2026 PLD 12 SUPREME-COURT-AZAD-KASHMIR Judicial Precedent

S. 302(b)Arms Act (XX of 1965), S. 13Qatl-i-amd, possession of illicit weaponAppreciation of evidenceSingle Member of Shariat Appellate Bench of High Court confirming death sentenceLegalityScopeAccused was charged for committing murder of the father of complainant by firingPerusal of the record revealed that FIR was registered against the convict under S. 302, Azad Penal Code, 1860

Later on, the challan was presented in the District Criminal Court under S. 302, Azad Penal Code, and S. 13 of the Arms Act, 1965

At the conclusion of the trial, the District Criminal Court, found the convict guilty for the murder of father of complainant and awarded him death sentence as Qisas

Convict filed an appeal before the Shariat Court

Reference was also sent by the Trial Court for confirmation of death sentence awarded to the convict

Bench comprising of the then Chief Justice of the Shariat Court dismissed the appeal filed by the convict and the reference sent by the trial Court for confirmation of death sentence awarded to the convict was answered in affirmative

As through the impugned judgment, the then Chief Justice of the Shariat Court, being a Single Member of the Bench, had confirmed the death sentence awarded to the convict-appellant, hence, the same was not sustainable in the eye of law, therefore, without going into the merits of the case, the impugned judgment was set aside

Therefore, the appeal shall be deemed pending before the Shariat Appellate Bench of the High Court

Chief Justice, Shariat Appellate Bench of the High Court, was directed to constitute at least two Members' Bench for hearing of the appeal filed by the convict-appellant

Appeal was disposed of accordingly.

2026 SCMR 929 SUPREME-COURT Judicial Precedent

S.42Suit for declaration of ownership viz. immoveable property on the basis of oral giftOral gift, revocation ofSubsequent mutation in favor of donee/appellant, recalling ofRegistered gift deed executed subsequently by donor to his wifeLegalityOwnership status of the donorPossession of original title documents as the determining factorScopeThe present case concerned a dispute over ownership of suit property

The appellant/donee claimed to be owner of 50 percent of the property through an oral gift allegedly made by respondent No.1/donor in 1984 which was later confirmed by a written declaration in 1986, followed by mutation of half share in his name by the concerned authorities

Subsequently, respondent No.1/donor revoked the oral gift, got the mutation recalled in 1998, and executed a registered gift deed of the same property in 1989 in favour of his wife/respondent No.2

The appellant/donee filed a suit seeking declaration of his half ownership and restoration of the earlier mutation

The Trial Court decreed the suit, but the High Court reversed that decree

Hence, the appeal before the Supreme Court arose to determine “whether the oral gift of 1984 and its declaration of 1986 were validly made and acted upon, and whether respondent No. 1 had any subsisting title to again gift the same property to his wife in 1989”?

Held: What was required to be seen by the courts below was whether the gift deed to the extent of 50% share in the disputed property was executed in favour of the appellant by the respondent No.1 at the relevant time which was now denied

It was not the execution of the gift and the declaration of oral gift alone, it was the consequential effect of those documents that was established through evidence and that was mutation in the name of the appellant by the official authorities, which mutation, without notice to the appellant was withdrawn and recalled on10.06.1998

At the time of registration of gift deed by respondent No.1 in favor of his wife, the mutation had already been effected on the strength of an oral gift in favour of appellant in the year 1986 and it was allegedly withdrawn on the 10.06.1998 whereas the gift was registered in favour of respondent No.2 in the year 1989 in presence of valid mutation entry in favour of the appellant

Order of the trial court was very well reasoned and in consideration of the evidence recorded by the witnesses

The impugned order to the contrary did not discuss in detail the evidence that was recorded in disputing the gift deed executed by the respondent No. 1 in favour of respondent No.2 and the original documents in custody of the appellant having got the document redeemed from the bank where the property was mortgaged

Since the redemption of the document, the respondent/donor did not care to retrieve the original document of the subject property which were undisputedly not with the respondent

There was an oral gift executed by the respondent No.1/donor in favour of the appellant/donee to the extent of 50% of the property and that the mutation entry on the strength of the said oral gift were duly recorded which were subsequently unlawfully withdrawn without notice to the appellant

Therefore, respondent No. 1 was not enjoying the property at-least to the extent of 50% when he allegedly executed gift in favour of his wife

Consequently, order of the Single Judge in Chambers was restored by setting aside the order of the Division Bench of the High Court

Appeal was allowed, in circumstances.

2026 SCMR 905 SUPREME-COURT Judicial Precedent

Ss.2(a), 21, 22 & 24Agricultural Produce Markets Act (V of 1939) [since repealed], Ss.2(a), 4(2), 6(1), 26(1) & 27Manufacturing of fishmeal for poultry feed in Notified Market Area, licence forOperation of fishmeal business without license, allegation of

Challenge to demand notice by the manufacturer alleging fish was not used for human consumption thus falling outside the ambit of Schedule framed under the relevant statue

Legality

Term 'agricultural produce', definition of

Scope and ambit

Items/products capable for human consumption falling within the ambit of 'agricultural produce'

Items/products not capable for human consumption e.g. fishmeal for poultry feed

Such items/products not falling within the definition of 'agricultural produce'

Demand notice

Legality

Fishmeal not being used for human consumption excluded from the purview of Schedule framed under the statute

Demand notice rightly struck down

Factual background was that by issuing demand notice the petitioner (Market Committee) alleged that respondent No.1, acting as dealer, and respondent No.2, engaged in manufacturing fishmeal for poultry feed, were operating within a notified market area without the requisite license under the Agricultural Produce Markets Act, 1939 (APMA 1939), as fishmeal fell under the Schedule heading “Fish (Fresh and Dry)”

A complaint and demand notice were issued to the respondents for obtaining a license and paying the fee

Respondent No.1 challenged the notice through a constitutional petition, which was struck down by the High Court on the ground that fishmeal did not fall within the Schedule of Agricultural Produce Markets Act, 1939 (the Act 1939)

The petitioner contended that fishmeal was covered under “Fish (Fresh and Dry)” while the respondents argued that fishmeal, being for animal feed and not human consumption, was outside the scope of Schedule

The primary question for determination before the Supreme Court was as to “Whether the fishmeal was included in the Schedule attached to Agricultural Produce Markets Act 1939 or not?”

