Tahir Mehmood vs Appellate Tribunal Inland Revenue etc.

Stereo. H C J D A 38.

JUDGMENT SHEET

IN THE LAHORE HIGH COURT

RAWALPINDI BENCH RAWALPINDI

JUDICIAL DEPARTMENT

I.T.R. No.23 of 2026

Tahir Mehmood vs Appellate Tribunal Inland Revenue etc.

JUDGMENT

Date(s) of Hearing 15.10.2026 and 20.10.2026 Applicant by: Ch. Imran ul Haq, Advocate.

Respondent/department Barrister Hassan Ali Khan, Advocate in by: present and connected I.T.R. No. 30 of

Mr. Riaz Hussain Azam, Advocate in I.T.R. No. 29 of 2026.

Amicus Curiae: Mr. Hassan Kamran Bashir, Advocate, assisted by Mr. Abdul Wakeel, Advocate.

Anwaar Hussain J: Through this common judgment, the present and the connected Reference Applications, filed under Section 133 of the Income Tax Ordinance, 2001 (“Ordinance”), bearing I.T.R. Nos. 29 and 30 of 2026, arising out of orders dated 28.04.2026, 03.06.2026 and 19.05.2026, respectively, are being decided together, as they involve a common question of law. Through the above-referred orders, the Appellate Tribunal Inland Revenue, Islamabad (“Tribunal”), dismissed the appeals preferred by the applicants as barred by limitation.

2.In the present Reference Application, the order-in-original dated 19.03.2021 was challenged before the Commissioner Inland Revenue (Appeals) on 18.05.2021, and the appeal was decided on 30.06.2021. The applicant preferred appeal before the Tribunal on 05.10.2021,

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along with an application for condonation of delay. He explained that, upon returning from a foreign visit, he contracted COVID-19 and was subsequently quarantined; owing to these circumstances, he could not file the appeal within the prescribed period. The Tribunal dismissed the appeal as time-barred. In I.T.R. No. 29 of 2026, the order-in-original dated 27.06.2025 was challenged before the Commissioner (Appeals) on 25.07.2025, and the appeal was decided on 17.03.2026. The applicant appealed to the Tribunal on 25.05.2026, explaining that he had acquired knowledge of the appellate order only upon service of a recovery notice on 27.04.2026. The Tribunal declined to condone the delay and dismissed the appeal as time-barred. Likewise, in I.T.R. No. 30 of 2026, the order-in-original dated 13.06.2024 was challenged before the Commissioner (Appeals) on 05.09.2024, and the appeal was decided on 18.12.2025. The applicant appealed against that order on 30.04.2026, asserting that he had first acquired knowledge of it upon service of a recovery notice on 28.04.2026. The Tribunal declined to condone the delay and dismissed the appeal as time-barred.

3.Although multiple questions of law have been proposed, the controversy requiring determination by this Court essentially concerns the mode and manner of service of orders passed by the Commissioner (Appeals). In all three matters, the Tribunal treated the uploading of the respective orders on the Inland Revenue Information System—IRIS as sufficient service for computing the period of limitation. The common question of law is, therefore, reframed as follows:

Whether mere uploading of an appellate order on IRIS constitutes valid service under Section 218(1)(d) of the Ordinance, read with Rule 74 of the Income Tax Rules, 2002 (“Rules”), so as to commence the period of limitation for preferring an appeal before the Appellate Tribunal?

4.Ch. Imran ul Haq, Advocate, learned counsel for the applicants, contends that Section 218(1)(d) of the Ordinance, read with Rule 74 of the Rules, recognizes electronic service only in the prescribed

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manner, which does not include the mere uploading of an order on IRIS. Reliance is placed on the judgment dated 18.06.2026 of the Peshawar High Court in case titled Khadim Ullah Kakakhel v. Assistant/Deputy Commissioner Inland Revenue and others bearing T.R. No. 155-P of 2025, and the judgment dated 16.12.2025 of the Islamabad High Court in case titled Saqib Hayat Khan v. Assistant Commissioner Inland Revenue and others bearing I.T.R. No. 61 of 2024.

