Federal Court Grants Tax Authorities Raiding Powers Without Notice

On February 27, 2026, the Federal Constitutional Court (FCC) of Pakistan ruled that tax authorities can conduct raids without prior notice, even in the absence of any ongoing proceedings against a taxpayer. This decision, delivered by Justice Aamer Farooq, dismissed a petition from M/s Sceptre Pvt Ltd that challenged a previous Sindh High Court ruling validating a tax raid. The court emphasized that Section 175 of the Income Tax Ordinance, 2001, allows tax officials to enforce provisions of the law without needing to wait for formal proceedings. Justice Farooq stated, "The words used by parliamentarians under the law are 'enforcement', and 'enforcement' requires 'breach'." This ruling reinforces the broad powers of tax authorities, allowing them to act swiftly in cases of suspected tax violations. The court maintained that the language of the statute is clear and does not impose additional conditions for enforcement actions, stating, "Courts cannot impose additional conditions such as the requirement of pending proceedings."