2025 PLP 313 (PTD)

SULTAN TANVIR AHMAD, J.

The captioned intra court appeal, under section 3 of the Law Reforms Ordinance, 1972 as well as the appeals as detailed in schedule 'A' to this judgment, have been filed against judgment dated 22.12.2022 passed by the learned Judge-in-Chamber. Upon hearing the appeals the learned Judges of the Division Bench reached to different conclusions on certain issues. As a result thereof, the cases have been referred with the following:- Terms of reference:- Can power under Order XLI, Rule 33, C.P.C. be exercised without notice to the parties and without opportunity of hearing and whether the judgment of the learned Single Judge could be upset by exercise of these powers? Can the power under O.XLI, R. 33, C.P.C. be exercised unilaterally by one member of a Division Bench hearing the appeal. If the answer to the above is in the affirmative, can the constitutionality of S.8(2)(b) of the 2022 Act be upheld by invoking Art. 141 of the Constitution in ignorance of entry 50 of the Fourth Schedule to the Constitution. Has the levy under S.8(2)(b) been imposed on a resident individual or a foreign asset.

2. The first two terms of reference relate to power of Court of Appeal under Order XLI, Rule 33 of the Code of Civil Procedure, 1908 (the 'Code'). The relevant portion of the rule, which was introduced in the Code by Amendment Act IX of 19221, reads:-

33. Power of Court of Appeal.--The appellate Court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further or other decree or order as the case may be require, and this power may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection." (Emphasis supplied)

3. Prior to above amendment, under Rule 22 of Order XLI of the Code, it was incumbent for the non-appealing party to file cross-objection in manners prescribed therein. The above reproduced rule permits the Court of Appeal to make an order which ought to have been passed by the Court of first instance but not passed and to make such further order as the case may require. The words used the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection" start with "notwithstanding". The legislature has also used affirmative wording enabling the Courts of Appeal to pass order that should have been passed and also vitalized it by using non-obstante clause.

4. The language used is indicative of the intention of legislature to confer extensive power upon Court of Appeal to make order as the case may require, irrespective of filing appeal by a respondent or cross objection. Reading of Order XLI Rule 33 of the Code itself is convincing enough as to wide powers of Court of Appeal permitting to make orders that may be necessary for doing complete justice in a particular case. The Supreme Court of Pakistan in Messrs S. M. Yusuf & Bros v. (1) Mirza Muhammad Mehdi Pooya and (2) Amanullah Kirmani 2 has already ruled:- "We have accordingly referred to earlier judgment of the same Court in the earlier case of Bakhsh Illahi and Sons to examine the arguments there set out. Four precedent judgments are cited. From three of them, which are mentioned without reference to their particular facts, general propositions are extracted to the effect that the power given by the rule is widely expressed and must be applied with discretion, where interference is required "to adjust the right of the parties in accordance with justice, equity and good conscience" or where the failure to exercise the power "would lead to impossible, contradictory and unworkable orders". These particular considerations un-doubtedly are circumstances which would justify the exercise of the discretion conferred by the rule, but it is right that we should say that if these propositions are to be understood as limiting the exercise of the power within the circumstances specified, they would be in excess of the power given to the Courts to interpret and apply a rule express in such wide terms as is rule

33. The rule confers unfettered discretion, and anything expressed in negative or restrictive terms, affecting its application, must be accepted as applying only to the particular facts of the case to which the rule is being applied by interpretation. Such an interpretation cannot be extended to all or any other cases, for, in each one, the application of the rule must be made beneficially, and in accordance with the relevant facts. (Emphasis supplied)

5. In Ranjana Prakash and others v. The Divisional Manager and another 3 it is observed that Order XLI, Rule 33 of the Code can also be pressed into service to make an award more effective or maintain an award on grounds other than invoked by a learned Court in the order under appeal. Paragraph No. 7 of the said judgment reads as under:-

7. This principle also flows from Order XLI, Rule 33 of the Code of Civil Procedure which enables an appellate court to pass any order which ought to have been passed by the trial court and to make such further or other order as the case may require, even if the respondent had not filed any appeal or cross-objections. This power is entrusted to the appellate court to enable it to do complete justice between the parties. Order XLI, Rule 33 of the Code can however be pressed into service to make the award more effective or maintain the award on other grounds or to make the other parties to litigation to share the benefits or the liability, but cannot be invoked to get a larger or higher relief. For example, where the claimants seeks compensation against the owner and the insurer of the vehicle and the Tribunal makes the award only against the owner, on an appeal by the owner challenging the quantum, the appellate court can make the insurer jointly and severally liable to pay the compensation, along with the owner, even though the claimants had not challenged the non-grant of relief against the Insurer" (Underlining is added)

6. In Mst. Bibi Fatima v. Muhammad Sarwar 4, while discussing powers of Court of Appeal to grant relief to non-appealing parties, the Honourable Supreme Court has held that the appellate court is empowered, in the interest of justice, to allow appropriate relief to non-appealing parties where the appeal is with regard to whole of the decree in terms of Order XLI, Rule 33, C.P.C. The Court has also inherent powers under section 151, C.P.C, to make such orders, as may be necessary for the ends of justice and to prevent the abuse of the process of the Court. These are all enabling provisions; the powers thereunder can be exercised by the Court to cover ostensibly impossible situations, for complete dispensation of justice, for which C.P.C. has been designed, but despite the best efforts of the draftsman, to cater for all possible situations, if it is found lacking in meeting some eventualities, the Court can act ex delicto justiciae, supply the omission in the procedure, adopt methodology, for effectually carrying out the purpose.

7. Now I would like to engage in remaining aspects of the first two terms of reference regarding notice to the parties or opportunity of hearing before utilizing powers under Order XLI, Rule 33 of the Code as well as unilateral exercise of power under the said rule. Report and para-wise comments filed by respondent No. 2 / Federal Board of Revenue, before the learned Judge-in-Chamber, more specifically paragraphs Nos. (ii), (iii) and (vi), reflect that the said respondent has raised plea as to the deficiency of powers of the Provinces to make laws having extra-territorial operation as well as prayed to uphold constitutionality of section 8(2)(b) of the Finance Act, 2022 (the 'Act of 2022') on the basis of powers confers upon the Parliament under Article 141 of the Constitution of the Islamic Republic of Pakistan, 1973 (the Constitution ). Careful reading of the report and para-wise comments, indeed, reveals that this remained the main focus of the said respondents before the learned Judge-in-Chamber.

8. The above submissions made by the learned counsel for the respondents are also captured by the learned Judge-in-Chamber as reflected from paragraph No. 8 of the judgment questioned before the learned Division Bench. The arguments to this effect are also addressed in the operative part of the judgment. The entire material, including the discussed part of the report and para-wise comments, was before the Honourable Division Bench. Paragraph No. 7 in one of the judgments, given by one of my learned brothers (Anwaar Hussain, J), confirms that the question as to not filing cross-objections or challenging the judgment passed by the learned Judge-in-chamber was raised, considered and then dealt with. It cannot be said that the appellants were not having notice as to the ground set-up in defense to the petitions or the appellants were not afforded hearing vis- -vis the points that remained under discussion, which clearly include Article 141 of the Constitution and its potential effect on the relevant provisions of the Act of 2022.

9. It is already discussed in material detail that Order XLI, Rule 33 of the Code, notable falling under the sub-topic / heading of the Judgment-in-Appeal , effectively empowers the Court of Appeal with wide powers to make orders which ought to have been passed or make such further order as the case may require for doing complete justice, notwithstanding that appeal is directed against a part of decree, in favour of all or any of the parties and even if such parties or respondents have not filed appeal or cross-objection. The power, bestowed upon Courts of Appeal, so strongly worded and using non-obstante clause prior to " .although such respondents or parties may not have filed any appeal or objection", cannot be visualized so narrowly; and when the defense set-up by the respondents as well as their arguments on the particular issue are duly documented by the learned Judges, no question to exercise of any unilateral power by one member of worthy Division Bench arises, either. Even, the learned counsel for the parties, while assisting this Court, have not shown disagreement as to this precise proposition.

10. Now it is proper to examine subsections (1), (2)(b), (4)(g) and (13)(c) and (f) of section 8 of the Act of 2022, which read as under:-

8. Capital value tax 2022.

1. A tax shall be levied, charged, collected and paid on the value of assets at the rates specified in the First Schedule to this section for tax year 2022 and onwards; Provided that the tax shall be charged from the 1st day of July, 2022 in case of motor vehicles held in Pakistan.

2. Capital Value Tax shall be charged on the following assets- (b) foreign assets of a resident individual where the value of such assets on the last day of the tax year in aggregate exceeds Rupees one hundred million; and

4. The Tax shall be collected or paid in following manner, namely:- (g) in case of assets mentioned in clause (b) of subsection (2), the person holding the assets shall be liable to pay tax at the time the income tax return for the tax year is due in the manner prescribed; and

13. In this section- (c) foreign assets means any movable or immovable assets held outside Pakistan, whether directly or indirectly, and includes but not limited to real estate, mortgaged assets, stock and shares, bank accounts, bullion, cash, jewels, jewelry, paintings, accounts and loan receivables, assets held in dependents name, beneficial ownership or beneficial interests or contribution in offshore entities or trusts; (f) resident individual shall have the same meanings as defined in the Income Tax Ordinance, 2001 (XLIX of 2001); (Emphasis is added) Even plain reading of the reproduced provisions of the Act of 2022 makes it profusely clear that the legislature has envisaged this tax to be paid by resident individual(s) on the foreign assets, which are defined in subsection 13(c), when such assets have aggregate value exceeding rupees one hundred million. Subsection 13(f) of the Act of 2022 provides that resident individual shall have same meaning as given in Income Tax Ordinance, 2001. Now, approaching the constitutionality of section 8(2)(b) the Act of 2022 and the question if it can be upheld by invoking Article 141 of the Constitution. It is apt to reproduce Articles 141 and 142 of the Constitution, which read as under:- "

141. Subject to the Constitution, Majlis-e- Shoora (Parliament) may make laws including laws having extra-territorial operation for the whole or any part of Pakistan, and a Provincial Assembly may make laws for the Province or any part thereof.

142. Subject to the Constitution

(a) [Majlis-e-Shoora (Parliament)] shall have exclusive power to make laws with respect to any matter in the Federal Legislative List; (b) Majlis-e-Shoora (Parliament) and a Provincial Assembly shall have power to make laws with respect to criminal law, criminal law, criminal procedure and evidence;] (c) subject to paragraph (b), a Provincial Assembly shall, and Majlis-e-Shoora (Parliament) shall not, have power to make laws with respect to any matter not enumerated in the Federal Legislative List;] (d) Majlis-e-Shoora (Parliament) shall have exclusive power to make laws with respect to all matters pertaining to such areas in the Federation as are not included in any Province. (Emphasis supplied)

11. It is already a settled field by the Supreme Court of Pakistan that when body / provisions of the Constitution identify any particular power to legislate, as if it vests with the Parliament or Provincial Assemblies, then reference to legislative entries in the fourth schedule to the Constitution is hardly of any consequence. In case titled Province of Sindh through Chief Secretary and others v. M.Q.M. through Deputy Convener and others 5 the Court repelled contentions made at the bar that Parliament can make laws only as mandated under the Federal Legislative List given in the fourth schedule to the Constitution, in view of the fact that those powers, on the relevant area in the said case, are given in the body of the Constitution. It is ruled that Constitutional intent has to be gathered from the body of the Constitution as well and not merely the Legislative List. Paragraph No. 62 of the said judgment reads as follows:- "

62. Since Article 222(b) does not exclude the delimitation of constituencies for local government, and as the body of the Constitution specifies the appropriate legislature which should pass the law, any reference to the provisions of the legislative entries contained in Item 4 of the Fourth Schedule are of no consequence. There are similar provisions in the Constitution qua which there is no corresponding entry in the Federal Legislative List. For example, Article 6 clearly provides that the Majlis-e-Shoora (Parliament) will pass the law for high treason. But there is no corresponding entry in the 4th Schedule prescribing the subject of high treason in the Federal Legislative List. Article 142(c) could not be pressed into service to say that since the 4 Schedule is silent, in terms of Article 142(c), the Provincial Legislature would legislate in respect of high treason. When the main body of the Constitution provides for the competent legislature it is not necessary to look into the legislative list. Under Article 87(2), the Majlis-e-Shoora (Parliament) may enact law for condition of service of secretarial staff, whereas in this regard there is no corresponding entry in the Federal Legislative List; that Article 237 empowers the Majlis-e-Shoora (Parliament) to make laws for indemnity; against there is no entry to that effect in the Federal Legislative List; that under Article 253 the Majlis-e- Shoora Parliament) may make laws pertaining to maximum limits as to property etc; however, there is no corresponding entry in the Federal Legislative List; Article 146(2) states that the Majlis-e-Shoora (Parliament) may enact laws to confer powers of Provinces or their officers, but there is no entry in this regard in the Federal Legislative List; that under proviso to clause (2) of Article 212, the Majlis-e-Shoora (Parliament) may make laws in relation to administrative tribunals, however, there is no corresponding entry in the Federal Legislative List; that even though electricity" falls under entry 4 of the Part II of the Federal Legislative List, under Article 157(2)(b) the Provincial Government is empowered to levy tax on consumption of electricity within the Province and that Entry 58 of the Part 1 of the Federal Legislative List, clearly provides that the matters which under the Constitution are within the legislative competence of Majlis-e-Shoora (Parliament) or relate to the Federation, would fall under the domain of the Federal Legislature. In the instant case, as explained above, under the relevant Articles of the Constitution, the subject matters of delimitation and conduct of Local Government Elections fall under the domain of Parliament / Federal Legislature (Emphasis supplied)

