In Karachi, a legal battle has erupted in response to the recent increase in property tax by the Cantonment Board Clifton (CBC) for its residents. The Sindh High Court (SHC) has issued a restraining order against the CBC and the Defence Housing Authority (DHA), preventing them from taking any coercive action against residents who have filed two petitions in court.
The residents of DHA and Clifton approached the SHC, challenging a letter issued on August 23, 2022, by the assistant director general of military land & cantonment boards in Rawalpindi. They argue that the letter imposed an illegal, exorbitant, and arbitrarily assessed tax.
During the hearing, Advocate Zaheem Haider and CBC’s deputy CEO Zameer Hussain appeared in court to represent their respective parties. The counsel agreed to file comments on behalf of the DHA and CBC for the next hearing.
Assistant Attorney General G.M. Bhutto assured the bench that replies would be filed on behalf of the defense secretary, V Corps Commander, and military estate office Karachi circle. However, no representative from the Cantonment Board Karachi attended the hearing, leading the bench to issue a notice to CBK and the advocate general for the next hearing on September 20.
Advocate Saadat Yar Khan, representing the petitioners in one of the petitions, requested an interim restraining order regarding the challans (payment receipts) issued to the petitioners for property and other taxes. The bench granted the order, stating that no coercive action should be taken against the petitioners until the next hearing.
The residents argue in their petitions that only the parliament has the authority to levy taxes, as outlined in Article 77 of the Constitution. Therefore, the letter in question is deemed illegal and unconstitutional. They further contend that properties in a province are subject to provincial legislation, such as the Sindh immovable property tax, and that the provincial government has jurisdiction to assess and levy property tax.
In a previous similar petition, a division bench of the SHC had also restrained the respondents from taking any coercive action against the petitioners regarding the reassessment of taxes on pre-determined annual rental value (ARV) with retrospective effect. The bench had ordered that 25% of the reassessment be secured by the petitioners within ten days.
Multiple identical petitions filed by the residents of Defence and Clifton against property tax are pending before the SHC and scheduled for hearings on September 8 and September 26.
Overall, this legal battle highlights the ongoing concerns of Karachi residents regarding the increase in property taxes and the need to ensure proper legal processes are followed.