Retrospective effect

The Finance Act, 2025, reverted to the old adjudicatory scheme having one forum of appeal i.e. before the Appellate Tribunal Inland Revenue (ATIR)

Reference Applications against order of Commissioner Inland Revenue (Appeals) (CIR (Appeal) filed before the High Court in view of enactment of the Tax Laws (Amendment) Act, 2024

Remitting to ATIR

Scope

The amendments introduced through the Finance Act, 2025, restoring a right of appeal before the ATIR, is to be given retrospective effect and references filed against orders of CIR (Appeals) be remitted to the ATIR to be treated as appeals and decided in accordance with law

Law as to how a change of forum for adjudication of a dispute or controversy is to be treated as procedural law and such procedural law applies to pending matters, to the extent that they do not adversely affect the rights of parties and do not reopen past and closed transactions

Besides, the amendments made with regard to the forum for adjudication to the Income Tax Ordinance, 2001, through the Finance Act, 2025, was beneficial in nature, being curative and remedial legislation , as it provided for an additional forum for appeal and ought to apply retrospectively

Thus, the changes brought to the forum for hearing a grievance against decision of CIR (Appeals) by virtue of amendments introduced to the ITO through the Finance Act, 2025, being procedural in nature, would apply retrospectively to all pending cases

Said amendment by virtue of providing an additional forum for appeal before the ATIR, as it existed prior to enactment of the Tax Laws (Amendment) Act, 2024, also being beneficial ought to apply retrospectively

Such application of the amendments introduced through the Finance Act, 2025, would, however, only apply to pending cases and not to matters that have attained finality and are past and closed transactions

Consequently, all references that had been filed against decisions of CIR (Appeals) directly before the High Court and were pending adjudication were liable to be remitted to the ATIR, which would treat them as appeals pending before the ATIR and decide them in accordance with law

High Court directed that the Court fee paid by the applicants, while filing of these references, be reimbursed to them

References applications were disposed of accordingly.

Definitive scheme has been established under section 6(1) of Sales Tax Act, 1990 as it aligns charge and payment of import-stage sales tax with customs duty, and incorporates collection, enforcement and recovery machinery provided under the Customs Act, 1969 as the sole operative channel in absence of any parallel provision in Sales Tax Act, 1990 itself

Various Finance Act amendments made to Customs Act, 1969 and Sales Tax Act, 1990 operate to designate Customs as the forum for recovery, and thus are purely procedural in nature

Such amendments do not create any new liability, nor do they curtail any substantive defence available to taxpayer but merely regulate procedural channel through which existing obligation is to be enforced

As the amendments do not affect any vested right, such provisions apply retrospectively unless expressly excluded.

Accused assailed his conviction and sentence awarded by Trial Court whereby he was sentenced to 14 years of imprisonment

Validity

Where a particular statute/law provides a self-contained mechanism and well defined forum of redressal for determination of questions of law or facts by way of an appeal or revision to another authority or tribunal as the case may be, the same has to be followed being remedy provided under law

Accused without exhausting such remedies can be allowed to invoke Constitutional jurisdiction of High Court

Such jurisdiction of High Court cannot be exploited as the sole solution when there are equally effective and adequate alternative remedies provided under law

Such remedies cannot be bypassed to invoke Constitutional jurisdiction

Retrospective effect cannot be given to a Constitutional amendment, without any such intention by Legislature, otherwise matters decided prior to Constitutional amendment would also need to be reviewed by Constitutional Courts and it would open flood gates to any case

In the present case, provision of Article 247 of the Constitution was in field and jurisdiction of High Court was barred in matters exclusively dealt with by FATA hierarchy

Supreme Court declined to interfere in conviction and sentence awarded to accused as the judgment passed by Trial Court had attained finality

Petition for leave to appeal was dismissed and leave to appeal was refused.

Major penalty cannot be imposed with retrospective effect unless the competent authority is expressly empowered in said regard by some statute or rules made thereunder.

Statute is not to be applied retrospectively in absence of express enactment or necessary intendment, especially where statute is to affect vested rights, past and closed transactions or facts or events that have already occurred

Such principle is attracted to fiscal statutes which have to be construed strictly, for they tend to impose liability and are therefore burdensome (as opposed to beneficial legislation)

It is not only the wording/text of the statute which is to be considered in isolation

Courts are not to examine simpliciter whether such law has a retrospective effect or not, rather it has to be examined holistically by considering several factors such as, the dominant intention of the Legislature which is to be gathered from the language used, the object indicated or the mischief meant to be cured, the nature of rights affected, and the circumstances under which the statute is passed.

Department filed Reference Application against order passed by Appellate Tribunal Inland Revenue (Tribunal) in favour of DISCOs

Validity

Explanation added in sub-clause (i) of Clause (46) of S. 2 of the Sales Tax Act, 1990 (Explanation-in-question) contemplated an unequivocal clarification that the subsidy was not chargeable to the tax under Sales Tax Act, 1990, (the Act, 1990) in case of DISCOs

Explanation-in-question stated that "It is clarified that the value of supply does not include the amount of subsidy provided by the federal government or provincial governments to the electricity consumers and has never been chargeable to tax under the Act"

Pertinently, the explanation-in-question was inserted through the Finance Act, 2022, after the passing of order(s) by the Tribunal, and the matter was decided against Department by the Tribunal while observing that there was no clarification in the law regarding the identity of the obligator

Notwithstanding subsequent introduction of the explanation-in-question, scope and applicability of the explanation was clear

Thus, the proposed questions were decided in favour of the respondents and against the applicant-department

Reference applications were dismissed.

The question that arose for determination before the High Court was as to "whether, under the Income Tax Ordinance, 2001, a taxpayer engaged in the wholesale distribution of table glassware was entitled to the reduced minimum tax rate of 0.2% applicable to 'Fast Moving Consumer Goods' for tax year 2015, and whether the subsequent exclusion of durable goods from the definition of 'Fast Moving Consumer Goods' through the Finance Act, 2017, could be applied retrospectively to deprive the taxpayer of such benefit"

Facts in brevity were that the applicant was engaged in the wholesale business of kitchen/table glassware a net filed its tax return for the year 2015 under S. 120 of the Income Tax Ordinance, 2001 (the "Ordinance 2001")

The tax department issued a notice under S.122(5A), alleging that the return was erroneous and prejudicial to revenue interest due to incorrect application of the minimum tax rate under S. 113 of the "Ordinance, 2001"

The department contended that glassware, being durable goods, was excluded from the benefit of reduced tax rates for 'Fast Moving Consumer Goods'

The applicant argued that the reduced rate (0.2%) was applicable instead of the standard 1%, claiming that the definition of 'Fast Moving Consumer Goods' in 2015 did not exclude durable goods, and that subsequent amendments through the Finance Act, 2017 should not be applied retrospectively

Held: Each tax year was a separate unit of account and taxation, therefore, the definition of 'Fast Moving Consumer Goods' would apply as it stood in tax year 2015 prior to introduction of subsequent definitions which, of course, did not carry retrospective effect