12. In Messrs Sui Southern Gas Company Ltd. and others v. Federation of Pakistan and others 6 it was observed that from the provisions of the Constitution it is clear that the Federal Legislature has extra-territorial authority to legislate but no such extra-territorial authority is assigned to the Provincial Legislature. In this case the Honourable Supreme Court relied on Article 141 of the Constitution and reached to the conclusion that Provincial Legislature has no legislative competence to legislate law regulating the trade unions functioning at trans-provincial level. Reproducing a relevant extract from the said judgment will be beneficial:- ".... This interpretation also finds support from the fact that in terms of Article 141 of the Constitution, a Provincial Legislature does not possess extra- territorial legislative competence and therefore, cannot legislate with regard to a subject which in its application has to transcend the provincial boundaries. It is to be noted that as clarified by the learned High Court the resort to Entry No. 58 ibid could only be made to deal with an extra-ordinary situation i.e. when a matter may fall within the legislative competence of the Province but when it comes to its application it has to travel beyond the territorial boundaries of the Province, bringing it into the domain of the Federal Legislation. Thus, it is held that the federal legislature has the competence to legislate relating to the Establishments/Trade Unions functioning at the Federal as well as trans-provincial level. (Underlining is added)

13. The above judgments were later on relied by the Supreme Court of Pakistan in case titled Government of Sindh through Secretary Health Department and others v. Dr. Nadeem Rizvi and others 7 and it has been observed that it is not necessary to look into legislative list when the main body of the Constitution provides the requisite powers. The Supreme Court of Pakistan has recently reiterated the same in case titled Muslim Commercial Bank Limited v. Muhammad Anwar Mandokhel and others 8, whereby, while referring to Article 141 of the Constitution, following has been observed:- .From the above provision of the Constitution, it is abundantly clear that the Parliament has extra-territorial authority to legislate, but the Provincial Legislature has no legislative competence to legislate a law regulating the establishments and industries functioning at the trans-provincial level. Keeping in mind the afore-noted legal position, we have carefully examined the BIRO, 2010 and the BIRA, 2010 and have found that they do invest the Provincial Labour Court with the authority to adjudicate upon the matters relating to the trans-provincial establishments even if they provide so, it could not sustain under the law .. (Underlining is added)

14. The categories or fields falling in the Federal Legislative List, in terms of Article 142(a) of the Constitution, are within the exclusive domain of Parliament. The Provincial Assemblies have power to make laws with respect to any matter not enumerated in the Federal Legislative List. Then Article 142(d) of the Constitution again gives exclusive powers to Parliament with respect to all matters pertaining to such areas in the Federation as are not included in territorial limits of any of the Province. Meaning thereby, the Parliament has power to make laws given in Federal Legislative List as well as the matters pertaining to such areas which are not included in any Province. Article 141 of the Constitution embodies that Parliament has power to make laws having extra-territorial operation for whole or any part of Pakistan and the Provinces can make laws within their territorial limits.

15. The above leaves no ambiguity with regard to intent of the Constitution makers that when it is not within the competence of any of the Province to impose tax in connection with a subject-matter, on account of its restriction of territorial limits, then the Parliament has competence in this regard. The Provincial Legislature can tax immovable property which is located within its territories. Suitable laws exist or have been made by the relevant Provincial Legislative authorities in this regard. However, the tax in question is to be paid by resident individual(s) on their foreign assets, as already defined in subsection 13(c) of the Act of 2022, when such assets have aggregate value exceeding rupees one hundred million. Undisputedly, section 8(2)(b) of the Act of 2022 refers to assets, which do fall within the territorial limits of the Provinces. It seems that the appellants are attempting to seek complete escape from the tax, by adopting incorrect approach towards Articles 141 and 142 of the Constitution and also by misinterpreting entry 50 as to competence of the Parliament to legislate. The interpretation put-forth by the appellants, even otherwise, infringes the settled principle in M/s Ellahi Cotton Mills Ltd. and others v. Federation of Pakistan through Secretary Ministry of Finance, Islamabad and 06 others 9 that the Courts must lean in favour of upholding the constitutionality of a legislation keeping in view that the rule of Constitutional interpretation is that there is a presumption in favour of the constitutionality of legislative enactment unless ex-facie it is violative of Constitutional Provision.

16. I have carefully gone through the judgments of the two Honourable Judges and I am in consonance with the view adopted by my learned brother Anwaar Hussain, J. Therefore, I am of the opinion that the captioned Intra Court Appeal along-with connected matters are liable to be dismissed. The matter shall now be placed before the Honourable Division Bench for announcement of final decision. Sd/= Schedule A Sr. # Case # Title of Case 1 I.C.A No. 13110/23 Ghazi Akhtar Khan v. Federation of Pakistan and others. 2 I.C.A No. 13074/23 Mian Taufique Sayeed Saigol v. Federation of Pakistan and others. 3 I.C.A No. 13079/23 Sayeed Tariq Saigol v. Federation of Pakistan and others. 4 I.C.A No. 13080/23 Shahid Iqbal v. Federation of Pakistan and others. 5 I.C.A No. 13101/23 Zain ul Hassan Shabbir v. Federation of Pakistan and others. 6 I.C.A No. 13167/23 Imran Lateef v. Federation of Pakistan and others. 7 I.C.A No. 7933/23 Zaka Uddin Malik v. Federation of Pakistan and others. 8 I.C.A No. 13133/23 Sara Irfan v. Federation of Pakistan and others. 9 I.C.A No. 13140/23 Farrukh Shahzad Malik v. Federation of Pakistan and others. 10 I.C.A No. 13105/23 Ambar Shahzad Malik v. Federation of Pakistan and others. 11 I.C.A No. 13059/23 Mr. Imran Aslam v. Federation of Pakistan and others. 12 I.C.A No. 13142/23 Shahid Iqbal Khan Lodhi v. Federation of Pakistan and others. 13 I.C.A No. 13159/23 Shahzad Malik and 4 others v. Federation of Pakistan and others. 14 I.C.A No. 13134/23 Wahaaj Tariq and another v. Federation of Pakistan and others. 15 I.C.A No. 13075/23 Zahid Hussain Ch. v. Federation of Pakistan and others. 16 I.C.A No. 13085/23 Mrs. Saadia Tariq v. Federation of Pakistan and others. 17 I.C.A No. 13136/23 Omer Farooq Kabir Sheikh and another v. Federation of Pakistan and others. 18 I.C.A No. 13096/23 Mrs. Tahira Naheed Sufi v. Federation of Pakistan and others. 19 I.C.A No. 13064/23 Ahsan Ashraf v. Federation of Pakistan and others. 20 I.C.A No. 13099/23 Khalid Hadayat Ullah Sufi v. Federation of Pakistan and others. 21 I.C.A No. 13146/23 Sohail Ahmed Kabir v. Federation of Pakistan and others. 22 I.C.A No. 13086/23 Mr. Tariq Ullah Sufi v. Federation of Pakistan and others. 23 I.C.A No. 13139/23 Hamza Tariq Sufi v. Federation of Pakistan and others. 24 I.C.A No. 16709/23 Moonis Elahi v. Federation of Pakistan and others. 25 I.C.A No. 13095/23 Muhammad Naeem Saigol and 3 others v. Federation of Pakistan and others. 26 I.C.A No. 13104/23 Mr. Muhammad Zeid Yousuf Saigol v. Federation of Pakistan and others. 27 I.C.A No. 13152/23 Shahid Kamil Butt and another v. Federation of Pakistan and others. 28 I.C.A No. 13131/23 Mrs. Shaheen Nasir v. Federation of Pakistan and others. 29 I.C.A No. 13094/23 Osman Aziz Anwar v. Federation of Pakistan and others. 30 I.C.A No. 13163/23 Zahra Ali Elahi v. Federation of Pakistan and others. 31 I.C.A No. 13091/23 Fiza Ashraf Puri v. Federation of Pakistan and others. 32 I.C.A No. 13089/23 Shahnaz Sajjad Ahmed v. Federation of Pakistan and others. 33 I.C.A No. 13063/23 Sana Ashraf v. Federation of Pakistan and others. 34 I.C.A No. 13145/23 Ch. Muhammad Zaka Ashraf v. Federation of Pakistan and others. 35 I.C.A No. 13060/23 Zunaira Atif v. Federation of Pakistan and others. 36 I.C.A No. 13067/23 Adnan Ali v. Federation of Pakistan and others. 37 I.C.A No. 13056/23 Muhammad Ayub Sheikh v. Federation of Pakistan and others. 38 I.C.A No. 13141/23 Naushaba Zaka Ashraf v. Federation of Pakistan and others. 39 I.C.A No. 13078/23 Khalid Javaid v. Federation of Pakistan and others. 40 I.C.A No. 13062/23 Ikram Elahi v. Federation of Pakistan and others. 41 I.C.A No. 13088/23 Inam Elahi v. Federation of Pakistan and others. 42 I.C.A No. 13102/23 Sh. Fezan Majid Kapur v. Federation of Pakistan and others. 43 I.C.A No. 13077/23 Sh. Tahir Majid Kapur v. Federation of Pakistan and others. 44 I.C.A No. 13061/23 Sh. Akhtar Majid Kapur v. Federation of Pakistan and others. 45 I.C.A No. 13069/23 Sufi Muhammad Amin v. Federation of Pakistan and others. 46 I.C.A No. 13155/23 Sheikh Amer Majid Kapur v. Federation of Pakistan and others. 47 I.C.A No. 13081/23 Kamal Mannoo v. Federation of Pakistan and others. 48 I.C.A No. 13090/23 Ahsan Bashir v. Federation of Pakistan and others. 49 I.C.A No. 13055/23 Shahbaz Alam Monnoo v. Federation of Pakistan and others. 50 I.C.A No. 13087/23 Mahvish Ahmed Ellahi v. Federation of Pakistan and others. 51 I.C.A No. 13103/23 Khalid Bashir v. Federation of Pakistan and others. 52 I.C.A No. 13072/23 Ayesha Danish Monnoo v. Federation of Pakistan and others. 53 I.C.A No. 13070/23 Danish Kaisar Monnoo v. Federation of Pakistan and others. 54 I.C.A No. 13116/23 Mr. Ahmar Sarwar v. Federation of Pakistan and others. 55 I.C.A No. 13068/23 Sheraz Jahangir Monnoo v. Federation of Pakistan and others. 56 I.C.A No. 13151/23 Jehangir Azam Monnoo v. Federation of Pakistan and others. 57 I.C.A No. 13092/23 Ahmad Ali Tariq v. Federation of Pakistan and others. 58 I.C.A No. 13065/23 Khurram Tariq v. Federation of Pakistan and others. 59 I.C.A No. 13066/23 Sara Rehman v. Federation of Pakistan and others. 60 I.C.A No. 13083/23 Ibrahim Shamsi v. Federation of Pakistan and others. 61 I.C.A No. 13143/23 Mr. Sheikh Mehboob Ahmed v. Federation of Pakistan and others. 62 I.C.A No. 13147/23 Mr. Muhammad Ali Khan v. Federation of Pakistan and others. 63 I.C.A No. 13149/23 Mr. Nasir Shafi v. Federation of Pakistan and others. 64 I.C.A No. 13127/23 Mr. Shahid Nazir Ahmad v. Federation of Pakistan and others. 65 I.C.A No. 13123/23 Mr. Muhammad Hussain Khan Niazi v. Federation of Pakistan and others. 66 I.C.A No. 13119/23 Mr. Nadeem Ahmed Siddiqui v. Federation of Pakistan and others. 67 I.C.A No. 13132/23 Mrs. Nazia Nazir Ahmed v. Federation of Pakistan and others. 68 I.C.A No. 13058/23 Kamal Yousaf v. Federation of Pakistan and others. 69 I.C.A No. 13130/23 Mr. Muhammad Ayaz Khan Niazi v. Federation of Pakistan and others. 70 I.C.A No. 13054/23 Ahsan Kamal v. Federation of Pakistan and others. 71 I.C.A No. 13124/23 Mr. Hamza Waqar Malik v. Federation of Pakistan and others. 72 I.C.A No. 13107/23 Afaque Majeed v. Federation of Pakistan and others. 73 I.C.A No. 13111/23 Mr. Shahbaz Ali Malik v. Federation of Pakistan and others. 74 I.C.A No. 13118/23 Muhammad Momin Ali malik v. Federation of Pakistan and others. 75 I.C.A No. 13113/23 Muhammad Faizan Ch. v. Federation of Pakistan and others. 76 I.C.A No. 13135/23 Umer Farooq and another v. Federation of Pakistan and others. 77 I.C.A No. 14878/23 Mrs. Humaira Farooq Sohail v. Federation of Pakistan and others. 78 I.C.A No. 14882/23 Syed Mohsin Raza Naqvi v. Federation of Pakistan and others. 79 I.C.A No. 14888/23 Athar Hayat v. Federation of Pakistan and others. 80 I.C.A No. 14886/23 Adil Bashir v. Federation of Pakistan and others. 81 I.C.A No. 14885/23 Ms. Mustaneez Ahmed Jan v. Federation of Pakistan and others. 82 I.C.A No. 14884/23 Asjad Saeed v. Federation of Pakistan and others. 83 I.C.A No. 15024/23 Danyal Naveed Ahmad v. Federation of Pakistan and others. 84 I.C.A No. 19534/23 Muhammad Jahangir Muggo v. Federation of Pakistan and others. 85 I.C.A No. 19529/23 Faiz Yaqub v. Federation of Pakistan and others. 86 I.C.A No. 19519/23 Abdul Rahim Nasir v. Federation of Pakistan and others. 87 I.C.A No. 19525/23 Raza Nasir v. Federation of Pakistan and others. 88 I.C.A No. 18861/23 Muhammad Kamran Sabir v. Federation of Pakistan and others. 89 I.C.A No. 24997/23 Abdus Sami v. Federation of Pakistan and others. 90 I.C.A No. 17225/23 Sarmeen Alam v. Federation of Pakistan and others. 91 I.C.A No. 18648/23 Naseer-ud-Din Siddiqui v. Federation of Pakistan and others. 92 I.C.A No. 19509/23 Sadia Irfan v. Federation of Pakistan and others. 93 I.C.A No. 19517/23 Safdar Aamir Arshad v. Federation of Pakistan and others. 94 I.C.A No. 19513/23 Nageen Faiq v. Federation of Pakistan and others. 95 I.C.A No. 19507/23 Jawed Anwar v. Federation of Pakistan and others. 96 I.C.A No. 19522/23 Farhat Jehan v. Federation of Pakistan and others. 97 I.C.A No. 19521/23 Shaiq Jawed v. Federation of Pakistan and others. 98 I.C.A No. 19516/23 Faiq Jawed v. Federation of Pakistan and others. 99 I.C.A No. 25004/23 Furqan Elahi v. Federation of Pakistan and others. 100 I.C.A No. 20568/23 Syed Sheharyar Ali v. Federation of Pakistan and others. 101 I.C.A No. 20571/23 Syed Shahid Ali Shah v. Federation of Pakistan and others. 102 I.C.A No. 20574/23 Faisal Farid v. Federation of Pakistan and others. 103 I.C.A No. 26756/23 Farhatullah Sheikh and another v. Federation of Pakistan and others. 104 I.C.A No. 25203 /23 Syed Kamran Haider v. Federation of Pakistan and others. 105 I.C.A No. 26760/23 Omer Habib Khan v. Federation of Pakistan and others. 106 I.C.A No. 30913/23 Sultan Gohar v. Federation of Pakistan and others. 107 I.C.A No. 30919/23 Gohar Ejaz v. Federation of Pakistan and others. 108 I.C.A No. 28716/23 Muhammad Siddique v. Federation of Pakistan and others. 109 I.C.A No. 28721/23 Tariq Salah ud Din v. Federation of Pakistan and others. 110 I.C.A No. 29776/23 Humayun Maqbool v. Federation of Pakistan and others. 111 I.C.A No. 29950/23 Asif Bashir v. Federation of Pakistan and others. 112 I.C.A No. 31608/23 Amatul Ch. v. Federation of Pakistan and others. 113 I.C.A No. 33570/23 Mr. Sana Ullah Chaudhary v. Federation of Pakistan and others. 114 I.C.A No. 34404/23 Khalid Saeed Khan v. Federation of Pakistan and others. 115 I.C.A No. 34053/23 Naureen Shehzad v. Federation of Pakistan and others. 116 I.C.A No. 40778/23 Shazia Tanvir v. Federation of Pakistan and others. 117 I.C.A No. 40777/23 Memoona Waseem v. Federation of Pakistan and others. 118 I.C.A No. 40774/23 Shahzad Ahmad v. Federation of Pakistan and others. 119 I.C.A No. 40776/23 Muhammad Arshad v. Federation of Pakistan and others. 120 I.C.A No. 79643/23 Mr. Rizwan Shafi v. Federation of Pakistan and others. 121 I.C.A No. 2971/23 Rana Tahir Iqbal v. Federation of Pakistan and others. 122 W.P. No.5981 /24 Rizwan Fareed v. Federation of Pakistan and others. 123 W.P. No. 5996/24 Qazi Humayun Fareed v. Federation of Pakistan and others. 124 W.P. No. 5997/24 Naveed Fareed v. Federation of Pakistan and others. 125 W.P. No. 9271/24 Hafiz Avais Ghani v. Federation of Pakistan and others. 126 I.C.A No. 15535/24 Waseem Ashfaq v. Federation of Pakistan and others. 127 W.P. No. 29034/24 Khurram Tariq v. Federation of Pakistan and others. 128 I.T.R. No.25901/24 Syed Savail Meekal Hussain v. Commissioner Inland Revenue and others. Sd/= JUDGMENT SHEET IN THE LAHORE HIGH COURT, LAHORE JUDICIAL DEPARTMENT I.C.A. No.13108 of 2023 Shehla Tariq Saigol Versus Federation of Pakistan and others JUDGMENT Date of hearing: 12-06-2023 APPELLANTS BY: M/s Salman Akram Raja, Ali Sibtain Fazli, Syed Muhammad Ijaz, Syed Naveed A. Andrabi, Muhammad Ajmal Khan, Shehbaz Butt, Faisal Rasheed Ghauri, Barrister Muhammad Abu Bakar, Azeem Hafeez, Raheel Safdar, Rai Amer Ijaz Kharal, Hammad ul Hassan Hanjra, Basharat Ali Awan, Ibrahim Haroon, Ghias Ahmad, Ahsan Ahmad, Ch. Babar Waheed, Muqaddam Sukhera, Nadeem Shahzad Hashmi, Usman Ali Bhoon, Malik Ahsan Mahmood, Anas Irtiza Awan, Waseem Ahmad Malik, Ch. Wasim Ismail, Muhammad Shabbir Hussain, Mahmood Arif, Ibrahim Shahbaz Butt, Muhammad Ahsan Mahmood, Asad Abbas, Usman Zia, Mudasir Cheema, Abad ur Rehman, Hasham Ahmad Khan, Umar Tariq Gill, Kaivan Hossain Mir, Isa Ahmad Jalil, Muhammad Hamza Rauf, Muhammad Imam Khan, Fahim Khadam, Syed Faryad H. Shah Tirmizi, Khurram Saleem, Muhammad Iqbal Sabri, Raja Hamza Anwar, Mansha Sukhera, Zeeshan Asif, Muhammad Ali Awan, Omer Iqbal Khawaja, Saqib Qadeer, Muhammad Abrar, Yasir Hameed, Azeem Suleman, Muhammad Arslan Saleem Chaudhry, Mohsin Majeed, Faisal Anwar Minhas, Muhammad Zeeshan Sulehria, Kashif Habib Sheikh, Malik Nadir Ali Sherazi, Muhammad Usman, Muhammad Waseem Akram, Asad Javed Jutt, Ahmad Khalid, Waqar Fayyaz Dogar, Mian Nafees Bashir, Syed Kamal Ali Haider, Ashiq Ali Rana, Ch. Sabir Ali, Ali Raza Advocates. RESPONDENTS BY: Mr. Asad Ali Bajwa, D.A.G. Mr. Muhammad Mansoor Sial, Asst. Att. General. Ms. Sheeba Qaiser, A.A.G. M/s Barrister Ahmad Pervaiz, Shahzad Ahmad Cheema, Malik Abdullah Raza, Qaiser Zaman, Ibrar Ahmad, Ms. Riaz Begum, Falak Sher Khan, Saffi ul Hassan, Muhammad Nouman Khan, Jawad H. Tarar and Ms. Scheharezade Shahryar, Advocates. SHAHID KARIM, J.

