Law: Income Tax Ordinance, 2001

Section: 126A, 133

Law: Tax Laws (Amendment) Act, 2024

Section:

Tagline Retrospective application of beneficial procedural tax 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 Procedural Transition & Dispute Background: Under the Tax Laws (Amendment) Act, 2024, Section 126A was introduced into the Income Tax Ordinance, 2001, bypassing the first tier of appeal before the Appellate Tribunal Inland Revenue (ATIR). This allowed taxpayers aggrieved by the decisions of the Commissioner Inland Revenue (Appeals) to file references directly before the High Court. Subsequently, the legislature enacted the Finance Act, 2025, which omitted Section 126A, thereby restoring the original two-tier system and reinstating the ATIR as the first appellate forum. Core Legal Question: The High Court had to determine the status and proper forum for references filed directly before it against CIR (Appeals) orders during the interim period when the 2024 amendment was in effect. Court's Findings: The High Court (per Babar Sattar, J.) held that statutory amendments affecting the forum of adjudication are procedural in nature. Relying on established judicial precedents, the Court determined that procedural changes—particularly those of a remedial and beneficial nature that restore an additional tier of appeal—apply retrospectively to all pending proceedings that have not yet attained finality. Held & Directions: The instant reference was…