Summary: 216I.C.A- ICA (Writ)- ICA Land 157-23 FOP ETC VS KAREEM NAWAZ ETC Mr. Justice Ch. Muhammad Iqbal 06-10- 2025 2025 LHC 6243

Summary: The jurisdiction of the Civil Court is barred in matters arising out of the West Pakistan Consolidation of Holdings Ordinance, 1960. Civil Revision is Dismissed. 215Civil Revision 1104262.768-

Summary: Civil Procedure Code (V of 1908)--- ----O.XVII, R.3---Closing right of producing evidence---Fair trial---Scope---Petitioner /plaintiff assailed order of closing right of producing evidence---Validity---Record clearly indicated that after framing of the issues the petitioner's evidence could not be recorded due to various factors including strikes by the local bar and the leave of the Presiding Officer, while on approximately eight dates the petitioner's witnesses failed to appear for evidence---Subsequently the petitioner was granted a final opportunity to produce evidence on next date, however, on that date, the Presiding Officer was on leave and the matter was adjourned but on next date, the defendant filed an application under O.I, R.10, C.P.C, upon which the case was adjourned---Ultimately, the application was dismissed, thereafter, the matter was fixed for recording of the petitioner's evidence---Order sheet showed that following the dismissal of the said application only two effective opportunities, spanning about fifteen days, were granted to the petitioner to produce evidence; on the third date, the Trial Court closed the petitioner's right to lead evidence---Furthermore, the interim order sheets reflected that the matter was fixed for the defendant's evidence on at least four occasions; however, the defendant failed to produce evidence on those dates---Despite said repeated defaults, no coercive or adverse orders were passed against the defendant---It appeared that the Trial Court proceeded to pass the impugned order in a hasty and arbitrary manner, seemingly to expedite disposal of the case---Said approach, however, was not in consonance with the settled principles of law or fair trial, resulting in manifest prejudice to the petitioner---Therefore, the impugned order, was harsh and legally unwarranted in the circumstances of the case---Though the cases should be decided at the earliest without wasting time and adjournments should not be given without any plausible reason, so as to lessen the burden which was prevailing on the Courts, but at the same time it was also unjust to penalize the litigant public in a way, which has been adopted by the Trial Court---High Court set aside the impugned order, not being sustainable in the eyes of law---Resultantly, Trial Court was directed to afford one opportunity to the petitioner's side to lead its evidence subject to payment of costs of Rs.25,000/-to be paid by the petitioner to respondents---Civil revision was allowed accordingly. Pervaiz Inayat Malik for Petitioner. Muhammad Younas Bhullar and Waqar Islam for Respondents Nos. 1 and 3. Date of hearing: 3rd October, 2025.

Summary: (Against the judgment dated 16.06.2022 passed by the Lahore High Court, Lahore in P.T.R. No. 349 of 2010). (a) Income Tax Ordinance (XLIX of 2001)--- ----Ss. 21(c) & 153---Rebate granted by taxpayer to its customer for exclusive sale of products---Department treating rebate as payment for advertising services---Effect---Question raised whether such rebate attracted withholding tax---Deduction of tax, requirement of---Prerequisite---Actual payment to move from the person mandated to deduct to the person receiving the same and for whom it becomes advance payment of tax---Scope---The present case had arisen from the Income Tax Ordinance, 2001 concerning the tax year 2003---The department filed a reference before the High Court challenging a decision of the Appellate Tribunal that favored the respondent company---The dispute revolved around a “rebate” amounting to Rs. 7,893,898/- which the respondent company had given to its customer in exchange for sales exclusivity---The department treated this rebate as a payment for “advertising services” under Section 153(1)(b) of the Ordinance and disallowed it under Section 21(c), considering it taxable as “royalty”---The High Court ruled in favor of the respondent company leading the department to file the present civil petition for leave to appeal before the Supreme Court---Pivotal issue for determination before the Supreme Court was as to “Whether the rebate or discount allowed by respondent company to its customer, for ensuring exclusive sale of its products, constituted an actual “payment” for “advertising services” attracting withholding tax under Section 153(1)(b) of the Income Tax Ordinance, 2001”?---Held: It was clear that Section 153(1)(b) could not possibly have applied to the facts and circumstances of the present case---For the provision to apply would have required a payment being made by the taxpayer to the customer, from which the former had to deduct tax at the prescribed rate---The amount of “payment” allegedly made by the taxpayer to the customer in the present case was wholly notional and nothing was in fact paid---For Section 153(1)(b) to apply required an actual payment moving from the person mandated to deduct to the person receiving the same and for whom it becomes advance payment of tax---The provision had no application and nothing further needed to be examined---The department’s claim failed at its very inception being, on a correct application of the law, entirely outside any applicability of the provision---An actual payment had to be shown moving from the taxpayer to the customer and here there was nothing of the sort at all, hence, the section did not apply---Leave to appeal was refused and petition was dismissed, in circumstances. (b) Income Tax Ordinance (XLIX of 2001)--- ----Ss. 153(1), 161 & 163---Advance payment of tax by way of deduction or collection---Failure to comply---Consequences---Person in default---Personal liability for undeducted or uncollected tax---Scope---Section 153, like a number of other provisions in the Income Tax Ordinance, 2001, requires for the advance payment of tax by way of deduction---Other provisions provide for advance payment of tax byway of collection---If the person who is required to so deduct or collect fails to do so then, among