This appeal under section 3 of the Law Reforms Ordinance, 1972 brings a challenge to the judgment dated 22.12.2022 passed by a learned Single Judge of this Court. Through this judgment a cluster of appeals (listed in Appendix-I) will also be disposed of. This judgment will also decide a number of constitutional petitions directly fixed before this Court on the same issue and raising a common challenge.

2. In sum, the appellants before the learned Single Judge sought a declaration regarding section 8(2)(b) of the Finance Act, 2022 ("the Act, 2022") to the effect that the provision was outwith the authority of the Parliament and, therefore, the imposition of capital value tax in terms of the provision was ultra vires and unconstitutional. The constitutional petitions were dismissed by the learned Single Judge and the appellants are now before this Court in appeal.

3. Section 8(2)(b) of the Act, 2022 provides that: "8(2) Capital value tax shall be charged on the following assets. (a) __________ (b) foreign assets of a resident individual where the value of such assets on the last day of the tax year in aggregate exceeds Rupees one hundred million".

4. Section 8(2)(b) is an imposition of a capital value tax (CVT) to be charged on, inter alia, foreign assets of resident individual where the value of such assets on the last day of the tax year in aggregate exceeds Rupees one hundred million. The term resident individual has been given the same meaning as defined in the Income Tax Ordinance, 2001. Both the counsels for the parties are on common ground with regard to the fact that CVT has been levied on a resident individual within the jurisdiction of the Parliament and who owns foreign assets of the value given in section 8(2)(b). It is also undisputed that the tax is on an individual and not on the property. Section 8(2)(1) imposes a tax on the foreign assets of a "resident individual" and the chargeability of CVT is on the value held by a resident individual and does not attach to foreign property/ asset. Hence, the residence in Pakistan of the person subjected to tax is a key component of the taxable event.

5. The term resident individual has been defined in the Act, 2022 as: "(f) "resident individual" shall have the same meaning as defined in the Income Tax Ordinance, 2001 (XLIX of 2001)." It has the same meaning as in Income Tax Ordinance, 2001 which has the following definition:

82. Resident individual.

An individual shall be a resident individual for a tax year if the individual- a. is present in Pakistan for a period of or periods amounting in aggregate to, one hundred and eighty-three days or more in the tax year; b. *** c. is an employee or official of the Federal Government or Provincial Government posted abroad in the tax year; d. being a citizen of Pakistan is not present in any other country for more than one hundred and eighty two days during the tax year or who is not a resident taxpayer of any other country." This definition may not detain us any further since none of the appellants or petitioners before us claim to be outside this definition. Yet what is important is that if a person is not a resident individual (under Section 82) he is not liable to tax under section 8(2)(b) and it does not matter if he holds foreign assets or not. To reiterate, the tax is on a resident individual and not on foreign assets. The Issue:

6. The arguments in this Court centred on Entry 50 to the Federal Legislative List (Fourth Schedule of the Constitution) (Entry 50) which provides that: "Taxes on the capital value of the assets, not including taxes on immovable property". Learned counsel for the appellants contended before the learned Single Judge and reiterated before this Court that Entry 50 has to be read as a whole and the later part of the Entry is an exception to the first part and the two cannot be separated. Contrarily, learned counsel for Federal Government as well as Federal Board of Revenue (FBR) defended the decision. handed down by the learned Single Judge which is premised on the separability of the Entry into two parts. In a nub, learned Single Judge held that the latter clause in Entry 50 viz. "taxes on immovable property" (the second clause) was a separate power to levy taxes on immovable property and had no relation with the first clause of Entry 50, that is, "tax on capital value of assets" (the first clause) which would include according to the reading of learned Single Judge as well as the Federal Government and FBR all taxes on capital value of movable aid immovable assets comprised in the broader term 'assets' as mentioned in Entry

50. In my opinion, the appellants/ petitioners have a better reading of Entry 50 of the Constitution and Section 8(2)(b) of the Finance Act, 2022. The respondents' interpretation defies a traditional rule of statutory construction. Venerable and key principles of interpretation supply a way to resolve the conundrum. At the outset, let me start by quoting from a canonical 1928 case "the power to tax is not the power to destroy while this Court sits." (Panhandle Oil Co. v. Mississippi ex rel. Knox, 277 U.S. 218, 223 (1928)-Oliver Wendell Holmes, J. of US Supreme Court). The Opinion:

7. Firstly, it may be stated that Entry 50 is part of the Federal Legislative List which is the domain and remit of the Parliament to legislate upon. This is the mandate of Articles 141 and 142 of the Constitution of Islamic Republic of Pakistan, 1973 (the Constitution). It is by now settled by respectable authority of our superior courts that legislative entries must be given large and liberal interpretation and that the allocation of subjects to the list is not by way of scientific or logical definition but by way of mere simple enumeration of broad categories. The question as adumbrated which engages this Court is whether Entry 50 has to be read in two parts or conjointly. Do they form a stem from a common root? This is at the heart of the controversy since CVT has been levied on immovable properties owned by the appellants. At first blush, the Entry 50 seems ambiguous and indeterminate. Yet the historical context would lend actuality to the analysis.

8. The simple answer to the contentions raised by the Federation and FBR is that if the legislature intended to provide two fields of legislative subjects then the simpler method would have been not to provide the second clause in Entry

50. For, under the framework of our constitutional scheme, any fields of legislation which are not included in the Federal Legislative List are within the domain of the provincial legislature to legislate upon. Upon deletion of the words 'not including taxes on immovable property' from Entry 50, the ineluctable conclusion would have been that that subject was within the provincial domain and the Parliament was restrained from legislating upon it. The framers cannot be imputed an intention to create two disparate and distinct entries. In this case however the entire entry was retained by the legislature and no extraneous considerations can be imputed to the legislature in providing for two different fields of legislation within one entry.

9. The general rule is that a provision containing a proviso or an exception. must be construed as a whole, in accordance with the usual principle that an Act must be construed as a whole. This rule must be applied not only while construing a statute but also a constitutional provision and there is no reason to hold that this rule will not be applied while construing an entry in the Federal Legislative. List. Suffice to say that such an entry must be considered as a whole including an exception provided in that entry. This was reiterated in Jennings v. Kelly [1940] AC 206 at 229.

10. I shall refer to Bennion, Baily and Norbury on Statutory Interpretation (Eighth edition) for the proposition regarding exceptions, provisos and savings. The following statement would be relevant for our purposes: "17.5 Exceptions and provisos 1) A provision that is of general application will often contain exceptions for particular cases. 2) In older Acts exceptions sometimes takes the form of a proviso. This is a formula beginning Provided tha t, which is placed at the end of a provision, with the intention of narrowing the effect of the preceding words. 3) The main significance attached to identifying something as a proviso or exception nowadays relates to the burden of proof. Comment There are, of course, any number of ways in which a general legislative proposition may be qualified. One approach is to limit the scope of the general proposition so as to exclude any special cases (eg 'animals apart from dogs ). An alternative approach is to set out the general proposition before going on to set out any qualifications. In modern Acts exceptions often appear in a separate provision but in the past an exception might take the form of a proviso at the end. The proviso is an ancient verbal formula but has now largely fallen into disuse. Burden of proof The main significance of identifying a statement as an exception or proviso relates to the burden of proof. A person who wishes to take advantage of an exception will as a general rule have the onus of proving that it applies. Whether or not a particular provision amounts to an exception is a question of construction. In the criminal context, a considerable body of case law has developed about 'reverse burdens' and their compatibility with the European Convention on Human Rights. Detailed consideration is outside the scope of this work and reference should be made to specialist texts. Interpretation A proviso or other exception is usually limited in its operation to the section or other provision it qualifies. A provision containing a proviso must be construed as a whole, in accordance with the usual principle that an Act must be construed as a whole."