5.Conversely, Barrister Hassan Ali Khan, learned counsel for the respondent/department, led the arguments on behalf of the department, which were adopted by learned counsel for the department in connected I.T.R. No. 29 of 2026. Relying on case reported as Commissioner Inland Revenue, Peshawar Zone, Regional Tax Office, Peshawar v. Miss Shabnam Riaz (2025 PTD 883), he submits that Section 218(1)(d) expressly recognizes electronic service, which includes IRIS that is a web-based programme and constitutes a modern means and platform of electronic communication. He argues that Rule 74 should not be construed to restrict the scope of the parent provision concerning electronic service. He further avers that taxpayers are required to monitor their IRIS portals regularly. He also contends that, in the present Reference Application, the applicant did not challenge the validity of service through IRIS before the Tribunal, but attributed the delay to circumstances arising from the COVID-19 pandemic, foreign travel and subsequent quarantine and hence, said applicant cannot raise this ground before this Court.

6.Considering the importance of the question involved, Mr. Hassan Kamran Bashir, Advocate, was appointed as Amicus Curiae. He submits that the insertion of Section 218(1)(d) through the Finance Act, 2018, reflects legislative recognition of technological advancement in tax administration. The law, he argues, must remain responsive to changing technological realities while maintaining an appropriate balance between modern methods of communication and

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the procedural safeguards associated with service. He further submits that the statutory framework distinguishes between IRIS, which is an internal management programme, and “electronic service in the prescribed manner” that is specifically regulated by Rule 74. He avers that service effected solely through IRIS therefore does not, by itself, fulfil the mandate of Section 218(1)(d) of the Ordinance. He also contends that the Rules recognize only two forms of the electronic address for service: a facsimile number or an electronic mail address.

7.Arguments heard. Record perused.

8.To resolve the controversy, the language and scheme of the Ordinance must first be examined. Section 2(30AC) thereof defines IRIS in the following terms:

“Iris” means a web-based computer programme for operation and management of Inland Revenue taxes and laws administered by the Board.”

Section 218(1) contemplates as under:

“Service of notices and other documents. (1) Subject to this Ordinance, any notice, order or requisition required to be served on a resident individual (other than in a representative capacity) for the purposes of this Ordinance shall be treated as properly served on the individual if

(a)............

(b)............

(c)............

(d)served on the individual electronically in the prescribed manner.”

(Emphasis supplied)

The expression “prescribed”, appearing in clause (d), is defined under Section 2(44) of the Ordinance in the following terms:

“Prescribed” means prescribed by rules made under this Ordinance.”

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9.Rule 74 of the Rules, which governs electronic service, reads as under:

“Service of documents electronically:

(1)This rule applies for the purposes of the service of documents under the Ordinance or these rules.

(2)Where a person has provided an electronic address, the document required to be served on the person shall be considered sufficiently served if sent to that address.

(3)For the purposes of sub-rule (2), a document is considered sent to an electronic address if the sender receives-

(a)in the case of a message sent to a facsimile number, confirmation from the sending facsimile machine that the transmission is sent;

(b)in the case of a message sent to an electronic mail address, confirmation from the server of the recipient that the message has been received; and

(c)from the Board a digitally signed e-mail acknowledging the receipt of Electronic Income Tax Return or electronic withholding tax statement.

4)In this rule-

(a)‘document’ means any notice, order or requisition under the Ordinance; and

(b)‘electronic address’ means a facsimile number or electronic mail address.”

(Emphasis supplied)

10.A conjoint reading of the above-quoted provisions reveals that Section 218(1)(d) recognizes electronic service as an independent mode, but expressly makes its validity dependent upon compliance with the prescribed manner. The expression “prescribed” has a specific meaning under Section 2(44), while Rule 74 supplies the conditions governing electronic service. The respondent/department’s contention

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that the Rule cannot restrict the scope of the parent provision overlooks the relationship between primary and subordinate legislation. Rule 74 does not impose an external limitation on an otherwise unrestricted statutory power; the condition is contained in the Ordinance itself. To disregard it would render the expression “prescribed manner” redundant, contrary to the settled principle that every word employed by the legislature must, so far as possible, be given meaning and effect. Rule 74 identifies the electronic address to which a document must be sent and the circumstances in which its transmission is treated as complete. The definition of “electronic address” is confined to a facsimile number or an electronic mail address, while sub-Rule (3) prescribes the relevant confirmations.

