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29 October 2026
Author: Mr Asif S Kasbati (FCA, FCMA & LLB).
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I. BACKGROUND: (A) (1) Supreme Court Declares Income Support Levy Illegal - Pro Pakistani 9.3.22 reported Mr Asif Kasbati Comments on the SCP order (2) TLQC 1833 of 10.3.22 about Income Tax Levy held unlawful by SCP in trail, blue, italic and double Line (B) Other relevant QCs in Para IV.
II. EXECUTIVE SUMMARY
1. The SCP dismissed the review petitions seeking reconsideration of its judgment dated 28.12.21 concerning the constitutional validity of the Income Support Levy Act, 2013. The judgment under review had upheld the conclusion that the Act, enacted through the FA, 2013, without following the constitutionally prescribed legislative procedure, did not acquire the status of a valid law.
2. The Court reaffirmed that the Income Support Levy did not fall within the constitutional definition of a Money Bill under Article 73(2) of the Constitution. Accordingly, the legislation was required to undergo the ordinary legislative procedure under Article 70, involving both Houses of Parliament. The Court held that the Senate’s legislative role could not be bypassed by incorporating a levy into an FA.
3. The Court further observed that the Act was subsequently repealed through Section 10 of the FA, 2014, without an express saving provision for proceedings or liabilities arising thereunder. This provided an additional consideration, while the primary basis for the judgment remained the constitutional invalidity of the original enactment.
4. Reiterating the limited scope of review jurisdiction, the Court held that review is confined to correcting an error apparent on the face of the record or a manifest defect causing a miscarriage of justice. It cannot be used to reopen concluded issues merely because an alternative interpretation is possible or to obtain a fresh determination of questions already adjudicated.
5. The petitioners failed to establish any patent constitutional error, material omission or fundamental defect warranting reconsideration. Consequently, the review petitions, along with the connected civil appeals and petitions, were dismissed. However, C.P.L.A. 863-L/2023 was adjourned to a date in office because a distinct question of law was stated to be involved. There was no order as to costs.
6. The Court also emphasized judicial discipline, consistency of judicial precedents and institutional propriety. It expressed concern regarding the subsequent grant of leave by a three-member Bench on substantially identical constitutional questions while the earlier determination remained operative and subject to review proceedings. The Court observed that a subsequent grant of leave could not, by itself, review, modify or displace an earlier determination without following the appropriate judicial procedure.
III. DETAILS
A. Reference and issue
Further to KQU 4155 of 29.10.26, being an important matter, we would inform you about FCCP order dated 12.10.26 (we understand FCCP Court announced the same on 28.10.26 in Oped court) CRP 25-K/2022 CIR VS Muhammad Mustafa Gigi, & others, etc (Attachment 3796.1) in the ensuing paragraph, with emphasis in heading para within bold & Underline for quick reading.
B. Review Petitions Against SCP Judgment on Constitutional Validity of the ISL Act, 2013 – para 1 & 2 of the FCCP Order
1. Through the instant review petitions, the petitioners seek reconsideration of the judgment dated 28.12.21, passed by the SCP, whereby leave to appeal was refused in a batch of petitions arising out of judgments of the High Court of Sindh concerning the constitutional validity of the Income Support Levy Act, 2013 (hereinafter referred to as "the Act").
2. By the judgment under review, the SCP upheld the conclusion that the Act, having been enacted through the Finance Act (FA), 2013, without observance of the legislative procedure prescribed by the Constitution of the Islamic Republic of Pakistan, 1973 “the Constitution”, did not acquire the status of a valid law.
3. The connected appeals and petitions involve substantially identical questions of law and are, therefore, being considered through this common judgment.
We have heard learned counsel for the parties and examined the judgment under review, together with the connected appeals and petitions, in the light of the grounds urged for reconsideration.
C. Scope and Limitations of Review Jurisdiction – para 3
At the outset, it is necessary to reiterate that the jurisdiction of review, by its very nature, is limited and exceptional. Its object is to correct an error apparent on the face of the record or a manifest defect which has occasioned a miscarriage of justice. It is neither an extension of appellate jurisdiction nor a mechanism for securing a fresh determination of questions already adjudicated. The power of review cannot be exercised merely because another interpretation of the relevant constitutional or statutory provisions is conceivable, nor can it be invoked to substitute a different judicial opinion for a conclusion consciously reached upon consideration of the applicable law. The distinction between an erroneous decision and an error apparent on the face of the record must, therefore, remain firmly maintained.