other consequences, Section 161 is activated---The section makes the person in default personally liable for the payment of the amount of tax that was not deducted or collected and the recovery provisions of the Ordinance become applicable, per Section 163, “as if it were tax due under an assessment order”, thus, a failure to abide by the duty to deduct or collect advance tax has severe penal consequences and he becomes, in essence, a taxpayer in default---Section 153, when viewed from the perspective of the person who is said to be under a duty to collect or deduct the advance payment of tax, may be regarded as akin or analogous to a charging provision---This is so because of the severe penal consequences that can result from a failure to abide by the statutory duty---These advance payment provisions therefore have to be strictly construed---This need not be with the same rigidity and literalness with which a charging section, in terms of well settled tax jurisprudence, is interpreted---Nonetheless, such provisions cannot be regarded simply as recovery mechanisms and dealt with accordingly---The severe penal consequences for a person who defaults on a duty to deduct or collect, as the case may be, militate against any such approach---The interpretation must be tight and narrow. Ahmed Pervaiz, Advocate Supreme Court for Petitioner (via video-link, Lahore). Muhammad Shoaib Rashid, Advocate Supreme Court for Respondent (via video-link, Lahore). Date of hearing: 3rd October, 2025.

Summary: (Against the judgment dated 16.06.2022 passed by the Lahore High Court, Lahore in P.T.R. No. 349 of 2010). (a) Income Tax Ordinance (XLIX of 2001)--- ----Ss. 21(c) & 153---Rebate granted by taxpayer to its customer for exclusive sale of products---Department treating rebate as payment for advertising services---Effect---Question raised whether such rebate attracted withholding tax---Deduction of tax, requirement of---Prerequisite---Actual payment to move from the person mandated to deduct to the person receiving the same and for whom it becomes advance payment of tax---Scope---The present case had arisen from the Income Tax Ordinance, 2001 concerning the tax year 2003---The department filed a reference before the High Court challenging a decision of the Appellate Tribunal that favored the respondent company---The dispute revolved around a “rebate” amounting to Rs. 7,893,898/- which the respondent company had given to its customer in exchange for sales exclusivity---The department treated this rebate as a payment for “advertising services” under Section 153(1)(b) of the Ordinance and disallowed it under Section 21(c), considering it taxable as “royalty”---The High Court ruled in favor of the respondent company leading the department to file the present civil petition for leave to appeal before the Supreme Court---Pivotal issue for determination before the Supreme Court was as to “Whether the rebate or discount allowed by respondent company to its customer, for ensuring exclusive sale of its products, constituted an actual “payment” for “advertising services” attracting withholding tax under Section 153(1)(b) of the Income Tax Ordinance, 2001”?---Held: It was clear that Section 153(1)(b) could not possibly have applied to the facts and circumstances of the present case---For the provision to apply would have required a payment being made by the taxpayer to the customer, from which the former had to deduct tax at the prescribed rate---The amount of “payment” allegedly made by the taxpayer to the customer in the present case was wholly notional and nothing was in fact paid---For Section 153(1)(b) to apply required an actual payment moving from the person mandated to deduct to the person receiving the same and for whom it becomes advance payment of tax---The provision had no application and nothing further needed to be examined---The department’s claim failed at its very inception being, on a correct application of the law, entirely outside any applicability of the provision---An actual payment had to be shown moving from the taxpayer to the customer and here there was nothing of the sort at all, hence, the section did not apply---Leave to appeal was refused and petition was dismissed, in circumstances. (b) Income Tax Ordinance (XLIX of 2001)--- ----Ss. 153(1), 161 & 163---Advance payment of tax by way of deduction or collection---Failure to comply---Consequences---Person in default---Personal liability for undeducted or uncollected tax---Scope---Section 153, like a number of other provisions in the Income Tax Ordinance, 2001, requires for the advance payment of tax by way of deduction---Other provisions provide for advance payment of tax byway of collection---If the person who is required to so deduct or collect fails to do so then, among other consequences, Section 161 is activated---The section makes the person in default personally liable for the payment of the amount of tax that was not deducted or collected and the recovery provisions of the Ordinance become applicable, per Section 163, “as if it were tax due under an assessment order”, thus, a failure to abide by the duty to deduct or collect advance tax has severe penal consequences and he becomes, in essence, a taxpayer in default---Section 153, when viewed from the perspective of the person who is said to be under a duty to collect or deduct the advance payment of tax, may be regarded as akin or analogous to a charging provision---This is so because of the severe penal consequences that can result from a failure to abide by the statutory duty---These advance payment provisions therefore have to be strictly construed---This need not be with the same rigidity and literalness with which a charging section, in terms of well settled tax jurisprudence, is interpreted---Nonetheless, such provisions cannot be regarded simply as recovery mechanisms and dealt with accordingly---The severe penal consequences for a person who defaults on a duty to deduct or collect, as the case may be, militate against any such approach---The interpretation must be tight and narrow. Ahmed Pervaiz, Advocate Supreme Court for Petitioner (via video-link, Lahore). Muhammad Shoaib Rashid, Advocate Supreme Court for Respondent (via video-link, Lahore). Date of hearing: 3rd October, 2025.