11.An IRIS account of a taxpayer, by contrast, forms part of a web- based programme for the administration of inland revenue taxes. Section 2(30AC) of the Ordinance defines IRIS as a programme for the operation and management of inland revenue taxes and the laws administered by the Federal Board of Revenue (“FBR”). The IRIS portal operates as an internal computer workflow system structured around four primary folders: the Drafts Folder stores incomplete or unsigned documents under preparation by the taxpayer; the Outbox Folder holds submitted applications or tasks awaiting review, processing or approval by the FBR; the Inbox Folder serves as a repository for system-generated notices and correspondence; and the Completed Tasks folder acts as a digital archive for completed transactions, assessments and historical filings. The system undoubtedly facilitates electronic filing and communication, but its administrative functions do not, by themselves, confer the legal consequences of service on every act performed through it.

12.This Court is of the view that placing an order in an IRIS account does not, by itself, establish its transmission to an electronic address within the meaning of Rule 74 or fulfil the prescribed conditions. The

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distinction is between accessibility and service: the former concerns the availability of a document on the portal, whereas the latter requires completion of a legally recognized act of communication. An order may be accessible without having been served in accordance with law. The definition of IRIS in Section 2(30AC) of the Ordinance does not alter this position. The question is not whether electronic service through IRIS is permissible, but whether the particular method employed satisfies the law governing its exercise. Once electronic service has been validly effected, no additional physical delivery is required merely because the communication is electronic.

13.It is in this context that the precedents relied upon by the parties require consideration. In case of Shabnam Riaz, supra the Peshawar High Court recognized electronic service under Section 218(1)(d) as an independent mode and rejected the proposition that it must invariably be followed by physical delivery. That decision arose in circumstances where service through IRIS was admitted. The question whether mere uploading on IRIS, without compliance with the prescribed manner, could itself constitute service was therefore not determined on the same factual footing as the present controversy. This issue was directly examined by the Peshawar High Court in case of Khadim Ullah Kakakhel, supra. There, the assessment order had been uploaded on IRIS on 29.06.2020 but was subsequently received by the taxpayer through UMS on 10.10.2020. Upon examining Section 218(1)(d) and Rule 74, the Court held that mere uploading on IRIS did not constitute service in the prescribed manner and that limitation was to be reckoned from subsequent service through UMS. The two decisions of the Peshawar High Court are, therefore, not irreconcilable: one recognizes the independent efficacy of electronic service, while the other examines whether the particular act relied upon satisfies the prescribed requirements.

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14.Similarly, in case of Saqib Hayat Khan, supra the Islamabad High Court examined the distinction between knowledge of an appellate order and its service in accordance with law. There, the taxpayer became aware of the adverse order on 08.06.2023, downloaded it from IRIS on 09.08.2023 and preferred the appeal on 29.08.2023. The Tribunal had treated the earlier date of knowledge as the commencement of limitation. The High Court held that the Tribunal had failed to determine the legally relevant date of service and to properly consider the taxpayer’s efforts to obtain the order. The decision reinforces the principle that knowledge and service are not necessarily synonymous, and that limitation must be computed by reference to the event prescribed by statute.

15.The consequences and legal effect of uploading an order on IRIS were considered by the Supreme Court of Pakistan in the case reported as Commissioner Inland Revenue (Legal) Islamabad and another v. Pakistan LNG Limited and others (2026 SCMR 227). The Supreme Court examined the statutory safeguards governing coercive recovery under Section 140 of the Ordinance in proceedings initiated following the uploading of an appellate order on IRIS. That controversy concerned the legality of recovery proceedings, rather than the commencement of limitation under Section 131, and is therefore distinguishable in its statutory setting. Its relevance lies in the principle that the exercise of powers by the respondent/ department, notwithstanding their fiscal importance, remains subject to the conditions imposed by law. The power to recover tax and the obligation to serve an appellate order in accordance with law are distinct, but neither can be divorced from the statutory safeguards governing its exercise.

16.From the neighboring jurisdiction—India, the Delhi High Court, in case of Suman Jeet Agarwal v. Income Tax Officer, Ward 61(1) and others [(2022) 449 ITR 517 (Delhi)], [available at (2022 SCC OnLine

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Del 3141)] examined the validity of tax notices placed on the assessee’s e-filing portal without a corresponding real-time alert. The Court observed that, where electronic placement of a notice is recognized as a mode of service, the accompanying safeguard of a real-time alert assumes significance. It held that mere uploading, without the prescribed alert, did not constitute valid service under the applicable Indian statutory framework. Although the decision arose under a different statutory regime, its reasoning offers a useful comparative insight: placement of an order on an electronic portal and legally effective service are not necessarily the same.

