ORDER SHEET

IN THE HIGH COURT OF SINDH, KARACHI

SSTRA No.117 of 2024

Date	Order with signature of Judge

PRESENT:

Mr. Justice Arshad Hussain Khan

Mr. Justice Amjad Ali Sahito

Hg of case (Priority).

1. For orders on office objection.

2. For hearing of main case.

3. For hearing of CMA No.2237/2024.

12-10-2026

Mr. Arshad Arshad Hussain Shahzad, advocate for the applicant.

Mr. Faheem Ali Memon, advocate for respondent.

---------

This Special Sales Tax Reference Application under Section 47 of the Sales Tax Act, 1990 (the Act) has been preferred against Order-in-Appeal No.03 dated 28.06.2024 passed by the Commissioner Inland Revenue (Appeals-II), Karachi, affirming Order-in-Original No.22/2023-2024 dated 05.03.2024 passed under Section 11(2) of the Act by the Deputy Commissioner Inland Revenue, Unit-06, Zone-II, LTO, Karachi.

Briefly stated, the controversy pertains to the tax periods April 2011 to December 2013 regarding disallowance of zero-rating/concessional rate benefits under SRO 1125(I)/2011 dated 31.12.2011 on local supplies made to three registered customers/buyers, culminating in a tax demand of Rs.4,317,493/-. The instant reference was instituted directly before this Court pursuant to Section 126A inserted vide Tax Laws (Amendment) Act, 2024, which at that time permitted direct filing of a reference before the High Court against an order of the Commissioner (Appeals), bypassing the intermediate forum of the Appellate Tribunal Inland Revenue.

Learned counsel for the Applicant states that this reference pertains to the period when Section 126A was enforced. After enactment of the Finance Act, 2025, Section 126A has been omitted and the forum of the Appellate Tribunal Inland Revenue stands restored. He contends that the question of jurisdiction and change of forum is purely procedural, and restoration of appeal before the ATIR is beneficial and curative legislation providing an additional appellate forum. Relying upon Mian Group v. ACIR (2026 PTD 227) rendered by the Islamabad High Court and an unreported order of this Court in Income Tax Reference No.346 of 2024 dated 09.09.2026, he prays that the matter be remitted to the ATIR as a pending appeal for decision on merits. Learned counsel for the Respondents has no objection to the proposed remand.

Accordingly, by consent of both parties and in light of the dictum in 2026 PTD 227, the matter is remitted to the Appellate Tribunal Inland Revenue, Karachi. The office shall transmit the record to the ATIR, where the case shall be treated as a pending appeal under Section 46 of the Act and decided on merits after notice to the parties and in accordance with law. This Reference Application stands disposed of alongwith pending application(s) with no order as to costs.

Office is directed to send a copy of this order under the seal of this Court to the learned Appellate Tribunal as required under Section 47(5) of the Sales Tax Act, 1990.

JUDGE

Naveed PA