D. Constitutional Validity of the Income Support Levy and Classification as a Money Bill – para 4
1. The principal controversy determined by the SCP concerned the constitutional character of the ISL introduced through the FA, 2013, and whether the legislation imposing such levy could validly be enacted as a Money Bill within the contemplation of Article 73(2) of “the Constitution”.
2. The SCP examined the relevant provisions of the Act, its declared legislative object, the constitutional definition of taxation under Article 260(1), and the legislative procedure prescribed by Articles 70 and 73 of “the Constitution”.
3. Upon consideration of these provisions, it concluded that the levy, notwithstanding its financial implications, did not fall within the constitutional classification of a Money Bill and that its enactment was consequently required to undergo the ordinary legislative procedure involving both Houses of Parliament.
E. Distinction between Money Bills and Ordinary Legislation: Role of the Senate – para 5
1. The distinction between a Money Bill and ordinary legislation substantive and reflects the constitutional allocation of legislative authority between the two Houses of Parliament. Article 73 constitutes a limited exception to the ordinary legislative procedure prescribed under Article 70 and cannot be expanded merely by characterizing a legislative measure as a levy or incorporating it into a FA.
2. The constitutional character of legislation must be determined by reference to its substance, object and legal effect rather than its nomenclature or the legislative instrument through which it is introduced. A contrary construction would permit the exceptional procedure applicable to Money Bills to be employed for legislation falling outside its constitutionally prescribed limits, thereby circumventing the legislative role assigned to the Senate.
F. Senate’s Legislative Role and Mandatory Constitutional Procedure – para 6
1. The constitutionally mandated participation of both Houses in the legislative process constitutes a substantive safeguard rather than a mere procedural formality. The Senate, being the representative institution of the federating units, cannot be excluded from legislation which does not fall within the restricted ambit of Money Bills. The judgment under review correctly distinguished the recommendatory role of the Senate under Article 73(1) from its legislative authority under Article 70 of “the Constitution”.
2. The constitutional infirmity identified in the enactment of the Act was, therefore, not treated as an inconsequential procedural irregularity but as non-compliance with the mandatory constitutional requirements governing the enactment of legislation.
3. The petitioners have failed to demonstrate that the interpretation adopted in the judgment under review suffers from any patent constitutional error warranting correction in review jurisdiction.
G. Effect of Repeal of the Act on Outstanding Liabilities and Recovery Proceedings – para 7
1. The SCP further examined the subsequent repeal of the Act through section 10 of the FA, 2014, which did not expressly preserve the proceedings initiated or liabilities sought to be enforced thereunder. This aspect was considered in conjunction with the more fundamental conclusion concerning the constitutional invalidity of the original enactment.
2. Once the Act was held not to have acquired the status of a valid law, the question of enforcing liabilities purportedly arising thereunder necessarily lost its legal foundation. The repeal and absence of an express saving provision furnished an additional consideration in the judgment but did not displace the primary constitutional basis upon which the controversy was determined. Consequently, the legality of the impugned recovery proceedings could not be sustained independently of the validity of the enactment authorizing them.
H. No Apparent Error in the Judgment and Finality of Constitutional Determinations in Review Jurisdiction – para 8
1. Examined against the foregoing constitutional and statutory framework, the judgment under review discloses a conscious and reasoned determination of the material questions arising for adjudication. The relevant constitutional provisions, the competing interpretations concerning the character of the levy, and the legislative procedure prescribed for its enactment were duly considered before the conclusion was reached.
2. The reasoning may be susceptible to disagreement; however, disagreement with a judicial interpretation cannot, by itself, constitute an error apparent on the face of the record. The jurisdiction of review cannot be invoked to reopen a concluded constitutional determination merely upon the assertion that the provisions in question admit of another possible construction. To permit such a course would effectively transform review proceedings into a further appellate exercise and defeat the principle of finality attaching to judicial decisions.
