The Federal Constitutional Court of Pakistan (FCCP) on Monday heard the super tax case, with a three-member bench headed by Chief Justice Ameenuddin Khan presiding.
After completion of arguments from the government side, the court adjourned the hearing until Tuesday, January 27.
During the proceedings, Federal Board of Revenue (FBR) counsel Asma Hamid submitted a list of 150 writ petitions filed in various high courts challenging the super tax.
She argued that once a high court has upheld the validity of a legal provision, the same law should not be challenged in other high courts. She also alleged that Fauji Fertilizer continues to file petitions to obtain favorable rulings.
The FBR counsel rejected claims that legal requirements were not fulfilled, stating that such requirements are addressed during court proceedings rather than during the legislative process. She added that it is not constitutionally mandatory to hear taxpayers before imposing taxes at the lawmaking stage.
She further noted that while petitioners cited US Supreme Court rulings, each country follows its own constitutional and legal framework. She informed the court that Pakistan’s Supreme Court has previously upheld the retrospective application of taxes.
According to the FBR, a 29 percent normal income tax is currently in force, while the super tax represents an additional 10 percent charge and is legally payable.
Justice Hasan Azhar Rizvi raised questions regarding the treatment of expenses such as share-based operations, bank loans, and interest payments. The FBR counsel responded that these matters are clearly covered under the Eighth Schedule of the Income Tax Ordinance and have not been challenged.
After a brief recess, Revenue Division counsel Hafiz Ehsan Khokhar argued that the super tax is fully constitutional under Parliament’s special taxing authority. He maintained that Section 4C is part of the Income Tax law and does not constitute a separate or parallel tax. He also stated that the levy does not amount to double taxation but is an additional charging provision.
Following the completion of government arguments, the court adjourned the case until January 27, when counsel for various companies, Makhdoom Ali Khan, is expected to present rebuttal arguments.