{"id":3860,"date":"2026-05-07T13:23:37","date_gmt":"2026-05-07T13:23:37","guid":{"rendered":"https:\/\/www.worldwatchalert.com\/?p=3860"},"modified":"2026-05-07T13:23:38","modified_gmt":"2026-05-07T13:23:38","slug":"fcc-rules-section-7e-unconstitutional-rejects-fbr-appeals","status":"publish","type":"post","link":"https:\/\/www.worldwatchalert.com\/?p=3860","title":{"rendered":"FCC rules Section 7E unconstitutional, rejects FBR appeals"},"content":{"rendered":"\n<p><strong>ISLAMABAD: <\/strong>The Federal Constitutional Court (FCC) on Thursday declared Section 7E of the Income Tax Ordinance, 2001 unconstitutional, struck down the provision and dismissed appeals filed by the Federal Board of Revenue (FBR) seeking its restoration.<\/p>\n\n\n\n<p>The court ruled that the provision \u201cshall be deemed not to have been part of the Income Tax Ordinance from day one.\u201d It further declared that all actions taken by the FBR under Section 7E were also unlawful.<\/p>\n\n\n\n<p>The court observed that Section 7E had imposed tax on certain immovable properties, including plots that were not under active use.<\/p>\n\n\n\n<p>Under Section 7E of the Income Tax Ordinance, any immovable property owned by a taxpayer \u2014 other than the first property \u2014 was treated as though it generated rental income if it was not rented out. The provision applied to self-occupied properties, properties used for business purposes and agricultural land owned by the taxpayer.<\/p>\n\n\n\n<p>The law presumed a notional rental income equal to 20 per cent of the property\u2019s FBR-assessed value. This deemed income was then taxed at five per cent, effectively resulting in an annual tax of around one per cent of the property\u2019s FBR capital value.<\/p>\n\n\n\n<p>After hearing arguments, the court stated: \u201cWe are persuaded to hold that Section 7E of the Income Tax Ordinance, 2001, is ultra vires the Constitution, and is accordingly struck down, being void ab initio.\u201d<\/p>\n\n\n\n<p>The judgment further stated that \u201call actions, proceedings, and notices initiated or taken by the FBR\/CIR under Section 7E are declared to be without lawful authority and are hereby set aside.\u201d<\/p>\n\n\n\n<p>FCC Chief Justice Amin-ud-Din Khan, in the short order, noted that the provision introduced through the Finance Act 2022 had been challenged before several high courts across the country on constitutional grounds.<\/p>\n\n\n\n<p>The ruling came after conflicting judgments from different courts. The Peshawar High Court and the Balochistan High Court had already declared the provision unconstitutional and struck it down, while the Islamabad High Court had partially read it down and declared subsection (2) unconstitutional.<\/p>\n\n\n\n<p>A judgment by the Lahore High Court upholding the provision was later overturned by a division bench, whereas the Sindh High Court had dismissed similar petitions.<\/p>\n\n\n\n<p>As a result of the ruling, appeals filed by taxpayers were allowed, while petitions submitted by the Federal Board of Revenue and the Commissioner of Inland Revenue were dismissed. All related proceedings were disposed of accordingly.<\/p>\n\n\n\n<p>The court had reserved its verdict on April 30 before issuing the short order on Thursday.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>ISLAMABAD: The Federal Constitutional Court (FCC) on Thursday declared Section 7E of the Income Tax Ordinance, 2001 unconstitutional, struck down the provision and dismissed appeals filed by the Federal Board&hellip; <\/p>\n","protected":false},"author":1,"featured_media":3861,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[576,2120,35],"class_list":["post-3860","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-pakistan","tag-fbr","tag-fcc","tag-pakistan"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>FCC rules Section 7E unconstitutional, rejects FBR appeals - World Watch Alert<\/title>\n<meta name=\"description\" content=\"Federal Constitutional Court strikes down Section 7E of the Income Tax Ordinance, 2001 as unconstitutional, dismisses appeals by Federal Board of Revenue, and declares all actions under the provision void ab initio.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.worldwatchalert.com\/?p=3860\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"FCC rules Section 7E unconstitutional, rejects FBR appeals - World Watch Alert\" \/>\n<meta property=\"og:description\" content=\"Federal Constitutional Court strikes down Section 7E of the Income Tax Ordinance, 2001 as unconstitutional, dismisses appeals by Federal Board of Revenue, and declares all actions under the provision void ab initio.