11. Thus, according to the above statement a provision which is of general application will often contain exceptions for particular cases and one approach is to limit the scope of the general proposition so as to exclude any special cases. In my opinion, Entry 50 when read as a whole merely contains an exception in providing the second clause, that is, "not including taxes on immovable property". C

12. Learned counsel for FBR relied upon Entry 49 to contend that the word 'except' has been used in that entry and which connotes a separate category of taxation within the jurisdiction of Provincial Assemblies. Indeed, the term 'except' used in Entry 49 has created a separate category and this can be culled out by reading the entire Entry

49. Similarly in Entry 50 the words "not including" connote an exclusion and an exception and has relation to the first part necessarily. When read in its entirety Entry 50 means taxes on capital value of assets but not an asset which is in the nature of immovable property. The term 'assets' is a broad term and includes tangible assets such as land and buildings as also other assets such as securities, trading stock, investments, cash etc. But this argument ignores the essential features of Entry

49. Although the words following 'except' in Entry .49 intend to exclude but this is not by a distinct subject but has nexus with the earlier part. Entry 49 excludes sales tax on services from Parliament's ambit yet the entire entry is related to the subject of sales tax. Thus the subject of the entry is the same. This is a common thread running through the Fourth Schedule. There is a primary field from which an exception is carved out. This is also evident from an appraisal of section 8(2)(b) where capital value tax has been levied not only on foreign assets of a resident individual but also on motor vehicles and such assets or class of assets as specified by the Federal Government through a notification in the official gazette. Thus the imposition is broad and widely conferred on different assets held by a person and such assets may be expanded by the Federal Government through notification and this power has been delegated by virtue of section 8 of the Act, 2022. This lends further credence to the argument that the words "not including taxes on immovable property" would have relevance and essential nexus to the first clause of Entry 50 and therefore excludes capital value tax and its imposition on immovable property. Significantly, section 8(2)(b) imposes CVT on 'foreign assets' which may include other assets apart from immovable property. In this litigation, however, the issue which engages us relates to CVT on immovable property which is merely one class of foreign assets and thus we proceed to determine to that extent only. The appellants, it seems, are aggrieved of the levy of CVT on their immovable properties held as a foreign asset. The rest of the foreign assets are beyond the scope of this challenge. C

13. Learned counsel for the Federal Government and FBR invites us to hold that the words "not including taxes on immovable property" define a separate field of legislation and must be read as such. To reiterate, I do not think that the legislature had to draft Entry 50 in such a manner and to go to such lengths in order to create a field of legislation for provincial legislature. If that were the case merely providing for the first clause was sufficient. I am also convinced that there cannot be two fields of legislation combined in one entry, one for the Parliament and the other for the Provincial Assembly.

14. The above view would gain further traction by consideration of Entry 50 prior to its amendment by the Act, 2010 (18th Amendment) which provided that: "Taxes on the capital value of the assets, not including taxes on capital gains on immovable property". The words "on capital gains" were omitted by the 18th Amendment and this has generated the controversy in the present cases. Priorly, Entry 50 was construed to mean that the taxes on capital gains on sale or purchase of immovable property were not within the competence of the Parliament to legislate upon and to impose a tax on the capital value of this category of assets. This was the view taken by a learned Single Judge of this Court in Muhammad Osman Gull and others v. Federation of Pakistan and others [(2023) 127 Tax 511 (H.C. Lah)]. The construction put on the un-amended Entry 50 was as follows: The judgments, ibid, confirm that the ouster of immoveable property from the Entry 50, before 18th Amendment, was only for the purpose of capital gain tax, otherwise immovable property was an essential part of the Assets, giving competence to tax Capital Value of Assets. Therefore, it is concluded and held that, before 1962 Constitution, tax on agriculture income and agriculture land was out of Federation or Centre s competence. After 1962 Constitution till 18th Amendment, immoveable property was always an essential component of Assets, bestowing competence to tax Capital Value of Assets to Federation. The exclusion of immoveable properly was only for the purpose of charging Capital Gain Tax. The Capital Gain Tax always was and is a part of income tax, competence of which is under Entry 47, and reason for placing it in Entry 50 was to exclude the immovable property from the definition of Capital Assets, only for the purpose of capital gain. The learned Single Judge was clear that capital gain tax was always a part of the broader category of income tax and Entry 50 excluded immovable property from the definition of capital assets only for the purpose of capital gain. The learned Single Judge thereafter went on to construe the interpretation of Entry 50 after it was amended by the 18th Amendment and with due deference to the erudition of learned Single Judge, I do not agree with such construction put on Entry 50 which was materially different from the earlier construction put on the un-amended Entry

50. The reason is simple. If a construction has been arrived at while interpreting the un-amended Entry 50, that construction cannot be varied under the same Constitutional scheme merely because of the omission of the words "on capital gains" in Entry

50. This would be fallacious and a contradiction in terms and cannot be permitted to be done while construing the Constitution or any of its provisions. If the un-amended Entry 50 excluded levy of CVT on capital gain on immovable property, then the amendment merely extended that exclusion to the entire set of incomes arising out of an immovable property from the levy and imposition of CVT. Sindh High Court Judgment:

15. A challenge to the levy was brought before the High Court of Sindh and a Division Bench of Sindh High Court upheld the challenge and declared that: "Post 18" Amendment, now the words "on capital gains" stands omitted from this Entry which now reads as taxes on the Capital Value of the assets, not including taxes on immovable property. This use of the words not including taxes on immovable property is in fact the entire gist of the case of the Petitioners regarding challenge to the levy of tax on their immovable properties abroad. Their case is that use of these words has taken away all powers of the Parliament in respect of any legislation or imposition of fax on any sort of immoveable property; hence, the properties abroad cannot be taxed as well, notwithstanding, that the said properties also do not fall within the territorial limits of the Provinces. It may also be relevant to note that post 18th amendment since there is no Concurrent List or a separate list for the Provinces, it has been argued that the use of the words not including taxes on immovable property now vest all powers and authority upon the Provinces to legislate and tax all such immoveable properties. With respect we are unable to agree with this for a number of reason to follow. The entry in question empowers the Parliament to levy taxes on the capital value of assets which includes all assets i.e. moveable and immovable. This use of the words not including taxes on immovable property is to be read as no tax can be levied by the Parliament on the capital value of an immoveable property. And that is all, it wouldn't fair, to interpret this as contended by the Petitioners Counsel that this excludes competence of the Parliament to legislate in all manners including imposition of taxes of any sort on immoveable property. It is only taxes on immoveable property which now can be taxed by Province; however, subject to the property being frilling within its territorial limits. The subject of immoveable property still remains with the Parliament subject to that the property is beyond the territorial limits of the Province. In fact, if it is not within the competence of the Province to impose tax on any immoveable property due to restriction in respect of its territorial limits, then it reverts back to the Parliament. This is the only interpretation which can be arrived at when the entire scheme of the Constitution and the Legislative entries are read as a whole and understood accordingly." D According to the learned Judges of the Sindh High Court, the issue was without any complication. It was categorically held that the use of the words not including taxes on-immovable property clearly meant that no tax could be levied by the Parliament on the capital value of an immovable property. The learned Judges did not enter into a long-drawn argumentation on this issue and were pithy and concise in arriving at that conclusion. I would respectfully follow the judgment of the Sindh High Court regarding this aspect which undoubtedly has persuasive value for this Court. The doctrine of precedent requires that the judgment of a coordinate High Court of a different Province on the same issue must be followed unless it is irrational or perverse in its reasoning. More so because the striking down of the provision in a law which applies across Pakistan by one High Court of a Province would give rise to an unsavory situation if not followed by a High Court of another Province particularly in matters of taxation. The learned Judges of the Sindh High Court thereafter delved into the interpretation of Article 141 of the Constitution which, in my opinion, is not the issue which should have engaged the learned Judges. To that extent we endorse the views of the learned Single Judge in the judgment under challenge before us and in particular the findings given in paragraph 30 of the impugned judgment. Be that as it may, that part of the judgment has not been brought under challenge by the respondents and no arguments were addressed by either of the parties on the construction of Article 141 of the Constitution and we have therefore declined to enter upon and decide the issue relating to extraterritoriality of legislation under Article 141 of the Constitution. D Capital value:

16. The term 'capital value' has not been defined in the Act, 2022. However, according to the Oxford Dictionary of Finance (third edition) 'capital value' means "the value on which an asset has been recorded in the balance sheet of a company or other organization usually before the deduction of depreciation". In Words and Phrases, Permanent Edition), Volume 6, the term 'capital value', has been described as: "For purposes of determining whether taxpayer could deduct loss as ordinary loss on sale of real property involved in sale and lease back agreement, "capital value" is any noncash consideration received over an above rental value of premises."

17. In many cases the legislature thinks it proper to define the term 'capital value' and which may take different connotations but is broadly limited to the definitions which have been reproduced above. In PLD 1989 Kar. 15 = 1989 PTD 488 it was held that "the term would mean the value expressed in terms of money of the properties of all kinds possessed by a person and it is in this sense that the expression is also commonly understood in commercial and business parlance." By section 8 of the Act, 2022 capital value tax has been imposed on the value of foreign assets of a resident individual and the method for calculation of the value of assets has also been given in subsection (3) of section 8 and which means the total cost of the foreign assets on the last day of the tax year in relevant foreign currency converted into Rupees as per exchange rates notified by State Bank of Pakistan for the said day. The rate of tax has been determined at 1% of the value of the asset. This in my opinion is the capital value of the assets in the peculiar circumstances of section 8 of the Act, 2022.

18. The words "not including" have been used in contradiction to the word "include" which does not ordinarily introduce an exception list. This is the rule both in English usage and canons of interpretation which have over the years been used by the superior courts all over the world to construe the said term. It was held by the U.S Supreme Court in Federal Land Bank of St. Paul v. Bismarck Lumber Co. 314 US 95, 100 (1941) that "the term 'including' is not one of all-embracing definition, but connotes simply an illustrative application of general principle." It went on to hold that 'including indicates a non- exhaustive list and helps to emphasis the non-exhaustive nature". Thus, if the word 'include' does not ordinarily introduce an exhaustive list, 'not including' on the other hand introduces an exhaustive list and creates an exception by the second clause of Entry

50. Seen in this perspective, the words "not including" restrict the imposition of CVT by excluding taxes on capital value of immovable property from its ambit. Textual Analysis:

19. In order to understand the true import of Entry 50 of the Fourth Schedule to the Constitution, the provisions of Article 142 and Article 143 will have to be given scrupulous attention. These Articles are contained in Part V of the Constitution and relate to the legislative business between the Federation and Provinces and the distribution of legislative powers. Article 142 delineates the subject matter of Federal and Provincial laws and provides that:

142. Subject to the Constitution- (a) Majlis-e-Shoora (Parliament) shall have exclusive power to make laws with respect to any matter in the Federal Legislative List; (b) Majlis-e-Shoora (Parliament,.) and a Provincial Assembly shall have power to make laws with respect to criminal law, criminal procedure and evidence; (c) Subject to paragraph (b), a Provincial Assembly shall, and Majlis-e-Shoora (Parliament) shall not, have power to make laws with respect to any matter not enumerated in the Federal Legislative List; (d) Majlis-e-Shoora (Parliament) shall have exclusive power to make laws with respect to all matters pertaining to such areas in the Federation as are not included in any Province.

20. A holistic reading of Article 142 brings forth the fields of legislative power as distributed by the Constitution. The Constitution now has one list contained in the Fourth Schedule which is the Federal Legislative List and the Parliament has the exclusive power to make laws with respect to any matter in that list. Paragraph b of Article 142 contains three subjects which are concurrent subjects on which both the Parliament and the Provincial Assembly has power to make laws. Paragraph 'c' clearly states that a Provincial Assembly shall and the Parliament shall not have power to make laws with respect to any matter not enumerated in the Federal Legislative List. It indubitably follows that the Parliament has the exclusive power to make laws with respect to any matter in the Federal Legislative List and if a matter is not enumerated in that list, the Provincial Assembly shall have power to make laws with respect to that matter which does not find mention in the Federal Legislative List.' The inference necessarily is that the framers of the Constitution did not feel the need to provide for a subject as an Entry in the Federal Legislative List to fall Within the competence of the Provincial Assembly to legislate upon. That would be unnecessary and senseless and none of these can be attributed to the framers of the Constitution. The unenumerated subject-matter is for the Provincial Assembly and the enumeration is only required to clothe the Parliament with the power to legislate. No enumeration is needed for the Provincial Assemblies. This is in the context of the holding of learned Single Judge that the second clause of Entry 50 constitutes a subject within the domain of Provincial Assembly. Had it been intended to be such a case it would have been much easier and commonsensical as well as in accord with the constitutional scheme to have entirely deleted the second clause of Entry 50 by retaining. the words "taxes on the capital value of the assets". That would have served the twin purpose being canvassed by the respondents. First, the Parliament would have been competent to levy CVT on immovable property (being included in the broad term "assets) and second, taxes on immovable property as contended by the respondents and as held by the learned Single Judge would have been within the competence of the Provincial Assembly to levy without more. In short, by the architecture of Article 142, the Fourth Schedule need not provide for or refer to any subject on which the Provincial Assembly has power to makes laws. This will be inferred by necessary implication and is textually demonstrable constitutional commitment. Thus the retention of the second clause of Entry 50 by the framers of 18th amendment had a purpose and that purpose cannot be brushed aside merely on a nuanced and remarkably cramped construction which leads to absurdity.