Held: Fishmeal was a valuable ingredient in agriculture, primarily used as a high protein feed supplement in animal and aquaculture production

It also served as a beneficial soil amendment and organic fertilizer, enhancing plant growth and soil fertility

Fishmeal was a rich source of protein containing essential amino acids and other vital nutrients, making it a premium ingredient in animal feed

Supplementing animal diets with fishmeal could improve the growth rates, enhance reproductive performance and was better for overall health

Fishmeal was commonly used in poultry and cattle feed, as well as in aquaculture for fish and shrimp

Definition of 'agriculture produce' provided under the Act, 2010 included such agricultural produce or horticultural produce, livestock or poultry, fish or seafood and products and by-products which were capable for human consumption for sale or purchase in wholesale market within a boundary, which meant that the items/products, not capable of human consumption could not be treated or considered agricultural produce within the definition of 'agriculture produce'

Miscellaneous entry of Schedule only depicted the item “Fish (Fresh and Dry)” which otherwise did not include the fishmeal in its literal sense that implied a product or substance not intended for human consumption

Findings recorded by the High Court striking down the demand notice in question were cogent and based on relevant provisions of law

No factual, legal or jurisdictional error in the impugned order was found would could furnish basis, justification or ground for interreference by the Supreme Court

Moreover, Supreme Court emphasized that the Sindh Wholesale Agricultural Produce Markets (Development and Regulations) Act, 2010 was not implemented by the Government despite lapse of moratorium period of three years and inquired as to why notified markets had not been transferred to the market companies which should have been done long ago

Civil petition was dismissed and leave to appeal was refused, in circumstances.

2026 SCMR 812 SUPREME-COURT Judicial Precedent

S. 13(1)(a)Civil Procedure Code (V of 1908), S. 115Suit for possession through pre-emptionTalb-i-MuwathibatBurden of proofDelay between the date of mutation and knowledge of saleInformer not produced as witnessEffectProduction of supporting witnesses in place of informerLegalityConcurrent findings on issue of Talb-i-MuwathbatSuit was dismissed by the trial court, but was decreed by the Appellate court

Revisional court overturned the decision of the Appellate court while observing that Talb-i-Muwathibat remained unproved

Validity

Informer was never produced before the trial court throughout the proceedings without any explanation

Omission to produce the informer through whom knowledge of the sale was acquired was a significant shortcoming in the evidentiary chain

Requirement of Section 13 of the KPK Pre-emption Act, 1987, (Act) was not merely procedural but foundational for enforceability of the right of pre-emption, which mandated that the first demand (Talb-i-Muwathibat) be made immediately upon acquiring knowledge of the sale and be proven through unimpeachable evidence

Appellant's version remained uncorroborated for the most critical point that how and when he came to know about the sale

Lapse of more than three months between the date of mutation and the claimed knowledge further undermined the promptness and credibility of the alleged Talb

Without evidence of informer, appellant's version regarding the time, place and manner of acquiring knowledge of the sale remained uncorroborated

Supporting witnesses might have been present at the time of the alleged declaration/demand, but in the absence of the informer himself, the requirement of immediacy and authenticity under Section 13 of the Act remained unproven

Non-production of the informer may be fatal and may result in an adverse inference being drawn against the pre-emptor

Appellate Court's findings on the issue of Talb-i-Muwathbat were a result of misreading of evidence, thus, were liable to be set aside

High Court, in correcting that error, acted well within its powers under its revisional jurisdiction

Revisional Court is fully empowered under Section 115, C.P.C., to do so where such findings are based on misreading, non-reading, or misinterpretation of the evidence on record

Civil Appeal was dismissed, in circumstances.

2026 SCMR 769 SUPREME-COURT Judicial Precedent

Rr.13.6(2) & 13.9Sindh Service Tribunals Act (XV of 1973), Ss.4 & 5Constitution of Pakistan, Art. 189Out of turn/shoulder promotionReversion/demotion of Head Constables to Constables while misapplying judgment of Supreme CourtDecision of appeal by Service Tribunal without examination of service recordLegalityDuty of the Service TribunalScope

Prior to declaring a promotion as out of turn or shoulder promotion, the Tribunal was obliged to examine the service record to ascertain whether such promotion was accorded without merit, fulfilling elementary codal formalities including training courses/examinations

Promotion cases of petitioners whether or not out of turn promotion could obviously be decided if the relevant service record of the petitioners was properly vetted by the Service Tribunal, together with the question of alleged repeal or omission of Rule 13.6(2) of the Police Rules, 1934 with its effective date vis-à-vis the date of alleged out of promotion granted to the petitioners

Judgment of Supreme Court has binding effect in terms of Article 189 of the Constitution, but each case has to be decided on its own peculiar facts and circumstances with an independent and judicious application of mind, rather than simply relying on the departmental version as gospel truth

Civil petitions were converted into appeals and allowed in circumstances.

2026 PLD 69 SUPREME-COURT Judicial Precedent

Cl. 5Co-operative Societies Act (VII of 1925), S. 43Constitution of Pakistan, Arts.129 & 139(3)Complaints of financial mismanagement and administrative irregularities against a cooperative housing societyPower of Chief Minister to order initiation of inquiryScopeHigh Court accepting society's plea that only Registrar of cooperative societies could hold inquiry against the societyLegality

Acting upon the complaint received against working of a cooperative housing society, the Chief Minister directed his inspection team to conduct an inquiry

The society challenged this inquiry before the High Court under Article 199 of the Constitution, contending that the Chief Minister had no authority to order such inquiry since the Cooperative Societies Act, 1925 provided its own mechanism for supervision and inquiry

The High Court accepted the society's plea and set aside the inquiry proceedings

Against High Court's decision, the Government of Punjab filed the present petition before the Supreme Court

Pivotal question requiring determination before the Supreme Court was as to "Whether the Chief Minister, under Clause 5(2) of the Punjab Government Rules of Business, 2011, possessed the legal authority to initiate or order an inquiry into the affairs of a cooperative society registered under the Cooperative Societies Act, 1925, notwithstanding the specialized supervisory mechanism prescribed under the said Act"?

Held: It was clear from clause5 sub-clause (2) that Chief Minister could call for any case or information from any department, attached department or regional office

In this regard, complaint made to the Chief Minister's inspection team or the Chief Minister for probing into the affairs of the society, fell within the sphere of Cooperative Laws, wherein the secretary cooperative societies was the overall in-charge

Clause 5 permitted Chief Minister to call for record and issue directions to government departments

This function was administrative in nature and did not amount to statutory intervention

However, the inquiry could not usurp the functions of the Registrar of the authorities empowered under the Act

While the High Court correctly identified the supremacy of the Act in terms of substantive regulation, it erred in concluding that Chief Minister had absolutely no authority to order or initiate an inquiry or call for information even through competent department

The Constitutional and administrative role of the Chief Minister had to be given its due effect

Judgment of the High Court was not sustainable as it has construed Clause 5 ibid in a restricted manner and had made the referred power of the Chief Minister dormant wherever there was statutory regulatory scheme work

Chief Minister was not excluded from calling information or record pertaining to the cooperative societies or any provincial department or attached department under Clause 5 of the Rules

Leave to appeal was granted and present petition was converted into appeal which was accordingly allowed.