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.worldwatchalert.com\/?p=3860\" \/>\n<meta property=\"og:site_name\" content=\"World Watch Alert\" \/>\n<meta property=\"article:published_time\" content=\"2026-05-07T13:23:37+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2026-05-07T13:23:38+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/05\/311777930909-2-412x290-1.webp\" \/>\n\t<meta property=\"og:image:width\" content=\"412\" \/>\n\t<meta property=\"og:image:height\" content=\"290\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/webp\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#\\\/schema\\\/person\\\/a1cf922194712e47776dbb1e51115040\"},\"headline\":\"FCC rules Section 7E unconstitutional, rejects FBR appeals\",\"datePublished\":\"2026-05-07T13:23:37+00:00\",\"dateModified\":\"2026-05-07T13:23:38+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860\"},\"wordCount\":414,\"publisher\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.worldwatchalert.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/311777930909-2-412x290-1.webp\",\"keywords\":[\"FBR\",\"FCC\",\"Pakistan\"],\"articleSection\":[\"Pakistan\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860\",\"url\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860\",\"name\":\"FCC rules Section 7E unconstitutional, rejects FBR appeals - World Watch Alert\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.worldwatchalert.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/311777930909-2-412x290-1.webp\",\"datePublished\":\"2026-05-07T13:23:37+00:00\",\"dateModified\":\"2026-05-07T13:23:38+00:00\",\"description\":\"Federal Constitutional Court strikes down Section 7E of the Income Tax Ordinance, 2001 as unconstitutional, dismisses appeals by Federal Board of Revenue, and declares all actions under the provision void ab initio.\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860#primaryimage\",\"url\":\"https:\\\/\\\/www.worldwatchalert.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/311777930909-2-412x290-1.webp\",\"contentUrl\":\"https:\\\/\\\/www.worldwatchalert.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/311777930909-2-412x290-1.webp\",\"width\":412,\"height\":290},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?p=3860#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.worldwatchalert.com\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"FCC rules Section 7E unconstitutional, rejects FBR appeals\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#website\",\"url\":\"https:\\\/\\\/www.worldwatchalert.com\\\/\",\"name\":\"World Watch Alert\",\"description\":\"\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#organization\",\"name\":\"World Watch Alert\",\"url\":\"https:\\\/\\\/www.worldwatchalert.com\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/www.worldwatchalert.com\\\/wp-content\\\/uploads\\\/2026\\\/04\\\/Chief-Editor-Asif-Ali-Bhatti.png\",\"contentUrl\":\"https:\\\/\\\/www.worldwatchalert.com\\\/wp-content\\\/uploads\\\/2026\\\/04\\\/Chief-Editor-Asif-Ali-Bhatti.png\",\"width\":1080,\"height\":350,\"caption\":\"World Watch Alert\"},\"image\":{\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#\\\/schema\\\/logo\\\/image\\\/\"}},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.worldwatchalert.com\\\/#\\\/schema\\\/person\\\/a1cf922194712e47776dbb1e51115040\",\"name\":\"admin\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4c81c452db555bfe1e0e5ed315dd6b278f007d8ede7a2a3faadee052f7c23d40?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4c81c452db555bfe1e0e5ed315dd6b278f007d8ede7a2a3faadee052f7c23d40?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4c81c452db555bfe1e0e5ed315dd6b278f007d8ede7a2a3faadee052f7c23d40?s=96&d=mm&r=g\",\"caption\":\"admin\"},\"sameAs\":[\"https:\\\/\\\/www.worldwatchalert.com\"],\"url\":\"https:\\\/\\\/www.worldwatchalert.com\\\/?author=1\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"FCC rules Section 7E unconstitutional, rejects FBR appeals - World Watch Alert","description":"Federal Constitutional Court strikes down Section 7E of the Income Tax Ordinance, 2001 as unconstitutional, dismisses appeals by Federal Board of Revenue, and declares all actions under the provision void ab initio.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.worldwatchalert.com\/?p=3860","og_locale":"en_US","og_type":"article","og_title":"FCC rules Section 7E unconstitutional, rejects FBR appeals - World Watch Alert","og_description":"Federal Constitutional Court strikes down Section 7E of the Income Tax Ordinance, 2001 as unconstitutional, dismisses appeals by Federal Board of Revenue, and declares all actions under the provision void ab initio.","og_url":"https:\/\/www.worldwatchalert.com\/?p=3860","og_site_name":"World Watch Alert","article_published_time":"2026-05-07T13:23:37+00:00","article_modified_time":"2026-05-07T13:23:38+00:00","og_image":[{"width":412,"height":290,"url":"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/05\/311777930909-2-412x290-1.webp","type":"image\/webp"}],"author":"admin","twitter_card":"summary_large_image","twitter_misc":{"Written