I. Failure to Establish Grounds for Review – para 7
1. The petitioners have not demonstrated any patent misreading or non-reading of the relevant constitutional provisions, omission of a material issue going to the root of the controversy, or any other fundamental defect of such magnitude as would justify reopening the judgment within the permissible parameters of review. The submissions advanced substantially seek reconsideration of questions which have already received judicial examination and determination. Such an exercise falls outside the recognized scope of review jurisdiction.
2. The finality of judicial pronouncements assumes particular significance where questions of constitutional interpretation have been determined after consideration of the relevant legislative framework. Although the power of review exists to prevent manifest injustice, its exercise must remain confined to legally recognized grounds and cannot be employed merely to secure a different conclusion upon the same material.
J. Finality of Judgments and Limits of Review Jurisdiction – para 8
1. It is equally important to emphasize that judicial certainty and the orderly administration of justice require that concluded controversies should not be reopened in the absence of a demonstrable error satisfying the established threshold for review. The jurisdiction is corrective rather than substitutive and cannot be enlarged by reference to subsequent proceedings involving similar questions of law.
2. A judicial determination, otherwise validly rendered by a competent Bench, continues to retain its legal effect unless modified, recalled or set aside through a procedure recognized by law. The mere pendency of connected proceedings or the subsequent grant of leave in another matter does not, without more, furnish an independent ground for reconsideration of an earlier judgment.
K. Dismissal of Review Petitions and Connected Appeals – para 9
1. In view of the foregoing discussion, we are satisfied that the judgment under review does not suffer from any error apparent on the face of the record or other fundamental defect warranting interference in review jurisdiction. The constitutional questions raised therein were duly examined and determined, and no sufficient legal ground has been established for their reconsideration.
2. Consequently, the instant review petitions are dismissed, and the judgment dated 28.12.21 shall remain undisturbed. The connected civil appeals and civil petitions, being founded upon substantially the same constitutional controversy, are also dismissed in accordance with the foregoing determination, except C.P.L.A. 863-L/2023 - Viz CIR, Faisalabad VS Mr Farooq Ahmad [against the judgment dated 18.01.2023 passed by the Lahore High Court, Lahore in I.T.R.-2866/2023], which is adjourned to a date in office, as Ms. Asma Hamid, appearing on behalf of Mr. Muhammad Yahya Johar, ASC, has stated that this case is not identical to the other cases in this bunch, as a different point of law is involved. There shall be no order as to costs.
L. Judicial Discipline and Institutional Propriety – para 10
1. Before parting with this judgment, we deem it appropriate to advert to an aspect of institutional significance concerning judicial discipline and consistency of judicial pronouncements. The constitutional validity of the Income Support Levy Act, 2013, had already been examined by a learned two-member Bench of the SCP in CIR VS Muhammad Mustafa Gigi and others (PLD 2022 SC 420 - TLQC 1833 of 10.3.22 in trail refers) wherein leave to appeal was refused vide order dated 28.12.21.
2. Notwithstanding the said determination and the pendency of review petitions thereagainst, a subsequent three-member Bench, vide order dated 21.06.2022 in Civil Petition No.1718-K of 2021, granted leave on substantially identical constitutional questions and expressly contemplated reconsideration of the earlier determination.
3. The course adopted in the subsequent order, authored by Mr Justice Munib Akhtar, raises serious concerns regarding judicial discipline, legal norms and institutional propriety, particularly when the earlier determination remained operative and was already the subject of review proceedings.
4. It is a settled principle that coordinate or subsequent Benches must accord due regard to earlier judicial determinations, and any departure therefrom must conform to the established principles governing judicial precedent and the prescribed institutional procedure.
5. Although refusal of leave does not invariably preclude consideration of a distinct petition, a subsequent grant of leave cannot, by itself, operate to review, modify or displace an earlier determination. Judicial independence must be exercised consistently with judicial discipline, restraint and institutional decorum.
6. The course adopted in the subsequent proceedings, insofar as it contemplated reconsideration of the earlier judgment without recourse to the appropriate judicial mechanism, was inconsistent with these requirements. We reiterate that adherence to judicial discipline is indispensable to maintaining certainty, consistency and the institutional integrity of judicial adjudication.