2026 SCMR 558 SUPREME-COURT Judicial Precedent

Art. 212(3)Civil servicePromotionEntitlementDepartmental Promotion CommitteeMeeting deferred by departmentRevision of promotion rules during deferred period of meetingEffect upon pending promotion casesDepartment relying upon revised promotion rulesLegalityEntitlement determined under earlier rules

Briefly, the respondents were appointed as 'sub engineers' in the year 1986 and were later upgraded to BPS-16 from BPS-12

Upon becoming eligible under the then-applicable service rules, their working papers for promotion to the post of 'assistant engineer' in BPS-17 were prepared, but the meeting of the Departmental Promotion Committee (DPC) was deferred by the department on the ground that new promotion rules were under consideration, subsequently, revised rules were notified, under which the respondents were declared ineligible for promotion, while their departmental appeals remained undecided, leading them to file service appeals before the service tribunal, which were allowed, holding them entitled to promotion in accordance with the rules applicable at the time they became eligible

The said judgment of service tribunal was challenged by the department before the Supreme Court through present civil petitions for leave to appeal

Held: Respondents had satisfied the eligibility criteria for promotion pursuant to the rules enforced at the time of their initial appointment

Consequently, their cases were fully ripe for consideration by DPC

The subsequent delay in convening meeting of the DPC was an administrative failure attributable solely to the department and could not be imputed to the respondents

The subsequently amended rules were to operate prospectively unless a contrary intimation was manifestly evident from the statute

Question of whether the amended rules were to be applied retrospectively or prospectively was beyond the scope of DPC's mandate

The DPC also did not have the authority to delay the meeting while waiting for amendment of the rules

Leave was declined and present petition was dismissed, in circumstances.

2026 SCMR 521 SUPREME-COURT Judicial Precedent

R.2(1)(l)Khyber Pakhtunkhwa Police Rules, 1975, R.2(iii)Termination from serviceEmployee sent to civil prison in execution of a civil liabilityCivil imprisonment considered as a 'conviction' by department by terming it as misconductLegalityMisconductScope

In case a civil servant has been sent to civil prison on his failure to deposit the decretal amount pursuant to a judgment or decree in a civil suit, it does not fall within the definition of misconduct, for the reason that civil servant is not charged for any moral offence, nor is convicted by Court of law for a criminal offence.

2026 SCMR 521 SUPREME-COURT Judicial Precedent

R.2(1)(l)Khyber Pakhtunkhwa Police Rules, 1975, R.2(iii)Civil Procedure Code (V of 1908), S.51Constitution of Pakistan, Art.185(3)

Employee of police department terminated from service on account of him being sent to civil prison under an execution of a civil liability

Department considering such civil imprisonment as conviction

Legality

Non-mentioning of the relevant law under which the employee being proceeded

Effect

Departmental proceedings would be unlawful on this score alone

Brief facts of the matter were that the respondent was appointed as a 'special police officer' and was removed from service after being sent to civil prison for non-payment of a decretal amount arising from execution proceedings

He was reinstated by High Court for a fresh inquiry, after which the department again terminated him on the basis that his civil imprisonment amounted to misconduct

High Court set aside this second termination and reinstated him

The core legal question requiring determination before the Supreme Court was "whether civil imprisonment under execution proceedings of a civil liability amounted to a 'conviction' for purposes of service law, thereby justifying dismissal from service"?

Held: Respondent was issued the charge-sheet and statement of allegations while treating the period of three months when the respondent remained in the civil prison as period of conviction

The department while proceeding against the respondent failed to make mention of the law or the rules under which the departmental proceedings were initiated against the respondent

There was no mention of any law or the rules neither in the charge-sheet, statement of allegation, nor in show cause notice and in the order of the competent authority

This fact alone was sufficient to declare the entire proceedings initiated by the department against the respondent as nullity in the eyes of law for the reason that the respondent was not confronted with the relevant law and the rule according to which respondent was held liable to be proceeded and dismissed from service

From perusal of definition of the term "conviction" as defined in dictionaries it emerged that conviction was the result of a criminal trial in respect of a criminal offence and did not relate to civil proceedings

Therefore, even if a civil servant was sent to civil prison pursuant to execution proceedings in a civil suit it could not amount to his conviction

Moreover, the primary objective of arrest and detention under Section 51(c), C.P.C., was to recover the decretal amount and not to punish the judgment-debtor

Civil imprisonment/detention was not a punitive measure but a coercive and remedial tool to enforce orders and decrees of the court and could be purged upon compliance of the court order

Civil imprisonment as a consequence of execution of a civil liability did not amount to conviction, and, therefore, did not affect the terms and conditions of service of the civil servant

The impugned judgment passed by the High Court was unexceptionable

Present petition for leave to appeal was converted into appeal and dismissed.

2026 SCMR 494 SUPREME-COURT Judicial Precedent

S.5, Sched.Suit for recovery of dower decreed to the extent of entitlement to Rs.100,000/Executing court ordering recovery of gold ornaments at current market valueLegalityExecuting court could direct payment of the current market value of gold ornaments if their return was not possible

Respondent No.1 filed a suit before the family court for recovery of dower, dowry articles, and maintenance of minor, which was decreed while declaring her entitled to seven tolas of gold or, in the alternative, Rs.100,000/- as dower

In execution, the family court ordered recovery of either seven tolas of gold or its current market value

The petitioner/husband challenged this in revision, which was allowed by the district court holding that the entitlement was confined to Rs.100,000/

In respondent's (wife's) constitutional petition, High Court set aside the revisional order and restored the family court's execution order, holding that she could recover the gold or its prevailing market value

The petitioner/husband then filed the present civil petition before the Supreme Court raising the question for determination as to "Whether the decree entitling the respondent/wife to seven tolas of gold or in the alternative Rs.100,000/-, limits recovery to the fixed sum or allows recovery of the current market value of gold when return in specie is not possible"?

Held: High Court correctly appreciated the scope of the judgment and decree, the conduct of the parties, and the settled principle that, where a decree expressly afforded alternate modes of satisfaction, the decree-holder retained the liberty to exercise her choice

The contention that the Respondent No. 1 voluntarily sought amendment during execution proceeding was misconceived

The executing court's order maked it evident that the amendment was merely an addition of Rs. 100,000/- in consequence of the petitioner's objection, without in any way deleting, relinquishing or substituting the original stipulation of seven (07) tolas of gold

An executing court could direct payment of the current market value of gold ornaments if their return was not possible

Impugned judgment neither suffered from legal error nor reflected any perversity or misapplication of settled law

On the contrary, it reinforced the principle that the court must give effect to the true intent underlying the decree and the contract from which it flew

Impugned judgment was well-reasoned, based on proper appreciation of facts and law

No illegality, perversity, or misreading and non-reading of evidence had been found in the impugned judgment

Accordingly, the instant petition was dismissed and leave to appeal was refused.

2026 SCMR 339 SUPREME-COURT Judicial Precedent

Arts. 185(3) & 199Establishment and operation of a 330 MW 'private thermal power project'Premature invalidation of 'letter of support' by 'Private Power and Infrastructure Board' (PPIB)Encashment of performance guarantee (PG), challenge toHigh Court allowed the prayer for direction to reimburse the amount realized upon encashment of PGLegalityWhether such direction amounted to interference in a contractual disputeDetermination

Brief facts were that the federal government introduced the 1994 Power Policy under which the respondent was issued a 'letter of interest' ("LOI") and later a 'letter of support' ("LOS") for establishing a 330 MW power project, requiring achievement of financial close and submission of a performance guarantee ("PG")

The LOS was extended until 30.10.1996, while national policy decisions of the ECC altered the treatment of power projects exceeding the 3,000 MW cumulative financial-close threshold

Before expiry of the extended deadline, respondent was informed that its LOS stood invalid due to other projects reaching the cumulative limit and subsequently encashed the respondent's PG on 28.11.1996

The respondent filed a writ petition seeking refund of the encashed PG, which the High Court allowed, and the intra-court appeal against it was dismissed

The issue for determination before the Supreme Court was "whether the High Court's direction to refund the encashed PG amounted to unlawful interference in a contractual matter or whether it correctly enforced binding public-law decisions of the ECC?"