Summary: Islamabad Rent Restriction Ordinance (IV of 2001)--- ---- S.17---Eviction of tenant--- Landlord and tenant, relationship of--- Determination--- Rent Controller---Exercise of jurisdiction--- Petitioners / tenants were aggrieved of order passed by Lower Appellate Court setting aside order of Rent Controller whereby he framed an issue to redetermine relationship of landlord and tenant between the parties--- Validity--- Rent Controller had already concluded that relationship of landlord and tenant stood admitted between the parties--- Any subsequent attempt to re-open or re-determine such settled question was beyond jurisdictional competence of Rent Controller--- Such exercise in effect amounted to a review of earlier order of Rent Controller, which law did not permit in rent proceedings--- Lower Appellate Court rightly corrected procedural irregularity by remitting the matter with the direction to Rent Controller to proceed strictly in accordance with law--- Appellate order reflected judicious appreciation of record and adherence to settled legal principles--- High Court declined to interfere in the order passed by Lower Appellate Court as there was no error of jurisdiction, illegality or material irregularity--- Constitutional petition was dismissed in circumstances. Feisal Hussain Naqvi for Petitioner. Qaiser Qadeer Qureshi for Respondent No. 1. Date of hearing: 3rd October, 2025.

Summary: Civil Procedure Code (V of 1908)--- ----O.XXIII, R.3---Compromise decree---‘Master settlement agreement’ between the banks and company---Suits decreed by consent---The plaintiff banks and defendant No.1 (the “Company”) jointly filed compromise applications in two connected suits under Order XXIII Rule 3, C.P.C., stating that they had amicably settled their dispute through a Master Settlement Agreement and hence sought a compromise decree on the basis of the same---Validity---According to defendants 2 and 3, their earlier guarantees stood discharged the moment Master Settlement Agreement was executed by the banks---Counsel for defendants 2 and 3 had no objection to the grant of the compromise decree application in hand if it was allowed without prejudice to the rights of said defendants to agitate their plea qua discharge of their earlier guarantees and the said defendants could avail their remedies in accordance with law before the Company Bench---To this, counsel for the plaintiffs had no objection---Defendants 4 and 5 also had no objection to the grant of the compromise decree application in hand, if it was allowed without prejudice to the rights of the said defendants to agitate their factual and legal arguments at the time of hearing of their respective Leave-to-defend application---To this also, counsel for the plaintiffs had no objection---With respect to the hearing of Leave-to-defend applications filed by the defendants 2 to 5, the suits were adjourned sine die---Compromise application which was jointly filed by the plaintiffs and defendant No.1, and was also duly signed by the parties and their respective counsel, was therefore allowed, and the suit was decreed by consent against defendant No.1 on the terms mentioned in the listed compromise applications---Applications were allowed. Rashid Anwer and Yousuf Khalid Anwer, for Plaintiff. Ali Nawaz Khuhawar for Defendants Nos. 2 and 3. Waseem Ahmed for Defendants Nos.4 and 5. Faisal Riaz Virk [representative of MCB], Syed Asif Haider [representative of Askari Bank], Muhammad Zubair [representative of Askari Bank], Mehtab Khan Abbasi [representative of Bank of Khyber], Muhammad Irfan Siddiqui [representative of Saudi Pak Bank], Abdul Quddos [representative of National Bank], Adnan Arain [representative of Faysal Bank], Ghulam Nabi [representative of Faysal Bank] and Zahid Saleem [representative of Pak Kuwait Bank] are present in person.

