Govt collecting Super Tax at cost of people: SC

ISLAMABAD: Justice Syed Hassan Rizvi Friday remarked that while the government is collecting Super Tax from companies, the loss is being borne by the people.

A five-member Constitutional Bench headed by Justice Aminuddin Khan heard scores of petitions challenging Sections 4B and 4C of the Income Tax Ordinance (ITO) 2001 regarding Super Tax.

The other members of the bench included Justice Jamal Khan Mandokhail, Justice Muhammad Ali Mazhar, and Justice Shahid Bilal Hassan.

Hundreds of petitions had challenged Sections 4B and 4C, which were inserted in the Income Tax Ordinance, 2001.

“What kind of policies the government is making that cause financial harm particularly to those aged 60 years and above,” Justice Rizvi questioned.

Continuing her arguments, FBR’s counsel Asma Hamid submitted that two paragraphs in the Islamabad High Court’s judgment contradicted each other — one saying the tax would not be imposed, the other saying it would.

Addressing her, Justice Hasan Azhar Rizvi said in the case of Super Tax, while the tax is being collected from companies, the real loss is suffered by the people.

Justice Rizvi questioned as to how government policies were affecting those over 60 years of age. To this, the counsel replied that she could only assist the court on legal points of the matter and had no knowledge regarding who may benefit or suffer loss.

Justice Muhammad Ali Mazhar inquired whether deductions were also made from the provident funds, noting that such funds were often given to widows.

Justice Rizvi further asked whether, if the net beneficiaries are widows, companies could transfer the amount into another account.

Justice Muhammad Ali Mazhar asked whether this issue had been formally raised or if the petition was filed without such grounds. The counsel responded that a show-cause notice had been issued, after which the petition was filed.

At this, Justice Mazhar remarked that “this is like inviting trouble yourself.”

Another FBR lawyer argued that twenty of her petitions were pending with the court, adding that Sections 4C and 9 of the Income Tax Ordinance 2001 should be read together, with Section 4C being a complete provision.

Justice Muhammad Ali Mazhar commented that the definition of income in both provisions was not being overridden and asked what was the purpose of reading them together.

Justice Jamal Khan Mandokhail inquired under which law the tax rate was determined. Asma Hamid replied that after the 1979 Ordinance, an amendment had been introduced, and the rate was fixed under that. As the court’s time ended, the hearing was adjourned until Monday, September 15.