21. Article 143 provides that:

143. If any provision of an Act of a Provincial Assembly is repugnant to any provision of an Act of Majlis-e-Shoora (Parliament) which Majlis-e-Shoora (Parliament) is competent to enact, then the Act of Majlis-e-Shoora (Parliament), whether passed before or after the Act of the Provincial Assembly, shall prevail and the Act of the Provincial Assembly shall, to the extent of the repugnancy, be void.

99. The above provision in the Constitution relates to inconsistency between Federal and Provincial laws. It states that if any provision of an Act of a Provincial Assembly is repugnant to any provision of an Act of Parliament which Parliament is competent to enact then the Act of Parliament shall prevail and the Act of the Provincial Assembly shall be void to the extent of repugnancy. It has been mentioned above that the Provinces have enacted laws relating to capital value tax on immovable property including Punjab although the law in Punjab was repealed in the year 2017. These laws are: The Sindh Finance Act, 2010, Balochistan Finance Act, 2013 and Khyber . Pakhtunkhwa Finance Act, 2010, respectively. These laws are still valid and the levy is being charged under them. The holding of the learned Single Judge would have grave consequences for the Provinces, in that, the law enacted by the Provinces regarding levy of capital value tax on immovable property would be void since it has now been enacted by the Parliament. Under the constitutional scheme the two laws cannot exist concurrently. Yet neither the Federal Government nor the Provincial Government has taken exception to this and the taxpayers cannot be burdened with a tax of the same incidence levied by the two legislatures. It is also inconsistent with Article 142 since either one of the two legislatures can legislate on a subject which is contained in the Federal Legislative List and as explicated if it is not so included then the Provincial Assembly has the power to make laws. This would create an anomalous and unsavory situation indeed and the courts cannot embark upon an interpretation which leads to absurdity. FBR and Federal Government knew the intention:

23. There are contemporaneous events which lead to the ineluctable conclusion that both the FBR as well as the Federal Government were cognizant of the intention underlying the amendment made in Entry 50 through the 18th amendment. That intention was reflected in the actions taken by the Federal Government pursuant to the amendment and which comport with the instant opinion as well as the decision rendered by the High Court of Sindh.

24. Historically CVT was levied through section 7 of the Finance Act, 1989 by the Parliament. It was levied on acquisition by purchase on certain assets which included immovable property as well as motor vehicles. In later years amendments were made in section 7 to include or delete certain entries but the imposition of CVT remained in place till it was deleted by section 4 of the Finance Act, 2010. That omission only related to CVT on immovable property. Doubtless, the amendment was the consequence of the 18th amendment and recognition by the Federal Government that henceforth the subject was within the domain of the Provincial Assemblies and the Parliament was not competent to legislate upon it. The ambiguity if any was resolved by Circular No.3 of 2012 titled "Capital Value Tax" and was issued as an Explanation of important provisions relating to CVT on 01.08.2012. The Explanation provided that: "Scope of CVT. Prior to the 18th Constitutional Amendments effective from 19th April 2010 Entry 50 of the Federal Legislative List contained in Part-I of the Fourth Schedule to the constitution of Islamic Republic of Pakistan empowered the Federal Legislature to levy taxes on the capital value of the assets, not including taxes on capital gains on immoveable property. The words "on capital gains" were omitted by the 18th Constitutional amendment. The effect of omission of these words is that the Federal Legislature cannot impose taxes on capital value of immoveable property located in the provinces. Accordingly CVT was abolished through the Finance Act, 2010 as chare and levy of CVT became a provincial subject. Different provinces have started levy and collection of CVT on immoveable property through their respective Legislation. However, CVT in Islamabad Capital Territorial is to be o levied by the Federal Legislature and accordingly through amendment made in subsection (1) of section 7 of Finance Act, 1989, the levy of CVT has been reintroduced in Islamabad Capital Territory in respect of immovable property. The CVT is payable w.e.f 1st July, 2012 on the purchase of immoveable property with identical structure as adopted by the provinces."

25. A reading of the paragraph from Circular No.3 set out above clearly shows the effect of the amendment made in Entry 50 through the 18th amendment. The FBR was in no manner of doubt that Federal Legislature cannot impose taxes on Capital value of immovable property located in the Provinces and hence CVT was abolished through the Finance Act, 2010 as charge and levy of CVT became a Provincial subject. It also noted that different Provinces had started levy and collection of CVT on immovable property through respective legislation. This stance of FBR is in contradiction to the stance now being taken both by the Federal Government as well as FBR and cannot be countenanced. FBR cannot be permitted to take contradictory positions to the detriment of the taxpayers since the element of consistency would be seriously eroded. Moreover, taxpayers arrange their commercial and business transactions around a particular stance by the highest public authority which regulates the imposition and collection of taxes across Pakistan. FBR was under a bounden duty to have stuck to its earlier position taken in Circular No.3. On the contrary, FBR opposed these petitions and invited this Court to construe Entry 50 differently while ignoring the events which surrounded the amendment made through the 18th amendment. This element is of crucial importance and must inform any decision-making by this Court regarding true construction of Entry 50 and the intention which permeated the framers. Entry 44 and Entry 50 in pari materia:

26. Entry 50 of the Fourth Schedule is not the only Entry which is couched in terms whose interpretation is engaged in these petitions/appeals. Entry 44 is similarly worded and provides that: "

44. Duties of excise, including duties on salt, but not including duties on alcoholic liquors, opium and other narcotics."

27. Entry 44 is an analogous entry which relates to duties of excise and is drafted in similar terms to Entry

50. The words after the second comma are: "not including duties on alcoholic liquors, opium and other narcotics," (the second part). This part mentions the word duties alone and not duties of excise and begins with the words 'not including'. Would it therefore be proper to construe this entry to hold that the term 'duties' in the second part refers to some other duties of a different kind and not duties of excise so as to read it disjunctively as is being done for Entry

50. If the conclusion drawn by the learned Single Judge is to be accepted then the second part in Entry 44 should also mean simply duties on alcoholic liquors, opium and other narcotics and not duties of excise in respect of these items. Surely there cannot be an undefined duty to be imposed by a legislature. In my opinion, this is not what Entry 44 means as it entirely relates to duties of excise (one subject-matter) and thus, the part of it after the second comma also talks about duties of excise on alcoholic liquors, opium and other narcotics which would fall within the domain of the Provincial Assembly. There cannot be a different interpretation put on Entry 44 from the one which is sought to be put on Entry 50 as there is absolutely no difference in the terminology used in these Entries which have been enacted in similar terms.

28. This is called Related-Statutes canon which prescribes that statutes in pari materia are to be interpreted together, as though they were one law. In Reading Law by Antonin Scalia and Bryan A. Garner, it has been explained thus: "Any word or phrase that comes before a court for interpretation is part of a whole statute, and its meaning is therefore affected by other provisions of the same statute. It is also, however, part of an entire corpus juris. So, if possible, it should no more be interpreted to clash with the rest of that corpus than it should he interpreted to clash with other provisions of the same law. Hence laws dealing with the same subject being in pari materia (translated as "in a like matter ) should if possible be interpreted harmoniously. As James Kent explained in 1826: "Several acts in pari materia, and relating to the same subject, are to be taken together, and compared in the construction of them, because they are considered as having one object in view, and as acting upon one system." "Statutes", Justice Frankfurter one wrote, "cannot be read intelligently if the eye is closed to considerations evidenced in affiliated statutes." Part of the statute's context is the corpus juris of which it forms a part, and this corpus can be dauntingly substantial. What is required, according to a British judge, is a "conspectus of the entire relevant body of the law for the same purpose."

29. A similar entry was contained in the Constitution of 1962. Clause 'b' of Item 43 of the Third Schedule of 1962 Constitution dealt with duties of excise and provided that: "

43. Duties and taxes, as follows: (a) .. (b) duties of excise (including duties on salt), but not including duties on alcoholic liquor, opium or other narcotics.

30. A comparison of paragraph 'b' of Item 43 in the Third Schedule of the 1962 Constitution with Entry 44 of the Fourth Schedule to the 1973 Constitution would show that there is no difference at all in these Entries. In fact, Entry 44 is an exact reproduction of paragraph `b' of Item 43 of the 1962 Constitution. This Entry in the 1962 Constitution fell for determination before the Supreme Court of Pakistan which construed the Entry to mean that the duties of excise fall within the domain of the Parliament and the words "but not including duties on alcoholic liquor, opium or other narcotics" were taken to mean that the duties of excise on these items would be within the domain of the Provincial Assemblies. This was held in Hirjina & Co. v. Islamic Republic of Pakistan and another (1993 SCMR 1342) while making a comparison of relevant Entries in the Government of India Act, 1935, Constitution of 1956 and the 1962 Constitution. It was noted that the 1962 Constitution contained only one List (Third Schedule) which is similar to the present architecture of the 1973 Constitution. The appellants before the Supreme Court of Pakistan were owners of hotels, liquor bars and restaurants and they had been asked to pay excise duty in respect of services they rendered in providing rooms, liquor and other refreshments to their clients. They called in question the liability on a number of grounds including the law by which the services provided by them had been brought under tax. In the peculiar context of the present case, the following observations are relevant: "...However, so far as alcoholic drinks are concerned the matter stands on a different footing. Under item 43(b) of the Third Schedule of 1962 Constitution duty of excise on alcoholic liquor was specifically reserved for the Provincial filed. In the absence of any compelling reason we will be reluctant to construe clause (b) of section 4(3) of the Act in a manner that would include the cost of alcoholic liquor in the amount with reference to which excise duty might be charged by the Federal Government, otherwise it would be indirectly permitting the Federal Government to levy a tax which by express language of the Constitution belonged to another Government."

31. The observations set out above clearly show that the Supreme Court of Pakistan was emphatic that the duty of excise on alcoholic liquor was specifically reserved for the provincial field. While stating the words "duty of excise on alcoholic liquor" the Supreme Court of Pakistan was in no manner of doubt in relating the second part of paragraph `b' of Item 43 with the first part which prescribed the levy of duty of excise. It will be noted that in the second part of paragraph `b' of Item 43, the word 'duties' has been used without elaboration but the Supreme Court in Hirjina took the term to mean 'duties of excise' to link it to the first part. Thus, the Supreme Court of Pakistan not only read the Item 43 as a whole but also considered the words "not including" to be an exception to the duties of excise generally and which fell within the domain of the Central Government at that time. This precedent is on all fours with the questions that are engaged in these petitions/ appeals and which calls upon us to construe Entry 50 in the 1973 Constitution which is couched in the same terms as paragraph 'b' of Item 43 of the 1962 Constitution. E

39. In sum, the scheme of Entry 50 is that there is an enumeration of a subject-matter out of which an exception has been carved out. Thus a part of the tax in Entry 50 is for the Provincial Assembly to impose. Further, a reference to a genre of tax in one entry of the Fourth Schedule is to the same tax throughout and not to two or more different taxes. The conclusion of the learned Single Judge would imply that there are two different taxes amalgamated in Entry 50: one is the CVT on assets and the other is taxes on immovable property. This would be perverse and irrational. E

