Withholding agents across Sindh just got a powerful shield. In the sales tax reference filed by M/s HEI-HRL Joint Venture DHA, Lahore (651 of 2020) against the Commissioner, Sindh Revenue Board, the Sindh High Court (Justice Agha Faisal, author; Justice Shah Nawaz Memon) answered the question of law in the applicant's favour and disposed of the reference accordingly.
The issue was retrospective recovery. The SRB sought to recover from the joint venture — as a withholding agent — for the period October 2016 to December 2018. But the provision enabling such recovery, sub-section (3) of section 13 of the Sindh Finance Act, 2019, took effect only on 1st July 2019. The bench held the provision is prospective, not retrospective: it cannot be used to reach back and recover for periods before it existed.
The court followed its own binding judgment of 22.12.2020 in Spl. STRA No. 30 of 2020 (Fatima Fertilizer Company Limited v. Commissioner-II, SRB) — a precedent the bench was bound to apply, and did.
The practical fallout is immediate for any business that has received an SRB recovery notice as a withholding agent for a pre-July-2019 period: this judgment says that recovery cannot stand. Cite it, and cite Fatima Fertilizer behind it. More broadly, the case restates a foundational rule of tax law — a taxing provision applies from the date the legislature says it applies, and the executive cannot backdate liability by creative reading. This pairs naturally with the KATS ruling already covered on this site: Sindh's tax jurisdiction is expanding, but it must stay inside the lines the law actually draws. Qanoon wahi jo likha hai, jitna likha hai, jab se likha hai.