Summary: (a) Constitution of Pakistan- -Arts. 185(3) & 199-Establishment and operation of a 330 MW ‘private thermal power project’-Premature invalidation of ‘letter of support’ by ‘Private Power and Infrastructure Board’ (PPIB)-Encashment of performance guarantee (PG), challenge to-High Court allowed the prayer for direction to reimburse the amount realized upon encashment of PG-Legality-Whether such direction amounted to interference in a contractual dispute-Determination-Brief facts were that the federal government introduced the 1994 Power Policy under which the respondent was issued a ‘letter of interest’ (-LOI-) and later a ‘letter of support’ (-LOS-) for establishing a 330 MW power project, requiring achievement of financial close and submission of a performance guarantee (-PG-)-The LOS was extended until 30.10.1996, while national policy decisions of the ECC altered the treatment of power projects exceeding the 3,000 MW cumulative financial-close threshold-Before expiry of the extended deadline, respondent was informed that its LOS stood invalid due to other projects reaching the cumulative limit and subsequently encashed the respondent’s PG on 28.11.1996-The respondent filed a writ petition seeking refund of the encashed PG, which the High Court allowed, and the intra-court appeal against it was dismissed-The issue for determination before the Supreme Court was-whether the High Court’s direction to refund the encashed PG amounted to unlawful interference in a contractual matter or whether it correctly enforced binding public-law decisions of the ECC?-Held: Private Power and Infrastructure Board (PPIB) prematurely declared the respondent’s LOS invalid and refused to approve essential term sheets even though the LOS remained valid until 30.10.1996, thereby preventing the respondent from achieving financial close-Since the approval of the respondent’s term sheets by PPIB was mandatory before financial close could be declared, and since PPIB, in its letter dated01.09.1996, had taken the position that the respondent’s LOS was not valid, not because it had expired, but because other private power projects had achieved financial close for a cumulative capacity of 3,000 MW, it could not be held with certainty that the respondent would not have achieved financial close within the deadline of 30.10.1996 set in PPIB’s letter dated 24.03.1996-By informing the respondent through letter dated 01.09.1996 that its LOS was not valid, the respondent could not have been expected to take steps for achieving close thereafter-It was almost a month before such deadline that PPIB through its letter dated 01.09.1996, informed the respondent that its LOS was no longer valid-PPIB’s basis for taking this position was achievement of financial close for the cumulative capacity of 3,000MW by other private power projects, and not because the respondent had breached any provision of the LOS-In such circumstances, the encashment of the respondent’s PG was most irrational and unreasonable-By allowing respondent’s writ petition High Court had given effect to the decisions of the ECC and had not interfered with the contractual obligations arising under the LOS-Appeal had no merit and was dismissed, in circumstances. (b) Constitution of Pakistan- -Art. 199-Constitutional jurisdiction of the High Court, exercise of-Disputes arising out of a contract, interference in-Scope-Article 199 of the Constitution empowers High Courts to issue writs for the enforcement of fundamental rights and public duties-Actions of the State, its instrumentality, any public authority or person whose actions bear insignia of public law element or public character are amenable to judicial review and the validity of such an action would be tested on the anvil of the provisions of the Constitution and, in particular, the fundamental rights enshrined therein-However, when a dispute arises purely out of a contract, the courts have generally held that writ jurisdiction is not meant to settle private contractual rights, especially when an alternate civil remedy exists-While exercising the power under Article 199 of the Constitution, the High Court would be circumspect to adjudicate the disputes arising out of a contract depending on the facts and circumstances in a given case-After the State or its agents enter into the field of the ordinary contract, the relations are governed by the provisions of the contract which determines the rights and obligations of the parties inter se.

Summary: (a) Legal Practitioners and Bar Councils Act (XXXV of 1973)- -Ss.5A & 5B [as amended through Legal Practitioners and Bar Councils (Amendment) Act (XXIV of 2025)]-Pakistan Legal Practitioners and Bar Councils Rules, 1976, Rr.4, 6, 10-B & 175-K-Constitution of Pakistan, Arts.8(2), 25, 97 & 199-Constitutional petitions-Vires of amendments enhancing eligibility criteria for membership of Provincial Bar Councils and introducing changes in election framework, challenge to-Whether amendments were discriminatory, violative of fundamental rights, and retrospective vis-à-vis Bar Council Elections, 2025-Legality-Determination-Brief facts of the matter were that the petitioners, who were advocates enrolled with various Bar Associations, filed constitutional petitions challenging the amendments introduced through the Legal Practitioners and Bar Councils (Amendment) Act, 2025 and the corresponding amendments in the Pakistan Legal Practitioners and Bar Councils Rules, 1976, whereby changes were made to the qualifications and disqualifications for membership of Provincial and Islamabad Bar Councils, including enhancement of the eligibility threshold from five to ten years as an Advocate of the High Court, requirement of conducting thirty decided