Retrospective effect to legislation could only be given if it appeared beneficial for any person

An attempt on part of respondent department to bring the case of applicant within the 'exclusion ambit' of the amended definition clause of "Fast Moving Consumer Goods" was simply meant to deprive him of the benefit of the reduced tax rate

It was also meant to create a new liability and to disturb past and closed transaction

The plea of retrospective effect of the amendment, taken by the respondent department was therefore repelled

Regarding the question as to whether table glassware should be subject to the same sales tax criteria as held in the case reported as 2018 PTD 1582, particularly in cases where distributors of table glassware were required to pay a higher sales tax than those dealing in electronic appliances it was very clear that Art. 25 of the Constitution guaranteed equal protection of the law and prohibited arbitrary discrimination between similarly situated persons

Therefore, imposing a higher sales tax on distributors of table glassware than on electronic appliances created an unwarranted tax disparity, violating the principle of uniformity in taxation

No rational distinction existed between table glassware and electronic appliances that would have justified placing a higher tax burden on distributors of glassware while giving preferential treatment to electronics distributors

Distributors of table glassware were entitled to the same sales tax criteria as distributors of electronic appliances

The imposition of a higher sales tax on glassware distributors was unjustified and inconsistent with the principles of fiscal equity, constitutional rights, and fair market competition

The applicant / taxpayer was dealing in 'consumers goods' and thus he was liable to pay 0.2% minimum tax of the total turnover for tax year 2015

Reference application was accepted and decided against the respondent-Department.

Retrospective effect to legislation can only be given if it appeared beneficial for any person.

Where an amendment is brought about in a fiscal statute it should not be given retrospective construction by applying it to past transactions, unless intention is expressed with irresistible clearness

Permissive basis for such legislative action is the fact that taxation is neither a penalty imposed on taxpayer nor a liability which he assumes by contract

It is but a way of apportioning the cost of government among those who in some measure are privileged to enjoy its benefits and must bear its burdens.

Appellant / taxpayer contended that rates specified in the Table in Division VII, Part I of First Schedule to Income Tax Ordinance, 2001 at the time of acquisition of securities were applicable

Validity

Notwithstanding the changes brought about in Division VII, Part I of First Schedule to Income Tax Ordinance, 2001, the legislature through Finance Act, 2024 again revived 0% rate of tax on disposal of securities acquired between 01-07-2022 and 30-06-2024 where holding period exceeded six years

Disposal of securities acquired before 01-07-2013 were again held liable to 0% tax as per second proviso to Division VII, Part I of First Schedule to Income Tax Ordinance, 2001

Amendments so made had completely nullified the effect of offending proviso added to Division VII, Part I of First Schedule to Income Tax Ordinance, 2001 through Finance Act, 2022

This lent credence to the allegation of discrimination by appellant / taxpayer

In view of amendments made in Division VII, Part I of First Schedule to Income Tax Ordinance, 2001 up to year 2021 and in year 2024, there did not appear to be any rational basis for giving a different treatment to the disposal of securities acquired before 01-07-2013 through amendments made in Division VII, Part I of First Schedule to Income Tax Ordinance, 2001 through Finance Act, 2022

Offending proviso to Division VII, Part I of First Schedule to Income Tax Ordinance, 2001 which had the effect of nullifying the Table and which on textual plane could only be construed as an independent provision stipulating a new tax, could not be inserted in Division VII, Part I of First Schedule to Income Tax Ordinance, 2001 for burdening appellant / taxpayer with 12.5% tax on capital gain on disposal of securities

The right that had come to vest in appellant / taxpayer for application of 0% tax could not be taken away by proviso to Division VII, Part I of First Schedule to Income Tax Ordinance, 2001

Division Bench of High Court directed Federal Board of Revenue to constitute a Policy Board consisting of experts to render advice on future legislation keeping in view legal and Constitutional principles interpreted and settled by the Courts in order to avoid such legislation being struck down

Division Bench of High Court set aside judgment passed by Judge in Chambers of High Court and constitutional petition filed by appellant / taxpayer was allowed

Division Bench of High Court declared that proviso added to Division VII, Part I of First Schedule to Income Tax Ordinance, 2001 through Finance Act, 2022 was inoperative on the right of appellant / taxpayer to be applied 0% tax on capital gain arising on the disposal of securities from 01-07-2022 till January 2023

Intra Court Appeal was allowed, in circumstances.

There is no presumption as to a tax and nothing is to be read in and nothing is to be implied and one has to look fairly at the language used.

Petitioner authority was aggrieved of retrospective operation given to S. 100BA read with R.1-A of Tenth Schedule to Income Tax Ordinance, 2001

Validity

Legislature in categorical terms did not express its intention to apply proviso to R. 1-A of Tenth Schedule to Income Tax Ordinance, 2001, to returns filed in past three years to make taxpayers who were in default, liable for tax on the rates mentioned in Tenth Schedule to Income Tax Ordinance, 2001

Retrospective effect could not be given to proviso to R. 1-A of Tenth Schedule to Income Tax Ordinance, 2001, so as to destroy or impair past and closed or concluded transactions

High Court advised Federal Board of Revenue to constitute a body of experts for rendering opinion on future legislation / notifications in light of legal and Constitutional principles, in order to avoid such legislation which would be struck down

High Court further advised Federal Board of Revenue to hire services of expert draftsmen to frame legislation / notifications in a manner that ordinary public would understand

Constitutional petition was allowed, in circumstances.

Ss. 53 & 113, Second. Sched., Pt-IV, Clause (11)(xvi) & Second Sched. Pt- III, Cl. (5) [as inserted through SRO No.171(I)/2008 dated 21.02.2008 ('SRO 171)]

Extending benefit and curing mischief of accumulated liabilities of Power Distribution Companies (DISCOs)

Retrospective effect

Scope

Department filed Reference as the Appellate Tribunal approved retrospective operation of Cl. (5) of Part-III of the Second Schedule of Income Tax Ordinance, 2001, ('Clause (5)') and extended its benefit for Tax Year 2007 to Taxpayer (DISCO)

Contention of the Applicant/Department was that “Clause (5)” came into effect on 21.02.2008 and was not applicable to Tax Year 2007 from 01.07.2006 to 30.06.2007 as the exemption allowed had to be construed strictly

Stance of the taxpayer (DISCO) was that sub-clause (xvi) of clause (11) of Part-IV of Second Schedule to the Ordinance, 2001, extended exemption to corporatized entities-including taxpayer - from the provision of minimum tax, relating to receipts of sales of electricity, from date of their creation to the date of completion of the process of corporatization, being the date of notification of tariff as the tariff was notified on 24.02.2007 while the SRO No.171(I)/2008 dated 21.02.2008 was introduced to alleviate hardships encountered by the corporatized entities, which had the effect to extend exemption till the year 2013

