Lahore High Court, adjudicating lis of section 7E of Finance Act, 2022, has held that taxing presumptive income of immovable property is ultra vires the Constitutional legislative scheme, offending entry No. 50 and 47 of the Federal Legislative List. Thus, the Court has read down the phrase “treated to have derived, as income” provided in section 7E and the word “income”in sub section 1 has replaced with the word “Capital Assets” to save the law from being struck down and to bring it into conformity with the Constitution. The Court has further held “ clauses (iii) and (iv) of Section 7E(2)(d), as discriminatory, offending the Article 25, therefore, are declared ultra vires.”
(i2023LHC1548),
