LHC Criticizes FBR Court Fee Exemption, Calls It Discriminatory

The Lahore High Court (LHC) strongly criticized the Federal Board of Revenue (FBR) for being exempt from court fees when filing tax references, while ordinary litigants must pay Rs 50,000 per case. The court called this a clear case of discrimination, violating citizens’ fundamental rights under Articles 4, 10-A, and 37(d) of the Constitution.

The ruling was issued during a case challenging the abolition of the Commissioner Inland Revenue (Appeals) under the Tax Laws (Amendment) Act, 2024. The LHC Rawalpindi bench found that this amendment is hindering justice, causing delays, and obstructing the judicial system.

The Tax Ordinance initially allowed a three-stage appeal process—beginning with the Commissioner (Appeals), followed by the Appellate Tribunal, and concluding with the Tax Reference to the Court. However, the recent amendment removed one appeal stage, making the process more complex.

The Ministry of Law and Justice defended the amendment, stating that its aim was to reduce the number of appeals, simplify the process, and expedite case resolutions. It argued that backlogged cases—holding up nearly Rs 2 trillion in revenue—are due to bench shortages and delays in tribunal formations. The ministry also claimed that limiting appeals would cut administrative costs and discourage frivolous litigation.