Validity

Clause (11) (xvi) of Part-IV of the Second Schedule to the Ordinance, 2001, extended exemption to corporatized entities - including taxpayer - from the provisions of minimum tax, relating to receipts of sales of electricity, from date of their creation to the date of completion of the process of corporatization, which corporatization would be deemed completed till the tariff was notified

Clause (11) (xvi) was omitted through Finance Act, 2008

Clause (5) of Part-III of the Second Schedule to the Ordinance, 2001, was added through SRO No.171(I)/2008 dated 21.02.2008

Taxpayer e-filed return of income for Tax Year 2007 on 12.01.2008, wherein turnover was computed from 24.02.2007 - date of notification of tariff - to 30.06.2007 and purchase price / cost was excluded for the purposes of computing minimum tax, which became deemed assessment order

Later, notice was issued under S. 122 (5A) of the Ordinance, 2001 and in response thereto, taxpayer defended exclusion of the purchase price by pleading retrospective application of clause (5) - SRO No.171(1)/2008 dated 21.02.2008, which defence was rejected and assessment was amended

Amended assessment was upheld by the First Appellate Forum, before being annulled by the Appellate Tribunal

Clause (5) was added in Part-III of the Second Schedule - earlier clause (11) was part of Part-IV of the Second Schedule to the Ordinance, 2001

It is pertinent to mention that Clause (11A) was added to Part-IV of the Second Schedule through Finance Act 2009, wherein sub-clause (xv) was pari materia to sub-clause (xvi) of erstwhile Clause (11)

Section 53 of the Ordinance provides exemptions and tax concessions

Clause (c) of subsection (1) of S. 53 envisages reduction in the tax liability, subject to the conditions and extent thereof specified

Preamble of Part-III replicates spirit of clause (c) of subsection (1) of S. 53

Intention was to reduce the tax liability of corporatized entities, including the taxpayer

SRO No.171(I)/2008 dated 21.02.2008 was promulgated in exercise of powers under subsection (2) of S. 53 of the Ordinance 2001, which per se depicts the object / purpose of Clause (5)

Omission of Clause (11), along with sub-clause (xvi), of Part-IV of Second Schedule through Finance Act 2008 had to be reconciled with the concurrent omission of Section 113 of the Ordinance, also through the Finance Act, 2008

And re-enactment of Clause (11A) of Part-IV of Second Schedule coincided with the re-admission of S.113 of the Ordinance, 2001, both through Finance Act, 2009

Clause (11) of Part-IV of Second Schedule and Clause (5) of Part-III of Second Schedule intended to reduce the liability by excluding the component of purchase price of electricity from the turnover, liable to minimum tax

Clause (5) of Part-IV of Second Schedule assumed accumulation / build-up of liability with respect to corporatized entities, which upon notification of tariff were not entitled to claim exemption, for the purposes of turnover, subject to minimum tax

There is no rational justification to treat Clause (5) of Part-III of Second Schedule having prospective effect, when the intention was to reduce liability - accrued at the time of promulgation of SRO under reference

Reduction in the tax liability, as the object of Part-III suggests existence of liability, in the same manner as exemption inherently acknowledges chargeability and liability of tax

Retrospectivity of Clause (5) is inherently inbuilt, and any contrary construction would nullify the object / purposes thereof

In terms of Clause (5) exclusion of component of purchase price of electricity from the turnover, liable to minimum tax, was granted till the year 2013

High Court found no rational basis to exclude the period, for the purposes of exemption, from notification of the tariff till 21.02.2008

The exclusion was beneficial, intended to remedy the effect of inclusion of purchase price of electricity as component of turnover, liable to minimum tax

Significance of including Clause (5) to Part-III has its own significance, which cannot be ignored

High Court did not find any justification to construe Clause (5) in a manner that benefit thereof was denied to those corporatized entities, in respect whereof tariff was notified before 21.02.2008; such segregation amongst similar class of persons - corporatized entities - was another factor contributing to the retrospective operation of Clause (5)

Superior Court have upheld retrospective application / implementation of such legislative instrument, which exhibited curative and remedial character - intended to address the mischief of accrued liabilities, as in the present case

Appellate Tribunal had not committed any illegality, while passing the order under reference

Thus, proposed questions were answered in the affirmative i.e., against the Department

Reference Application, filed by the Department, was dismissed.

Deemed assessment order of S. 120 of the Income Tax Ordinance, 2001 ('the Ordinance, 2001') was reviewed by the Taxation Officer invoking S. 221 of the Ordinance, 2001, and addition was made by the Taxation Officer treating amount of loan as income, waived under State Bank's Amnesty Scheme in lieu of irrecoverable loans / debts while denying benefit of Clause-3A of Part-IV of Second Schedule to the Income Tax Ordinance, 2001

Taxpayer's first appeal was allowed and the addition was deleted

Department filed Reference application against judgment passed by Appellate Tribunal Inland Revenue ('Tribunal'), whereby its appeal was dismissed while affirming order of the deletion of addition passed by Commissioner (IT/WT)-Appeals

Plea of the applicant / department was that extending the benefit of Clause 3A to the taxpayer against Tax year 2004, without appreciating that Clause (3A) was inserted through Finance Act, 2004, was wrong as that the Legislative intent could not be stretched otherwise to extend retrospective effect to Clause (3A)

It was the case of the applicant department that waiver of loan, by the ZTBL under State Bank of Pakistan Banking Policy Department's Circular No.29 dated 15.10.2002 (BPD Circular No.29), had to be treated as income of the taxpayer and no benefit could be extended or claimed in the garb of Clause (3A), which was not applicable retrospectively to the Tax year 2004

Validity

Clause (3A) ousts applicability of subsection (5) of Ss.34 & 70 of the Ordinance, 2001 and extends benefit(s), derived by way of waiver of debt(s) by the Banks, under State Bank's BPD Circular No.29 dated 15.10.2002 ('BPD Circular No.29')

Purpose of BPD Circular No.29 was to facilitate recovery of irrecoverable-cum-non-performing loans against payment of FSV of the properties / securities, determined according to the mechanism provided under the BPD Circular

It was a one-time opportunity, having cut-off date of 14.04.2003 - which was extended later, but still such extension had no consequence with respect to the issue-at-hand

Such benefit was available and effective from the date of BPD Circular No.29, i.e., 15.10.2002 and applicability whereof could not be denied for the purposes of Tax Year 2004

Clause (3A) was impregnated with retrospectivity, and any construction contrary to such plain and textual interpretation would render it superfluous

Reference to the date of effectiveness of BPD Circular, i.e., 25.10.2002 was a clear indication, let alone an explicit declaration

It is absurd to construe Clause (3A) in a manner as suggested by the department - to apply it prospectively and extend benefit to one set of debtors - post Finance Act 2004 - and deny benefit to other taxpayers, both benefactors of BPD Circular 29 - a distinctive class of persons

Clause (3A) possessed all the features and attributes of a curative, declaratory and beneficial enactment, affirming the spirit of the BPD Circular

Retrospectivity of Clause (3A) stood endorsed in terms of the clarification made, by the then CBR, through Circular No.14 of 2004 dated 17.07.2004 - reference to which was made in the order of CIT(A)

In these circumstances, mere insertion of Clause (3A) through Finance Act, 2004, would not make its application prospective, denuding it of its curative and declaratory character

Retrospective effect to Clause (3A), in view of the facts and circumstances of the present case, could not be denied

Question of law was answered in the affirmative and decided against the department, declaring that Clause (3A) was declaratory and had retrospective effect

Reference application , filed by the Department , was dismissed, in circumstances.

