I.   BACKGROUND (BG)

1.   This refers to the related Important TLQCs in trail, blue, italic and double Line (a) 3185 of 4.7.25 about Punjab Budget 2025-26: Finance Act Gazette version and 6 Finance Acts Workshops (b) 2072 of 18.11.22 about Immovable Property Rent not Taxable held by SCP but Maintenance issue 

2.   We also refer to several Other TLQC including (a) 435 of 9.3.18 about SST- Amendments re Renting of Immovable Property Services (b) 340 of 21.8.17 about No SST on Rent of Immovable Property as per SHC but SST issue Rent related Services??

II.   EXECUTIVE SUMMARY AND KC VIEWS & RECOMMENDATIONS

1.   Punjab Finance Act 2025 (PFA) introduced 16% Rent on Immovable property. Several Professionals were indicating on various WhatsApp Groups that owing to SCP in case of SRB / Sindh Govt VS ------ (TLQC 2072 of 18.11.22 refers). However, we guided (whether landlord Tenant or others) that before relying on the SCP order, they should consider changes in Sindh & Punjab Sales Tax laws viz-a-viz SHC & SCP orders. We will discuss the matters in detail in the Finance Act Workshops too.

2.   As expected, ----------------a Pvt Ltd challenged amendments to the PST by the PFA, 2025 without proper homework as per LHC. The Petitioner argued that taxing Renting of Immovable property as a service is Unconstitutional, citing Article 142 and Entry 47 of the Constitution Fourth Schedule. He referred to ------ Pvt Ltd VS Province of Sindh case (TLQC 340 of 21.8.17 refers), where a similar Sindh law was struck down.

3.   The Government Representative contended that the Young’s case is distinguishable because the Punjab Act explicitly includes "immovable property" in its provisions (via 20--- amendments), unlike the Sindh law. 

4.   As per Interim LHC order Notices were issued to Respondents & case relisted for -------- for further proceedings. No interim relief, on Advocate could not make out the Case for Interim relief. Hence, several High Level Advocates have to be involved to study and argue. Otherwise, taxpayers may lose the case and it will increase Cost of Doing business owing to the high 16% PST rate.

5.   We are in touch with several Leading Senior Advocates on Rent issues. If anyone wants to appeal at SHC, LHC or IHC, please email us.

III.   DETAILS

A.   Case Reference

Further to KQU 3511 of -------, being an important matter, we would inform you about ----------------(Attachment 3242.1) in the ensuing paragraph, with emphasis in bold & Underline for quick reading.

B.   Learned Counsel for Petitioner/Taxpayer Submissions

1 to 3

C.   Learned Counsel for Respondent / Punjab Govt Submissions

1 to 2 

D.   LHC Deliberation

1.   Points raised need consideration. Issue notice to the Respondents through ordinary mode, registered post and courtier service at the expense of the petitioner. which shall be deposited by next week.

2.    Since the question of vires of the impugned amendment has been agitated, therefore, notice in terms of Order XXVII-A of the Code of Civil Procedure, 1908 (C.P.C.) is also issued to learned Advocate General Punjab.

3.   Relisted for  -----------.

E.   No Interim Relief 

1 to  5

E.   Kasbati & Co Recommendations 

1.   KC understands that in the upcoming hearing on -----------, the matters will be discussed in detail.

2.   As explained above, no interim relief as the Advocate could not make out the Case for Interim relief. Hence, in case of material effect to your entity, being Urgent & Important, you Goodself may consider to take up the matter with your Legal Department & /or  (if not Legal Department), then Senior Advocates Supreme Court to file Petitions in all relevant High Courts for in-depth study of the matter, discuss with your Goodself, File Writ / CP and get interim relief by arguing well, preferably by paying or receiving Rent. 

3.  Otherwise, if one taxpayer (having issues like in this case) may lose the case, it will all others too (as no separate ICA opportunity in LHC & IHC too - TLQC 3238 of 16/17.8.25 as reported in Business Recorder on Monday 18.8.25) and it will increase Cost of Doing business owing to the high 16% PST rate.

3.   We are in touch with several Leading Senior Advocates on Rent issues. If anyone wants to appeal at SHC, LHC or IHC, please email us.

IV.   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 Advisory, Statement or Return Filing or Review services, or related accounting matters like the above, please feel free to email Mr Amsal at amsal@kasbati.co with CC to info.kasbati@professional-excellence.com. Your Good self may continue to get other services from your current Tax & Legal Advisors.