IV. FURTHER RELATED TLQCs
TLQC 1127 of 2.7.20 about Income support Levy Act, 2013 is ultra vires- SHC
TLQC 743 of 13.5.19 about Income Support Levy - Demand held Valid by LHC - Be ready for Notice
QC 196 of 24.12.16 about Income Support Levy - Expected notices
QC 161 of 14.10.16 about Income Support Levy - LHC SB order suspended by in ICA - ISL no more recoverable
V. FURTHER DETAILS & SERVICES
Should you require any clarification or explanations in respect of the above or otherwise, or require Income Tax, Federal & Provincial Sales Tax or Withholding Tax Statement, Advisory, Return Filing or Review services, please feel free to email info.kasbati@professional-
Best regards for Here & Hereafter
Asif S Kasbati (FCA, FCMA & LLB)
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Kasbati & Co (1400+ Tax, Levies, Companies, Economy, Inflation, HR, Banking, Finance, etc
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From: Asif Siddiq Kasbati <asif.s.kasbati@professional-
Date: Thu, Mar 10, 2022 at 6:06 PM
Subject: TLQC1833= Income Tax Levy held unlawful by SCP
Dear Learned Professional
BACKGROUND
This refers to TLQCs 1127, 761, 743, 196, 161 (in trail, blue, italic & after double line) about SHC & LHC orders on Income Support Levy (ISL).
As per TLQC 1127 & 761 dated 2.7.20 & 26.5.19 respectively we sent our Commentary about the SHC and LHC had issued different judgments on the issue of the ISL. The SHC decision announced in the case of Yaqoob Ahmed and 575 other petitioners in CPD-3757/2013, etc that ISL Act is ultra vires the Constitution; while earlier LHC had declared it as intra vires Constitution vide order of April-May 2019 in WP 14509-2019, etc in case of Syed Tayyab Hussain Rizvi, etc.
UPDATED STATUS
You may have seen KQU1550 dated 9.3.22 (Afternoon) whereby we shared the link of the “SCP Judgement on ISL in case of CIR VS Muhammad Mustafa Gigi - C.P.490-K/2020” alongwith several other updates and now covering in our Commentary being an Important matter as your Goodself may have missed out the same owing to likely busy schedule.
EXECUTIVE SUMMARY
The Pro Pakistani Newsclipping sent this morning in DNVC (click on the link and treat it as Attachment 1833.1) about the SCP detailed judgement was based on the discussion with the undersigned.
The SCP in CP 490-K/2020 & 580 Others in the case of CIR VS Muhammad Mustafa Gigi & 580 Others (Attachment 1833.2) gave its verdict whereby the Department appeals against SHC Order have been dismissed. The SCP upheld the SHC Order in favour of Taxpayers and against the Department on the following 3 grounds:
(a) ISL law was passed along with Money Bill, it does not possess the character of a tax; and
(b) it is a levy in the nature of fund to be charged and utilized for a specific purpose i.e. to provide for financial resources for raising an income support fund for the economically distressed persons and their families; hence, ultra vires considering Article 73 of the Constitution;
(c) Since, the ISL Act 2013 (Act) has been repealed through the Finance Act 2014, without a saving clause, therefore, whether any levy can be claimed, charged, or collected on the basis of the Act, which allegedly stood obliterated/abrogated completely, from the date of its promulgation.
DETAILS
1. Basic Facts
1.1 The SCP stated on the matter that these 581 petitions seek leave to appeal the judgments authored by Mr. Justice Aqeel Ahmed Abbasi of a Division Bench of the SHC. The Respondents had challenged the ISL Act, 2013 and the ISL sought to be recovered pursuant to the Act. Section 9 of the Finance Act, 2013 enacted the Act (para 2 refers).
1.2 The very next year the Act which had imposed the ISL was repealed. The Finance Act, 2014 repealed the Act with the wording “10. Repeal of Income Support Levy Act, 2013.- The Income Support Levy Act, 2013 is hereby repealed.” (para 3 refers).
1.3 Since the Petitioner was recovering the ISL for the period that the Act subsisted the respondents filed petitions challenging the constitutionality of the Act. The SHC decided the petitions filed by the respondents after the Act was repealed (para 4 refers).
