Chief Justice of Pakistan (CJP) Umar Ata Bandial on Friday rejected the notion that the country was headed towards bankruptcy and asked the government to adopt measures to stem foreign currency smuggling.

A three-member bench headed by Justice Bandial resumed a hearing into the Federal Board of Revenue’s (FBR) challenge to the Lahore High Court’s bar on the taxman from moving to collect a “super tax” from industries.

In June last year, the government launched plans to impose a one-time 10 per cent tax on large-scale industries’ profits to ease the impact of the rising inflation on the poor. The FBR projected Rs250bn from the imposition of the super tax in FY23.

Through the Finance Act 2022, the government imposed a super tax on high-earners by inserting a new section — 4C — in the income tax ordinance. Through the section, FBR imposed a 10pc super tax on 13 sectors earning more than Rs150 million from tax year 2022.

Several companies subsequently approached the Lahore High Court (LHC) challenging the super tax, following which the LHC placed a moratorium on the FBR from collecting it. In response, the FBR appealed against the LHC’s order in the SC.

In the last hearing on Feb 6, the apex court modified the LHC’s interim order and directed wealthy taxpayers to deposit half of their super tax dues directly with the FBR within one week.

Today, the top court sought to club all pleas related to the super tax so they could be heard together.

At the start of the hearing, FBR counsel Faisal Siddiqui told the court that the LHC had suspended the implementation of its final decision into the case for 60 days.

Barrister Farogh Naseem, representing the companies, argued that all petitions of the FBR against the LHC’s interim order had become ineffective, especially after the announcement of the provincial court’s final decision.

The chief justice said the case could be fixed for a hearing next week. He remarked that the FBR imposed the super tax in “good faith”.

CJP Bandial said it was also known that Shell Pakistan, one of the petitioners, paid taxes in the millions of rupees.

“Right now I am representing the FBR,” Siddiqui responded. He said he would also represent the federal government if the country defaulted.

The chief justice interrupted him, saying the country was “not going bankrupt”. “Everyone needs to improve themselves in the better interest of the country,” he added.

After issuing the directives, the court adjourned the hearing till Feb 16.