ISLAMABAD: The Supreme Court on Monday held that tax authorities should not act as penalising agencies, rather as institutions of the state tasked with facilitating compliance through clarity, transparency, and procedural propriety.

“The legitimacy of a tax system in large depends on whether taxpayers are able to understand not only that they are liable, but also the consequences for not discharging their liability,” observed Justice Ayesha A. Malik while deciding an appeal by the Islamabad Inland Revenue (Legal) commissioner against Pakistan LNG Limited and Serene Air (Pvt) Limited.

Justice Malik was member of a three-judge bench consisting of Justice Munib Akhtar and Justice Shahid Waheed, which had taken up for hearing petitions against the April 16, 2024, and June 24, 2024, orders of the Islamabad High Court (IHC).

The respondent, Pakistan LNG Limited, whose income tax........

© Dawn Business