2025 PLP 1217 (PTD)
BASHIR AHMED Versus FEDERATION OF PAKISTAN through Secretary Finance, Islamabad and 4 others
| Citation | 2025 PLP 1217 (PTD) |
| Forum / Court | Lahore High Court |
| Bench Members | Khalid Ishaq, J |
| Parties | BASHIR AHMED Versus FEDERATION OF PAKISTAN through Secretary Finance, Islamabad and 4 others |
| Primary Law | Income Tax Ordinance (XLIX of 2001) |
Q1: What are the key laws and sections cited in 2025 PLP 1217 (PTD)?
This judgment primarily cites: Income Tax Ordinance (XLIX of 2001) as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2025 PLP 1217 (PTD)?
The case was heard and decided by the Lahore High Court bench comprising: Khalid Ishaq, J.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2025 PLP 1217 (PTD) (BASHIR AHMED Versus FEDERATION OF PAKISTAN through Secretary Finance, Islamabad and 4 others). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Representation
- ----Ss. 182 & 209---Large Taxpayers' Office---Jurisdiction, determination of---Petitioner, being Chief Executive Officer of Faisalabad Electric Supply Company (FESCO), filed constitutional petition calling into question order passed under S. 182 of the Income Tax Ordinance, 2001 ('the Ordinance, 2001') by the Commissioner Inland Revenue, Large Taxpayers Office, Faisalabad (respondent No.3) whereby he had been awarded a penalty in his personal capacity i.e. Chief Executive Officer of FESCO ('the Impugned Order')---Submission of the petitioner was that in view of Federal Board of Revenues (FBR) own notification FESCO fell under the jurisdiction of LTO, Multan---Validity---The fact that the automated system of the FRR did not recognize and entertain the appeal of the petitioner was enough to hold the (present) constitutional petition maintainable and the petitioner could not be left remediless---Even otherwise, the serious question of jurisdiction was involved as to the authority and powers to issue the Show-Cause Notice-in-question (dated 16.06.2023) and the impugned order passed on the basis thereon, therefore, the petitioner had rightfully invoked the constitutional jurisdiction of the High Court---Record (including the documents appended by both sides) clearly led to an ineluctable conclusion that the petitioner was caught within the mischiefs of confusion of jurisdiction of the relevant LTOs created by FBR without there being any default, malice or wrong doing attributable to the petitioner--- During the pendency of the present petition, FESCO also approached FBR by means of a representation under the provisions contained in the Federal Board of Revenue Act, 2007, in order to lay its grievance qua the overlapping and conflicting claims of jurisdictions by two offices of FBR, however, no definite findings were handed down owing to the pendency of the present petition---The reliance of the respondents Nos. 3 and 5 on a notification/circular dated 03.10.2019 was apparently in contradiction with subsequent circulars/orders dated 12.10.2020 (relied upon by the petitioner) and dated 01.07.2021 (relied upon by learned counsel for respondent No.4)---Considering the petitioner's unrefuted claim that no loss or evasion of revenue was involved in the case, which claim was also substantiated from the Show-Cause Notice and impugned order, the treatment meted out to the petitioner was untenable under the law---However, in order to streamline the question of jurisdiction of the relevant RTOs qua FESCO and for further verification qua possibility of any loss or evasion of the revenue, the intervention and a definite finding by the FBR was inevitable---High Court set-aside the impugned order, and the matter (present petition) was transmitted to the Chairman FBR as a representation under the provisions contained in Federal Board of Revenue Act, 2007, who shall hear the petitioner as well as concerned LTOs and pass a speaking order for final determination of the controversy qua the jurisdiction in clear terms---Constitutional petition, filed by Chief Executive Officer of Faisalabad Electric Supply Company, was allowed accordingly.
- Mian Ashiq Hussain for Petitioner.
- Abdul Muqtadir Khan for Respondents Nos.3 and 5.
- Muhammad Yahya Johar for Respondent No.4.
