Law: Income Tax Ordinance, 2001

Section: 4C,Division IIB of Part-I of First Schedule

Law: Constitution of Pakistan, 1973

Section: 25

INCOME TAX ORDINANCE, 2001 (XLIX OF 2001)---Section: 4C & Division IIB of Part-1 of First Schedule - Super tax on higher earning persons - Retrospective application to tax year 2022 - Inherent discrimination - Challenge to Section 4C before Single Judge of Lahore High Court - Upholding retrospective application of section 4C by the Single Judge in chamber - Appeal against - FACTS This appeal and a cluster of appeals have assailed the judgment by a learned Single Judge of this Court. In a set of constitutional petitions the learned Single Judge dismissed the challenge to section 4C of the Income Tax Ordinance, 2001 in its retrospective application to tax year 2022 and upheld it with regard to inherent discrimination which lies in Division IIB of Part I of First Schedule. Both the taxpayers (petitioners before the learned single bench) and Federal Board of Revenue (FBR) have come in appeals. ARGUMENTS Learned counsel for the appellant, Ms. Asma Hamid, Advocate argued in this Court that while doing so the learned Single Judge did not advert to the material placed on record (though it was referred in passing the impugned judgment). Primarily, three sets of documents have been relied upon by learned counsel for the appellants to contend that the creation of separate class of persons was permissible under Article 25 of the Constitution and was in consonance with the constitutional mandate. DCISION (a) Certain sectors cannot be isolated from similarly placed persons and taxed at a higher rate - Our precedents do not countenance such discrimination which has been held to be unconstitutional and contrary to the rule of law. Certain sectors without any intelligible criteria cannot be isolated from rest of the persons similarly placed and sought to be taxed at a higher rate than those persons who earn an income in the same bracket. This is precisely the holding of the Sindh High Court, Islamabad High Court and the learned Single Judge. We do not find any illegality or error in the holding of the learned Single Judge in this respect. In the above analysis, we concur in the result reached by the Islamabad High Court and Sindh High Court (where similar challenges were…

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