33. These appeals/petitions (Appendix-I) are allowed. Consequently: i. The impugned judgment, to the extent it upholds the levy of section 8(2)(b) of the Act, 2022, is set aside. ii. Section 8(2)(b) of the Act, 2022 is held unconstitutional and struck down. iii. The tax recovered under Section 8(2)(b) of the Act, 2022, shall be refunded forthwith. Sd/= Sd/= (Appendix-I) Sr. No. I.C.A. Nos. Title 1. 13064 of 2023 Ahsan Ashraf v. Federation of Pakistan and others 2. 14884 of 2023 Asjad Saeed v. Federation of Pakistan and others 3. 13092 of 2023 Ahmad Ali Tariq v. Federation of Pakistan and others 4. 13065 of 2023 Khurram Tariq v. Federation of Pakistan and others 5. 13107 of 2023 Afaque Majeed v. Federation of Pakistan and others 6. 13111 of 2023 Shahaz Ali Malik v. Federation of Pakistan and others 7. 13118 of 2023 Muhammad Momin Ali Malik v. Federation of Pakistan and others 8 13074 of 2023 Mian Taufique Sayeed Saigaol v. Federation of Pakistan and others 9. 13079 of 2023 Syeed Tariq Saigaol v. Federation of Pakistan and others 10. 13080 of 2023 Shahid Iqbal v. Federation of Pakistan and others 11. 13167 of 2023 Imran Latif v. Federation of Pakistan and others 12. 7933 of 2023 Zaka Uddin Malik v. Federation of Pakistan and others 13. 13059 of 2023 Imran Aslam v. Federation of Pakistan and others 14. 13142 of 2023 Shahid Iqbal Khan Lodhi v. Federation of Pakistan and others 15. 13091 of 2023 Fiza Ashraf Puri v. Federation of Pakistan and others 16. 13089 of 2023 Mrs. Shahnaz Sajjad Ahmed v. Federation of Pakistan and others 17. 13063 of 2023 Sana Ashraf v. Federation of Pakistan and others 18. 13145 of 2023 Ch. Muhammad Zaka Ashraf v. Federation of Pakistan and others 19. 13060 of 2023 Zunaira Atif v. Federation of Pakistan and others 20. 13067 of 2023 Adnan Ali v. Federation of Pakistan and others 21. 13056 of 2023 Muhammad Ayub Sheikh v. Federation of Pakistan and others 22. 13141 of 2023 Naushaba Zaka Ashraf v. Federation of Pakistan and others 23. 13078 of 2023 Dr. Muhammad Khalid Javaid v. Federation of Pakistan and others 24 13062 of 2023 Ikram Elahi v. Federation of Pakistan and others 25. 13088 of 2023 Inam Elahi v. Federation of Pakistan and others 26. 19509 of 2023 Sadia Irfan v. Federation of Pakistan and others 27. 19517 of 2023 Sadaf Aamir Arshad v. Federation of Pakistan and others 28. 19513 of 2023 Nageen Faiq v. Federation of Pakistan and others 29. 19507 of 2023 Jawed Anwar v. Federation of Pakistan and others 30. 19522 of 2023 Farhat Jehan v. Federation of Pakistan and others 31. 19521 of 2023 Shafiq Jawed v. Federation of Pakistan and others 32. 19516 of 2023 Faiq Jawed v. Federation of Pakistan and others 33. 25004 of 2023 Furqan Elahi v. Federation of Pakistan and others 34. 24997 of 2023 Abdus Sami v. Federation of Pakistan and others 35. 28716 of 2023 Muhammad Shafique v. Federation of Pakistan and others 36. 28721 of 2023 Tariq Salah ud Din v. Federation of Pakistan and others 37. 17225 of 2023 Sharmeen Alam v. Federation of Pakistan and others 38. 18648 of 2023 Naseer ud Din v. Federation of Pakistan and others 39. 19519 of 2023 Abdul Rahim Nasir v. Federation of Pakistan and others 40. 19525 of 2023 Raza Nasir v. Federation of Pakistan and others 41. 18861 of 2023 Muhammad Kamran Sabir v. Federation of Pakistan and others 42. 29950 of 2023 Asif Bashir v. Federation of Pakistan and others 43. 31608 of 2023 Amatul Ch. v. Federation of Pakistan and others 44. 34404 of 2023 Khalid Saeed Khan v. Federation of Pakistan and others 45. 20568 of 2023 Syed Sheharyar Ali v. Federation of Pakistan and others 46. 250571 of 2023 Syed Shahid Ali Shah v. Federation of Pakistan and others 47. 20574 of 2023 Faisal Farid v. Federation of Pakistan and others 48. 26756 of 2023 Farhatullah Sheikh v. Federation of Pakistan and others 49. 13102 of 2023 Sh. Fezan Majid Kapur v. Federation of Pakistan and others 50. 13077 of 2023 Sh. Tahir Majid Kapur v. Federation of Pakistan and others 51. 13061 of 2023 Sheikh Akhtar v. Federation of Pakistan and others 52. 13069 of 2023 Sufi Muhammad Amin v. Federation of Pakistan and others 53. 13155 of 2023 Sheikh Amir Majid Kapur v. Federation of Pakistan and others 54. 13081 of 2023 Kamal Manoo v. Federation of Pakistan and others 55. 13090 of 2023 Ahsan Bashir v. Federation of Pakistan and others 56. 13055 of 2023 Shahbaz Alam manoo v. Federation of Pakistan and others 57. 13087 of 2023 Mehvish Ahmad Elahi v. Federation of Pakistan and others 58. 13103 of 2023 Khalid Bashir v. Federation of Pakistan and others 59. 13072 of 2023 Ayesha Danish Manoo v. Federation of Pakistan and others 60. 13070 of 2023 Danish Qaiar Manoo v. Federation of Pakistan and others 61. 13116 of 2023 Ahmar Sarwar v. Federation of Pakistan and others 62. 13068 of 2023 Sheraz Jahangir Manoo v. Federation of Pakistan and others 63. 13151 of 2023 Jehangir Azam Manoo v. Federation of Pakistan and others 64. 13159 of 2023 Shahzad Malik and others v. Federation of Pakistan and others 65. 13134 of 2023 Wahaaj Tariq and another v. Federation of Pakistan and others 66. 13075 of 2023 Zahid Hussain Ch. v. Federation of Pakistan and others 67. 13085 of 2023 Mrs. Saadia Tariq v. Federation of Pakistan and others 68. 13136 of 2023 Omer Farooq Kabir Sheikh v. Federation of Pakistan and others 69. 13096 of 2023 Tahira Naveed Soofi v. Federation of Pakistan and others 70. 13133 of 2023 Sara Irfan v. Federation of Pakistan and others 71. 13140 of 2023 Farrukh Shahzad Malik v. Federation of Pakistan and others 72. 13105 of 2023 Ambar Shahzad Malik v. Federation of Pakistan and others 73. 13101 of 2023 Zain ul Hassan Shabbir v. Federation of Pakistan and others 74. 13113 of 2023 Muhammad Faizan Ch. v. Federation of Pakistan and others 75. 13135 of 2023 Umer Farooq and others v. Federation of Pakistan and others 76. 13066 of 2023 Mrs. Sara Rehman v. Federation of Pakistan and others 77. 15024 of 2023 Danyal Naveed Ahmad v. Federation of Pakistan and others 78. 14848 of 2023 Mr. Humaira Farooq Sohail v. Federation of Pakistan and others 79. 14882 of 2023 Syed Mohsin Raza Naqvi v. Federation of Pakistan and others 80. 14888 of 2023 Athar Hayat v. Federation of Pakistan and others 81. 14886 of 2023 Adil Bashir v. Federation of Pakistan and others 82. 14885 of 2023 Ms. Mutaneez Ahmed Jan v. Federation of Pakistan and others 83. 13099 of 2023 Khalid Hadayat Ullah Sufi v. Federation of Pakistan and others 84. 13146 of 2023 Mr. Sohail Ahmad Kabir v. Federation of Pakistan and others 85. 13086 of 2023 Mr. Tariq Ullah Safi v. Federation of Pakistan and others 86. 13139 of 2023 Hamza Tariq Sufi v. Federation of Pakistan and others 87. 13095 of 2023 Muhammad Naseem Saigaol and others v. Federation of Pakistan and others 88. 13104 of 2023 Muhammad Zeid Yousaf Saigol v. Federation of Pakistan and others 89. 13152 of 2023 Shahid Kamil Butt v. Federation of Pakistan and others 90. 13131 of 2023 Mrs. Shaheen Nasir v. Federation of Pakistan and others 91. 13094 of 2023 Usman Aziz Anwar v. Federation of Pakistan and others 92. 13163 of 2023 Zahra Ali Elahi v. Federation of Pakistan and others 93. 13143 of 2023 Sheikh Mehboob Ahmad v. Federation of Pakistan and others 94. 13147 of 2023 Muhammad Ali Khan v. Federation of Pakistan and others 95. 13149 of 2023 Nasir Shafiq v. Federation of Pakistan and others 96. 13127 of 2023 Shahid Nazir Ahmad v. Federation of Pakistan and others 97. 13123 of 2023 Muhammad Hussain Khan Niazi v. Federation of Pakistan and others 98. 13119 of 2023 Nadeem Ahmed Siddiqui v. Federation of Pakistan and others 99. 13132 of 2023 Mrs. Nazia Nazir v. Federation of Pakistan and others 100. 13058 of 2023 Kamal Yousaf v. Federation of Pakistan and others 101. 13130 of 2023 Muhammad Ayaz Khan Niazi v. Federation of Pakistan and others 102. 13054 of 2023 Ahsan Kamal v. Federation of Pakistan and others 103. 13124 of 2023 Mr. Hamza Waqar Malik v. Federation of Pakistan and others 104. 16709 of 2023 Moonis Elahi v. Federation of Pakistan and others 105. 19534 of 2023 Muhammad Jahangir Muggo v. Federation of Pakistan and others 106. 19529 of 2023 Faiz Yaqub v. Federation of Pakistan and others 107. 13083 of 2023 Ibrahim Shamshi v. Federation of Pakistan and others 108. 25203 of 2023 Syed Kamran Haider v. Federation of Pakistan and others 109. 29776 of 2023 Humayun Maqbool v. Federation of Pakistan and others 110. 13110 of 2023 Ghazi Akhtar Khan v. Federation of Pakistan and others

111. W.P. No.34053 of 2023 Noureen Shehzad v. Federation of Pakistan and others Sd/- Sd/- ANWAAR HUSSAIN, J.

I have had the privilege to go through the judgment, authored by my learned brother, in the present as well as connected Intra Court Appeals, preferred under Section 3(2) of Law Reforms Ordinance (XII of 1972) 1972, a list of which is attached therewith as 'Appendix-I' as also the constitutional petitions that directly came before this Court. With great respect, I find myself in disagreement with the opinion of my learned brother.

2. The issue involved is constitutionality of Section 8(2)(b) of the Finance Act, 2022 ("Act 2022") by virtue of which the Federal Legislature has imposed 'tax on the capital value of the assets' (foreign assets) of a resident individual. Challenge was thrown on the ground that the Parliament lacks legislative competence to levy such tax on the immovable property situated abroad but owned by the resident individual. Through consolidated judgment dated 22.12.2022 passed by the learned Single Bench in 2023 PTD 268 titled Zaka Ud Din Malik v. Federation of Pakistan and others", the constitutional petitions were dismissed. It is imperative to note that the learned Single Bench held the tax to be valid while observing that it is a tax on the capital value of the foreign assets of a resident individual with an apparent and obvious purpose/objective of the levy is to discourage concentration of wealth and not a tax on immovable property. Before proceeding further, it is expedient to reproduce the impugned provision of Act, 2022 that reads as under: "

8. Capital value tax 2022.- (1) A tax shall be levied, charged, collected and paid on the value of assets at the rates specified in the First Schedule to this section for tax year 2022 and onwards: Provided that the tax shall be charged from the 1st day of July, 2022 in case of motor vehicles held in Pakistan. (2) Capital value tax shall be charged on the following assets:‑ (b) foreign assets of a resident individual where the value of such assets on the last day of the tax year in aggregate exceeds Rupees one hundred million; and

3. On behalf of the appellants, it has been argued that there is no entry in the Federal Legislative List that empowers the Parliament to impose taxes upon immovable property per se, regardless of whether the properties are situated within or outside Pakistan and Entry-50 of the federal Legislative List provided in the Fourth Schedule of the Constitution of Islamic Republic of Pakistan, 1973 ("the Constitution") makes it abundantly clear that the Constitution prohibits the Federal Legislature from imposing taxes upon the capital value of immovable property; that the Entry-50 does not create distinction between the immovable property held in Pakistan or outside Pakistan and therefore, the Parliament is expressly forbidden from imposing the taxes on capital value of the immovable property; and that the exclusion clause in a legislative entry is not to be read as a separate legislative field and the words 'not including taxes on immovable property' has to be read as a proviso to Entry-50 as it intends to exclude something which, but for the proviso, would have otherwise been covered by Entry-50 as the word 'not including' qualifies generality of the main part of the said Entry by providing an exception thereto. Reliance has been placed on cases reported as "Union of Indian v. Harbhajan Singh Dhilon"in1 ; "Daman Singh and others v. State of Punjab and others 2; and "Sunrise Associates v. Government of NCT of Delhi and others"3 . It has been also asserted that the learned Single Bench erred by not appreciating that in the year 2018, the Federal Legislature promulgated the Foreign Assets (Declaration and Repatriation) Act, 2018 ("the Foreign Assets Act") with express representation made therein that the movable and immovable assets held outside Pakistan, if declared as such under the Act ibid, would only be charged with a one-time tax at the rates set out in Section 7 of the Foreign Assets Act and hence, the impugned imposition under the Act, 2022 is unjust and inequitable. It is also the case of the appellants that keeping in view the exclusion of any sort of taxes on the immovable properties, the Province of Punjab did impose such tax through Punjab Finance Act, 2017 and the entry in this regard is part of the Government of the Punjab Rules of Business, 2011 conferring power on the Revenue Department of the Government of the Punjab to levy Capital Value Tax and that the principle of Ejusdem Generis4 has been ignored by the learned Single Judge while interpreting Entry-50.

4. Conversely, it is the case of the Federation as well as of the respondent-FBR that it is well within the power of the Federation to levy impugned tax pursuant to Entry-50 that must be read along with Entry-58 of the Federal Legislative List; that the Provinces cannot legislate in respect of immovable properties located abroad whereas under the Constitution, the Federation is empowered to deal with the legislation beyond the territorial confines and jurisdiction of Pakistan and for the purposes of taxation, the principle of a resident is applicable and the properties in question are declared properties of the appellants for the purpose of the Income Tax Ordinance, 2001 ("the Ordinance") and the returns thereunder and therefore, can be taxed by the Parliament. On behalf of the appellants, it has been emphatically put forth, as a rebuttal, that the issue of extra-territorial operation of the impugned provisions cannot be considered and/or argued at this stage because the learned Single Bench has held the tax leviable on the ground that the levy is not on the immovable property but on the resident persons and no cross-appeals/cross objections have been filed by the respondents and this issue could have been looked into only if the respondents had filed cross-appeals and/or cross objections.

