The Peshawar High Court (PHC) has reportedly dismissed petitions filed by 23 cigarette manufacturing companies challenging the Federal Board of Revenue’s (FBR) directive to install closed-circuit television (CCTV) cameras in their production facilities.
According to Dawn News, a bench comprising Justice Syed Arshad Ali and Justice Mohammad Faheem Wali upheld the August 18, 2025, letter issued by the Tracking and Tracing System (TTS) project director at the FBR, which instructed factories to install cameras. While the court issued a short order, a detailed judgment is expected to follow.
The petitions, including one from Universal Tobacco Company, had sought to have the FBR letter declared unlawful, claiming it was discriminatory and unsustainable, particularly against cigarette units wholly owned by Pakistani citizens. The companies also requested the court to halt any action taken under the directive.
Last August, the PHC had ordered the de-sealing of factories that were shut for non-compliance and directed the FBR not to take punitive action against them in the meantime.
Senior lawyer Aamir Javed, representing the FBR, emphasized that the matter involved significant revenue and focused solely on the installation of CCTV cameras in production areas. He argued that the measure would not adversely affect business operations but was necessary to ensure transparency following reports of tax evasion by some firms.
He explained that relevant rules were amended in 2025, enabling electronic monitoring of the production, import, and supply chain of tobacco and other products. The CCTV installations would allow FBR direct access to production activities, supporting oversight and compliance.
Mr. Javed highlighted that various monitoring mechanisms were already in place, including the deployment of Inland Revenue officers under Sections 40-B and 40-C of the Sales Tax Act and electronic surveillance. Despite this, cigarette factories in the province faced the additional requirement to install CCTV cameras as per FBR specifications.
Dawn reported, the lawyer added that the petitioner companies had been compliant with all applicable laws, including the Sales Tax Act, 1990, Income Tax Ordinance, 2001, and Federal Excise Act, 2005, as well as the related rules.
The TTS system, installed at a high cost and linked with FBR-authorized licensees in November 2023, ensures round-the-clock monitoring of the production process by both the electronic system and the Regional Tax Office in Peshawar.
Source: Dawn News