Deemed assessment order of S. 120 of the Income Tax Ordinance, 2001 ('the Ordinance, 2001') was reviewed by the Taxation Officer invoking S. 221 of the Ordinance, 2001, and addition was made by the Taxation Officer treating amount of loan as income, waived under State Bank's Amnesty Scheme in lieu of irrecoverable loans / debts while denying benefit of Clause-3A of Part-IV of Second Schedule to the Income Tax Ordinance, 2001

Taxpayer's first appeal was allowed, and addition was deleted

Department filed Reference Application against judgment passed by Appellate Tribunal Inland Revenue ('Tribunal'), whereby its appeal was dismissed while affirming order of the deletion of addition passed by Commissioner (IT/WT)-Appeals

Plea of the Applicant / Department was that extending the benefit of Clause 3A to the taxpayer against Tax Year 2004, without appreciating that Clause (3A), was inserted through Finance Act, 2004, was wrong as that Legislative intent could not be stretched otherwise to extend retrospective effect to Clause (3A)

It was the case of the applicant Department that waiver of loan, by the ZTBL under State Bank of Pakistan Banking Policy Department's Circular No.29 dated 15.10.2002 (BPD Circular No.29), had to be treated as income of the taxpayer and no benefit could be extended or claimed in the garb of Clause (3A), which was not attracted retrospectively, to the Tax Year 2004

Validity

There was another aspect of the matter; Clause (3A) was deleted through Finance Act, 2008

And lately such benefit, drawn by way of waiver of profit on debt or the debt itself under State Bank of Pakistan Banking Policy Department's Circular No.29 dated 15.10.2002, was declared as income upon adding Explanation to clause (d) subsection (1) of S. 18 of the Ordinance, 2001, by virtue of Finance Act, 2011

In the wake of deletion of Clause (3A), through Finance Act, 2008 and addition of Explanation to clause (d), it was evident that no exemption, in terms of subsection (5) of Ss. 34 & 70 of the Ordinance, 2001, thereafter was available, but such benefit could not be denied from the date of the effectiveness of BPD Circular No.29 till deletion of Clause (3A)

Taxpayer, in the present case, was fully covered

Question of law was answered in the affirmative and decided against the Department, declaring that Clause (3A) was declaratory and had retrospective effect

Reference application , filed by the Department, was dismissed, in circumstances.

Petitioners (enlisted distribution contractors) deposited security in year 2021 in light of policy introduced by SNGPL in 2018

A memorandum was issued by SNGPL on 13th September, 2023, ('Memorandum-in-question') in the light of a decision of the Islamabad High Court allowing constitutional petition filed by a contractor of SNGPL

Vide memorandum-in-question, SNGPL decided to return the security amount deposited by each contractor against their pre-qualification yet with certain conditions including 5% Performance Bond/Warranty of the total value of the Work Order

Petitioners filed constitutional petition as SNGPL (Respondents) denied return of security to them ('impugned order')

Whether a memorandum can be given effect retrospectively

Held, that admittedly, the petitioners were awarded work and in terms thereof work order was issued on 09th March, 2021, for three years, which had to expire in the next month (March, 2024)

A notification/memorandum or an executive order cannot operate retrospectively unless it is specifically provided therein

Through memorandum-in-question (having been issued dated 13th September, 2023 ) the respondents (SNGPL) decided to return the security amount deposited by the petitioners and instead they were directed to fulfill the certain other conditions mentioned for their pre-qualification

Contracts awarded to the petitioners were yet to expire (in March, 2024) and it was not the case of the respondents (SNGPL) that the petitioners failed to abide by the terms and conditions of the contracts

In such a situation any condition detrimental to the interest of the petitioners could be introduced during the currency of the already executed contract

High Court set aside the impugned order (dated 15th December, 2023) passed by the Respondents (SNGPL), being illegal and unlawful

Respondents were further restrained from refunding the security already deposited and from asking the petitioners to abide by memorandum/notification dated 13th September, 2023, for the current contracts

Constitutional petition was partly allowed.

When legislature gives retrospective effect to a law, either by express provision or by necessary implication, no protection can be afforded to vested rights contrary to the law.

Changes in substantive law, which divest or adversely impact vested rights, must be applied prospectively unless the legislature explicitly indicates retrospective applicability.

Plea of the taxpayer being that subsequent amendment in S. 65B of the Income Tax Ordinance, 2001 ('the Ordinance 2001') made through Finance Act 2012 whereby words "extension" and "expansion" were added and where tax credit was made allowable (against tax payable including on account of minimum tax and final taxes) carry retrospective effect as a beneficial legislation

Whether beneficial, remedial or curative legislation has a retrospective effect?

Validity

Retroactive legislation , as a general rule, is rightly looked upon with disfavor because of its tendency to be unjust and oppressive; consequently, in the absence of any indication in the statute that the legislature intended for it to operate retroactively, it must not be given retrospective effect

However, where an Act is procedural, declaratory or explanatory or where a statute is passed for the purpose of supplying an obvious omission in a former statute, it is to operate retrospectively, obviously because it does not affect vested rights

The legal position that emerges is that generally beneficial legislation is to be given liberal interpretation, however, for the said legislation to have a retrospective effect, the beneficial legislation must carry curative or remedial content

Therefore, such legislation must either clarify an ambiguity or an omission in the existing law and must, therefore, be explanatory or clarificatory in nature

While beneficial legislation is to be liberally interpreted, in order to advance the beneficent object of the statute, it in no manner means that "beneficial legislation" or "liberal interpretation" necessarily includes or interchangeably means retrospective application of the statute

Unless the legislation is remedial, curative, explanatory or clarificatory, it cannot be interpreted retrospectively merely on the ground that the legislation is generically beneficial in nature

An amendment becomes a part of the original statute and must be read together

While an amendment, being considered as the last expression of the will of the legislature, generally prevails, however, such effect is prospective and would not be given any retroactive construction, overriding effect on prior rights, unless the verbiage of the provision makes such construction necessary

In the present case, there was no ambiguity or anomaly existing in the law, as it stood prior to Finance Act, 2012

Section 65B of the Ordinance 2001 was/ is the section allowing tax credit subject to certain conditions

Amendment in the said S. (65B) vide Finance Act, 2012 simply introduced additions of words "extension" and "expansion" and allowed tax credit against Minimum Tax and payment of tax in Final Tax Regime in S. 65B and that by no means remedy or cure any ambiguity or omission in the law

There is nothing in the language of S. 65B (as amended by Finance Act 2012) to suggest that the amendment is retrospective

The amendment merely enlarges the scope of tax credit to be allowed in case of "extension" and "expansion" (in addition to balancing, modernization and replacement of plot and machinery already installed in an industrial undertaking)

Further, provision under S. 65B provides tax credit to be allowed for the first time on tax payable on account of minimum tax and final taxes payable under the law, which was not in existence in previous tax years; the same being in the nature of a substantive amendment would be prospective, in the absence of any indication to the contrary

Hence, plea of taxpayer to label the given amendments as remedial or curative legislation is misconceived

Thus, the benefit of amendments in S. 65B made through Finance Act, 2012 was not available to the taxpayer / appellant for tax made through Finance Act, 2012 having no retrospective application

Commissioner Inland Revenue (Appeals) rightly held the amendments in S. 65B through Finance Act, 2012 as of prospective having no retrospectivity

Appeal , filed by Taxpayer/ Company, was dismissed.

