The Islamabad High Court (IHC) issued a restraining order on Tuesday against the government’s decision to block the mobile phone SIM cards of individuals who are not tax filers.
Last Friday, telecom companies agreed to commence the manual blocking process for non-filers in small batches, ending a week-long standoff over the implementation of tax measures aimed at expanding the tax base.
This agreement followed crucial discussions between the Federal Board of Revenue (FBR), the Pakistan Telecommunication Authority (PTA), and telecom companies to enforce Income Tax General Order No. 1, mandated under Section 114 B of the Income Tax Ordinance 2001.
On April 30, the FBR released a comprehensive list of 506,671 individuals who had not filed their tax returns for 2023. As a penalty, their mobile phone SIMs were set to be blocked promptly. However, telecom providers objected to the decision, delaying its execution despite being sanctioned by parliament.
An official statement from the FBR revealed that after extensive consultations, telecom companies have agreed to start the manual blocking process in small batches until their systems are fully equipped to automate it.
The IHC, under Chief Justice Aamer Farooq, entertained a petition filed by private telecom operator Zong.
During the hearing, the petitioner’s counsel, Salman Akram Raja, contended that the Constitutional amendment regarding this matter infringed upon the fundamental right to conduct business as guaranteed in Article 18.
“There cannot be any legislation conflicting with the fundamental rights enshrined in the Constitution,” Raja argued.
He asserted that the government cannot acquire the authority to block individuals’ mobile phone SIMs by amending the law.
Raja pointed out that blocking over 500,000 SIMs would result in an annual loss of Rs1 billion.
The IHC has requested a response from the respondents by May 27.
Initially, on May 4, the PTA rejected the FBR’s request to block mobile phone SIMs, stating that such action fell outside its jurisdiction and, therefore, would have no legal binding effect as it contradicted the applicable legal framework.
Then, on May 7, telecom companies jointly expressed their concerns to the Ministry of IT, stating that the FBR’s decision to block SIMs of non-filers was hastily made and would adversely affect telecom customers.
The letter from cellular mobile operators (CMOs) emphasized that they were obligated to provide uninterrupted services to customers, except in circumstances outlined in the Telecom Act and applicable regulations, where they could disconnect or block services.
