Islamabad: The Federal Constitutional Court has declared Section 7E of the Income Tax Ordinance, 2001 unconstitutional and void.
According to Beyond Time News, the court also ruled that all notices and proceedings initiated by the Federal Board of Revenue (FBR) under this provision are invalid.
Background
Section 7E, introduced through the Finance Act 2022, imposed tax on deemed income from immovable property. It was challenged for taxing property ownership without actual income, leading to conflicting judgments by different high courts.
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Decision
A two-member bench held that the provision effectively amounts to a tax on property rather than income, exceeding constitutional limits.
The court struck down Section 7E and terminated all related proceedings.
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