- 3. Conversely, learned counsel for respondents Nos.3 and 5 has vehemently questioned the maintainability of the petition in hand by submitting that Impugned Order has been passed under section 182 of the Ordinance and a specific appeal is available against such orders in terms of section 127 of the Ordinance before the Commissioner Inland Revenue (Appeals). Further submits that while replying to the Show-Cause Notice dated 08.06.2023, the petitioner has practically submitted and conceded to the jurisdiction of respondents Nos.3 and 5. While relying upon Notification No.F.No. 57(2)/Jurisdiction/2017-24263-R dated 03.10.2019 issued by FBR under section 209 of the Ordinance read with sections 30(1) and 31 of the Sales Tax Act, 1990, section 29(1) of the Federal Excise Act, 2005 and the provisions contained in Islamabad Capital Territory (Tax on Services) Ordinance, 2001, learned counsel submits that FESCO clearly falls under the jurisdiction of LTO, Faisalabad. While submitting that though the petitioner may have been unable to file an appeal in terms of section 127 of the Ordinance through automated FBR system, however, nothing precluded the petitioner from filing an appeal manually, therefore, the petitioner cannot invoke the constitutional jurisdiction of this Court as an adequate alternate remedy was available. Placed reliance upon Montogomery Flour and General Mills Limited, Lahore v. Federation of Pakistan through Chairman, Central Board of Revenue, Islamabad and 3 others (2002 PTD 155) and Member Board of Revenue/Chief Settlement Commissioner, Punjab, Lahore v. Abdul Majeed and another (PLD 2015 Supreme Court 166).
- 4. Learned counsel for respondent No.4 has placed reliance upon the report and parawise comments already filed in this petition, which are reproduced herein below:-
- 6. The fact that the automated system of the FBR does not recognize and entertains the appeal of the petitioner is enough to hold this petition maintainable and the petitioner cannot be left remediless. Even otherwise, the serious question of jurisdiction is involved as to the authority and powers to issue the Show-Cause Notice dated 16.06.2023 and the Impugned Order passed on the basis thereon, therefore, the petitioner has rightfully invoked the constitutional jurisdiction of this Court. The perusal of the documents appended with this petition and the ones relied upon by the learned counsel for respondent No.4 and respondents Nos.3 and 5 respectively, clearly leads to an ineluctable conclusion that the petitioner is caught within the mischiefs of confusion of jurisdiction of the relevant LTOs created by FBR and its LTOs without there being any default, malice or wrong doing attributable to the petitioner. During the pendency of this petition, FESCO also approached FBR by means of a representation under the provisions contained in the Federal Board of Revenue Act, 2007, in order to lay its grievance qua the overlapping and conflicting claims of jurisdictions by two offices of FBR, however, no definite findings were handed down owing to the pendency of the petition in hand. The reliance of the learned counsel for respondents Nos. 3 and 5 on a notification/circular dated 03.10.2019 is apparently in contradiction with a subsequent circulars/order dated 12.10.2020 (relied upon by the petitioner) and 01.07.2021 (relied upon by learned counsel for respondent No.4). Considering the petitioner's unrefuted claim that no loss or evasion of revenue is involved in the case, which claim is also substantiated from the Show-Cause Notice and Impugned Order, the treatment meted out to the petitioner is untenable under the law. However, in order to streamline the question of jurisdiction of the relevant RTOS qua FESCO and for further verification qua possibility of any loss or evasion of the revenue, the intervention and a definite finding by the FBR is inevitable.
Headnotes / Summary
Qamar Hanif, Assistant Attorney General.
Judgment & Decree
KHALID ISHAQ, J.
Through this constitutional petition, the petitioner has called into question order dated 16.06.2023 (Impugned Order) passed under section 182 of the Income Tax Ordinance, 2001 (Ordinance) by the Commissioner Inland Revenue, Large Taxpayers' Office, Faisalabad / respondent No.3 whereby the petitioner has been awarded a penalty amounting to Rs.135,719,105/- in his personal capacity as Chief Executive Officer of Faisalabad Electric Supply Company (FESCO).