by":"admin","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.worldwatchalert.com\/?p=3860#article","isPartOf":{"@id":"https:\/\/www.worldwatchalert.com\/?p=3860"},"author":{"name":"admin","@id":"https:\/\/www.worldwatchalert.com\/#\/schema\/person\/a1cf922194712e47776dbb1e51115040"},"headline":"FCC rules Section 7E unconstitutional, rejects FBR appeals","datePublished":"2026-05-07T13:23:37+00:00","dateModified":"2026-05-07T13:23:38+00:00","mainEntityOfPage":{"@id":"https:\/\/www.worldwatchalert.com\/?p=3860"},"wordCount":414,"publisher":{"@id":"https:\/\/www.worldwatchalert.com\/#organization"},"image":{"@id":"https:\/\/www.worldwatchalert.com\/?p=3860#primaryimage"},"thumbnailUrl":"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/05\/311777930909-2-412x290-1.webp","keywords":["FBR","FCC","Pakistan"],"articleSection":["Pakistan"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/www.worldwatchalert.com\/?p=3860","url":"https:\/\/www.worldwatchalert.com\/?p=3860","name":"FCC rules Section 7E unconstitutional, rejects FBR appeals - World Watch Alert","isPartOf":{"@id":"https:\/\/www.worldwatchalert.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.worldwatchalert.com\/?p=3860#primaryimage"},"image":{"@id":"https:\/\/www.worldwatchalert.com\/?p=3860#primaryimage"},"thumbnailUrl":"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/05\/311777930909-2-412x290-1.webp","datePublished":"2026-05-07T13:23:37+00:00","dateModified":"2026-05-07T13:23:38+00:00","description":"Federal Constitutional Court strikes down Section 7E of the Income Tax Ordinance, 2001 as unconstitutional, dismisses appeals by Federal Board of Revenue, and declares all actions under the provision void ab initio.","breadcrumb":{"@id":"https:\/\/www.worldwatchalert.com\/?p=3860#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.worldwatchalert.com\/?p=3860"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.worldwatchalert.com\/?p=3860#primaryimage","url":"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/05\/311777930909-2-412x290-1.webp","contentUrl":"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/05\/311777930909-2-412x290-1.webp","width":412,"height":290},{"@type":"BreadcrumbList","@id":"https:\/\/www.worldwatchalert.com\/?p=3860#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.worldwatchalert.com\/"},{"@type":"ListItem","position":2,"name":"FCC rules Section 7E unconstitutional, rejects FBR appeals"}]},{"@type":"WebSite","@id":"https:\/\/www.worldwatchalert.com\/#website","url":"https:\/\/www.worldwatchalert.com\/","name":"World Watch Alert","description":"","publisher":{"@id":"https:\/\/www.worldwatchalert.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.worldwatchalert.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.worldwatchalert.com\/#organization","name":"World Watch Alert","url":"https:\/\/www.worldwatchalert.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.worldwatchalert.com\/#\/schema\/logo\/image\/","url":"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/04\/Chief-Editor-Asif-Ali-Bhatti.png","contentUrl":"https:\/\/www.worldwatchalert.com\/wp-content\/uploads\/2026\/04\/Chief-Editor-Asif-Ali-Bhatti.png","width":1080,"height":350,"caption":"World Watch Alert"},"image":{"@id":"https:\/\/www.worldwatchalert.com\/#\/schema\/logo\/image\/"}},{"@type":"Person","@id":"https:\/\/www.worldwatchalert.com\/#\/schema\/person\/a1cf922194712e47776dbb1e51115040","name":"admin","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/4c81c452db555bfe1e0e5ed315dd6b278f007d8ede7a2a3faadee052f7c23d40?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/4c81c452db555bfe1e0e5ed315dd6b278f007d8ede7a2a3faadee052f7c23d40?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/4c81c452db555bfe1e0e5ed315dd6b278f007d8ede7a2a3faadee052f7c23d40?s=96&d=mm&r=g","caption":"admin"},"sameAs":["https:\/\/www.worldwatchalert.com"],"url":"https:\/\/www.worldwatchalert.com\/?author=1"}]}},"_links":{"self":[{"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=\/wp\/v2\/posts\/3860","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3860"}],"version-history":[{"count":1,"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=\/wp\/v2\/posts\/3860\/revisions"}],"predecessor-version":[{"id":3862,"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=\/wp\/v2\/posts\/3860\/revisions\/3862"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=\/wp\/v2\/media\/3861"}],"wp:attachment":[{"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3860"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3860"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.worldwatchalert.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3860"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}