cases, additional voter membership conditions, modifications relating to right to vote, nomination, and disqualification on violation of the Code of Conduct; the amendments were enacted shortly before the Provincial Bar Council Elections, 2025-Held: The amended qualification of ten (10) years as an Advocate of High Court was in line with the earlier prescribed qualification of five (05) years-The question that as to what should have been the touchstone and length of experience was purely a matter within the legislative competence of the legislature and its wisdom in bringing about this change could not be questioned-The impugned amendment of S.5A of the Act, 1973 was not discriminatory in nature by any means-The rights claimed by the petitioners might have become vested rights being enforceable under the law once such rights were perfected by virtue of acceptance of nomination papers of the candidates or at least when the election schedule was notified-Mere claim of ‘campaign’ for upcoming election did not transform a mere expectancy into a ‘vested right’ in any manner-Bar Councils created and functioning under the Act, 1973 and the Rules, 1976, be it Pakistan Bar Council or Provincial Bar Councils, were performing delegated authority of the Federation to regulate the profession of law-Article 97 of the Constitution clearly purported that the power and authority to legislate viz a particular subject matter, came within the executive authority of the federation qua the same subject-The condition of-continuous practice for five preceding years in such district-, sought to be imposed through impugned notification, clearly amounted to contradicting, overriding and enlarging the scope of statutory provision as provided under S.5A(d) of the Act, 1973, which imposed a condition that a candidate simply needed to be a voter member of Bar Association falling in such district for a period of not less than five (05) years-Similarly, the amended clause (a) of Rule 175-K and newly inserted clause (a1) of Rule 175-K of the Rules, 1976 were also not in conformity with the definition of a voter, as couched in S.2(o) of the Act, 1973-Rules made under a parent statute could not go beyond the scope of parent statute-Amendments brought about through the Impugned Notification in R.6(1), clause (a) to R.175-K and clause (a1) to R.175-K of the Rules, 1976 were declared ultra vires-The remedy of appeal being provided before the Attorney General against the decision of Advocate General lacked the element of judicial oversight, therefore, sub-rule (5) substituted R.10-B of Rules, 1976 was declared ultra vires and the matter was referred to the Pakistan Bar Council for reconsidering the same by providing a remedy, which might have some judicial oversight-The challenge laid to the vires of the amendments brought about in the Legal Practitioners and Bar Councils Act,1973, by virtue of the Legal Practitioners and Bar Councils (Amendment) Act, 2025 was dismissed and the impugned amendments thereof were declared intra vires-The alternate prayer seeking declaration that the amended provisions were retrospective in nature, therefore, the same could not be implemented for the upcoming elections of the Provincial Bar Councils was also dismissed being misconceived-Constitutional petition was disposed of, in circumstances. Election Commission of Pakistan through its Secretary v. Javaid Hashmi and others PLD 1989 SC 396 rel. (b) Constitution of Pakistan- -Art.199-Vires of law, challenge to-Judicial review-Scope-Power to strike down or declare void a legislative enactment-Such jurisdiction must be exercised with great care and caution, in deference to the wisdom of the legislature-Considerations approved by Supreme Court highlighted and relied upon by the High Court. Lahore Development Authority v. Imrana Tiwana 2015 SCMR 1739 rel. (c) Constitution of Pakistan- -Art.199-Vires of law, challenge to-Constitutional yardsticks-(i) Abridging of fundamental rights; (ii) Competence of the legislature enacting the law; (iii) Legislation is colorable; (iv) Directly opposed to provisions of the Constitution; (v) Possibility of two constructions and consequent conclusion. Jawwad S. Khawaja v. Federation of Pakistan PLD 2024 SC 337; Muhammad Azfal v. Secretary Establishment Division 2021 SCMR 1569; Sui Southern Gas Company v. Federation of Pakistan 2018 SCMR 802; Province of East Pakistan v. Siraj ul Haq Patwari PLD 1966 SC 854; Federation of Pakistan v. Shaukat Ali Mian PLD 1999 SC 1026; Baz Muhammad Kakar v. Federation of Pakistan PLD 2012 SC 923; MQM (Pakistan) v. Pakistan PLD 2022 SC 439; Younas Abbas v. Additional Sessions Judge, Chakwal PLD 2016 SC 581; Zafar Ali Shah v. Pervez Musharraf PLD 2000 SC 869; Watan Party v. Federation of Pakistan PLD 2006 SC 697; Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445 and Interpretation of Statutes by (11th Edition) by N.S. Bindra | published by LexisNexis | p140. rel. (d) Constitution of Pakistan- -Art.199-Vires of law, challenge to-Grounds that cannot be looked at while determining vires of legislative instruments highlighted-(i) Mala fides not attributable to the legislature; (ii) The law possibly or likely to be administered in a discriminatory manner is not a ground to strike down law; (iii) Wisdom or policy of the legislature - not to be questioned; (iv) Reasonableness of law not to be looked at to determine its vires. Messrs Chenone Stores Ltd. through Executive Director (Finance Accounts) v. Federal Board of Revenue through Chairman and 2 others 2012 PTD 1815; Messrs Elahi Cotton Mills Ltd. and others v. Federation of Pakistan through Secretary Ministry of Finance, Islamabad and 6 others PLD 1997 SC 582; Mohammad Imran and others v. Province of Sindh through