Insertion of a new amendment under Clause 105A in the Second Schedule ('Clause 105A ') of Income Tax Ordinance , 2001 ('the Ordinance, 2001')

Retrospective effect

Audit proceedings, applicability of

In the absence of any indication of its retrospective operation, the new amendment must not be given retrospective effect

Generally, beneficial legislation is to be given liberal interpretation, however, for the said legislation to have a retrospective effect, the beneficial legislation must carry curative or remedial content

Such legislation must, therefore, either clarify an ambiguity or an omission in the existing law and must therefore be explanatory or clarificatory

In the present case, there was no specific wording that the concession shall apply retrospectively hence, it could not be construed by any canon of interpretation that said amendment had a retrospective effect

Consequently, in the absence of any indication in the statute that the legislation intended for it to operate retroactively, it must not be given retrospective effect

In any case, the provisions related to fiscal statutes will be interpreted prospectively, not retrospectively

The impugned notice was issued to the petitioner on 14.01.2022, while the said amendment in the Ordinance, 2001 was enacted with effect from 01.07.2022 ; hence, the petitioner could not be benefited from the new amendment

Constitutional petition, filed by taxpayer / company, being merit-less was dismissed, in circumstances.

Where any existing rights are jeopardized by giving an executive order retrospective effect, further causing inconvenience or injustice so as to hamper the vested rights, then the courts will not favour an interpretation giving retrospective operation to the same.

Though an amendment has been effected in Transfer of Property Act, 1982 vide Transfer of Property (Amendment) Act, 2021 qua the children of son of the propositus being declared entitled to get the share of their deceased father but the said Amendment has not been given a retrospective effect rather it has been blatantly mentioned in S.1 subsection (2) of the Transfer of Property Act, 1882, that it shall come into force at once, hence said amendment is also not helpful to the plaintiffs/appellants

No misreading and non-reading of evidence or violation of any settled law had been noticed in the impugned judgments passed by both the Courts below

Second appeal filed by plaintiffs, being merit-less, was dismissed, in circumstance.

Procedural law has retrospective effect unless the contrary is provided expressly or impliedly.

Procedural law has retrospective effect unless the contrary is provided expressly or impliedly.

Statute, which is procedural in nature, can operate retrospectively unless it affects an existing right on the date of promulgation or causes injustice or prejudice to a substantive right

If such statute is of such character that it may tend to promote justice without any consequential embarrassment or detriment to any of the parties concerned, Courts favourably incline towards giving effect to such procedural statute retrospectively.

Petitioner applied for scholarship of Ph.D. and entirely fulfilled overall general eligibility criteria based on previous policy duly mentioned in advertisement

Case of petitioner was processed and he was the only candidate of Ph.D. who qualified for such position of scholarship abroad

Requisite existence of scholarship was approved and reserved in the meeting of Board

Effect

Vested right accrued in favour of petitioner and subsequent announcement of new policy of August 2023 did not have retrospective effect on the case of petitioner, which pertained to terms and conditions of previous policy

New policy of year 2023 having no retrospective effect as well as condition of two years' service after L.L.M. was directory in nature having statutory backing and did not affect case of petitioner

High Court directed Balochistan Education Endowment Fund to convene Board meeting to grant scholarship to petitioner

Constitutional petition was allowed accordingly.

Matters relating to investigation/inquiry/ trial/receiving of evidence are procedural and a new legal dispensation on the eve of omission/replacement of old legal dispensation may operate retrospectively.

Petitioners / companies were aggrieved of revoking of tax exemption certificates on the basis of amendment in S. 153(4) of Income Tax Ordinance, 2001 incorporated by Finance Act, 2024

Validity

Legislature is competent to make law on a particular subject and also has power to legislate such law on a particular subject with retrospective effect and can by legislative authorization even take away vested rights

When legislature give retrospective effect to a law, either by express provision or by necessary implication, no protection can be afforded to vested rights contrary to that law

When legislature enacts a law with retrospective effect, the person affected cannot plead imposition of a previously non-existent civil obligation as a ground for declaring such law invalid

There was no provision of Finance Act, 2024 that expressly or by necessary implication had given any retrospective effect or application to amended S. 153(4) of Income Tax Ordinance, 2001

Amendment in question could not be construed to affect exemption certificates issued in favour of petitioners / companies in accordance with the law existing at the relevant time

Amendment introduced through Finance Act, 2024 was applicable on all exemption certificates issued after its effective date i.e. 01-07-2024

High Court set aside order passed by authorities and petitioners / companies were held entitled to avail benefit of exemption pursuant to exemption certificates issued in their favour

Constitutional petition was allowed accordingly.

Appellants / taxpayers were aggrieved of applicability of S. 4C of Income Tax Ordinance, 2001, with retrospective effect

Appellants / taxpayers raised the plea that liability stood fixed on 30-06-2022 (for normal tax year) and what was left merely was furnishing of return of income which by law was deemed an assessment order

Validity

Assessment order was in respect of a taxable income for that year and tax due thereon

Amendment to assessment year could only be made under certain circumstances mentioned in S.122 of Income Tax Ordinance, 2001

Other than that the matters between the revenue and the taxpayer come to a close on filing of return of income and nothing more was required to be done

Issue at the heart of litigation in respect of discrimination was that different rates of taxation were provided in Division IIB of Part-I of First Schedule to Income Tax Ordinance, 2001

Proviso to S. 4C of Income Tax Ordinance, 2001, identified and narrowed down certain sectors of businesses which in the opinion of the Legislature had generated windfall profits and, therefore, must be taxed at a different rate

While doing so, the fact had been ignored that there might be a number of persons who earned income exceeding Rs.300 million and who might also be making windfall profits

Such persons were exempted from payment of tax at the rate of 10% and were happy to be dealt with a lesser rate of tax at 4%

This was discrimination writ large on the face of proviso to S. 4C of Income Tax Ordinance, 2001, and had been rectified by substitution through Finance Act, 2023, where income exceeding Rs.500 million was imposed to a rate of taxation at 10%

Anomaly was corrected by the Legislature and a rate of tax across the board in respect of a particular category of taxpayers was imposed

Such discrimination was unconstitutional and contrary to the rule of law

Certain sectors without any intelligible criteria could not be isolated from rest of the persons similarly placed and be taxed at a higher rate than those persons who earned an income in the same bracket

Division Bench of High Court set aside finding of Judge in Chambers of High Court upholding retrospective application of S. 4C of Income Tax Ordinance, 2001, by the use of the words "for the Tax Year 2022"

Division Bench of High Court declared that rights conferred on appellants / taxpayers for Tax Year 2022 on 30-06-2022 were past and closed transactions and could not be impaired or whittled away by the use of these words

Super tax under S. 4C of Income Tax Ordinance, 2001, could not be imposed on appellants / taxpayers for the Tax Year 2022 and special tax year

Intra Court Appeal was allowed accordingly.

