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ISLAMABAD: Days before the announcement of the budget, the Federal Constitutional Court (FCC) has affirmed that poultry feed manufacturers and poultry farmers were not liable to pay additional tax under Section 3(1A) of the Sales Tax Act, 1990.
A two-judge FCC bench, headed by Justice Aamer Farooq and also including Justice Muhammad Karim Khan Agha, set aside a Dec 24, 2025, Lahore High Court (LHC) judgement and ruled that imposing a 4 per cent tax on supplies made to non-registered entities would be unjust and against the sales tax regime.
The bench had taken up a set of appeals moved by Shahzor Feeds (Pvt) Ltd, Lahore Feeds Ltd and S.S. Feed Mills Pvt Ltd.
The petitioners were aggrieved by an order of the Commissioner (Inland) Revenue, LTU, Lahore, issued on Sept 11, 2024, whereby it was held that manufacturers of poultry feed supplying products to farmers were liable to pay an additional tax under section 3(1A) of the 1990 Sales Tax Act since recipients of the supply were not registered.
