JAWAD HASSAN, J. By filing this constitutional petition under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973 (the "Constitution"), the petitioner, Tetra Pak (Pakistan) Limited, has sought Judicial Review of a public Action taken by the Respondent, Federal Board of Revenue (the "FBR"), through issuance of the impugned notices dated 17th of June, 2021, under Section 138(1) of the Income Tax Ordinance, 2001 (the "Income Tax Ordinance") read with Section 4(9) of the Workers' Welfare Fund Ordinance, 1971 (the "WWF Ordinance"), for recovery of certain amount of tax and the Workers Welfare Fund (the "WWF").
2. Mr. Mansoor Usman Awan, ASC submits that the impugned notices have been issued by the concerned authority without going through the proper procedure provided under the law, in sheer violation of the provisions of Article 4 of the Constitution; which states in unequivocal terms that it is an inalienable right of every citizen of this country to be treated in accordance with law and no action detrimental to his/her life, liberty, reputation or property shall be taken except as per law, which in this case is the Income Tax Ordinance and the WWF Ordinance. In this regard, reliance is placed on the judgment passed By Full Bench of the Hon'ble Supreme Court of Pakistan in the case of Watan Party and another v. Federation of Pakistan and others (PLD 2011 SC 997) in which it has been held that "Article 4 thereof remained fully operative, which laid down that to enjoy the protection of law and to be treated in accordance with law the inalienable right of every citizen, wherever he may be, and of every other person for the time being within Pakistan and in particular no action detrimental to the life, liberty, body, reputation or property of any person would be taken except in accordance with law." He further submits that the petitioner has various objections to the vires of the, impugned notices, including (i) jurisdiction of the Taxation Officer; (ii) `method; (iii) mode; and (iv) mechanism prescribed under both the Income Tax Ordinance and the WWF Ordinance for conducting such exercise. He next contends that the impugned notices have been issued straightway without providing any opportunity of hearing to the petition to ascertain, determine and verify its tax liabilities as per the returns already tiled by it, being a registered taxpayer under Section 114 of the Income Tax Ordinance.
3. Mr. Mansoor Usman Awan, ASC goes on to argue that issue of the WWF has already been discussed in detail by the august Supreme Court of Pakistan, under the WWF Ordinance, in the judgment reported as Workers' Welfare Funds, Ministry of Human Resources Development, Islamabad through Secretary and others v. East Pakistan Chrome Tannery (Pvt.) Ltd. through G.M (Finance), Lahore and others (PLD 2017 SC 28). He has referred to paragraph 16 of the said judgment which is reproduced hereunder for ease of the matter:-- "16. Besides there are certain other features of the contributions made to the Workers' Welfare Fund that suggest they are not in the nature of a tax. In this regard section 4(7) of the Ordinance of 1971 is important which reads as follows:-- Section 4(7) The payment made by an industrial establishment to the Fund under subsection (1) shall be treated as an expenditure for purposes of assessment of income-tax.
Section 4(7) basically states that the payments made by industrial establishments to the Workers'
Welfare Fund under the Ordinance of 1971 are to be considered as expenditure while assessing income tax. It is a necessary, corollary that the contributions to tug workers' Welfare Fund cannot be a tax if they are to be considered as an expenditure while assessing income tax. This argument is bolstered by Section 60A in Part IX of Chapter III of the Income Tax Ordinance, 2001 (Ordinance of 2001) which reads as follows:- 60A. Workers' Welfare Fund.---A person shall be entitled to a deductible allowance for the amount of any Workers' Welfare Fund paid by the person in tax year under Workers' Welfare Fund Ordinance, 1971."
A deductible allowance has been defined in section 2(16) of the Ordinance of 2001 as "an allowance that is deductible from total income under Part IX of Chapter III", meaning thereby that any contributions made by a person under the Ordinance of 1971 will be deducted from the total income of that person. This also suggests that the contributions are not a tax, as they are being deducted from the total income, as opposed to being considered as a tax credit, in which case the contributions would be subtracted from the total tax to be paid. In the light of the foregoing, we are of the view that the contributions made to the Workers' Welfare Fund are not in the nature of a tax."
Further reliance is placed on the judgments reported as Commissioner Inland Revenue Multan v.
Messrs Allah Wasaya Textile and Finishing Mills Ltd. (2013 PTD 1548) (D.B) and Messrs Azgard Nine Ltd. v. Pakistan through Secretary and others (2013 PTD 1030). He maintains that the rationale rendered by this Court as well as the Hon'ble Supreme Court of Pakistan in the aforesaid judgments is binding on all the executive/judicial authorities throughout Pakistan under Articles 189, 190 and 201 of the Constitution. He has also drawn attention of the Court toward the latest judgments in the cases of Chenab Flour and General Mills and others v. Federation of Pakistan through Secretary Revenue Division and others (PLD 2021 Lahore 343) and Ramzan Sugar Mills Limited v. Federal Board of Revenue and others (2021 PTD 1321) in which jurisdiction of the Federal Board of Revenue (the "FBR"); scope of the powers vested in the officers functioning under control of the FBR and provisions of various Sections of the Income Tax Ordinance have been discussed. He contends that the exercise being conducted by the Respondents pursuant to the impugned notice, is also in violation of the FBR's own Circular No. 4(33)-Rev. Bud./99 dated 17th of February, 2000 (the "FBR Circular"), which is binding on them under Section 206 of the Income Tax Ordinance. He claims that the provisions of Section 138 of the Income Tax Ordinance cannot be straightway invoked without adopting the Steps/method/mechanism given in subsections (4) and (9) of Section 4 of the WWF Ordinance read with the provisions of sections 122 and 221 of the Income Tax Ordinance, as it offends the provisions of Article 10-A of the Constitution, granting right of fair trial and due process to every citizen of Pakistan.
4. At this juncture. Malik Abdullah Raza, Advocate for the FBR submits that, in Ramzan Sugar Mills'
Case (supra) it has been by this Court that the FBR is Regulator of all fiscal laws in the country and being a Regulator, it vests with the main goal of tax collection in the country", therefore, the matter of seeking record and information under various subsections of Section 122 of the Ordinance comes within the domain of the FBR as well as the government officers appointed under the Income Tax Ordinance and such matters need no interference by this Court as required under its constitutional jurisdiction. Mirza, Nasar Ahmad, Additional Attorney General for Pakistan, however, submits that today, similar matters have been taken by my learned brother Shams Mehmood Mirza, J. who has referred the same to the concerned authority for its expeditious disposal in. accordance with law and also granted interim relief, in the meanwhile. He has no objection if similar relief be granted to the petitioner of the instant petition. Mr. Mansoor Usman Awan, ASC, while affirming the above position, submits that the petitioner will be satisfied if the matter be referred to the Respondent No.3 with a direction to decide the same in accordance with law within a timely fashion.
5. In view of the above, a copy of this writ petition along with all the annexures be remitted to the Respondent No.3 who will consider it as a representation of the Petitioner, carefully look into the FBR Circular and then decide the issue in hand after providing proper hearing to all concerned including the Petitioner, strictly in accordance with relevant provisions of the Income Tax Ordinance as well as the WWF Ordinance, keeping in mind the Constitutional provisions and the law discussed in the judgments mentioned above, through a speaking order, within two weeks from the receipt of certified copy of this order. In the meanwhile, under the Doctrine of Stopgap Arrangement Tax Matters developed by this Court in the judgment cited as Shell Pakistan Limited v. Government of Punjab and others (2020 PTD 1607), no coercive measures shall be taken against the Petitioner for recovery of the disputed amount of tax or WWF, till decision of its representation by the Respondent No.3.
Disposed of.