17.The Pakistani precedents, read in their respective contexts, establish that electronic service is a legally recognized mode, but its validity depends on compliance with the requirements prescribed by the Rules. The decision from neighboring jurisdiction reinforces, by analogy, the significance of safeguards accompanying electronic communication. Where limitation is linked to service of an appellate order, the relevant date cannot be determined merely from its electronic availability on IRIS. This construction neither diminishes the efficacy of electronic service prescribed by law nor adds a requirement of physical delivery; it gives effect to the statutory conditions governing the mode employed. The distinction assumes particular significance because Section 131(2)(d) links the period for preferring an appeal before the Tribunal to service of the order of the Commissioner (Appeals). Limitation serves the legitimate objectives of certainty and finality, but its operation presupposes the occurrence of the event from which the legislature directs time to run. Limitation may operate with rigour once it begins to run; it cannot be made to run from an event which the law does not recognize as its commencement.

18.The respondent/department’s submission that taxpayers registered on IRIS are expected to monitor their electronic accounts must be considered in the same context. Such an expectation may be

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relevant to diligence and the credibility of an explanation for delay, but it cannot substitute for compliance with the prescribed requirements of service. A duty to exercise vigilance does not relieve the respondent/department of its corresponding statutory obligation to communicate the order in accordance with law. To hold otherwise would permit an administrative practice or expectation to override an express condition imposed by law.

19.The contention that the applicant in the present Reference Application attributed the delay before the Tribunal to the COVID-19 pandemic, foreign travel and subsequent quarantine, rather than expressly challenging the validity of service through IRIS, is misconceived. The application for condonation of delay makes clear that the applicant’s case was that, owing to travel and illness, he could not access IRIS and was therefore unaware of the impugned order. In any event, where the Tribunal’s conclusion rests upon the legal efficacy of an admitted mode of communication, its correctness presents a question of law within the scope of reference jurisdiction of this Court. The absence of an objection before the Tribunal framed in identical legal terms cannot validate a mode of service not recognized by statute.

20.This Court recognizes that the use of technology in tax administration is both legitimate and necessary. It promotes efficiency, transparency and accessibility. Yet these objectives are served by adherence to law, not by dispensing with the safeguards which the law prescribes. The State may modernize the means by which it communicates its decisions, but it cannot, in the name of modernization, dispense with the legal conditions that make such communication effective. Technology remains an instrument of statutory administration, not an independent source of statutory authority.

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21.Moreover, the foregoing interpretation is consistent with the constitutional requirement that public functionaries must act in accordance with law. The right of appeal is a creature of statute; nevertheless, once the legislature confers that right, access to the appellate remedy cannot be defeated by computing limitation from an event which the statute does not recognize as service. Such an approach would make the remedy subject to administrative practice rather than the law that created it. The guarantees of lawful treatment under Article 4 and due process under Article 10A of the Constitution of the Islamic Republic of Pakistan, 1973, do not enlarge the statutory right of appeal; rather, they reinforce the obligation to ensure that access to the appellate remedy is not defeated except in accordance with the procedure prescribed by law.

22.In the present and connected Reference Applications, the Tribunal proceeded on the premise that uploading the respective appellate orders on IRIS was itself sufficient service for computing limitation. In the absence of proof of service in the prescribed manner, that premise could not sustain dismissal of the appeals as time-barred. The Tribunal therefore erred in treating the appeals as barred by limitation merely on the strength of uploading the orders on IRIS.

23.For the foregoing reasons, the question of law is answered in the negative, holding that mere uploading of an order on IRIS, without compliance with the prescribed requirements of service, does not by itself constitute valid electronic service under Section 218(1)(d) of the Ordinance read with Rule 74 of the Rules. Consequently, the present and connected Reference Applications are allowed, and the impugned orders dated 28.04.2026, 03.06.2026 and 19.05.2026 are set aside. As a corollary, the appeals preferred by the applicants shall stand restored to their original numbers before the Tribunal, which shall decide them on the merits in accordance with law.

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24.Office shall transmit a copy of this judgment under the seal of the Court to the Tribunal in terms of Section 133(8) of the Ordinance.

25.Before parting with this judgment, this Court expresses its appreciation to Mr. Hassan Kamran Bashir, Advocate/Amicus Curiae, for his valuable assistance in the matter.

(MIRZA VIQAS RAUF) (ANWAAR HUSSAIN)

Judge Judge

Approved for reporting

Judge Judge

AB**