Held: Private Power and Infrastructure Board (PPIB) prematurely declared the respondent's LOS invalid and refused to approve essential term sheets even though the LOS remained valid until 30.10.1996, thereby preventing the respondent from achieving financial close

Since the approval of the respondent's term sheets by PPIB was mandatory before financial close could be declared, and since PPIB, in its letter dated01.09.1996, had taken the position that the respondent's LOS was not valid, not because it had expired, but because other private power projects had achieved financial close for a cumulative capacity of 3,000 MW, it could not be held with certainty that the respondent would not have achieved financial close within the deadline of 30.10.1996 set in PPIB's letter dated 24.03.1996

By informing the respondent through letter dated 01.09.1996 that its LOS was not valid, the respondent could not have been expected to take steps for achieving close thereafter

It was almost a month before such deadline that PPIB through its letter dated 01.09.1996, informed the respondent that its LOS was no longer valid

PPIB's basis for taking this position was achievement of financial close for the cumulative capacity of 3,000MW by other private power projects, and not because the respondent had breached any provision of the LOS

In such circumstances, the encashment of the respondent's PG was most irrational and unreasonable

By allowing respondent's writ petition High Court had given effect to the decisions of the ECC and had not interfered with the contractual obligations arising under the LOS

Appeal had no merit and was dismissed, in circumstances.

2026 SCMR 227 SUPREME-COURT Judicial Precedent

Arts. 10A & 14Income Tax Ordinance (XLIX of 2001), S. 140Adverse order passed by the DepartmentRecovery of tax from third parties holding money on behalf of the taxpayerDate set in the notice, absence ofImmediate coercive recoveryConstitutional rights of taxpayerScope

Within a short span of time (of about eight and half hours) from the decision by the Commissioner Inland Revenue- Appeals and it being uploaded on the FBR's web portal, notice for immediate recovery from Bank was sought by the Department

Legality

Constitutional underpinning of Section 140 of the Income Tax Ordinance, 2001 ('the Ordinance 2001') is that the requirement of notice before recovery is not merely statutory but reflects the broader guarantees of due process and fair trial under Article 10A of the Constitution, as well as the right to dignity under Article 14

Even in fiscal matters, recovery must be carried out in a manner that respects the individual's dignity and legal safeguards

Consequently, even where the law allows coercive recovery, it must be carried out in a way that preserves the dignity of the taxpayer

Therefore, in view of the statutory framework and applicable Rules, Section 140 of the Ordinance, 2001 does not permit immediate coercive recovery in the absence of a date set in the notice

Section 140 of the Ordinance, 2001 expressly provides that the party holding money on behalf of the taxpayer must be afforded a notice with a due date to discharge its liability

In both present cases, the notices issued Section 140 of the Ordinance, 2001 seek immediate recovery, thereby blatantly violating the requirements of Section 140 of the Ordinance, 2001, which is illegal

No case for interference was made out

As leave had already been granted, the Civil petitions were converted into appeals and dismissed.

2026 SCMR 227 SUPREME-COURT Judicial Precedent

S. 140Adverse order passed by the DepartmentRecovery of tax from third parties holding money on behalf of the taxpayerTimeframeDate set in recovery notice, absence ofImmediate coercive recoveryScope and effect

Within a short span of time (of about eight and half hours), from the decision by the Commissioner Inland Revenue-Appeals and it being uploaded on the FBR's web portal, notice for immediate recovery from Bank was sought by the Department on the same date as the notice

Legality

Provision of Section 140 of the Income Tax Ordinance 2001 ('the Ordinance 2001') provides for recovery of tax from third parties holding money on behalf of the taxpayer

The Commissioner is required to issue notice in writing to such person to pay to the Commissioner the tax due as set out in the notice, by the date set out in the notice

A bare reading of Section 140(1) of the Ordinance 2001 reveals the express condition to set a date for payment, in the notice on which the stipulated tax has to be paid

The use of the words by the date set out in the notice in Section 140(1) of the Ordinance 2001 reflects the very clear requirement to provide for a future date in the notice on which the tax becomes payable, meaning that the Commissioner has to provide for a future date, being a date other than the date of the notice to make payment

Thus, the words to set a date mandates the Commissioner to set a date in the notice on which the tax liability has to be discharged by the third party such that the Commissioner, while issuing the notice, is conscious of the fact that the notice must contain a future date for payment

The act of setting a date in the notice is a substantive requirement of the Ordinance 2001 which necessitates a legal timeline to come into effect for both the Commissioner as the enforcing authority and the third party as the person from whom recovery has to be effectuated

Said legal timeline serves a dual purpose whereby it gives the Commissioner a clear date on which recovery can be effected and it gives the third-party fair notice of the demand and the opportunity to act within the prescribed period

The condition of fixing a future date is in effect a legal safeguard which ensures that the process of recovery is protected from arbitrariness and undue haste, which gives legal certainty to the process of recovery, hence ensures that the process is conducted fairly, transparently and in a reasonable manner; this is necessary given that the mode of recovery from a third-party holding money on behalf of the taxpayer is an independent mode of recovery, that too coercive in nature, which measure should be exercised with great caution and due process

The legislative intent, therefore, is to regulate the discretion given to the Commissioner to recover tax on behalf of the tax payer where the taxpayer has failed to pay the tax

Consequently, the very act of setting a date mandates the Commissioner to plan for a future date and notify the third-party of the date when the recovery will be effected

Therefore, in view of the statutory framework and applicable Rules, Section 140 of the Ordinance 2001 does not permit immediate coercive recovery in the absence of a date set in the notice

Section 140 of the Ordinance 2001 expressly provides that the party holding money on behalf of the taxpayer must be afforded a notice with a due date to discharge its liability

In both present cases, the notices issued under Section 140 of the Ordinance 2001 seek immediate recovery, thereby blatantly violating the requirements of Section 140 of the Ordinance 2001, which is illegal

No case for interference is made out

As leave had already been granted, the Civil petitions were converted into appeals and dismissed.

2026 SCMR 227 SUPREME-COURT Judicial Precedent

Ss.137(2), 138 & 140Adverse order passed by the DepartmentRecovery of tax from third parties holding money on behalf of the taxpayerTimeframeImmediate coercive recoveryScopeTerms "amount payable" and "tax due"Scope

Within a short span of time (of about eight and half hours), from the decision by the Commissioner Inland Revenue-Appeals and it being uploaded on the FBR's web portal, notice for immediate recovery from Bank was sought by the Department on the same date as the notice

Legality

In a scenario in which the assessment order is modified upon appeal, /resulting in a reduction of the "amount payable" it becomes crucial to determine whether the original demand notice under Section 137(2), which was issued in accordance with the initial assessment order, remains valid, or, would it be necessary to issue a new demand notice that aligns with the revised amount specified in the order on appeal?

