for the purpose of interpreting deterrent provisions?
  • Is the imposition of default surcharge permissible when the taxpayer's legitimate money is already held by the government?
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• M/s. Amin Spinning Mills Ltd., Industrial Area Mirpur Azad Kashmir, M/s.PTCL 2017 CL. 227 · Supreme Court of Azad Jammu and Kashmir · 2015-02-26Read full judgment →
• M/s. American School of International Academics vs Dr. Farrukh2017 PLJ Lahore 511 · Lahore High Court · 2017-02-21Read full judgment →
• M/s. Alba International, Lahore. vs 1. Collector of Customs (Appraisement),2018 PTD (Trib.) 2162, PTCL 2017 CL. 840 · Customs Appellate Tribunal · 2016-09-06Read full judgment →
• M/s. Al-Haj Enterprises (Pvt.) Ltd vs Collector of Customs, Model CustomsK.L.R. 2017 S.C. 539 · Supreme Court of Pakistan
  customs rulesbonded carriershort deliveryPOL productsevaporationcustoms reference application
  Summary & questions settled

  This matter arises from a petition filed by a bonded carrier against the dismissal of its Customs Reference Application by the Islamabad High Court, which had upheld the Customs Appellate Tribunal's order holding the petitioner liable for duties and penalties regarding short-delivered petroleum products. The core legal question concerned the interpretation of Rule 564(4) of the Customs Rules, 2001, specifically whether a bonded carrier can be held liable for shortages exceeding the permissible one percent limit due to evaporation without proof of pilferage or broken seals. The Supreme Court held that where the rule explicitly provides for consequences when short supply exceeds one percent, liability attaches automatically upon such excess variation without requiring proof of pilferage. The Court laid down the principle that the plain text of Rule 564(4) must be applied as drafted, and shortages exceeding the permissible limit justify the imposition of duties and penalties against the responsible carrier.

  Questions settled

  • Whether a bonded carrier can be held liable for petroleum product shortages exceeding the one percent limit under Rule 564(4) of the Customs Rules, 2001 without proof of pilferage?
  • Does Rule 564(4) of the Customs Rules, 2001 require proof of broken seals or theft before imposing liability for short delivery?
  • Can a carrier avoid liability for short supplies exceeding the permissible limit under the Customs Rules, 2001 on the ground of natural evaporation?
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• M/s. Al-Haj Enterprises (Pvt) Ltd vs Collector of Customs, Model2017 PLJ SC 596 · Supreme Court of Pakistan
  customs rulesbonded carrierPOL productsshort deliveryevaporation lossshow-cause notice
  Summary & questions settled

  This matter comes before the Supreme Court of Pakistan via a petition arising from a Customs Reference Application decided by the Islamabad High Court, which upheld the Customs Appellate Tribunal's order. The core legal question concerns the interpretation and application of Rule 564(4) of the Customs Rules, 2001, regarding liability for short delivery of POL products exported to Afghanistan beyond the permissible one percent variation limit. The Supreme Court held that where the provisions of Rule 564(4) are fully attracted due to a shortage exceeding one percent between the declared quantity and the quantity certified at the destination, liability for duties, taxes, and surcharges is rightly imposed on the bonded carrier, regardless of claims regarding natural evaporation. The ratio decidendi is that explicit statutory rules fixing liability for short supplies beyond a prescribed tolerance limit must be applied according to their tenor, and courts will not interfere where lower forums have correctly enforced such provisions. The key principle laid down is that a bonded carrier entrusted with transit goods is strictly accountable for shortages exceeding the permitted percentage under the Customs Rules unless exceptions are statutorily recognized.

  Questions settled

  • Whether a bonded carrier is liable for duties and taxes under Rule 564(4) of the Customs Rules, 2001 when the shortage of POL products exceeds the permissible one percent limit?
  • Can a bonded carrier escape liability for transit shortages exceeding the prescribed percentage on the ground of natural evaporation in the absence of statutory exceptions?
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• M/s. Ai-Haj Enterprises (Pvt.) Ltd. vs Collector of Customs, Model Customs2017 P.C.T.L.R. 569 · Supreme Court of Pakistan
  bonded carriercustoms dutyshort deliveryPOL productsstrict liabilityCustoms Rules 2001evaporation loss
  Summary & questions settled

  This matter concerns a petition for leave to appeal against a judgment of the Islamabad High Court, which upheld the liability imposed on a bonded carrier for the short delivery of POL products transported to Afghanistan for the International Security Assistance Force (ISAF). The core legal question was whether a carrier can be held liable for shortages exceeding the one percent permissible limit under Rule 564(4) of the Customs Rules, 2001, even if the carrier claims the loss resulted from uncontrollable factors like evaporation rather than theft or pilferage. The Supreme Court held that the provisions of Rule 564(4) are strict and explicitly prescribe consequences for shortages beyond the one percent threshold. The Court reasoned that since the rule's conditions were met and the consequences for such short supply were clearly provided, the lower forums committed no legal error in imposing liability. The key principle laid down is that where a statutory rule explicitly provides for liability upon the occurrence of a specific event—in this case, a shortage exceeding a defined percentage—the carrier is strictly liable regardless of the underlying cause of the shortage.