Chief Secretary and others 2019 SCMR 1132; Sui Southern Gas Company v. Federation of Pakistan 2018 SCMR 802; All Pakistan Newspapers Society v. Federation of Pakistan PLD 2012 SC 1; Muhammad Nasir Mehmood v. Federation of Pakistan PLD 2009 SC 107; Watan Party v. Federation of Pakistan PLD 2006 SC 697; Federation of Pakistan v. Shaukat Ali Mian PLD 1999 SC 1026; Elahi Cotton v. Federation of Pakistan PLD 1997 SC 582; LDA v. Imrana Tiwana 2015 SCMR 1739; Federation of Pakistan v. Shaukat Ali Mian PLD 1999 SC 1026; Lal Muhammad v. State 1991 MLD 2622; East and West Steamship Co. v. Pakistan PLD 1958 SC 41; Muhammad Muzaffar Khan v. Muhammad Yusuf Khan PLD 1959 SC 9; Pakistan Lawyers Forum v. Federation of Pakistan PLD 2005 SC 719; Zaman Cement Company v. Central Board of Revenue 2002 SCMR 312; Zulfiqar Ali Babu v. Government of Punjab PLD 1997 SC 11; Federation of Pakistan v. Saeed Ahmed Khan PLD 1974 SC 151; Punjab v. Malik Khizer Hayat Tiwana PLD 1956 FC 200; Federation of Pakistan v. Haji Muhammad Sadiq PLD 2007 SC 133; Anound Power Generation Limited v. Federation of Pakistan PLD 2001 SC 340 and Karnataka Bank Limited's case, AIR 2008 SC (Supp) 1377: 2008 AIR SCW 1021 rel. (e) Constitution of Pakistan- -Art.25-Equality of citizens-Discrimination, plea of-Reasonable classification-Principle-Scope-Reasonable classification is permissible and Art.25 of the Constitution is only attracted in an apple to apple comparison-Although Art.25 of the Constitution envisages equality amongst citizens, it also allows for differential treatment of persons who are not similarly placed by virtue of a reasonable classification-However, to justify this difference in treatment, the reasonable classification needs to be 'based on intelligible differentia, which has a rational nexus with the object being sought to be achieved-Likewise, the persons may be classified in groups and such groups may be treated differently, if there is a reasonable classification. Government of the Punjab through Chief Secretary, Lahore and others v. Ch. Abdul Sattar Hans and 29 others 2015 SCMR 915; National Commission on Status of Women through Chairperson and others v. Government of Pakistan through Secretary Law and Justice and others PLD 2019 SC 218; Hadayat Ullah and others v. Federation of Pakistan and others 2022 SCMR 1691; Federation of Pakistan through Secretary Ministry of Communications, Islamabad and another v. Shuja Sharif and others 2023 SCMR 129; Government of Balochistan through Additional Chief Secretary v. Azizullah Memon and 16 others PLD 1993 SC 341; Sikandar and 2 others v. Muhammad Ayub and 2 others 1991 SCMR 1041 and Gul Zarif Khan and others v. Government of Khyber Pakhtunkhwa through Chief Secretary, Peshawar and others 2025 SCMR 415 rel. (f) Interpretation of statutes- -Maxim"ut res magis valeat quam pereat"-Meaning and scope-It is better for a thing to have effect than to be made void, or it is better to validate a thing than to invalidate it-The Court should, in so far as possible, avoid that construction which may ascribe or attribute unreasonableness to the will of legislature and while moving into the task of interpretation of any law or provision, the predominant objective should be that the law survives and the presumption, if any, must be in favour of its constitutionality-The Court should not adopt such interpretation which renders the statute or any of its provisions inoperative or unworkable. (g) Interpretation of statutes- -Prospectivity and retrospectivity of a statute-Procedural law-There can be no two views about the powers of legislature to legislate any law and to make it applicable prospectively or retrospectively or from any particular date, with clear/express intendment in this regard-However the procedural law, even though not expressly provided for, normally holds its applicability retrospectively as no one can claim vested right in the matter of procedure. Judges’ Pension Case [H.R.C. No.40927-S of 2012 / Constitution Petition No.127 of 2012] PLD 2013 SC 829 rel. (h) Words and phrases- -Vested right-Meaning and scope-Rights are vested when the right to enjoyment, present or prospective, has become the property of some particular person or persons as a present interest-A vested right is a title to the present or future enjoyment of property, or to the present or future enforcement of a demand or a legal exemption from a demand by another-The right must be immediate, absolute, complete, unconditional and independent of a contingency-Accordingly, a mere expectancy of future benefit or a contingent interest founded on the anticipated continuance of existing laws, does not constitute a vested right-Inchoate rights, which have not been acted upon, are not vested rights-Moreover, a vested right may not arise at a time when there is no possibility of enforcing a claim under the existing law-In certain cases, a distinction is drawn between an existing right and a vested right and it is said that the rule against retrospective construction is applied only to save vested rights and not existing rights-The expression ‘vested right’ means an absolute or indefeasible right-The claim based on the vested right or settled expectation to obtain sanction cannot be set up against statutory provisions-It is a right which cannot be taken away without the consent of the owner-Such rights may arise from contract or statute and from the operation of law-The right to take advantage of a statute cannot be held to be a vested right. Nabi Ahmed and another v. Home Secretary, Government of West Pakistan, Lahore and 4 others PLD 1969 SC 599 and Mian Rafi ud Din and 6 others v. The Chief Settlement and Rehabilitation Commissioner and 2 others PLD 1971 SC 252 rel. Mylapore Club v. State