The answer is that a fresh demand notice would indeed be necessary

This is because the original "amount payable as assessed in the initial assessment order has been modified and effectively merged with the findings of the order on appeal, thereby necessitating an updated notice to reflect the revised amount

Consequently, given the facts of the present case, the Commissioner was required to issue a fresh notice under Section 137(2) reflecting the amounts determined in the appellate order, demanding payment from the taxpayer (respondent) within a fresh 30-day period

Only if the taxpayer (respondent) failed to pay the "amount payable" as established in the appellate order within the allotted time could the recovery mechanisms provided in section 138 or 140 be activated

Given that no notice under Section 137(2) had been generated after the appeal, no amount could be considered as "tax due"

Therefore, any recovery actions taken based on that premise would be deemed invalid

Thus, the petitioner -Revenue Department remained unable to substantiate the validity of the notice under Section 140 of the Ordinance 2001 ,consequently, no disturbance in the acceptance of the taxpayer's (respondent's) writ petitions and dismissal of the petitioner's (Revenue's) Intra-Court Appeals were made out

Appeals, filed by Department , were dismissed.

2026 SCMR 227 SUPREME-COURT Judicial Precedent

Ss. 137(2) & 140Adverse order passed by the Commissioner Inland Revenue-AppealsImmediate coercive recovery of tax from bank holding money on behalf of the taxpayerDoctrine of mergerScope

Within a short span of time (of about eight and half hours), from the decision by the Commissioner Inland Revenue-Appeals and it being uploaded on the FBR's web portal, notice for immediate recovery from Bank was sought by the Department on the same date as the notice

Legality

When an appeal is properly brought before a higher authority, and that authority either modifies, reverses, or upholds the order put in issue before it, the order from the lower authority merges with the decision from the higher authority, and it is the latter which subsists, remains operative and is capable of enforcement in the eyes of the law

Said concept is known as the doctrine of merger, which is rooted in the necessity to maintain order within the judicial process and to uphold the integrity of the justice delivery system

The rationale supporting the merger doctrine is clear: there can only be one operative order addressing the same subject matter at any given moment

In light of said doctrine, it can be ,logically deduced that, following the appellate order, the previous notice issued under Section 137(2), pursuant to the assessment order or amended assessment order, had lost its significance and efficacy; it stood wiped out

Thus, the petitioner -Revenue/Department remained unable to substantiate the validity of the notice under Section 140 of the Ordinance 2001, consequently, no disturbance in the acceptance of the taxpayer's (respondent's) writ petitions and dismissal of the petitioner's (Revenue's) Intra-Court Appeals were made out

Appeals, filed by Department , were dismissed.

2026 SCMR 54 SUPREME-COURT Judicial Precedent

Ss. 2(d), 5 & 13Pre-emptionDistinction between sale and exchangeTransaction recorded in mutation as an exchange or a sale, classification ofDeterminationRight of pre-emption, arising ofPre-requisiteOccurrence of sale transaction being mandatoryCourts below concurrently holding that defendant failed to prove that the transaction was an exchangeLegalityBurden of proofOnus of proof primarily lay with the plaintiff who asserted that mutation represented a sale rather than an exchange

The dispute arose over a parcel of land measuring 24 kanals and 3 marlas situated in Dera Ismail Khan, where "MT", the owner, executed a mutation reflecting an exchange of land with the defendant, allegedly for better management

The plaintiff, claiming a superior right of pre-emption, instituted a suit asserting that the transaction, though recorded as an exchange, was in fact a sale

Trial Court treated the mutation as a sale and decreed that both parties, being co-owners in the same khata, were entitled to equal pre-emption rights

The appellate and revisional courts upheld this view

The legal issue requiring determination before the Supreme Court was "whether the transaction through mutation constituted a genuine exchange or a sale disguised as an exchange, thereby determining the applicability of the right of pre-emption under Section 5 of the KPK Pre-emption Act, 1987"?

Held: Courts below incorrectly surmised that the defendant failed to provide sufficient proof that the transaction was an exchange

The onus of proof primarily lay with the plaintiff (pre-emptor), who asserted that the recorded mutation represented a sale rather than an exchange

The mere failure of the defendant to establish the transaction as a legitimate and bona fide exchange did not automatically validate the conclusion that it was a sale

The absence of any credible proof indicating payment of price or a promise thereof led to the conclusion that the transaction documented in the mutation was an exchange rather than the sale claimed by the plaintiff (pre-emptor)

Courts below significantly misinterpreted the evidence presented and they also misapplied the relevant legal principles

According to Section 5 of the Act, the right of pre-emption was contingent upon the occurrence of a sale; this right did not extend to transactions such as gifts or exchanges

In the present case, the plaintiff (pre-emptor) failed to demonstrate that the transaction documented in mutation constituted a sale

Consequently, the plaintiff (pre-emptor) was not entitled to the decree he sought

Judgments and decrees issued by the courts below were legally untenable and same were set aside

Petitions were converted into appeals and petition brought forth by the plaintiff (pre-emptor) was dismissed and one brought forth by the defendant was allowed.

2026 SCMR 31 SUPREME-COURT Judicial Precedent

S. 13(2)(i)Qanun-e-Shahadat (10 of 1984), Art. 129(g)Landlord seeking ejectment of tenant and recovery of arrears of rentClaim of arrears filed by landlord after four years without any credible evidenceBurden on landlord to prove claim of rentHigh Court allowed the ejectment petition along with recovery of rentLegality

Respondent / landlord filed an ejectment application before the rent controller against petitioners / tenants seeking possession of the shop in question along with recovery of rent from 2016 onwards

The respondent / landlord claimed that the tenancy agreement had expired in 2016, yet the petitioners retained possession after locking the premises

The petitioners submitted a reply asserting that they had already handed over vacant possession and paid all dues but did not contest further and were proceeded against ex-parte

The rent controller allowed the ejectment application but rejected the rent arrears claim which was affirmed in appeal

However, High Court set aside the concurrent findings, granting ejectment along with recovery of rent from January 2016 to January 2024, leading to the present petition before the Supreme Court

Held: Both the rent controller and the appellate authority concurrently found that the respondent / landlord failed to discharge the burden of proving rent arrears or continued possession by the petitioners after 2016

These findings were based on appreciation of evidence, or the lack thereof, and did not suffer from any legal infirmity or jurisdictional error

No witness was produced to support the claim that the petitioners / tenants continued to occupy the premises after 2016

The individual named "S", in whose purported assurance the respondent / landlord allegedly refrained from taking possession, was neither impleaded as a party nor summoned as a witness, therefore, such omission constituted withholding of the best available evidence

Furthermore, the statutory regime under Section 13(2)(i) of the West Pakistan Urban Rent Restriction Ordinance, 1959 prescribed a period of sixty days for initiating proceedings in cases of non-payment of rent, in the absence of a fixed timeline in the tenancy agreement

In the present case, the tenancy agreement expired in 2016 and the ejectment application was filed in 2020 and no explanation was offered for this extraordinary delay, nor was there any plea of acknowledgment or revival of the tenancy in the interceding period

The unexplained lapse of nearly four years was fatal to the claim, both on grounds of limitation and laches

The finding of the High Court that the respondent/landlord was entitled to rent for eight years, in the absence of proof of possession or an ongoing tenancy, disregarded fundamental rules of evidence

The landlord, having admitted that the shop remained locked and having produced no cogent evidence to show that the petitioners/tenants used or benefited from the premises during that period, cannot be awarded rent merely because the tenants failed to actively contest the proceedings

Impugned judgment of the High Court was set aside

Petition was converted into an appeal and allowed, in circumstances.