5. In the first glance, it appears that the issue involved relates to the interpretation of Entry-50. Specifically, whether the words occurring after the comma in Entry-50 operate as an exception to the part preceding it. The learned Single Bench, while applying principle of Noscituar a socii5, has interpreted the said entry to comprise of two parts with the words 'not including taxes on immovable property' (exclusionary clause) coming after comma in the said entry to be distinctive from the words 'taxes on the capital value of the assets' forming part of the main entry. However, I am of the opinion that, quintessentially, the matter involves the interpretation as well as interface of Entry-50 and the substantive constitutional provisions relating to distribution of legislative competence of the Federation and the Provinces including Article 141 of the Constitution

6. More precisely, where does the power to legislate and tax the resident person qua his foreign immovable assets lie?

6. Before delving into the interpretation of Entry-50, it would be convenient to address the argument of the appellants' side that the levy is unjust on the ground that the Federation under the Foreign Assets Act already charged a one-time tax at the rates set out in Section 7 thereof, therefore, the impugned levy through the impugned provision cannot be imposed second time. The argument is misconceived and falls through on two counts. Firstly, the appellants before this Court are estopped from whimsically shifting and vacillating their positions and stances. At first, they conceded to the power of the Federal legislature to impose tax on immovable property situated abroad when they declared the foreign assets under the Foreign Assets Act and became beneficiary of the Foreign Assets Act that was enacted by the Parliament in respect of immovable properties; however, they now claim that the Federal Legislation cannot impose tax on foreign assets. It is admitted position that they had already deposited the tax imposed by the Federal Government under the Foreign Assets Act at the rate prescribed therein while declaring their assets thereunder. Therefore, it does not lie in the mouth of the appellants to object as to the competence of the Parliament as the properties in question are declared by those persons in terms of the Ordinance as well as the Returns and Wealth Statement thereunder. Secondly, under Section 3 of the Foreign Assets Act, it has been contemplated that the provisions of the Act ibid shall have effect 'notwithstanding anything to the contrary contained in any other law for the time being in force'. Section 8(2) provides that no tax shall be payable by the declarant under any law for the time being in force including the Ordinance where tax has been paid under section 8(1) in respect of the foreign assets declared under Section 5 of the Foreign Assets Act. The conjunctive reading and the effect of Sections 3 and 8 of the Foreign Assets Act is that as a result of payment of tax at the prescribed rate under the Foreign Assets Act, any past or current liability of taxation or otherwise under any law including the Ordinance was notionally considered to have been duly discharged. Thus, the legislature mutated any liability which would have been incurred by the appellants and/or beneficiary of the said Act but for the payment under the Foreign Assets Act. To put it more simply, the Foreign Assets Act recognizes the existence of assets or income outside Pakistan and the consequence of Sections 3 and 8 of the Foreign Assets Act is that the compliance thereof represents payment of tax under the Ordinance, for all the past years and any proceedings under any law for the time being in force, before the income tax authorities or any other authority which could have been initiated with respect to such assets put to rest as past and closed transaction. Suffice to mention that the Foreign Assets Act does not provide for any restriction that the said assets are immune to any further taxation as and when the legislature imposes in accordance with law.

7. Similarly, much emphasis has been laid on the point that since the learned Single Bench has categorically held that the tax is not on the immovable property but on the resident persons and no appeals/cross objections have been filed by the respondents, therefore, this Court cannot consider the fact that the immovable property is situated outside Pakistan and not within the country. I am not in agreement with the arguments of learned counsel for the appellants as also the observation of my learned brother in his lordship's judgment, in this regard. Suffice to observe that this Court, under Order XLI, Rule 33 of the Code of Civil Procedure, 1908 ("the C.P.C."), can exercise the appellate powers in favour of all or any of the respondents or parties though such respondents or parties may not have filed any appeal or objection as held in case of "Central Government of Pakistan and others v. Suleman Khan and others"

7. Similarly, in case reported as "North-West Frontier Province Government, Peshawar through Collector, Abbottabad and another v. Abdul Ghafoor Khan through legal heirs and 2 others 8, the Supreme Court while considering the cumulative effect of Sections 107 (2) and 151 read with Order XLI, Rule 33 of the C.P.C. held as under: "...It hardly needs any emphasis that the entire body of the procedural law is meant for advancement of the cause of justice and not to pose any technical difficulty in the way of the Court to unveil the truth and do complete justice between the litigating parties, for the determination of which alone it has been created. Not unoften it has been noticed by the Courts that the provisions of Order XLI, C.P.C. are not exhaustive. Seemingly, to fill in the gap in the procedure, section 107(2) was enacted under which the appellate Court has the same powers and is burdened with the same duties, as conferred and imposed on the trial Court. Reference here may also be made to Order XLI, Rule 33 C.P.C. which in order to prevent the ends of justice being defeated, gives wide discretionary powers to the Appellate Court, to adjust the rights of the parties, as the ends of justice may demand and pass such decree or order, as ought to have been passed. The Court has also inherent powers under Section 151, C.P.C. to make such orders, as may be necessary for the ends of justice and to prevent the abuse of the process of the Court. These are all enabling provisions; the powers thereunder can be exercised by the Court to cover ostensibly impossible situation, for complete dispensation of justice, for which C.P.C has been designed, but despite the best efforts of the draftsman, to cater for all possible situations, if it is found lacking in meeting some eventualities, the Court can act exdelicato justiciae, supply the omission in the procedure, adopt methodology for effectually carrying out the purpose in view. Reading of these provisions together would amply demonstrate that the Appellate Court enjoys plenary powers to proceed in the matter." Even otherwise, since the petitions filed by the appellants had been dismissed by the learned Single Bench, the respondents were not required to prefer appeal(s) merely because the petitions had been dismissed on one ground (i.e., Entry-50 constituting distinctive parts), and not on the other ground (i.e., effect of Article 141 of the Constitution). Similarly, this Court in appeal is not bound to render its opinion only on aspects considered by the lower fora. In fact, it is settled law that appeal is continuation of the suit (lis) and the Appellate Court is vested with all the power and jurisdiction vested in the Trial Court. This argument is liable to given short shrift on another ground as well. The interpretation involving determination of Entry-50 of the Federal legislative list and Article 141 of the Constitution is a question of law rather that of a constitutional interpretation, which can be raised at any stage, and decided by this Court on its own, even if not raised through filing of cross appeals or objections. Hence, the argument of the appellants is misconceived. I am of the view that the matter must be examined from this angle as well in order to reach a fair conclusion on a question of constitutional interpretation.

8. Adverting to the nub of the matter that relates to the competency of the Parliament to levy CVT on foreign assets in terms of Entry-50 of the Federal Legislative List to the Fourth Schedule of the Constitution, one has to keep in sight the fact that Pakistan is a federation, with four provinces as the federating units and there is a division of power at the central and provincial level. A federal constitution like ours establishes a dual polity with the union at the centre and the provinces at the peripheries and thereby each of them is granted sovereign powers to exercise in the fields assigned to them under the Constitution. Prior to the 18th Amendment, there were two separate Legislative Lists under the Constitution, i.e., Federal Legislative List and the Concurrent Legislative List. In addition, Article 142(e) of the Constitution provides that a Provincial Assembly shall, and the Parliament shall not, have power to make laws with respect to any matter not enumerated in either the Federal Legislative List or the Concurrent List. Through the 18th Amendment, Concurrent List was abolished and at present whatever is not envisaged under the Federal Legislative List falls within the domain of the Provinces. At this juncture, it is imperative to reproduce the said entry that, at present, reads as under: I "

50. Taxes on the capital value of the assets not including taxes on Immovable property" I (Emphasis supplied) Prior to the 18th amendment, the said entry in the Constitution was articulated as under: "

50. Taxes on the capital value of the assets, not including tax on capital gains on Immovable property" (Emphasis supplied) It is well evident that prior to the 18th Amendment, Entry-50 read as 'Taxes on the capital value of assets, not including tax on capital gains on unmovable property meaning thereby that the Parliament had all the powers to levy taxes on capital value of assets but not including the tax on capital gains on immovable property. However, post 18th Amendment, the words 'on capital gains' stand omitted from Entry-50 that reads as taxes on the capital value of the assets, not including taxes on immovable property . While emphasizing that the learned Single Bench has held the impugned tax to be the tax on the resident individual and not on the immovable property, it has been argued before this Court that the omission of the words 'on capital gains' is insignificant and the conjunctive reading of the words before the comma i.e., 'taxes on the capital value of assets' with the words after the comma i.e., 'not including tax on immovable property' leads to the inference that the Parliament has no power to legislate on the capital value of immovable property and the learned Single Bench erred in not following the principle of Ejusdem Generis in this regard. There is much contest between the parties as to which rule of statutory interpretation ought to apply in interpreting Entry-50 - the principles of Ejusdem Generis or Noscituar a socii as the appellants have been vociferously advocating that the former principle is applicable whereas the learned Single Bench has applied the latter. There is no cavil to the proposition that these are well known cannons of statutory interpretation that are deployed to interpret the text of a statute. However, it needs to be borne in mind that it is the Constitution that we are interpreting and not any ordinary law, hence, first and foremost, recourse must be made to the governing principles of the constitutional interpretation that have been settled by the Supreme Court and the High Courts of this country. This is not to say that the principles of constitutional interpretation and those of the statutory interpretation are mutually exclusive. However, some of the principles of constitutional interpretation that have been settled by the Courts, are more foundational in nature and highlight the overarching approaches to interpreting the Constitution, keeping in view the constitutional scheme and the object and purpose of the relevant constitutional provisions. These principles, therefore, must acquire pre-eminence in any constitutional analysis before the language of the provision itself is analysed. J

9. The first of these principles that is relevant In this case is that entries in the legislative lists should be given a broad and liberal interpretation since these are not the source of legislative power but the fields of legislative heads. This principle has been well elaborated by the Supreme Court of Pakistan in the case reported as "Messrs Khurshid Soap and Chemical Industries (Pvt.) Ltd. through Sheikh Muhammad Ilyas and others v. Federation of Pakistan through Ministry of Petroleum and Natural Resources and others

9. A similar view has been taken by a Full Bench of this Court in the case of "LPG Association of Pakistan through Chairman v. Federation of Pakistan through Secretary, Ministry of Petroleum and Natural Resources, Islamabad and others 10, where this Court held that the widest possible meaning should be given to a legislative entry so as to make the legislative power given to the Parliament meaningful. The Sindh High Court has also adopted this principle in the case of "KESC and others v. N.I.R.C. and others11 while holding as under: J "

16. We shall next examine as to under which Entry of the Federal Legislative List the legislation of Industrial Relations Act, 2012 can be justified. Prior to the 18th amendment there were two Legislative Lists i.e. Federal and Concurrent. In such a situation there was a genuine need to harmonize the two lists so that efficacy of the concurrent list is not lost, which rule of interpretation is no more attracted when there is only one Legislative List. It is also a rule of interpretation that where two views on the constitutionality of an enactment are possible, the one making the enactment constitutional is to be adopted. While interpreting the scope of any Legislative Entry it is well established principle that widest possible meaning is to be attributed to its provisions i.e. the rule of liberal construction is to be followed." Importantly, the Sindh High Court has observed in the above cited judgement, prior to the 18th Amendment, when there were two legislative lists and the principle of harmonious interpretation was followed so that the efficacy of the Concurrent Legislative List was not lost. However, after the 18th Amendment, the approach is no longer required and instead, the constitutional scheme is best served by ensuring that entries in the Federal Legislative List, which are a positive expression of the legislative competence of the Parliament, are given the widest possible meaning so that the legislative power of the Parliament, as provided in the Constitution, is made effective and meaningful. At this juncture, it is also imperative to note that equally important is another principle applicable to both statutory as well as constitutional interpretation in the terms that proviso and/or exception to any provision is to be construed strictly and narrowly as the proviso generally curtails and/or dilutes the impact of the general provision. Such curtailment is to be confined to as narrow an expanse as possible. Therefore, while the part of Entry-50 before the comma is the main provision conferring power on the Federal Legislature to levy CVT on assets, the exclusion in terms of the words after the comma being an exception is to be interpreted narrowly.

10. The second principle that is of relevance to this case has also been dilated upon by this Court in the case of LPG Association, supra while relying upon the Supreme Court's judgment in the case of "Messrs Sui Southern Gas Company Ltd and others v. Federation of Pakistan and others .12 In a nutshell, this principle states that as per Article 141 of the Constitution, a provincial legislature does not possess extra-territorial legislative competence and therefore, cannot legislate with regard to a subject which in its application transcends the provincial boundaries. On the other hand, the Federal Legislature does possess the competence to legislate upon matters that transcend provincial boundaries. The Supreme Court in the case of Sui Southern Gas Company Ltd., supra, while relying on Article 141 of the Constitution read with Entry-58, has held that even when a matter may fall within the legislative competence of the Provincial Legislature but in its application, it has to travel beyond the legislative boundaries of the Province, it will fall within the legislative competence of the Federal Legislature. Operative part of the case of Sui Southern Gas Company Ltd., supra is as follows: "Additionally, Entries Nos.58 and 59, which fall at the end of the Part-I of the FLL, have their own significance. These two entries are independent and unfettered. Entry No.58 ibid covers the "Matters which under the Constitution are within the legislative competence of Majlis-e-Shoora (Parliament) or relate to the Federation". Further, Entry No.59 deals with the "Matters incidental or ancillary to any matter enumerated in this Part". From the plain reading of these two Entries, it is clear that besides the subjects enumerated in the previous Entries, these Entries provide extended powers to the Federal Legislature; inasmuch as, by means of these Entries, the legislative competence of the Federal Legislature extends not only to the matters which under the Constitution are within the legislative competence of the Parliament but also to the matters which relate to the Federation and also the matters incidental or ancillary thereto. Thus, in addition to the matters specifically enumerated in any of the Entries in Part-I of the FLL, the matters which in some way relate to the Federation would also fall within the legislative competence of the Parliament. This interpretation also finds support from the fact that in terms of Article 141 of the Constitution, a Provincial Legislature does not possess extra-territorial legislative competence and therefore, cannot legislate with regard to a subject which in its application has to transcend the provincial boundaries. It is to be noted that as clarified by the learned High Court the resort to Entry No.58 ibid could only be made to deal with an extra-ordinary situation i.e. when a matter may fall within the legislative competence of the Province but when it comes to its application it has to travel beyond the territorial boundaries of the Province, bringing it into the domain of the Federal Legislation. Thus, it is held that the federal legislature has the competence to legislate relating to the Establishment/Trade Unions functioning at the Federal as well as trans-provincial level." While the above judgment of the Supreme Court was passed in the context of entities operating a the trans-provincial level, the principle enunciated therein will, of necessity, also apply to any legislative subject that may in its application or import transcend the territorial limits of Pakistan, since the same would also lie beyond the territorial limits of the provinces, and therefore, beyond the legislative competence of the provincial legislatures. K

11. The third principle of constitutional interpretation that is also of some significance in this case is long settled and simply stated, is that the Courts should lean in favour of the constitutionality of a legislation rather than destroying it. This principle has been aptly summarized by the seventeen members Full Court, in case of "Dr. Mobashir Hassan and others v. Federation of Pakistan and others"

13. This Court is aware of the fact that this is not a rule of absolute application. Where a legislation is patently against the letter and dictate of the Constitution, the Courts are duty bound to strike it down. For example, where it has been passed clearly beyond the remit of the legislative competence of the relevant legislature since allowing such a legislation to stand would tantamount to allowing a continued violation of the Constitution. In this sense, the Court's duty to act decisively to end a patently unconstitutional legislation is no less important than the Court's duty to lean in favour of the constitutionality of a statute. Cases falling in the latter category would mostly be those where a legislation does not clearly operate against a constitutional provision and some plausible argument exists in favour of its constitutionality. K

12. Moreover, one cannot lose sight of the fact that an entry in the Legislative List cannot be so interpreted that it defeats the main provisions of the Constitution (Article 141 of the Constitution in the instant case). Therefore, in case of any ambiguity and/or conflict, if any, between the substantive constitutional provision and the legislative entries, the former is to be given precedence over the latter and to be interpreted in a manner that legislative entries do not nibble away and undermine the substantive provision of the Constitution.

