Law: Income Tax Ordinance, 2001

Section: 126A, 133

Law: Tax Laws (Amendment) Act, 2024

Section:

Tagline Retrospective application of beneficial procedural amendments restoring the right of appeal before the Appellate Tribunal Inland Revenue (ATIR); pending High Court references remitted to the ATIR to be treated as regular appeals with interim protection extended.  Summary Background of the Dispute: Under the Tax Laws (Amendment) Act, 2024, Section 126A was introduced into the Income Tax Ordinance, 2001, which bypassed the first tier of appeal before the Appellate Tribunal Inland Revenue (ATIR). This allowed taxpayers aggrieved by the Commissioner Inland Revenue (Appeals) to file references directly before the High Court. However, the legislature subsequently enacted the Finance Act, 2025, which omitted Section 126A and restored the original two-tier system, reinstating the ATIR as the first appellate forum. Core Question: The High Court had to determine the fate of references filed directly before it against CIR (Appeals) orders during the interim period of the 2024 amendment. Court's Finding: The High Court (per Babar Sattar, J.) held that a change in adjudicatory forum constitutes a procedural law. Relying on Supreme Court precedents, the Court established that procedural changes—especially those of a remedial and beneficial nature that restore an additional tier of appeal—apply retrospectively to all pending proceedings that have not attained finality. Held & Order: The instant…