Lahore High Court (LHC) has provided relief to the banking sector and other high-income earners to file their income tax returns excluding the Super Tax under section 4C of the Ordinance of 2001.
The order of the LHC issued on Thursday in this regard said, “This is subject to the condition to deposit post-dated cheques of the differential amount liable to be deposited under Section 4C. It is, however, clarified on request of the petitioners’ side, that cheques shall be encashed on the direction of the court or subject to the decision in this and connected petitions.”
The petitioner has assailed retrospective application of Section 4C of the Income Tax Ordinance, 2001, whereby Super Tax is imposed for Tax Year 2022 and onwards, read the court order.
The court order said that the petitioner contended that the transactions and accounts made for the tax year 2022 by calculating normal tax have become past and closed transactions, therefore, this section, even if applied retrospectively, could not be effective against the past and closed transactions.
It is submitted, by referring to prayers of this and connected petitions, that vires of Section 4C of the Income Tax Ordinance (“Ordinance of 2001”) have been challenged, said LHC order.
LHC maintained that the petitions are entertained only to the extent of retrospective effect of Section 4C, against past and closed transactions.
LHC observed that the law prima facie is clear that retrospective legislation, by express words, would not disturb the past and closed transactions, as rights of the parties are not only accrued but are acted upon.
The LHC has adjourned the case up to October 20, 2022.