2. Learned Counsel for Petitioner Submissions
2.1 The learned Dr. Shah Nawaz represents the Commissioner Inland Revenue, who is the petitioner in all these petitions. He submits that the ISL constituted taxation as defined in Article 260(1) of the Constitution, which is reproduced below in Italics for ready reference:
‘“taxation” includes the imposition of any tax or duty, whether general, local or special, and “tax” shall be construed accordingly;’
He stated that the ISL had all the characteristics of taxation and the nomenclature used to describe it was immaterial. He further submitted that since the Act constituted a Money Bill, as described in Article 73(2) of the Constitution, it became law when it was passed by the National Assembly and received the President’s assent. And, since the Act subsisted from 1 July 2013 to 30 June 2014 the ISL for this period is required to be paid by all those who were liable to pay it under the Act. However, the learned Judges of the High Court incorrectly held that the Act could not have been introduced as a Money Bill, and also incorrectly held that the ISL was not a tax or taxation, and then on the basis of these incorrect assumptions held that the Act was unconstitutional, submitted the learned counsel. He also relied on the following cases:
(a) Sohail Jute Mills Ltd. v Federation of Pakistan, (reported as PLD 1991 Supreme Court 329);
(b) Pakistan Industrial Development Corporation v Pakistan (reported as 1992 SCMR 891);
(c) Elahi Cotton Mills Ltd. v Federation of Pakistan (reported as 1997 PTD 1555);
(d) Nasir Ali v Pakistan (reported as 2010 PTD 1924); and
(e) Lotte Pakistan PTA Ltd. v Federation of Pakistan (reported as 2011 PTD 2229) (para 5 refers).
2.2 The learned Dr. Shah Nawaz stated that there were two categories of cases before the SHC, firstly, those in which proceedings for the recovery had not been initiated, and, secondly, where this had been done, and the SHC in respect of the latter category held that since there was no saving clause in the repealing law, the proceedings which had been initiated died a natural death with the repeal of the Act. In support of this contention, the learned counsel referred to the following judgments of the SCP:
(a) Commissioner of Income Tax Peshawar v Islamic Investment Bank Ltd. (reported as 2016 SCMR 816);
(b) Taza Khan v Ahmad Khan (reported as 1992 SCMR 1371); and
(c) to a judgment of a learned single Judge of the LHC in the case of Tayyab Hussain Rizvi v FoP (reported as 2019 PTD 1414) (para 6 refers).
2.3 The learned counsel submitted that the SHC committed another error by holding that the ISL was discriminatory in stating that it was made applicable only to taxpayers who file returns under section 116 of the IT Ordinance and had failed to appreciate that every person was required to submit a wealth return. Therefore, the observation made in the impugned judgment that those who do not file IT Returns are placed in an advantageous position, because they will not have to pay the ISL, was not correct, and reliance was placed on the judgment in the case of Elahi Cotton Mills Ltd. (reported as 1997 PTD 1555) (para 7 refers).
3. Learned Counsel for Respondent Submissions
3.1 The learned Mr. Ghulam Mustafa Lakhani has filed caveat in two petitions (Civil Petitions for Leave to Appeal Nos. 720-K and 995-K of 2020) and the learned Mr. Abdur Rehman in one (Civil Petition for Leave to Appeal No. 719-K of 2020). They support the impugned judgment and state that it was comprehensive, well-reasoned, and met each and every point raised by the petitioner’s learned counsel. They controverted the contention that the ISL constituted taxation, as defined in Article 260(1) of the Constitution. They submitted that the Act was enacted through the Finance Act, 2013 even though it did not have the ingredients of a Money Bill as mentioned in Article 73(2) of the Constitution. Therefore, if it was to be made law then it had to comply with the ordinary legislative procedure prescribed in Article 70 of the Constitution. However, by tabling the Act as a Money Bill, or as a purported component of a Money Bill, the Senate of Pakistan was bypassed. Ordinary legislation (which is not Money Bill), they submitted, must be sent to the Senate for voting, but this was not done. Therefore, the Act did not constitute law, and because it was not law it need not be complied with (para 8 refers).
