ISLAMABAD - The Supreme Court of Pakistan on Tuesday ordered the federal government to resolve the matter within one month pertaining to collection of sales tax from Azad Jammu and Kashmir (AJK) on provision of electricity.
A three member bench headed by Justice Umer Atta Bandial conducted hearing on the above matter.
The court asked the federal cabinet, Ministry of Water and Power and Ministry of Finance to address the matter within a month in accordance with the law.
The bench directed additional attorney general and deputy attorney general to apprise the federation regarding the importance of the subject. The court noted that IESCO and FBR were federal departments.
Justice Bandial remarked that it was a matter related to agreement between the governments of Pakistan and AJK. The AJK had been assured that the electricity would be tax free, the bench noted.
Justice Bandia remarked that taxes would be applied on the electricity when it would be exported to other countries. Whether the AJK was receiving taxes from its consumers, he questioned. AJK's Lawyer Ali Sabtain Fazli answered that yes the AJK had been receiving sales taxes from its citizens.