Substituted subsection (6) and newly inserted subsection (6A) of S. 177 of the Income Tax Ordinance, 2001, applicability of

Retrospective effect

Scope

Department filed reference against the judgment passed by the Appellate Tribunal Inland Revenue in favour of the taxpayer/respondent, with the plea that the applicability of substituted subsection (6) and newly inserted subsection (6A) of S.177 of the Income Tax Ordinance, 2001, was retrospective

Validity

Taxpayer / respondent was selected for audit on 09.05.2019 whereas Show-Cause Notice proposing to amend assessment under S.122 of Income Tax Ordinance, 2001 ('the Ordinance 2001'), was issued to the respondent on 25.02.2021

Perusal of the Show-Cause Notice clearly indicated that audit proceedings were still pending and no audit report was issued by the Department till the amendments-in-question were made in S. 177 of the Ordinance, 2001 through Finance Act, 2019

There was nothing available on record to show what substantive right, if any, had accrued in favour of the applicant / department on 01.07.2019 when the amendment made through Finance Act, 2019, in S. 177 of the Ordinance, 2001 in the form of substitution of subsection (6) and insertion of subsection (6A) became effective which adversely affected the applicant / Department

Said provisions became effective from 01.07.2019; subsection (6) of S. 177 of the Ordinance 2001 made it mandatory for the Commissioner, upon completion of the audit, to obtain taxpayer's explanation on all the issues raised in the audit and after that issue an audit report containing audit observations and findings

There is nothing in the language of the said provision which suggests retrospective application of the same; it means that cases where vested rights have accrued or transaction has been closed because of completion of audit prior to the said amendment, the requirements stipulated through substituted subsection (6) cannot be pressed into service

However, there is nothing in the language of subsection (6) of S. 177 of the Ordinance, 2001, which restricts application of the said provision to cases where audit was pending completion or still underway on 01.07.2019, which is the case here

Likewise, there is nothing in the text of the said provision that restricts its application to the cases selected for audit after any particular tax year

Indeed, the date of selection for audit hardly provides any basis for regulating applicability of the amended subsection (6) of S. 177 of the Ordinance, 2001, which clearly would apply to all cases where audit was yet to be completed after the said enactment

Thus plea rendered by the applicant qua retrospective application of said subsection (6) was wholly misconceived and untenable

Questions raised by the applicant/department were answered against the applicant/department and in favour of the respondent / taxpayer

Reference application filed by the Department was dismissed.

In absence of any stipulation to the contrary, any change in substantive law which adversely affects vested rights of the parties should always have prospective application

Courts lean against giving retrospective operation where the same would prejudicially affect vested rights or past transactions

A prospective statue operates from date of its enactment conferring new rights whereas a retrospective statute, on the other hand, operates backwards and takes away or impairs vested rights acquired under existing laws

However, a statutory provision cannot be termed to have been given retrospective effect merely because a part of the requisites for its action is drawn from a time antecedent to its passing or operation thereof is based upon the status that arose earlier.

There is no prohibition on the Parliament to make retrospective legislation, particularly when such intention is expressly or impliedly clear from the text of the statute.

When the Legislature, while amending any statute, intends to preserve any inchoate right under a repealed provision, it usually incorporates a saving clause or provision in amending statute

When any amendment is made in a statute which is procedural in nature then retrospective rule of construction is to be applied even if it is not specifically given retrospective effect

There is an exception to such general rule i.e. when any substantial right stands accrued in favor of a person then general rule is not to be applied.

Statutes remedial in nature can operate with retrospective effect and are applicable to proceedings pending at the time when an Act comes into force

Remedial legislation does not apply to cases which have been finally determined or proceedings which have attained finality.

There is no prohibition on the Parliament to make retrospective legislation, particularly when such intention is expressly or impliedly clear from the text of the statute.

Petitioner sought clearance of his consignments under Afghan Transit Trade on the plea that goods were imported prior to issuance of notification SRO No.1397(I)/2023 dated 3-10-2023

Validity

Transit Agreement of 1965 was replaced with the 2010 Agreement

Provision of notification SRO 151(I)/2004 dated 10-03-2004 still refers to Art. X of the Agreement (without specifying the year)

In the new Agreement of 2010 Art. X relates to and deals with Licensing of Transport Operators

This appeared to be a mistake on the part of Ministry of Commerce, that since year 2010, the notification SRO 151(I)/2004 dated 10-03-2004 was not amended accordingly

Even when notification SRO 1397(I)/2023 dated 03-10-2023 was issued, they again failed to take care of it and the same mistake still continued

Not withstanding that the Ministry of Commerce, Federal Government may have powers in terms of S.3(1) of the Import and Export Control Act, 1950, a ban could not be imposed unilaterally on the goods which had already been shipped and for which Bills of Lading were already issued

Such action by authorities was too harsh and also against the settled principle of protection to vested rights besides being impractical

Principle of vested right as enunciated by the Courts of law was applicable to the goods in dispute and the same were to be governed by the policy as in vogue prior to the issuance of SRO 1397(I)/2023 dated 03-10-2023

Constitutional petition was allowed accordingly.

Accused was aggrieved of his jail trial and had also assailed appointment of Special Judge under Official Secrets Act, 1923

Validity

There was no judicial order available in file requiring proceedings and trial to be conducted in jail

Essential prerequisite of passing a judicial order requiring trial against accused to be conducted in jail was not fulfilled

Authorities submitted a proposal to Cabinet for sanctioning trial against accused to be conducted in jail, as under R. 3 in Part-A of Chapter-1 in Vol-III of High Court (Lahore) Rules and Orders, Trial Court was to obtain sanction of Government

Provision of R. 3 in Part-A of Chapter-1 in Vol-III of High Court (Lahore) Rules and Orders or any other law did not empower Government to issue such sanction with retrospective effect

It was a vested right of every accused for the trial against him to be conducted in open Court at a place designated for its usual sittings

Retrospective operation could not be given to executive orders so as to destroy vested rights of citizens

Division Bench of High Court declared ex-post facto sanction given by decision of Cabinet to proceedings and trial conducted in jail as unlawful

Intra Court appeal filed under S. 3(2) of Law Reforms Ordinance, 1972, against judgment passed in Constitutional petition was maintainable