of Tamil Nadu JT (2005) 9 SC 443 ref. (i) Interpretation of statutes- -Retrospectivity of a statute-The rule against retrospective construction is not applicable to a statute merely-because a part of the requisites for its action is drawn from a time antecedent to its passing-If that were not so, every statute will be presumed to apply only to persons born and things come into existence after its operation and such interpretation may well result in virtual nullification of most of the statutes-An amending Act is, therefore, not retrospective merely because it applies also to those to whom the pre-amended Act was applicable if the amended Act has operation from the date of its amendment and not from an anterior date-But this does not mean that a statute which takes away or impairs any vested right acquired under existing laws or which creates a new obligation or imposes a new burden in respect of past transactions, will not be treated as retrospective. (j) Interpretation of statutes- -Retrospective application-Scope-There is no distinction between a retrospective legislation which affects rights and liabilities and that which does not do so-All legislations affect rights or liabilities; the words being used in their widest sense-Legislature either creates a right or takes away a right or restricts or enlarges a right or similarly affects liabilities-A statute is to be deemed to be retrospective, which takes away or impairs any vested right acquired under existing laws, or creates a new obligation, or imposes a new duty, or attaches a new disability in respect of transactions or considerations already past-According to this definition, the very meaning of a retrospective legislation is one that impairs any vested right or imposes a new obligation in relation to transactions already past-Retrospective is well defined: -Nova constitutio futuris formam imponere bebet, non prateritis-i.e. unless there be clear words to the contrary, statutes do not apply to a past, but to a future, state of circumstances. Mir Ahmad Nawaz Khan Bughti v. Superintendent, District Jail PLD 1966 SC 357 rel. (k) Words and phrases- -Vested rights-Distinction and gradation of rights-Past and closed transaction, doctrine of-Scope-While every past and closed transaction is normally based on or comprises of a vested right, every vested right is not necessarily a past and closed transaction-Indeed, if rights were required to be placed in ascending order, the 'scale' could be said to comprise of a 'bare' right, a ‘vested right’ and a ‘past and closed transaction’-Ordinarily, a right can be regarded as progressing from a 'bare' right to become a ‘vested right’ and then perhaps even a ‘past and closed transaction’-Of course, some rights only become vested rights, and do not go beyond to become past and closed transactions-Others may vest immediately, as soon as they arise or accrue, and then may (or may not) become past and closed transactions-Some rights (in rare and unusual situations) may even become past and closed transactions once they accrue, i.e., progress to that category straight from being 'bare' rights. Messrs Al Samrez Enterprise v. Federation of Pakistan and others 1986 SCMR 1917; Commissioner of Inland Revenue v. Messrs Mekotex PLD 2024 SC 1168 and Molasses Trading and Export (Pvt) Ltd. v. Federation of Pakistan and others 1993 SCMR 1905 rel. (l) Precedent- -A case is only authority for what it actually decides and cannot be cited as precedent for a proposition that may be inferred from it. Syed Hammad Nabi and others v. Inspector General of Police Punjab, Lahore and others 2023 SCMR 584; Trustees of the Port of Karachi v. Muhammad Saleem 1994 SCMR 2213 and Sindh High Court Bar Association through its Secretary and another v. Federation of Pakistan through Secretary Ministry of Law and Justice, Islamabad and others PLD 2009 SC 879 rel. Quinn v. Leathem 1901 AC 495 ref. (m) Interpretation of statutes- -Delegated legislation-Scope-Delegated legislation is secondary legislation; it is a law made by a person or body other than the legislature but with legislature’s authority. Trustees of the Port of Karachi v. Muhammad Saleem 1994 SCMR 2213 ref. (n) Interpretation of statutes- -Rules travelling beyond the parent statute, vires of-Legality-Rules made under an Act or Statute are subservient to the parent Act and such rules cannot contradict, override, add to the clear provision of the parent Statute-Any rule which is inconsistent or travels beyond the scope of parent statute, is ultra vires the parent statute-The rules made under a parent statute cannot go beyond the scope of said statute nor can they enlarge the scope of statutory provisions therein as the power of rule-making is an incidental power that must follow and not run parallel to the parent statute. Sindh High Court Bar Association through its Secretary and another v. Federation of Pakistan through Secretary Ministry of Law and Justice, Islamabad and others PLD 2009 SC 879; Farrukh Raza Sheikh v. The Appellate Tribunal Inland Revenue and others 2022 SCMR 1787; Commissioner Inland Revenue, LTO, Islamabad v. Messrs Pakistan LNG Limited, Islamabad 2025 SCP 267; Pakistan Electronic Media Regulatory Authority v. Pakistan Broadcasters Association and others PLD 2023 SC 378; Jurists Foundation through Chairman v. Federal Government through Secretary, Ministry of Defence and others PLD 2020 SC 1; Suo Motu Case No.13 of 2009 PLD 2011 SC 619; Suo Motu Case No.11 of 2011 PLD 2014 SC 389; Mian Zaiuddin v. Punjab Local Government and others 1985 SCMR 365 - PLD 1995 SC 423 and Khawaja Ahmad Hassan v. Government of Punjab and others 2005 SCMR 186 rel. Dates of hearing: 22nd, 23rd, 24th, 25th, 29th, 30th September and 2nd October, 2025.