2026 SCMR 1 SUPREME-COURT Judicial Precedent

Ss.5, Sched. & 17-AMuslim Family Laws Ordinance (VIII of 1961), Ss.5 & 9Constitution of Pakistan, Arts.14, 25, 35 & 185(3)Wife's entitlement to maintenance in a non-consummated marriageScopeMaintenance allowance to wife, denial ofMarriage not being consummated, ground ofLegalityWife's right to maintenance flows unconditionally from solemnization of a valid marriageObligation of husband to pay maintenanceException statedHusband to prove that wife repudiated the marital relationship

Brief facts were that the petitioner/wife and the respondent/husband contracted marriage on 02.11.2012 through a valid nikahnama, with rukhsati mutually scheduled for February 2013, however, the respondent/husband delayed rukhsati for more than a year

Petitioner/wife filed a suit for maintenance before the family court, whereby, Rs.3,000 per month was decreed in her favour from the date of marriage

On appeal, the district court enhanced the amount to Rs.5,000 per month

During the proceedings, the respondent/husband divorced the petitioner/wife on 02.05.2014

High Court, however, set aside the decrees of the lower courts, holding that since the marriage had not been consummated, the petitioner/wife was not entitled to maintenance

The petitioner/wife thereafter approached the Supreme Court seeking restoration of her right to maintenance

Pivotal questions for determination before the Supreme Court were as to (i)"When does a Muslim woman become entitled to maintenance within a marriage"? and, (ii)"under what circumstances, if any, may a husband be excused from his marital obligation to pay maintenance to his wife"?

Held: Islamic principles, Constitutional and statutory protections, and judicial precedents affirmed that the wife's right to maintenance flew unconditionally from the solemnization of a valid marriage and constituted a binding legal duty

A husband could only be excused from paying maintenance where he could prove through clear, cogent, and compelling evidence that the wife had wholly and unjustifiably withdrawn from the marital relationship including its emotional, residential, and relational aspects

The burden of proof lay squarely on the husband

This exception in favour of the husband was to be narrowly construed to support structural gender inequalities which demanded a cautious and rights-oriented approach to interpreting such exceptions, ensuring that maintenance remained a shield against economic vulnerability, not a tool of coercion

In the present case, there was no dispute that the parties entered into a valid marriage, nor was there any allegation, much less evidence, that the petitioner/wife refused consummation or cohabitation without reasonable cause

On the contrary, the record revealed that the respondent/husband failed to provide a marital abode, made no arrangements for rukhsati, and did not take steps to fulfill his basic obligations under the marital contract

There was similarly no factual or legal basis in the record to invoke the narrow exception to the respondent's/husband's obligation of maintenance

No credible evidence had been led to suggest that the petitioner/wife willfully withdrew from the marital relationship or refused cohabitation without valid cause

The wife's inability to cohabit due to the husband's own failure to facilitate rukhsati did not defeat her claim to maintenance

Petitioner/wife could not be penalized for non-consummation that resulted from the respondent's/husband's own inaction

Petitioner's/wife's right to maintenance accrued upon the solemnization of marriage and continued throughout the subsistence of the marital bond

Considering that the divorce took place during the pendency of the said litigation, the maintenance period was to continue till the period of iddat

The denial of maintenance in the present case, in light of the respondent's/husband's default and the absence of any fault on part of the petitioner/wife, was contrary to law and was accordingly set aside

Impugned judgment was set aside

The petitioner's/ wife's entitlement to maintenance from the date of valid marriage was affirmed in the sum for Rs. 5000/- per month adjudicated upon by the district court and also included maintenance for the period of iddat

The petition was accepted, converted into an appeal, and allowed.

2026 PTD 997 SUPREME-COURT Judicial Precedent

Ss.14A & 156(1)(7A)Customs Rules, 2001, R.556Import of hunting carbinesGoods declarations filedSeizure before assessmentIssuance of delay and detention certificateRefusal by terminal operator to honor delay and detention certificatesLegalityPowers and obligations of terminal/port operatorScopeDemurrage and detention charges, refund and waiver of

Whether the importer was entitled to any relaxation, concession or complete waiver of the detention and demurrage charges, plea of

Briefly, the respondents, importers of hunting carbines, filed goods declarations for clearance of their consignments, which were initially seized by the Directorate of Intelligence and Investigation Customs before assessment by the Collectorate

Following proceedings before the High Court, the seized goods were ordered to be handed over for processing, resulting first in confiscation by an order-in-original, then its setting aside by the Collector (Appeals) with remand, and eventual assessment and clearance of the consignments

In parallel, additional consignments imported by another respondent were subjected to adjudication regarding non-attachment of financial instruments, leading initially to a conditional release with penalty, which was later set aside in appeal and the goods released unconditionally

Thereafter, delay and detention certificates under section 14A of the Customs Act, 1969 were issued by the competent customs authority in favour of both respondents, but the petitioners declined to comply with those certificates, prompting the respondents to approach the High Court, which allowed their writ petition with directions, against which the present civil petition for leave to appeal was filed

Held: Sub-paragraph (iv) of the Customs Rules compelled the terminal operator, who was under an obligation to honor the delay and detention certificate and grant concession from port handling and demurrage charges

Indeed, if on issuance of delay and detention certificate the importer was not found to be at fault then it did not necessarily mean that the terminal operator was at fault

However, the two claims were independent and not necessarily be taken up together

Unadjudicated claim of terminal operator could not be pressed against importer on issuance of delay and detention certificate

It was for the convenience of the importer and further accrual of claim that goods ought to be released on issuance of such certificate

Port operator which was only a licensee under the agreement and thus could not be a judge of his or its own cause

It was at this point in time when paragraph (iv) of rule 556 of the Customs Rule would come into play

Interestingly, despite the use of the word 'entertain' the word 'shall honour' used in the aforesaid sub-paragraph was not changed

This sub-paragraph continued to bind the terminal operator to honour the delay and detention certificate issued by an officer of customs, not below the rank of assistant collector, for concession from ports handling or demurrage charges in cases of hardship, where the delay in clearance of the imported cargo was not on the part of the consignee or importer; provided that the 'consignee or, as the case may be, the importer shall substantiate their case with corroborative documents'