Designation of Special Court (Anti-Terrorism-I), Islamabad, to try cases reported under Official Secrets Act, 1923, through notification No. F.No.40(64)/2023-A-VIII, dated 27-06-2023 was valid and lawful

There was no provision in Criminal Procedure Code, 1898 which could compel Trial Court to hold his Court in a usual Court Room

In exceptional circumstances and where it was conducive to justice, a trial could be conducted in jail in manner that could fulfill requirements of an open trial or trial in camera provided it was in accordance with procedure provided by law

Division Bench of High Court declared Notification No. F.No.8(93)/ 2021-A-IV,dated 29-08-2023 issued by authorities to be without lawful authority and of no legal effect for want of any order by appropriate Government and fulfillment of requirements provided in S. 352, Cr.P.C. as well as R. 3 in Part-A of Chapter-1 in Volume-III of High Court (Lahore) Rules and Orders

Division Bench of High Court further declared respective Notifications dated 12-09-2023; 25-09-2023; 03-10-2023 and 13-10-2023 issued by authorities to be without lawful authority and of no legal effect for want of fulfillment of requirements provided in S. 352, Cr.P.C., as well as R. 3 in Part-A of Chapter-1 in Volume-III of High Court (Lahore) Rules and Orders

Division Bench of High Court also declared that respective Notifications dated 13-11-2023, 12-11-2023 and 15-11-2023 issued by authorities on the basis of Cabinet's decision dated 15-11-2023 were of no legal consequence for not having been preceded by order of Trial Court in terms of S. 352, Cr.P.C., passed in judicial proceedings

Division Bench of High Court further declared by way of clarification that Notification No. F.No.40(68)/2023-A-VIII, dated 15-11-2023 issued by authorities on the basis of Cabinet's decision dated 15-11-2023, could not be given retrospective effect

Division Bench of High Court also declared that proceedings of trial against accused in jail premises were notan open trial and the same stood vitiated

Intra Court Appeal was allowed accordingly.

Trial Court convicted and sentenced the appellant/accused under S. 9(c) of CNSA, 1997, to suffer nine years' rigorous imprisonment with a fine of Rs. 80,000 as per the new scheme of penalties inserted by the Control of Narcotic Substances (Amendment) Act, 2022

Validity

New scheme of penalties under Control of Narcotic Substances (Amendment) Act, 2022 ('the Amending Act 2022') had provided that when the quantity of Charas weighed 1000-grams to 4999-grams , the imprisonment might extend to fourteen years which would not be less than nine years along with a fine up to Rs. 400,000 but not less than Rs. 80,000

Trial Court had misconceived and mis-interpreted the Amending Act, 2022 as the amendment was promulgated after about three months of offence having been commitment in the present case , therefore, new amendment could not be applied and enforced retrospectively; and the sentence awarded by the Trial Court was in utter violation of Art. 12 of the Constitution

High Court observed that the sentence awarded to the appellant, being a first offender, was harsh , who had no previous criminal record, therefore, the appellant deserved leniency

Impugned judgment was modified by reducing the sentence of the appellant from nine years to three years and the fine of Rs. 80,000 to Rs. 30,000 with the premium of 382-B of Criminal Procedure Code, 1898

Appeal was partly allowed, in circumstances.

Authorities issued show cause notice to respondent company for certain discrepancies with regard to withholding of short/less amount of sales tax as withholding agent while making purchases etc. pertaining to years 2013 and 2014

Appellate Tribunal Inland Revenue held that S.11(2) of Sales Tax Act, 1990, was not applicable to respondent company

Validity

Dispute was with regard to liability of withholding agent in respect of failure to deduct and deposit sales tax on purchases made by it for a period prior to year 2016 as a withholding agent

Provisions of Finance Act, 2016, did not give any impression of its retrospective application

Liability to pay sale tax was on the person making taxable supplies and withholding agent was only responsible to withhold certain amount of tax at specified rate to deposit the same with the revenue

Liability in question was created through Finance Act, 2016, which had no retrospective application

Demand of the revenue for the period prior to the Finance Act, 20l6, was without lawful authority

No tax was due against respondent company, therefore, penalty and default surcharge could not be imposed upon it for the relevant tax period prior to the Finance Act, 20l6

Reference was dismissed, in circumstances.

Where Legislature has made its intention clear that amending Act should have a retrospective effect / operation, it must be so construed, even though consequence may entail hardship to a party.

Land was mutated in favour of petitioner/defendant in year 1938 on death of predecessor-in-interest of parties excluding respondent/plaintiff from inheritance

Respondent/plaintiff filed suit for recovery of possession, declaration and injunction to the extent of her share in suit land

Suit was concurrently decreed by two Courts below

Contentions of petitioner/defendant were that amendment introduced to S. 59 of Punjab Tenancy Act, 1887, was not applicable retrospectively and he had been depositing compensation under S. 4 of Khyber Pakhtunkhwa Tenancy Act, 1952, therefore, he had acquired exclusive right over suit land

Validity

Not only heading of S. 59 of Punjab Tenancy Act, 1887, [as amended by Punjab Tenancy (Amendment) Act, 1951] but body of main section also aimed at providing a complete code for devolution of occupancy rights of deceased occupancy tenant

With the amendment brought in year 1951 the matter of devolution which had earlier been governed by customs was to be regulated by the law of Shariat

Right of occupancy had always been treated inheritable by law

Only difference that was made by Punjab Tenancy (Amendment) Act, 1951, was to the effect of substituting governing law and changing it from customs to Shariat

Right of occupancy tenancy was always inheritable

Matter of legacy of a Muslim occupancy tenant was governed by S. 59 of Punjab Tenancy Act, 1887, [as amended by Punjab Tenancy (Amendment) Act, 1951], even if deceased occupancy tenant had died before promulgation of Amending Act, because of its retrospective effect

Payment made by brother (petitioner/ defendant) was also deemed to be made on behalf of sister, who was plaintiff before Trial Court

High Court declined to interfere in concurrent judgments and decrees passed by two Courts below

Revision was dismissed accordingly.

Statute providing change of forum pecuniary or otherwise is procedural in nature and has retrospective effect unless contrary is provided expressly or impliedly or it affects existing right or causes injustice or prejudice.

