Appointment of ATIR chief, judicial members: LHC DB suspends its single-member bench’s judgment

ISLAMABAD: A division bench of the Lahore High Court (LHC) suspended its single-judge judgment regarding the appointment of the chairman and judicial members of the Appellate Tribunal Inland Revenue (ATIR).

The LHC bench comprising Justice Faisal Zaman Khan and Justice Abid Aziz Sheikh admitted the appeal for regular hearing and issued notices to the respondents, and directed the LHC office to fix the case in the fourth week of February 2024.

The Federation through the secretary Establishment Division, the prime minister through the secretary Cabinet, the secretary Ministry of Law and Justice, the ATIR through its Registrar, and the Lahore Tax Bar Association have been cited as respondents.

Case of getting inadmissible tax refunds: ATIR turns down rectification plea filed by Chinese firm

The appellants have challenged the judgment of the single judge of the LHC, whereby, the ATIR (Appointment of Chairman and Members) Rules, 2020, were declared, “ultra vires to the Constitution”.

The judgment also read down the provision of Section 130(2) of the Income Tax Ordinance, 2001 by reading the “federal government” instead of Prime Minister in the said provision and consequently, the appointments made under the rules were declared illegal and without lawful authority.

It; however, had allowed them to continue to hold their offices under the defacto doctrine till the appointment of regular incumbent under the rules to be framed by the federal government.

The appellants’ counsel submitted that in the writ petition only the appointment of chairman (Mian Tauqeer Aslam) was challenged on the ground that the chairman has been appointed as the chairman of the Income Tax Appellate Tribunal on acting charges basis, whereas, the appointment should have been made on a regular basis of most senior member of the Tribunal.

He also challenged the vires of Section 130 of the Ordinance on the ground that the said provision has been amended through the money bill and is violative of Article 25 of the Constitution.

The appellants’ lawyer further submitted that the single bench of the LHC has gone much beyond the pleadings and firstly read down the provision of Section 130(2) of the Ordinance by inserting the word “federal government” instead of “prime minister” and thereafter, also struck down the rules of the ground that these rules are not framed by the federal government by way of approval from cabinet as required by the SC’s judgment in Mustafa Impex.

The counsel argued that before the amendment in section 130 of the Ordinance through Tax Laws Amendment Act, 2020 and Tax Laws (Second Amendments) Ordinance, 2019, the word federal government was mentioned in Section 130(2) of the Ordinance.

He informed that the said word was deliberately and consciously substituted by the legislation through the amendments under Section 130(2), hence there was no reason for the single bench to read down the word “Prime Minister” and introduce the word “federal government” in Section 130(2) of the Ordinance.

He contended that not only the word “federal government” was introduced but on the basis of the said insertion, the rules were struck down on the ground that there is no approval of the federal cabinet for framing of the rules, which is a mandatory requirement where the word “federal government” is used in the law.

The counsel also argued that the provision of Section 130(2) of the Ordinance has been read down not being contrary to the Constitution but on the basis of instruction conveyed by the attorney general for Pakistan, who actually neither stated that the provision of Section 130(2) be read down nor was in position to concede the vires of any law duly framed by the legislation through the amendments.

He submitted that the approval of the chief justice of Pakistan was obtained for the appointment of judicial members as required in Riazul Haq case.

He stated that the appointment of appellants as judicial members of the Tribunal has been set aside without even impleading them as respondent or giving them hearing in the constitutional petition, therefore, they are all condemned unheard.

The counsel also submitted that even the defacto doctrine has wrongly been invoked in the given situation. The bench said that the points raised needed consideration; therefore, admitted the appeal and issued notices to the respondents.

Copyright Business Recorder, 2024