Once the delay and detention certificate was issued, it ought to be entertained and in consequence whereof demurrage charges were to be refunded

Thus, the phrase 'shall entertain' used in subsection (2) of section 14A of the Act casted a mandatory obligation upon all agencies, including port authorities, terminal operators and container freight stations, to receive, acknowledge, and act upon a delay and detention certificate issued by a customs officer not below the rank of assistant collector

Failure to refund or waive demurrage and detention charges for the certified period constituted a violation of statutory duty and attracted penal consequences under section 156(1)(7A) of the Act

When the law required an authority to 'entertain' a document or application, it was not a mere formality but an obligation to consider and give effect to it

Section 14A(2) of the Act signified that a port authority must not only receive but act upon the delay and detention certificate issued by customs authorities

Hence, the statutory mandate left no discretion with the port authorities to disregard or partially comply with such certificates; the obligation was absolute, enforceable and mandatory in nature

Proposed question of law was answered in the negative

Present petition was converted into an appeal and was dismissed, in circumstances.

2026 PTD 967 SUPREME-COURT Judicial Precedent

Ss.4, 74, 120 & 122(2)Dispute regarding applicability of the Income Tax Ordinance, 2001 to a given tax yearWhether the Ordinance, 2001 applies as it stood on 30 June (end of tax year) or on 1 July (beginning of next year)Tax year being 2009 and notice under Section 122(9) issued in 2015 to amend a deemed assessmentLegalityEach tax year is a self-contained fiscal unit governed by the law as it stands in respect of that tax year alonePrinciple enunciatedOrdinance, 2001 applied as it stood on the last day of the tax yearDepartment's notice held to be time-barred

Facts of the case in brevity were that the case arose under the Income Tax Ordinance, 2001, concerning the limitation for amendment of assessment under Section 122(2) for the tax year 2009

The respondent company's deemed assessment order under Section 120 was sought to be amended by a notice issued on 18.06.2015

The taxpayer argued that the notice was time-barred based on the version of Section 122(2) applicable on 30 June 2009, which allowed amendment only within five years from issuance of the assessment order

The department contended that the substituted version introduced by the Finance Act, 2009, effective 1st July 2009, extended the limitation period and therefore governed the case

The High Court upheld the taxpayer's view, holding that the earlier provision applied

Pivotal issue requiring determination before the Supreme Court was as to “How is the Income Tax Ordinance, 2001 to apply in relation to a given tax year; as it stood at the end of the said year (i.e. on June 30th) or as amended on July 1st by the Finance Act of that year, which is the beginning of the next financial year”?

Held: The genesis of the rule in relation to the charging section of the Income Tax Act, 1922 was that the statute applied not as it stood on the last day of the previous year but rather as on the first day of the year when the statute was brought into effect by the Finance Act in relation thereto, and that was inclusive of all amendments (if any, which was more often than not the case) made to the Act up to and on the latter date

But any amendments made thereafter did not apply to the previous year in question

Or, put differently, the Income Tax Act, 1922 did not apply as it stood on March 31st (or June 30th) but rather as it stood on the succeeding April 1st (or July 1st)

For each tax year the 2001 Ordinance applied as it stood at the end of that year

Any other date, including in particular the first day next succeeding, was of no relevance for the simple reason that no such referent existed in the charging provision

The day next succeeding the last day of a tax year was simply the first day of the next tax year

It had no meaning or relevance for the tax year that just ended

Put differently, the end of the year which was to be brought to tax did not, as it did under the predecessor statutes, slide into a “year” that had also to be taken into account since the tax was to be charged with reference to the latter

Thus, each tax year was, in all aspects, in near complete accord and harmony with the fundamental principle of income tax law, i.e., that each such period is a self-contained “unit”

Since everything was self-contained in the tax year, which was its own referent for all purposes of the charge, it followed that the 2001 Ordinance applied to that tax year as it stood on the last day of such period, i.e., June 30th

However, this was in relation to the “normal tax period”, which was the situation in the present case in respect of the TY 2009, whereas, Section 74 also dealt with what was described therein as a “special tax year”

Same principles applied equally, mutatis mutandis, in relation to a special tax year

If the 2001 Ordinance was amended on or before its last day (i.e., on or before June 30th), that still would not have affected the financial or budgetary position of the Federal Government for the ensuing financial year

The reason was that the tax, though levied on and assessed for the (just ended) tax year, was nonetheless collected in the following (financial) year

Therefore, the (expected) revenue receipts on account of the tax would not be affected

The rates amended up to 30th June for the just ended tax year would both properly “close” that year and also result in receipts that would be collected in, and therefore for, the ensuing financial year

In the present case, the department took the position that the provision applied as it stood on the date of the notice by when it had of course been substituted to take the form

High Court held that the change in law could not affect the vested right that had accrued to the taxpayer to have the provision applied as it stood on the last day of the tax year

Therefore, the notice was time barred

On any view of the matter the department's stand was, without merit

Present leave petition was converted into an appeal and the question posed was answered against the department

Appeal failed and same was dismissed, in circumstances.

2026 PTD 669 SUPREME-COURT Judicial Precedent

Ss.67, 120, 122(5), 148 & 237Income Tax Rules, 2002, R.13Income taxManufacturer deriving income from locally manufactured products and imported finished goodsImported goods subjected to final tax at import stageAllocation/apportionment of expenditures between presumptive and non-presumptive incomePTR (presumptive tax regime) income on importation of goodsRe-apportionment of expenses by applying Rule 13 of the Income Tax Rules, 2002Legality

Briefly, for tax year 2003, the petitioner taxpayer derived income from two sources: locally manufactured beverages chargeable under the normal tax regime and imported finished beverages subjected to final tax at import stage under section 148 of the Income Tax Ordinance, 2001

The taxpayer filed its return under Section 120, which became a deemed assessment, wherein it apportioned common expenditures between the two income streams on the basis of gross profit ratio

The Commissioner Inland Revenue amended the deemed assessment under Section 122 by reallocating expenditures between presumptive and non-presumptive income through application of Rule 13 of the Income Tax Rules, 2002, using a sales-based formula

The departmental appeal failed, but the appellate tribunal set aside the amendment, whereafter the High Court, in a tax reference, reversed the tribunal's decision

The taxpayer then sought leave to appeal before the Supreme Court against the High Court's judgment

Pivotal question of law for consideration was as to "whether the appellate tribunal was justified to hold that Rule 13 of the Income Tax Rules, 2002 was not mandatory for purpose of apportionment of expenses under Section 67 of the 2001 Ordinance?"

