Law: Income Tax Ordinance, 2001

Section: 12(1),12(2),12(2)(c),127,Clause(39),Part -I of Second Schedule

Law: Constitution of Pakistan, 1973

Section: 199

INCOME TAX ORDINANCE, 2001 (XLIX OF 2001) Sections: 12(1), 12(2), 12(2)(c) & 127 - Clause (39), part-1 of second schedule of Ordinance, 2001 - Constitution of Pakistan, 1973, Art. 199 - Constitutional petition - salary - Special judicial allowance and judicial allowance - Charge of tax - Exemption disallowed - Validity - FACTS The petitioners are Judicial Officers of the District Judiciary of Khyber Pakhtunkhwa and Officers and Staff Members of the Establishment of the Peshawar High Court, Peshawar; and they contend that they are receiving Special Judicial Allowance vide Notification dated 27th July, 2010 which cannot be termed as salary, and thus not taxable under the enabling provisions of the Income Tax Ordinance, 2001. Petitioners have filed Writ Petition for declaration to the effect that deductions and collections of income tax, assessment and charging of tax against special judicial allowance and judicial allowance by respondents is ab initio, illegal and discriminatory. ARGUMENTS The counsel for the Revenue has contended that petition is hit by laches and petitioners having alternate remedy u/s 127 of Ordinance can challenge u/s 127 of Ordinance. The Counsel for Revenue further contended that Special Judicial Allowance does not fall within the Special Allowance or benefit provided under clause (39) of Part-I of the second schedule appended to the Ordinance. DECISION (A.) Laches - As far as the objection to the petition being hit by laches is concerned, this Court is not in consonance with the contention of the worthy counsel for the revenue, as the impugned deduction made from the petitioners is being carried out every month, thus, the same is a recurring cause of action, and can surely be raised at any stage, as has been done by the present petitioners. (B.) Availability of alternate remedy u/s 127 - Moving on to the second objection regarding the petitioners having an alternative remedy under section 127 of the Ordinance, this Court finds that the orders, which could be challenged under section 127 ibid has not been passed in the instant case, hence, it would not be appropriate for this Court to reject the claim of the petitioners on this ground…

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