Summary: (Against the order dated 13.05.2013 of the Islamabad High Court passed in I.C.A. No. 685-W of 2013). (a) Constitution of Pakistan--- ----Arts. 185(3) & 199---Establishment and operation of a 330 MW ‘private thermal power project’---Premature invalidation of ‘letter of support’ by ‘Private Power and Infrastructure Board’ (PPIB)---Encashment of performance guarantee (PG), challenge to---High Court allowed the prayer for direction to reimburse the amount realized upon encashment of PG---Legality---Whether such direction amounted to interference in a contractual dispute---Determination---Brief facts were that the federal government introduced the 1994 Power Policy under which the respondent was issued a ‘letter of interest’ (“LOI”) and later a ‘letter of support’ (“LOS”) for establishing a 330 MW power project, requiring achievement of financial close and submission of a performance guarantee (“PG”)---The LOS was extended until 30.10.1996, while national policy decisions of the ECC altered the treatment of power projects exceeding the 3,000 MW cumulative financial-close threshold---Before expiry of the extended deadline, respondent was informed that its LOS stood invalid due to other projects reaching the cumulative limit and subsequently encashed the respondent’s PG on 28.11.1996---The respondent filed a writ petition seeking refund of the encashed PG, which the High Court allowed, and the intra-court appeal against it was dismissed---The issue for determination before the Supreme Court was “whether the High Court’s direction to refund the encashed PG amounted to unlawful interference in a contractual matter or whether it correctly enforced binding public-law decisions of the ECC?”---Held: Private Power and Infrastructure Board (PPIB) prematurely declared the respondent’s LOS invalid and refused to approve essential term sheets even though the LOS remained valid until 30.10.1996, thereby preventing the respondent from achieving financial close---Since the approval of the respondent’s term sheets by PPIB was mandatory before financial close could be declared, and since PPIB, in its letter dated01.09.1996, had taken the position that the respondent’s LOS was not valid, not because it had expired, but because other private power projects had achieved financial close for a cumulative capacity of 3,000 MW, it could not be held with certainty that the respondent would not have achieved financial close within the deadline of 30.10.1996 set in PPIB’s letter dated 24.03.1996---By informing the respondent through letter dated 01.09.1996 that its LOS was not valid, the respondent could not have been expected to take steps for achieving close thereafter---It was almost a month before such deadline that PPIB through its letter dated 01.09.1996, informed the respondent that its LOS was no longer valid---PPIB’s basis for taking this position was achievement of financial close for the cumulative capacity of 3,000MW by other private power projects, and not because the respondent had breached any provision of the LOS---In such circumstances, the encashment of the respondent’s PG was most irrational and unreasonable---By allowing respondent’s writ petition High Court had given effect to the decisions of the ECC and had not interfered with the contractual obligations arising under the LOS---Appeal had no merit and was dismissed, in circumstances. (b) Constitution of Pakistan--- ----Art. 199---Constitutional jurisdiction of the High Court, exercise of---Disputes arising out of a contract, interference in---Scope---Article 199 of the Constitution empowers High Courts to issue writs for the enforcement of fundamental rights and public duties---Actions of the State, its instrumentality, any public authority or person whose actions bear insignia of public law element or public character are amenable to judicial review and the validity of such an action would be tested on the anvil of the provisions of the Constitution and, in particular, the fundamental rights enshrined therein---However, when a dispute arises purely out of a contract, the courts have generally held that writ jurisdiction is not meant to settle private contractual rights, especially when an alternate civil remedy exists---While exercising the power under Article 199 of the Constitution, the High Court would be circumspect to adjudicate the disputes arising out of a contract depending on the facts and circumstances in a given case---After the State or its agents enter into the field of the ordinary contract, the relations are governed by the provisions of the contract which determines the rights and obligations of the parties inter se. Salman Akram Raja, Advocate Supreme Court for Appellants. Muhammad Akram Sheikh, Senior Advocate Supreme Court and Ms. Natalya Kamal, Advocate Supreme Court along with Syed Rifaqat Hussain Shah, Advocate-on-Record for Respondent. Date of hearing: 2nd October, 2025.