Civil Procedure Code (V of 1908), Ss. 6 & 106 [as amended by S. 3 of Khyber Pakhtunkhwa Code of Civil Procedure (Amendment) Act (XLIX of 2020)]

Civil Courts, pecuniary jurisdiction

Nature of change

Retrospective effect

Scope

Respondents/plaintiffs fixed value of the suit as Rs.100 million in the plaint

Plea raised by appellants/defendants was that after amendment, jurisdiction to try the suit had changed

Validity

Amendment introduced through S. 3 of Khyber Pakhtunkhwa Code of Civil Procedure (Amendment) Act, 2020, whereby pecuniary jurisdiction of Civil Judge viz-a-viz District Judge was determined, had the effect on all pending suits which should be transferred by respective Civil Judges seized of the matter to competent Court under S. 6(b), C.P.C. (as substituted)

Statute amending forum for institution of appeal or that of Appellate Court during pendency of the lis was to have retrospective effect unless otherwise provided by subsequent/amending Act

Appellants/defendants filed appeal under S. 106, C.P.C., which was also amended through Khyber Pakhtunkhwa Code of Civil Procedure (Amendment) Act, 2020

Prior to the amendment, appeal against any interim order passed by a Civil Judge, where value for the purpose of jurisdiction was fixed or determined more than Rupees ten million, would also lie to High Court in view of un-amended S.106, C.P.C. read with S. 18 of West Pakistan Civil Court Ordinance, 1962

By amending S. 106, C.P.C. through Khyber Pakhtunkhwa Code of Civil Procedure (Amendment) Act, 2020, any order passed by Civil Judge during pendency of proceedings, was appealable before District Judge and not before High Court

Amendment in question had retrospective effect as it changed forum of appeal

High Court had no jurisdiction to entertain appeal filed by appellants/defendants

High Court directed the office to transmit the appeal to concerned District Judge for adjudication in accordance with law

High Court directed the parties to appear before District Judge concerned

Appeal was transmitted accordingly.

Competent authority declined appointment to the petitioner on the ground that the policy-in-question was for those whose fathers had died after 1st July, 2005 (Prime Minister Assistance Package, 2005)

Held, that Prime Minister Assistance Package, 2005, was meant for benefitting the ex-employees, which (package) was in line with the rules framed for the employees of Government in the relevant Provincial Civil Servants Act

Authorities were also performing duties under the Ministry of Education and the employees, who had rendered services under their establishment, could not be left high and dry and deprived of such benefits

Authorities could adopt the requisite criteria (prescribing qualification) or experience as required for any post under their command and the petitioner would also be subject to fulfilling the requisite criteria for any post to be considered commensurate to it, which would be in line with the principle for liberal construction of statutes, particularly that the mischief was suppressed and remedy granted

Said principle provided that if literal reading of provision did not produce absurdity or anomaly the same would not be construed to be only prospective

When the law was enacted for the benefit of community as a whole, even in the absence of a provision, the statute could be held to be retrospective in nature

Facility which had not yet been withdrawn but was subsisting, as such a vested right continue to accrue

Executive orders/notifications, which conferred right and were beneficial, would be given retrospective effect and those which were detrimental, prejudicial, had adversely affected, disturbed or invaded upon vested right could not be applied with retrospective effect

Prime Minister Assistance Package, 2005, as beneficial legislation was to be applied to the petitioner whose cause of action had accrued subsequent to the policy-in-question

Constitutional petition was allowed, in circumstances.

There is no prohibition on the Parliament to make retrospective legislation, particularly when such intention is expressly or impliedly clear from the text of the statute.

Petitioner assailed order passed by respondent whereby his retirement order was recalled with the direction to rejoin his official duty in terms of amendment made in S.12 of the Punjab Civil Servants Act, 1974, through the Punjab Civil Servants (Amendment) Act, 2021

Validity

Retirement order of the petitioner had been issued prior to promulgation of the Punjab Civil Servants (Amendment) Act, 2021

Punjab Civil Servants (Amendment) Act, 2021, did not apply retrospectively to the case of the petitioner

When the Legislature through an enactment altered the rights of parties by taking away or conferring any right of action, such amendment did not affect pending actions, unless provided in express terms within the enactment

General rule of common law was that the statute changing the law ought not to affect past events, unless the intention appeared with reasonable certainty to be understood as applying to facts or events that had already occurred in such a way so as to confer or impose or otherwise effect rights or liabilities which the law had defined with reference to the past events

Constitutional petition was allowed and the impugned order was set aside.

Petitioners / taxpayers sought striking down of S.4C of Income Tax Ordinance, 2001, on the plea that charging section could not be retrospective in nature

Contention of authorities was that protected right created vide S.4B of Income Tax Ordinance, 2001, stood impliedly superseded with retrospective effect by insertion of S.4C in Income Tax Ordinance, 2001

Validity

There was a clearly expressed statutorily protected right in respect of super tax, created in favor of tax payer

Under no stroke of interpretation, even strained, strict or convoluted, the benefit stood diminished

Tax payers availed benefit for two years so far and nothing was demonstrated before High Court to consider them disentitled to remaining period

Provision of S.4C of Income Tax Ordinance, 2001, merited in the scenario whereby authorities claimed that rights subsisting vide S.4B of Income Tax Ordinance, 2001, had been vitiated vide S.4C of Income Tax Ordinance, 2001, notwithstanding manifest absence of any express legislative intent to such effect

Super tax was to be recovered from every person, subject to qualifying quantum of income, on the basis delineated in the identified schedule

Relevant schedule precluded recovery of super tax from every person for a period inclusive of tax year 2022

There was a manifest inconsistency with S.4C of Income Tax Ordinance, 2001, which sought to recover super tax for the tax year 2022

Levy under S.4C of Income Tax Ordinance, 2001 was on the income of every person and differentiation in respect of quantum of income was determinant factor for application of the designated tax rate

Higher the level of income the higher was the incidence of taxation intended

Similar treatment was accorded under S.4B of Income Tax Ordinance, 2001, which was reasonable having a nexus with the objective of the levy

Constitution had conferred fundamental rights upon citizens with respect to property, per Arts. 23 & 24 of the Constitution

Such rights could not be abridged by measures determined to be discriminatory

Proviso could not survive test of intelligible differentia, as it could not be demonstrated that imposition of a two hundred and fifty percent (250%) higher rate of super tax was based on any intelligible differentia, having nexus with the purpose of the law

Super tax levied once again vide S.4C of Income Tax Ordinance, 2001, could not be recovered during subsistence of benefit / protection granted to the tax payer vide S.4B of Income Tax Ordinance, 2001

Only avenue to save conflicting provisions of law was to harmonize the same

Provision of 1st proviso to Division IIB of Part I of the First Schedule to Income Tax Ordinance, 2001, was discriminatory as there was no intelligible differentia therein, having rational nexus with the object of classification

Provision of S. 4C of Income Tax Ordinance, 2001, was read to reflect that the levy would be applicable from the tax year 2023

High Court declared provision of 1st proviso to Division IIB of Part I of the First Schedule to the Income Tax Ordinance, 2001, as discriminatory and ultra vires to the Constitution

Constitutional petition was allowed accordingly.

Rules made in exercise of statutory powers cannot be given retrospective effect so as to adversely affect vested rights acquired by persons prior to framing of the Rules.

Sindh Environmental Protection Agency (Review of Initial Environmental Examination and Environmental Impact Assessment) Regulations, 2014, Regln. 1

Commencement

Retrospective effect

Scope

Sindh Environmental Protection Act, 2014 and Sindh Environmental Protection Agency (Review of Initial Environmental Examination and Environmental Impact Assessment) Regulations, 2014 cannot have retrospective effect.

Seniority with retrospective effect cannot be conferred unless such right was established.