LAHORE: The Lahore High Court has restrained the Federal Board of Revenue (FBR) from taking coercive measures against the Multan Electric Power Company (Mepco) for the recovery of over Rs4.53 billion in back taxes, as an interim relief.
A two-judge bench, comprising Justice Jawad Hassan and Justice Abid Hussain Chattha, passed the order on a petition filed by Mepco for setting aside FBR orders issued on Aug 5 and Sept 7, 2026, demanding the payment of the amount under Section 140(1) of the Income Tax Ordinance, 2001, covering tax years 2018–2022 and 2023–2024.
The company’s lawyers — Muhammad Ali Siddiqui, Fatima Safeer and S.M. Kumail Haider Naqvi — told the court that Mepco had not bypassed the mandatory Alternative Dispute Resolution (ADR) process. Rather, they said, the ADR committee heard the case but never conclusively resolved the central issue -- what minimum tax rate should apply.
Addressing the bench’s concerns about the maintainability of the petition, the Mepco’s counsel referred to the Section 134A of the ordinance, which sets out a specific process for state-owned enterprises.
They said a committee must be formed within 15 days and if it fails to decide within the prescribed period, the section spells out an appellate route.
The bench issued notices to the FBR and other respondents for submission of replies. It also sought assistance from the attorney general for Pakistan.
The bench granted Mepco an interim relief, barring the FBR from taking coercive action against the utility during the pendency of the petition.
Published in Dawn, September 26th, 2026