2. Learned counsel for the petitioner contends that respondent No.2 i.e. Federal Board of Revenue (FBR), while exercising jurisdiction under section 209 of the Ordinance read with sections 30(1), 31 of the Sales Tax Act, 1990, section 29(1) of the Federal Excise Act, 2005 and the provisions contained in Islamabad Capital territory (Tax on Services) Ordinance, 2001, has determined the jurisdiction of Chief Commissioner and Commissioner Inland Revenue, Large Taxpayers' Office (LTO), Multan by virtue of notification bearing No.F. No.1(48) Jurisdiction/2014-177049-R dated 12.10.2020, which states that the Chief Commissioner Inland Revenue, LTO, Multan shall exercise powers and perform functions under the Income Tax Ordinance, 2001, Sales Tax Act, 1990 and the Federal Excise Act, 2005 in respect of persons mentioned in Table-B and Table-C appended with the aforementioned letter. While referring to serial No.74 in Table-B, the learned counsel submits that FESCO clearly falls under the jurisdiction of LTO, Multan. Submits that considering the aforementioned jurisdictional sphere of different LTOS, FESCO filed returns and made payments of taxes withheld in bulk challans in the LTO, Multan; adds that neither it is alleged in the show-cause notice or Impugned Order that there is any evasion or short payment of any tax, which is withheld in bulk challans by FESCO, nor FESCO is involved in any such practice, therefore, there is no case of evasion or loss of revenue against FESCO, but despite that, personal penalty has been imposed upon the petitioner vide the Impugned Order solely on the ground that the jurisdiction for the payment and filing of returns of bulk challans for FESCO and its certain consumers falls within jurisdiction of LTO, Faisalabad and not LTO, Multan. Further submits that the FESCO as well as the present petitioner i.e. CEO, FESCO, present themselves for further verification and audit in order to satisfy the competent authority and FBR that there is no evasion, loss or short payment of any tax withheld in bulk challans by FESCO. Further submits that though the Impugned Order imposes personal penalty against the petitioner, however, the petitioner was unable to file his appeal before the Commissioner Inland Revenue (Appeals) since the system does not recognize the petitioner as a registered taxpayer in such capacity; therefore, the only remedy available to the petitioner is in the form of this constitutional petition. Finally submits that the objection to the jurisdiction was raised by filing a reply to the Show Cause Notice dated 08.06.2023 issued by respondent No.5, however, no cogent findings have been rendered while passing the Impugned Order. Placed reliance on Nagina Silk Mill, Lyallpur v. The Income Tax Officer, A-Ward, Lyallpur and others (PLD 1963 SC 322), Al Ahram Builders (Pvt.) Ltd. v. Income Tax Appellate Tribunal (1993 SCMR 29).
3. Conversely, learned counsel for respondents Nos.3 and 5 has vehemently questioned the maintainability of the petition in hand by submitting that Impugned Order has been passed under section 182 of the Ordinance and a specific appeal is available against such orders in terms of section 127 of the Ordinance before the Commissioner Inland Revenue (Appeals). Further submits that while replying to the Show-Cause Notice dated 08.06.2023, the petitioner has practically submitted and conceded to the jurisdiction of respondents Nos.3 and
5. While relying upon Notification No.F.No. 57(2)/Jurisdiction/2017-24263-R dated 03.10.2019 issued by FBR under section 209 of the Ordinance read with sections 30(1) and 31 of the Sales Tax Act, 1990, section 29(1) of the Federal Excise Act, 2005 and the provisions contained in Islamabad Capital Territory (Tax on Services) Ordinance, 2001, learned counsel submits that FESCO clearly falls under the jurisdiction of LTO, Faisalabad. While submitting that though the petitioner may have been unable to file an appeal in terms of section 127 of the Ordinance through automated FBR system, however, nothing precluded the petitioner from filing an appeal manually, therefore, the petitioner cannot invoke the constitutional jurisdiction of this Court as an adequate alternate remedy was available. Placed reliance upon Montogomery Flour and General Mills Limited, Lahore v. Federation of Pakistan through Chairman, Central Board of Revenue, Islamabad and 3 others (2002 PTD 155) and Member Board of Revenue/Chief Settlement Commissioner, Punjab, Lahore v. Abdul Majeed and another (PLD 2015 Supreme Court 166).