3.2 Another contention of the learned counsel representing the said respondents was that the stated purpose of the Act was to ‘provide financial assistance and other social protection and safety net measures to economically distressed persons and families,’ ‘promoting social and economic well-being of the people and to provide basic necessities of life and ‘to provide for financial resources for running an income support fund for the economically distressed persons and their families.’ However, neither the Act nor the ISL Rules, 2013 (‘the Rules’) made pursuant to the Act had set up an income support fund nor mandated that the amounts collected pursuant to the ISL be separately kept for spending on the stated objectives of poverty alleviation (para 9 refers).
4. SCP Deliberation
4.1 The SCP after hearing the learned counsel, reading the impugned judgment, the Act, the Rules, the cited precedents and the applicable provisions of the Constitution Article 70 through to Article 177 of the Constitution prescribes the Legislative Procedure to be followed to enact legislation. Except Money Bills, every proposed piece of legislation is introduced as a bill in either of the two Houses, that is, the National Assembly or the Senate. Once the bill is passed by the House in which it is introduced, it is transmitted to the other House for voting. However, a Money Bill can only originate in the National Assembly. A Money Bill also does not have to be transmitted to the Senate for voting. It was assumed that the Act was a Money Bill, or formed part of a Money Bill, and on this assumption it was not transmitted to the Senate after it was passed by the National Assembly. However, the impugned judgments held that the Act was not a Money Bill. Therefore, the first and foremost question to be determined is whether the Act was a Money Bill (para 10 refers).
4.2 The SCP noted that the Act itself did not state that the ISL was or constituted a tax or taxation. Leaving semantics aside, an examination of the Act makes it abundantly clear that it neither came within the definition of tax nor taxation. The Act was social legislation with the declared objective of poverty alleviation. Though a worthwhile objective, it did not bring the Act within the definition of a Money Bill (para 12 refers).
4.3 That since the Act was not a Money Bill it had to be passed by both Houses, as provided by Article 70 of the Constitution. Since the Act did not constitute a Money Bill, it had to be transmitted to the Senate to vote on the Act. But as this was not done the Act never became law. And, the petitioner could not take action pursuant to something (the Act) which was not law and nor was anyone liable thereunder (para 13 refers).
4.4 The Act also suffered from other insurmountable constitutional shortcomings. In the absence of any legislative mechanism to secure the amounts collected as ISL for the stated objective of poverty alleviation, such amounts would be deposited and become part of the Federal Consolidated Fund (‘the Fund’), 16 becoming indistinguishable from other monies therein. Monies which are set aside for particular purposes are referred to as expenditure charged upon the Fund and these are mentioned in Article 81. The expenditure charged upon the Fund includes the remuneration of the President, Judges, Chief Election Commissioner, Chairman and Deputy Chairman of the Senate, Speaker and Deputy Speaker of the National Assembly and the Auditor-General for Pakistan and the administrative expenses of their respective offices. Undoubtedly, the object of charging the same on the Fund is to bolster their independence by also securing them financially. Clause (e) of Article 81 enables other sums also to be charged upon the Fund if either the Constitution or an Act of Parliament declares them to be so charged. But, as stated above, the Act did not declare that the amounts recovered pursuant to the Act were to be charged in any specific manner on the Fund. Resultantly, the amounts raised by the ISL would go into the Fund and would have to be distributed pursuant to the mechanism provided in the Constitution. Consequently, the stated objective of poverty alleviation, for which the Act was purportedly enacted, could not be achieved (para 14 refers).
4.5 Monies in the Fund which do not constitute expenditure charged on the Fund are to be disbursed/distributed in terms of the recommendation of the National Finance Commission as per the mechanism provided for in Article 160 of the Constitution. The Financial Procedure mentioned in the Constitution17 includes the maintenance of the Fund and how revenue is collected and distributed between the Federation and the Provinces (para 15 refers).
