ISLAMABAD: The Supreme Court on Wednesday restored the Sales Tax Amendment Act in the erstwhile Federally Administered Tribal Areas (FATA) and Provincially Administered Tribal Areas (PATA).
A five-member larger constitutional bench of the apex court, headed by Justice Aminuddin Khan, issued a stay order on the appeals filed by the Ghee Mills and Steel Mills Associations, challenging the PHC verdict.
Notices were issued to all concerned parties, while the hearing was adjourned indefinitely.
The PHC had earlier struck down the Sales Tax Amendment Act, terming its application in ex-FATA and PATA unconstitutional. The High Court’s decision had been challenged by the federal government as well as industrial associations operating in the region.
During hearing, the counsel for the Steel Mills Association contended that the PHC had overstepped its constitutional jurisdiction by issuing a ruling that, in effect, amounted to legislating—a power that rests solely with the Parliament.
Advocate Hafiz Ehsan Khokhar, appearing on behalf of the appellants, argued that the High Court had granted relief beyond the scope of the original petitions, despite the matter involving tax revenues amounting to billions of rupees.
He further maintained that the PHC issued directives prematurely, without waiting for the finalisation of customs clearance procedures specific to the FATA and PATA regions.
The counsel for the Ghee and Steel Mills Association added that the High Court’s orders, which directed the issuance of refund cheques to the petitioners, were in violation of existing legal provisions.
After hearing the arguments, the Supreme Court bench suspended the PHC judgment and issued notices to respondents. The bench did not specify a date for the next hearing, adjourning the matter indefinitely.
The case holds significant implications for the taxation framework in the former tribal regions, which were merged with Khyber Pakhtunkhwa following the 25th Constitutional Amendment in 2018.