Held: As long as "any" reasonable basis was used for the proration of expenditures the basis applied by the taxpayer could not be defeated or denied simply for the reason that applying Rule 13 of Income Tax Rules, 2002 would have resulted in a larger or enhanced tax liability

Or, to invert that observation, it was impermissible to conclude that since the non-application of Rule 13 (and the reasonable basis actually adopted by the taxpayer in its stead) resulted in a smaller tax burden that, in terms of Section 122(5), amounted to income chargeable to tax escaping assessment or led to the total income being under-assessed

That would be to completely misconstrue and misapply both that provision and Section 67(1)

The point, for present purposes, was reinforced by sub-rule (2) which provided that any expenditure incurred for a particular class or classes of income was to be regarded as so allocated

From this, it was clear that submission made on behalf of the petitioner was correct that the manufacturing and other such expenses incurred for the local production of beverages had to be allocated solely to the non-PTR (presumptive tax regime) income and had nothing to do with the PTR income

For such expenditure the question of proration did not arise

The order amending the deemed assessment showed that the department, while applying the formula laid down in sub-rule (3), had taken "total admissible expenses" into account, which was incorrect in the facts and circumstances of the case

Nature of the exercise required (i.e., allocation between PTR and non-PTR income) and keeping in mind the relevant factors as applicable i.e., the relative size and nature of the activities (local manufacture versus import to which the expenditure related) the basis actually adopted was a reasonable one

That sufficed for purposes of subsection (1) of Section 67

It followed that the approach taken by the department and upheld by the High Court was not sustainable

Leave petition was converted into an appeal and the question posed was answered in the affirmative, in circumstances.

2026 PLD 53 SUPREME-COURT Judicial Precedent

Ss. 25 & 28Constitution of Pakistan, Arts.10-A & 185(3)Deficiency in payment of court-feeInadequately stamped memorandum of appealEffectConsequent rejection of appealLegalityCourts to allow rectification of deficiency in court-feesScope

Duty of Courts to ascertain precise amount of deficient court-fee and then grant a reasonable period to petitioner to remedy the deficiency

The Province of Punjab allotted 100 kanals of land to "A" under a tubewell scheme, and after his death, his heirs executed a general power of attorney in favour of "MH" who agreed to sell the land to respondent "MC"

When "MH" failed to honor the agreement, MC filed a suit for specific performance, which the Trial Court decreed in his favour

The Province challenged this decree through an appeal, but its counsel filed an inadequately stamped memorandum of appeal and, despite seeking repeated adjournments, failed to deposit the proper court-fees

Consequently, the District Court rejected the appeal, and the High Court, in revision, upheld that rejection

Therefore, the core issue before the Supreme Court for determination was as to "whether the rejection of the petitioner's first appeal due to insufficiently stamped court-fees was lawful"?

Held: When the memorandum of appeal was initially presented, the ministerial staff reported that court-fees was needed

However, the specific amount of the deficient court-fee was not indicated, leaving a crucial gap in the proceedings

The file was subsequently presented to the district judge, who, rather than determining the exact sum owed in court-fees, opted to adjourn the case at the petitioner's request to allow time to submit the required fee

In a bid to rectify the situation, the petitioner sought seven adjournments to address the fee deficiency

Despite these attempts, the petitioner failed to fulfil this requirement

As a result, the district judge ultimately rejected the memorandum of appeal

This procedural approach, characterized by an improper handling of the case, defeated substantial justice and fell short of the established principles of law

It was incumbent upon the district judge to first ascertain the precise amount of the deficient court-fee and subsequently grant a reasonable period for the petitioner to remedy this shortfall

This essential exercise was neglected, rendering the rejection of the memorandum of appeal invalid

Consequently, the petitioner was deprived of a fair trial, which is a right protected under Article 10-A of the Constitution

The significance of this oversight alone warranted a revision of the order that led to the rejection of the first appeal, however, the High Court overlooked this critical aspect when it dismissed the petitioner's application under Section 115, C.P.C.

So viewed, the order of the High Court was also illegal

Consequently, the High Court judgment along with the district judge's order was set aside

The case was referred back to the district judge, who was directed to determine the exact amount of the court-fee owed

After this assessment, the district judge was directed to provide the petitioner with a reasonable opportunity to rectify any deficiencies in the payment of the court-fee and after granting that opportunity the district judge could proceed to adjudicate the matter according to the law

Present petition was converted into appeal and was allowed, in circumstances.

2026 CLD 642 SUPREME-COURT Judicial Precedent

S.14Limitation Act (IX of 1908), First Sched., Arts.178 & 181Arbitral awardFiling before the courtLimitationFiling of award by arbitrator himselfEffectObjection that filing was barred by limitationLegalityDistinction from party-initiated filingScopeBriefly, the petitioner and the respondent entered into a contract for supply and installation of DG sets at PTCL sitesContract contained an arbitration clause nominating the CEO of PTCL as arbitrator

An arbitral award was made in favor of the respondent and was initially filed before the civil court but was returned for want of pecuniary jurisdiction, after which the arbitrator himself filed the award before the district court

Petitioner objected that the filing was barred by limitation under Article 178 of the Limitation Act, 1908

Objection was accepted by the district court but set aside by the High Court, leading to the present petition before the Supreme Court requiring determination of the issue as to “whether Article 178 of the Limitation Act, 1908, applied where the award was filed by the arbitrator himself without a party applying to the court, or whether such filing was governed by the residuary Article 181 of the Limitation Act, 1908?”

Held: Article 178 of the Act of 1908 being the primary provision regulated the period within which proceedings could be instituted for making an Award Rule of the Court

It prescribed a period of ninety days, running from the date on which notice of the making of the Award was served

Where a party did not first request the arbitrator or umpire to file the Award in Court, it could directly approach the Court and seek an order directing the Arbitrator or umpire to file the Award or a signed copy thereof

An application of this nature fell within the ambit of Article 178 of the Act of 1908, provided that notice of the Award had been served in terms of Section 14(1) of the Act of 1940

A different legal regime applied where no notice of the Award had been served and the party merely requested the Arbitrator, under Section 14(2) of the Act of 1940, to file the Award in Court

In such a situation, the residuary Article 181 of the Act of 1908 applied

Article 181 prescribed a period of three years commencing from the date when the right to apply accrued

In matters of arbitration, that right accrued when the Award is made and the party obtained knowledge of it

Article 178 of the Act of 1908 has no application where the Award was filed by the Arbitrator himself because he sought no relief for his own benefit

Service of notice upon the party is, therefore, a sine qua non for the applicability of Article 178 of the Act of 1908, and in the absence of such notice, the provision could not be invoked

In the present case, the record clearly demonstrated that the respondent did not, at any material stage, file an application under Section 14(2) of the Act of 1940 seeking a direction from the Court requiring the Arbitrator to file the Award

Instead, it was the Arbitrator who filed the Award before the district court, without any judicial direction compelling him to do so

In such circumstances, the essential preconditions for the applicability of Article 178 of the Act of1908 were not met, and the provision was erroneously invoked

High Court rightly held that Article 178 of the Act of 1908 applied only where a party to the arbitration proceedings applied to the Court for filing of the Award

It did not apply to an application made by the party to the Arbitrator for filing the Award, which would instead been governed by Article 181 of the Act of 1908

Leave was declined and present petition was dismissed, in circumstances.

2026 CLD 408 SUPREME-COURT Judicial Precedent