RAWALPINDI: The Lahore High Court’s (LHC) Rawalpindi bench, on Wednesday, concluded a petition filed by the Strategic Plans Division (SPD) against the show cause notices issued by the Punjab Revenue Authority (PRA) for the recovery of taxes. Justice Jawad Hassan presided over the case and encouraged both entities to resolve their dispute through mediation.

The court emphasized the importance of the Alternative Dispute Resolution (ADR) system in Pakistan, highlighting its role in easing the burden on the judicial system. ADR provides a more efficient, cost-effective, and amicable means of resolving disputes.

The SPD had challenged the “impugned notices” issued by the PRA, which imposed a provincial sales tax on services. The SPD argued that these notices were unlawful and issued without proper authority. Ahmar Bilal Soofi, representing the SPD, asserted that the PRA lacked the jurisdiction to impose such taxes on the SPD.

On the other hand, the PRA defended the legitimacy of the notices, arguing that they were issued in accordance with the law. The PRA’s counsel contended that the issuance of a show cause notice does not constitute an adverse order, and thus, a petition under Article 199 of the Constitution was not appropriate.

Justice Hassan acknowledged that a show cause notice is not an adverse order but must include all essential facts and clearly outline the alleged actions or inactions by the taxpayer.

Given that both parties had agreed to settle the matter through mediation as per the ADR Act, the court disposed of the petition. Justice Hassan ordered that the SPD representative “shall appear” before the PRA, which will proceed with the ADR mechanism in accordance with the law and the guidelines set by the Supreme Court of Pakistan.

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