The Lawyer said an additional 1% special duty was imposed on specified goods produced in the country through Section 3-A.
The lawyer further explained that taxes have been paid by the mills, and now they are seeking a refund.
ISLAMABAD ( Web News )
Chief Justice of Pakistan, Justice Fiaz Esa Qazi, has stated that determining the tax rates is the government’s responsibility, and Parliament has the authority to impose taxes. He questioned whether Parliament can empower the government to levy taxes, and whether the increase in rates is within the government’s discretion. The Chief Justice asked whether the Additional Commissioner or the Chairman of the FBR (Federal Board of Revenue) drafts such resolutions.
A three-member bench led by Chief Justice Fiaz Esa Qazi, including Justice Aminuddin Khan and Justice Athar Minallah, heard 17 requests related to the imposition of an additional 1% customs duty in 2007 on sugar mills and other industrial units by the federal government. The bench heard arguments from the Commissioner Inland Revenue and other parties on these requests.
During the hearing, Chief JusticeFiaz Esa Qazi, addressed the Commissioner Inland Revenue’s lawyer, urging him to present evidence and start the discussion. The Chief Justice remarked on sales tax, income tax, and questioned the issue at hand. The lawyer explained that an additional 1% special duty was imposed on specified goods produced in the country through Section 3-A.
Chief Justice inquired why it was discontinued in 2011, and the lawyer responded that it was the government’s decision. The Chief Justice advised the lawyer not to use unnecessary rhetoric with each paragraph. He emphasized that the reasons behind imposing the duty must be discovered.
Justice Athar Minallah stated that such resolutions should be reviewed. The lawyer clarified that an additional 1% duty was imposed through Section 3-A on specified goods. The Chief Justice questioned whether this was a parliamentary decision or a government decision to impose such a duty and grant an exception. The lawyer responded that the board issues notifications.
The lawyer further explained that taxes have been paid by the mills, and now they are seeking a refund. The Sindh High Court has given a judgment in favor of the refund in 17 requests filed by the Commissioner Inland Revenue and others. Chief Justice mentioned that this 1% tax remained applicable for four years.
The lawyer informed that notices were issued in the 40 cases, and orders were also issued. Additional Controller Inland Revenue Abdul Wahid Shar informed that these cases are pending in the Supreme Court, and the amount needs to be recorded. The lawyer stated that he has not verified whether the amount has been paid or not. Chief Justice said that the payment has been made.
Former Attorney General Barrister Khalid Javed Khan, representing the petitioner Ali Haider, informed the court that a refund has been granted in case CA 918/2018 related to MS Pakistan Bureegs Limited. The government lawyer stated that it was not a new tax but an additional tax. A 1% additional tax was imposed on income-generating and domestically produced goods in Pakistan, granting the federal government the authority to impose an additional 1% tax.
Chief Justice questioned whether this was an additional duty or an additional tax rate. The lawyer stated that the board issues a notification. The lawyer mentioned that taxes have been collected from the mills, and they are now seeking a refund. The Sindh High Court has given a judgment in favor of the refund.
Chief Justice stated that it was a 1% tax for four years. The lawyer said that notifications were issued in 40 cases, and orders were also issued. Additional Controller Inland Revenue Abdul Wahid Shar informed that these cases are pending in the Supreme Court, and the amount needs to be recorded. The lawyer stated that he has not verified whether the amount has been paid or not. Chief Justice said that the payment has been made.
The lawyer explained that Section 3-A imposed an additional 1% duty on specified goods. Chief Justice questioned why Section 3-A was added and why it was not added to Section 3. The lawyer responded that the board issues notifications. The lawyer mentioned that taxes have been collected from the mills, and they are now seeking a refund. Chief Justice stated that it was a 1% tax for four years.
The lawyer said that notices were issued in 40 cases, and orders were also issued. Additional Controller Inland Revenue Abdul Wahid Shar informed that these cases are pending in the Supreme Court, and the amount needs to be recorded. The lawyer stated that he has not verified whether the amount has been paid or not. Chief Justice said that the payment has been made.
Former Attorney General Barrister Khalid Javed Khan, representing the petitioner Ali Haider, informed the court that a refund has been granted in case CA 918/2018 related to MS Pakistan Bureegs Limited. The government lawyer stated that it was not a new tax but an additional tax. A 1% additional tax was imposed on income-generating and domestically produced goods in Pakistan, granting the federal government the authority to impose an additional 1% tax.
Chief Justice questioned whether this was an additional duty or an additional tax rate. The lawyer stated that the board issues a notification. The lawyer mentioned that taxes have been collected from the mills, and they are now seeking a refund. The Sindh High Court has given a judgment in favor of the refund.
Chief Justice stated that it was a 1% tax for four years. The lawyer said that notifications were issued in 40 cases, and orders were also issued. Additional Controller Inland Revenue Abdul Wahid Shar informed that these cases are pending in the Supreme Court, and the amount needs to be recorded. The lawyer stated that he has not verified whether the amount has been paid or not. Chief Justice said that the payment has been made.
The lawyer explained that Section 3-A imposed an additional 1% duty on specified goods. Chief Justice questioned why Section 3-A was added and why it was not added to Section 3. The lawyer responded that the board issues notifications. Chief Justice mentioned that the Lahore High Court and the Sindh High Court have contradictory judgments. The Chief Justice inquired about the names of the judges in the Lahore High Court and the Sindh High Court.
It was revealed that a Lahore High Court bench included former Supreme Court Justice Sheikh Azmat Saeed, while the other bench included former Chief Justice of Pakistan Anwar Zaheer Jamali and Justice Asad Munir. The Sindh High Court bench included the current judges of the Supreme Court, Justice Manzoor Ahmad and Justice Gulzar Ahmed. Chief Justice clarified that one of the judges from these benches is a retired Supreme Court judge and is currently a Supreme Court judge.
The Chief Justice questioned on what basis the Sindh High Court declared the imposition of tax as void. Khalid Javed Khan said that the Sindh High Court gave decisions on two different grounds. The Chief Justice stated that if a new tax is imposed, it is the jurisdiction of Parliament, and if there is an increase in the tax rate, it is the discretion of the government. He asked whether this is additional duty or an additional tax rate. Chief Justice Fiaz Esa Qazi, said that if they had not increased Section 3-A and had increased Section 3, it could have been challenged.
On the issue, Senator Barrister Muhammad Firoz Naseem, the lawyer for the plaintiff Ali Haider, stated that it is a separate charging section. Chief Justice said that they need assurance that this is a separate levy. Barrister Firoz Naseem said that this is a new thing; it is a separate scheme. Chief Justice Gulzar Ahmed said that Parliament has imposed taxes; it is the government’s job to determine the tax rates. He questioned whether Parliament can empower the government to levy taxes or not.
Government lawyer said that a vote was held on June 9, which was supposed to be implemented from July 1. Justice Athar Minallah said that when Khalid Javed Khan was the Attorney General, he used to talk with patience. Chief Justice advised Khalid Javed Khan to speak with patience and not to say that when he was a lawyer, he also spoke with great patience. Chief Justice Gulzar Ahmed, while concluding the hearing, directed the registrar’s office not to fix any other important case for that day.