KARACHI, Oct 11: The Supreme Court has suspended a Sindh High Court division bench order declaring that the provincial excise and taxation department could not charge more than Rs50 per year as professional tax from commercial banks and other financial institutions for the 1993-2000 period and that any amount recovered in excess was liable to be refunded.

The levy was challenged in the SHC by a number of private banks. Their main contention was that the Sindh government levied, assessed and collected professional tax amounting to Rs2,258,000 in aggregate from each bank for the 1993-2000 period in violation of Article 163 of the Constitution and Section 2 of the Professional Tax Limitation Act, 1941, which prescribed the rate of Rs50. The court upheld the contention and declared any recovery beyond Rs50 as unlawful.

The provincial government sought leave to challenge the SHC decision through Additional Advocate-General Dr Qazi Khalid Ali. The petition for leave to appeal came up before Chief Justice Nazim Hussain Siddiqui at the Supreme Court's Karachi registry on Friday last week.

The CJ suspended the operation of the impugned order and directed the registry to send the petition and other identical matters to the principal seat at Islamabad for hearing in December.

The AAG submitted that Article 163 of the Constitution and the Finance Acts of 1964, 1975 and 1994 duly empowered the provincial government to impose a tax on 'persons engaged in professions, trades, callings or employments'.

He said the writ petitions were not maintainable in view of the bar contained in Article 199 of the Constitution, which conferred writ jurisdiction on the high courts. As for the amount prescribed by the Act of 1941, the AAG argued that it had since been revised by parliament as provided under Article 163 of the Constitution.