  Questions settled

  • Does Rule 564(4) of the Customs Rules, 2001 impose strict liability on a bonded carrier for shortages exceeding the one percent permissible limit?
  • Can a carrier avoid liability under Rule 564(4) of the Customs Rules, 2001 by claiming that shortages were caused by evaporation rather than theft?
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• M/s. Abasyn University through Vice-Chancellor vs Federation of2017 PLC 34, 2017 PLJ Peshawar 51 · Peshawar High Court · 2016-06-30
  statutory bodyEmployees Old Age Benefit Actcorporate veilconstitutional jurisdictionalternative remedyexemptioncontribution
  Summary & questions settled

  This constitutional petition challenged demand notices issued by the Employees Old Age Benefit Institution (EOAB) requiring Abasyn University to pay contributions under the Employees Old Age Benefit Act, 1976. The core legal question was whether the University, established under the Abasyn University Act, 2009, qualifies as a "statutory body" under Section 47(f) of the EOAB Act, thereby exempting it from such contributions. The Court held that the University, having been created by a specific legislative enactment, constitutes a statutory body and is thus exempt from the EOAB Act's purview. Consequently, the impugned demand notices were declared illegal and without lawful authority. Regarding the petitioner's request for a refund of previously paid amounts, the Court declined to grant relief, noting that such claims involve disputed facts requiring evidence, for which the petitioner must pursue the alternative remedy provided under the EOAB Act. The judgment affirms that a "statutory body" is an entity whose existence is directly caused by a special statute, and courts should generally respect the separate legal personality of corporate entities absent evidence of a sham or facade.

  Questions settled

  • Does a university established by a specific provincial enactment qualify as a 'statutory body' under Section 47(f) of the Employees Old Age Benefit Act, 1976?
  • Can a constitutional court pierce the corporate veil of an entity to determine its liability under the Employees Old Age Benefit Act, 1976, where the entity's structure is sanctioned by legislation?
  • Is a dispute regarding the refund of contributions paid to the Employees Old Age Benefit Institution a matter that requires factual determination by the Institution rather than a constitutional court?
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• M/s. A.H. Syed and Company (Pvt.) Ltd., Jhang vs The Cir, Rto, Faisalabad2017 P.C.T.L.R. 878 · Appellate Tribunal Inland Revenue · 2017-02-13
  minimum taxturnoverdistributorcommission agentdeemed assessmentamended assessmentrevenue recognition
  Summary & questions settled

  The taxpayer, a private limited company and distributor of Pakistan Tobacco Company, filed income tax returns for tax years 2014 and 2015, which were treated as deemed assessment orders under Section 120(1) of the Income Tax Ordinance, 2001. The tax authorities examined the records and found that the taxpayer declared only commission in its income tax return and paid minimum tax under Section 113, whereas it had declared turnover in its sales tax returns and audited accounts. Assessment orders were amended under Section 122(5A), treating the turnover for minimum tax. The taxpayer appealed to the Commissioner Inland Revenue (Appeals), who upheld the amendments, leading to the second appeal before the Appellate Tribunal Inland Revenue. The core legal question was whether a distributor declaring sales in its final accounts is liable to minimum tax on turnover under Section 113 or tax on commission. The Tribunal held that since the taxpayer chose to recognize sales as revenue in its final accounts, those sales are liable to minimum tax under Section 113, and the taxpayer cannot claim to be taxed solely on commission. The Tribunal dismissed the appeal on this ground while remanding the addition under Section 111(1)(b) for fresh consideration.

  Questions settled

  • Whether a distributor who declares sales revenue in its audited final accounts is liable to pay minimum tax on turnover under Section 113 of the Income Tax Ordinance, 2001?
  • Can a taxpayer who chooses to recognize sales as revenue in its final accounts subsequently claim to be taxed solely on commission under the final tax regime?
  • What constitutes the correct basis for revenue recognition and taxation for a distributor under local commercial practices and accounting standards?
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• M/s, K.B. Enterprises, vs The Commissioner of Inland Revenue, R.T.O.,PTCL 2017 CL. 207 · Appellate Tribunal Inland Revenue · 2015-11-26Read full judgment →