4. Learned counsel for respondent No.4 has placed reliance upon the report and parawise comments already filed in this petition, which are reproduced herein below:- "
1. Large Tax Payers' office, Multan holds the rightful jurisdiction of M/s. Faisalabad Electric Supply Company Ltd, Faisalabad (FESCO) vide Boards jurisdiction Order No.1(48) Jurisdiction/ 2014-177049-R dated 17-10-2020 mentioned at Serial No. 74 of Table-B.
2. LTO, Multan is collecting Income Tax under section 235 of the Income Tax Ordinance, 2001 from M/s. FESCO as per law. The mechanism of collecting withholding Income Tax is defined by the Board vide Circular No. 01/2022 issued vide C.No.1(3) DG(VH)/Circular/2021/96508-R dated 01-07-2021. Copy enclosed,, The enclosed document with the reply filed by respondent No.4 i.e. Circular No. 01 of 2022 - Operations (Inland Taxes) bearing C.No.1(3)DG(WH)/Circular/2021/96508-R dated 01.07.2021 substantiates the position of respondent No.4.
5. Arguments heard. Record perused.
6. The fact that the automated system of the FBR does not recognize and entertains the appeal of the petitioner is enough to hold this petition maintainable and the petitioner cannot be left remediless. Even otherwise, the serious question of jurisdiction is involved as to the authority and powers to issue the Show-Cause Notice dated 16.06.2023 and the Impugned Order passed on the basis thereon, therefore, the petitioner has rightfully invoked the constitutional jurisdiction of this Court. The perusal of the documents appended with this petition and the ones relied upon by the learned counsel for respondent No.4 and respondents Nos.3 and 5 respectively, clearly leads to an ineluctable conclusion that the petitioner is caught within the mischiefs of confusion of jurisdiction of the relevant LTOs created by FBR and its LTOs without there being any default, malice or wrong doing attributable to the petitioner. During the pendency of this petition, FESCO also approached FBR by means of a representation under the provisions contained in the Federal Board of Revenue Act, 2007, in order to lay its grievance qua the overlapping and conflicting claims of jurisdictions by two offices of FBR, however, no definite findings were handed down owing to the pendency of the petition in hand. The reliance of the learned counsel for respondents Nos. 3 and 5 on a notification/circular dated 03.10.2019 is apparently in contradiction with a subsequent circulars/order dated 12.10.2020 (relied upon by the petitioner) and 01.07.2021 (relied upon by learned counsel for respondent No.4). Considering the petitioner's unrefuted claim that no loss or evasion of revenue is involved in the case, which claim is also substantiated from the Show-Cause Notice and Impugned Order, the treatment meted out to the petitioner is untenable under the law. However, in order to streamline the question of jurisdiction of the relevant RTOS qua FESCO and for further verification qua possibility of any loss or evasion of the revenue, the intervention and a definite finding by the FBR is inevitable.
7. In view of above, the Impugned Order is set aside, this petition is transmitted to the Chairman FBR as a representation under the provisions contained in Federal Board of Revenue Act, 2007, who shall hear the petitioner as well as concerned LTOs and pass a speaking order for final determination of the controversy qua the jurisdiction in clear terms. Needless to add that the element of evasion or loss of revenue may also be looked into while deciding the representation.
8. This petition is allowed in above terms. MQ/B-5/L Petition allowed.