4.6 The SCP have concluded that the Act did not constitute a Money Bill and had to be transmitted to the Senate for voting, failing which it could not have become a law. The SCP had also observed that the stated objective of alleviating poverty and setting up an income support fund could not be achieved, because the amounts recovered as ISL would go into the Fund and would be distributed in terms of the applicable constitutional provision. Thus, the Act would not achieve its stated objective. The SCP need not attend to the precedents cited by the petitioner’s learned counsel and to his other contentions, which would have required attention if the SCP had upheld the Act to be a valid piece of legislation. (para 16 refers)
4.7 The Finance Act, 2013 (which incorporated the Act) originated in the National Assembly, and as it was assumed to be a Money Bill, it was transmitted to the Senate of Pakistan as provided for in Article 73(1) of the Constitution. The Senate was cognizant that the proposed legislation (the Act) was not a Money Bill. The concerns of the Senate were not heeded and its recommendations disregarded. However, after the Act had been enacted (through the Finance Act, 2013), realisation dawned that the concerns expressed by the Senate were legitimate, because the Finance Minister proposed the repeal of the Act. And, did so without recommending the incorporation of a saving clause with regard to actions already taken or to be taken pursuant to the Act during its subsistence (para 17 refers).
4.8 The Act was repealed by the Finance Act, 2014, which did not retain a saving section with regard to the actions taken under the Act or those which were proposed to be taken in respect of the period that the Act subsisted. This should have brought the matter to an end. However, the petitioner unnecessarily persevered and sought the purported recovery of the ISL allegedly incurred under the Act before its repeal, and issued hundreds of notices. This in turn compelled the respondents to file hundreds of petitions before the SHC. The petitions were allowed. But still the petitioner did not relent and filed hundreds of petitions before this Court challenging the judgments of the High Court, even though the impugned judgments had considered the constitutional provisions, and after a comprehensive determination had held that the Act was enacted in contravention of the Constitution (para 18 refers).
4.9 The SCP might have observed that the Finance Act, 2013, which enacted the ISL Act, 2013, did so by sheathing the Act within the Finance Act, 2013. This was a most novel method of enacting legislation. The Constitution prescribes the Legislative Procedure to be employed. It is best not to resort to unconventional devices in enacting legislation, as these invariably are against public interest. Adopting this unusual method would suggest that those who had introduced the Act themselves had reservations that it constituted a Money Bill. The Legislative Procedure set out in the Constitution must be abided by. The legislative procedure to enact a Money Bill is different from the procedure with regard to ordinary legislation. Nonmoney ordinary legislation is introduced in the National Assembly or in the Senate, and after its approval by the House in which it was introduced, it is sent to the other House which may pass it or propose amendments to it. If amendments are proposed the bill is sent to the House in which it originated and if it accepts the proposed amendments it sends it for the assent of the President. However, if the bill is rejected or not passed within ninety days, or sent to the other House under clause (2) of Article 70 with amendments which are not passed by that House, then if the House in which the bill originated so requests, it shall be considered in a joint sitting of both Houses. Resorting to a joint sitting of both Houses can be only done after going through the steps prescribed in Article 70 of the Constitution, and if this is done and the bill is passed by the votes of the majority of members present and voting in the joint sitting, it shall be presented to the President for assent (para 19 refers).
5. SCP Decision
5.1 The SCP concluded by stating that each and every word of the Constitution, and the methodologies and procedures prescribed therein, must be strictly adhered to. When this is done it dissipates misgivings and mistrust, and steers away from pitfalls. This also avoids wastage of time, money and effort, as witnessed in this case. History is testament to the fact that whenever the Constitution is violated it disrespects the people for whom it was made. Constitutional transgressions invariably have disastrous ramifications which, as the SCP had learnt to our peril, undermine democracy and national unity (para 23 refers).
5.2 Therefore, for the foregoing reasons, leave to appeal is declined and consequently, these petitions are dismissed effectively on the following 3 grounds (para 24 refers):
(a) ISL law was passed along with Money Bill, it does not possess the character of a tax; and
(b) it is a levy in the nature of fund to be charged and utilized for a specific purpose i.e. to provide for financial resources for raising an income support fund for the economically distressed persons and their families; hence, ultra vires considering Article 73 of the Constitution;
(c) Since, the ISL Act 2013 (Act) has been repealed through the Finance Act 2014, without a saving clause, therefore, whether any levy can be claimed, charged, or collected on the basis of the Act, which allegedly stood obliterated/abrogated completely, from the date of its promulgation.
Best regards
Asif S Kasbati (FCA, FCMA & LLB)
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