13. Keeping in view the above referred principles of constitutional interpretation, I intend to analyse the involved in this case. Under challenge is Section 8(2)(b) of the Act, 2022 that imposes a tax on the capital value of foreign assets of a resident individual where such value exceeds Rupees One Hundred Million . Suffice to note that there is difference between the taxes on immovable property and capital value taxes on assets, as held by the learned Single Bench and the said position is also undisputed by the appellant side. Here it is also relevant to note that Article 142(a) of the Constitution states that the Parliament shall have exclusive power to make laws with respect to the matters enumerated in the Federal Legislative List. This Article has to be read with Article 142(c) of the Constitution that a Provincial Assembly and not the Parliament shall have power to make laws with respect to any matter not enumerated in the Federal Legislative List. Together, these two Articles capture the division of legislative powers following the 18th Amendment. The changes brought in by the 18th amendment have to be kept in sight as well. It is also of utmost importance to note that the impugned levy is in respect of the foreign assets of a resident individual and does not implicate any property situated in Pakistan, and therefore, in the territorial jurisdiction of any province. The appellant's case in a nub is that the impugned levy offends Articles 142(a) and 142 (c) of the Constitution read with Entry-50 of the Fourth Schedule to the Constitution as the said Entry removes from the legislative competence of the Parliament any taxes in respect of immovable property and the Parliament having taxed the foreign immovable property of the appellants, has exceeded its legislative competence in violation of Articles 142(a) and 142 (c) of the Constitution. The appellants rely on the words following the comma in Entry-50 i.e., 'not including taxes on immovable property' to argue that the said words create an exception or a carve out, as it were, to the legislative subject preceding the comma and therefore, the Parliament, in no event, can tax immovable property, wheresoever situated. There was much focus before the learned Single Bench on the meaning and import of the words 'not including' in Entry-50, as also the nature of the taxes described in the two parts of Entry-50. I am of the opinion that in the facts and circumstances of this case, the meaning and import of the words 'not including' is perhaps not as significant as the parties think it to be. What is significant though is the subject of legislation in both parts of the entry. The subject of legislation in the first part is tax on the capital value of the assets while the subject of legislation in the second part is tax on immovable property.

14. Moreover, it is important to bear in mind that the present case relates to imposition of tax on foreign immovable property owned by the resident individual. It needs to be kept in sight that it is not only the legislative entries that define the limits of the legislative power of the Parliament and by exclusion the Provincial Legislature but other provisions of the Constitution are also relevant including Article 141 thereof. The appellant's argument, in essence is that on account of the carved out/exception provided in Entry-50, the Parliament cannot legislate in respect of taxes on the immovable property, specifically foreign immovable property even if it does so within the purview of taxes on the capital value of the assets. However, for the appellant's argument to be complete in order to render the levy beyond the legislative competence of the Parliament, it must also be said, on account of Article 142(c) of the Constitution, that it is the Provincial Legislature that is competent to legislate in respect of the taxes on foreign immovable property of a resident. It is here that the appellant's case runs into its first significant hurdle, nay, insurmountable hindrance. Since, as per the appellants, the exclusion specially relates to taxes in respect of the immovable property, it would follow that any legislative power that this exclusion was to confer on the Provincial Legislature (on the appellant's case) must be with respect to immovable 'property and in this case particular immovable property is outside Pakistan i.e., outside the territorial limits of the Province. The question that now arises is whether the Provincial Legislature can legislate with respect to the immovable property situated outside its territorial limits. Article 141 places a clear and unambiguous embargo on the power of a Provincial Legislature to legislate in respect of a subject beyond its territorial limits. It is observed that Article 142 begins with the words "subject to the Constitution" whereas 142(a) provides that parliament would have exclusive power to make laws with respect to matters enumerated in the Federal Legislative List. This undeniably and irrefutably implies that the federal list is not the exhaustive list and power of the legislative competence of the Federal Legislature. There are powers of the Federal Legislature to legislate under the substantive provisions of the Constitution. A subject that does not fall under Federal Legislative List and in respect of which the provinces also cannot legislate, like immovable properties outside Pakistan, falls back to the Federal Legislature for which Article 141 is one such manifestation of the power of the Federal Legislature to legislate and make laws having extra-territorial operation and limiting the power of Provincial Legislature to the territorial limits of the province. Since, as far as the impugned legislation is concerned, the immovable properties, the capital value of which, will be subject to tax as part of the capital value of the assets of a resident person, are situated beyond the territorial limits of a province, the Provincial Legislatures cannot legislate in respect of the same.

15. In the light of above discussion, in my view, the controversy in the present case turns primarily on the application of Article 141, therefore, it is not necessary to engage with the interpretation of the words 'not included' in the said entry or the judgments related thereto. Examining it from another perspective, if in pith and substance, treating Entry-50 as one field (subject matter of the levy) that the impugned tax is on capital value of the assets of the resident person and not on the immovable property as argued by the appellants, then one thing is clear that it falls outside the scope of the legislative competence of the provinces as the capital value as a field of legislative competence is that of the Federation. Therefore, it does not lie in the mouth of the appellants to argue that since it is in relation to the immovable property, therefore, the Federal Legislature has no power inasmuch as it negates the arguments of the appellants that capital value tax is not on immovable property but on the resident person. I am of the view that legislative competence was vested in the Federal legislature under Entry-50 out of which an exception was created that taxes with respect to immovable property as carve-out legislative competence and was shifted to provinces. Such provincial legislative competence would hold its ground within the territorial confines of the provinces respectively. Respondent-FBR had complete realization about the change brought about by the 18th Constitutional Amendment in Entry-50 of the Federal Legislative List, which is exhibited by the Circular No. 03 of 2012 bearing No. C.No.4(60)TTP-2012-106335-R, dated 01.08.2012 that has been also referred in the judgment authored by my learned brother. It reads as under: "Scope of CVT Prior to 18th Constitutional amendments effective from 19th April 2010 Entry 50 of the Federal Legislative List contained in Part 1 of the Fourth Schedule to the constitution of Islamic Republic of Pakistan empowered the Federal Legislature to levy taxes on the capital value of the assets, not including taxes on capital gains on immovable property. The words on "capital gains" were omitted by the 18th Constitutional amendment. The effect of omission of these words is that the Federal Legislature cannot impose taxes on capital value of immovable property located in the Provinces. Accordingly CVT was abolished through the Finance Act, 2010 as a charge and levy of CVT became a provincial subject .. (Emphasis supplied) It is noticeable that the respondent-FBR had spelled out in the above referred Circular that the subject of CVT on immovable property with the omission of words "on capital gains" has devolved upon provinces but only to the extent of property located within the Provinces and not beyond that. It is this conscious realization of the constitutional changes that respondent-FBR, as stated in the above referred Circular, imposed CVT only on the immovable property within the Islamabad Capital Territory and in respect of the immovable property located abroad, through the impugned Section 8(2)(b). The said realization is not in conflict with the provisions impugned herein i.e., 8(2)(b), rather the same is further actualization and accentuation of the change brought about by the 18th Amendment in Entry-50 read with Article 141 of the Constitution. Thus, it goes onto make it clear that both the Federal Legislature and respondent-FBR neither impinged upon the provincial autonomy nor competency of the Provincial Legislature. In fact, the impugned provisions reveal the legislative intent that the law was promulgated and levy imposed in exercise of its own legislative competence without nibbling away and undermining the provincial legislative competence.

16. It is also imperative to note that the Federal Legislature is vested with the legislative competence to tax capital value of the asset with the exception relating to immovable property. The natural corollary of the same is that capital value of immovable property falls within the provincial legislative competence. However, the provincial legislative competence is circumscribed by the territorial limits of the provinces and the immovable property not falling within the territorial confines of the province ipso facto is not susceptible to any provincial legislation. At this juncture, Article 141 of the Constitution vesting legislative competence in the federal legislature to make laws having extra-territorial application, comes into play. Thus, apparently there is no ambiguity and/or conflict inter se Article 141 and Entry-50 as it is the finish-line of the exception in Entry-50 which gives way to the starting line of Article

141. There is also no overlap by each others. However, any doubt, even if remaining, scuttles away in view of the principle that in case of any ambiguity between a Legislative Entry and the substantive provision of the Constitution, the latter is to be given overriding effect. Thus, in both eventualities, the legislation having extra-territorial applications falls within the federal legislative domain and Entry-50 and Article 141 of the Constitution collectively vest legislative competence in the Federal Legislature with regard to immovable property held abroad. I am of the view that the Sindh High Court,14 while examining the vires of the same legislation that is under challenge before this Court has rightly observed that the words 'including laws having extra-territorial jurisdiction' in Article 141 is a reference to laws that may have effect outside Pakistan. The appellants' argument is that even if the Provincial Legislature cannot legislate in respect of foreign immovable property, still the limit on the Parliament's legislative power provided in Entry-50 should be recognized and the Parliament should not be allowed to legislate with respect to taxes on any immovable property as the said entry is one set of the legislative field and to be read as a whole. As mentioned above, it is neither necessary to go into the effect of the words 'not included' in Entry-50, in this case, nor is it necessary to determine whether the same spell out an exclusion or an exception or something other than that. If, for the sake of argument, the appellant's position is accepted that Entry-50 does exclude all instances of legislation by the Parliament, in respect of foreign immovable property then its effect would be: the Parliament cannot legislate with respect to taxes on capital value of foreign immovable property on account of the exclusion in Entry-50 and the Provincial Legislature can also not legislate in respect of taxes in relation to foreign assets (immovable property) since it lies beyond the territorial limits of a province. In other words, the appellants are arguing that the Constitution does not allow for any kind of taxation on the capital value or otherwise in relation to the foreign immovable properties of a resident person. Put differently, the appellants are claiming that there is complete constitutional immunity against taxation of the foreign assets, to the extent of immovable property of resident persons. This position, if accepted, would militate against the basic principle of interpretation of the legislative entries that the widest possible meaning should be given to a legislative entry so as to make the legislative power given to the Parliament meaningful. In Entry-50, the Parliament has been given, manifestly and unambiguously, the power to legislate in respect of taxes on capital value of assets. To limit that power, particularly when the Provincial Legislature is clearly not competent to legislate in respect of the same (to the extent of foreign immovable properties), would amount to placing the narrowest and most restrictive interpretation on Entry-50, which runs contrary to the scheme of the constitution and the principles of constitutional interpretation enunciated by the Courts of our country.

17. Another noticeable aspect of the matter is that the Province of Punjab does not consider it an area where it is competent to legislate as is evident from the fact that, on behalf of the Province, no such power has been asserted before the learned Single Bench as well as before this Court in the appellate proceedings by laying a challenge to the impugned judgment. This aspect cannot be brushed aside lightly and strengthens the argument that the power to levy CVT under Entry-50 does not vest with the provinces in relation to the foreign immoveable properties owned by the residents but with the Federal Legislature.

18. In view of the reasons stated hereinabove, the present as well as connected appeals, along with constitutional petitions, are hereby dismissed. As a natural corollary, the challenge mounted to the impugned Section 8(2)(b) of the Act, 2022 fails. MH/S-34/L Appeal dismissed. 1 Civil Procedure (Amendment) Act, 1922 2 PLD 1965 Supreme Court 15 3 AIR 2012 SCW 848 4 2022 SCMR 870 5 PLD 2014 SC 531 6 2018 SCMR 802 7 2020 SCMR 1 8 2024 SCMR 298 9 PLD 1997 Supreme Court 582 1 AIR 1972 SC 1061 2 AIR 1985 SC 973 3 (2006) 5 SCC 603 4 Ejsdem generis is a Latin phrase that means of the same kind. It is statutory and constitutional principle of construction that states that where general words or phrases follow a number of specific words or phrases, the general words are specifically construed as limited and apply only to persons or things of the same kind or class as those expressly mentioned. 5 The principle of construction (or interpretation) of statutes and other documents that the meaning of words should be identified by reference to other words in the context of which they appear. 6 141: Subject to the Constitution, Majlis-e-Shoora (Parliament) may make laws (including laws having extra-territorial operation) for the whole or any part of Pakistan, and a Provincial Assembly may make laws for the Province or any part thereof. 7 PLD 1992 SC 590 8 PLD 1993 SC 418 9 PLD 2020 SC 641 10 2021 CLD 214 11 2015 PLC 1 12 2018 SCMR 802 13 PLD 2010 SC 265 14 C.P. No.4942 of 2022 titled Irfan Hussain Halai and others v. Federation of Pakistan and others