ISLAMABAD: A five-member constitutional bench of the Supreme Court, convened to hear the high-profile super tax case, was unexpectedly dissolved during proceedings on Monday, according to media reports.
The disruption occurred when Justice Aminuddin Khan, who was heading the bench, noted that Justice Aamer Farooq had previously ruled on the super tax issue during his tenure at the Islamabad High Court (IHC). Owing to this prior judgement, Justice Farooq was deemed ineligible to participate in the current proceedings, prompting the bench’s dissolution.
During the hearing, legal counsel for various companies requested an adjournment of the case until after Eid-ul-Fitr. However, the court denied the plea and decided to continue with daily hearings instead.
Justice Muhammad Ali Mazhar remarked that arguments in the case should at least commence without delay. He directed that separate paper books be prepared for Sections 4B and 4C of the Income Tax Ordinance, which are at the heart of the legal challenge. The court also granted additional time for parties to finalise their legal representation. Proceedings were adjourned until Tuesday.
The case revolves around the imposition of the controversial super tax, introduced under Section 4C of the Income Tax Ordinance, 2001. On 21 July 2023, the Islamabad High Court had declared the levy of super tax — amounting to billions of rupees — illegal. Justice Sardar Ishaq Khan, delivering the IHC verdict, ruled the tax unlawful and set aside all recovery notices issued under Section 4C.
In contrast, the Lahore High Court (LHC), three weeks ago, upheld the imposition of the super tax but ordered a reduction in the rate from 10% to 4% across 16 sectors, including the banking industry. This conflicting judicial stance between the IHC and LHC has added further complexity to the ongoing litigation.
More than 350 petitioners, including prominent companies and business associations, have challenged the legality of the super tax. The federal government and the Federal Board of Revenue (FBR) have vigorously defended the measure, arguing its necessity for economic stability and revenue generation.
Despite the legal uncertainty, the federal government has reiterated its commitment to enforcing the super tax for the fiscal year 2023. The move has reignited debate over the legitimacy of the levy, with opponents labelling it unconstitutional and burdensome to the private sector.
