PUNJAB FINANCE ACT, 2012

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THE PUNJAB FINANCE ACT 2012 
(XLI of 2012) 
CONTENTS 
1. Short title, extent and commencement  
2. Amendment in Act II of 1899 
3. Amendment in Act V of 1958 
4. Amendment in Act XXXII of 1958 
5. Amendment in Act XV of 1977 
6. Amendment in Act XV of 2010 
7. Amendment in Act XV of 2011 
 
TEXT 
1
THE PUNJAB FINANCE ACT 2012 
(XLI of 2012) 
[25th June, 2012] 
An 
Act 
to amend certain laws relating to taxes and duties in the Punjab. 
Preamble.– Whereas, it is expedient to amend certain laws relating to tax and duties 
in the Punjab and connected matters;  
It is enacted as follows:– 
1. Short title, extent and co mmencement.– (1) This Act may be cited as the 
Punjab Finance Act 2012.  
(2) It extends to whole of the Punjab. 
(3) It shall come into force on the first day of July 2012. 
2. Amendment in Act II of 1899.– In the Stamp Act, 1899 (II of 1899): 
(a) in section 27-A, in sub-section (1), for the expression “Articles 23, 31 or 
33”, the expression “Articles 23, 27 -A, 31 or 33” shall be substituted; 
and 
(b) in Schedule I, in Article 45, in column 3, after the proviso, the following 
Exception shall be inserted: 
“Exception.– Notwithstanding anything contained herein, a fixed stamp 
duty of five hundred rupees shall be charged in respect of an instrument 
of partition relating to an urban or rural property including agricultural 
land, which is partly or wholly based on opening of inheritance.”   
3. Amendment in Act V of 1958. – In the Punjab Urban Immovable Property 
Tax Act, 1958 (V of 1958): 
(a) in section 2, for clause (h), the following shall be substituted: 
“(h) “tax” means the tax  leviable under the Act and includes the  late 
payment surcharge in terms of section 12;”  
(b) in section 3, in sub -section (5), for the expression “31 st day of August”, 
the expression “30th  day of September” shall be substituted;  
(c) for section 12, the following shall be substituted: 
                                                           
1This Act was passed by the Punjab Assembly on 21 st  June, 2012; assented to by the Governor of the Punjab on 25 h   June, 
2012; and, was published in the Punjab Gazette (Extraordinary), dated 25th   June, 2012, pages 41719-41724. 
“12.  Payment of Tax and late payment surcharge .– (1) Subject to 
sub-section (2), the tax shall be paid on yearly basis on or before 30 th 
day of September of the year for which the tax pertains. 
(2) The Government may, by notification in the official 
Gazette, direct that the tax in any rating area for any specified period 
shall be paid separately. 
(3) In addition to the proceedings for the recovery of the tax 
under this Act, a late payment surcharge at the rate of one per cent of 
the gross payable tax shall stand imposed on th e first day of every 
month of delay if the tax payable for any year is not paid by 3 0th day of 
September of the said year: 
Provided the late payment surcharge on the arrears of tax as on 
30th day of June 2012 shall stand levied on and from 1 st day of July 
2012.”; and 
(d) in section 16, after the expression “section 3”, wherever occur, the 
expression “or the late payment surcharge levied under section 12” 
shall be inserted. 
4. Amendment in Act XXXII of 1958. – In the Punjab Motor Vehicles Taxation 
Act, 1958 (XXXII of 1958): 
(a) in section 3, in sub-section (1), in the last proviso, after the word 
“cabin”, the words “or a motor vehicle (motor car or jeep ) up to 1000 
CC” shall be inserted; and 
(b) in the Schedule, in  Sr.No. 4: 
(i) in column No.2, in para (b), for the entry at (i), the following shall 
be substituted:– 
“(i) A lump sum tax of rupees ten thousand shall be charged 
for motorcars and jeeps up to 1000cc at the time of 
registration: 
Provided that in case of a motor vehicle registered before 1 st 
day of July 2012, the amount of tax already paid shall be 
deducted from the payable tax of rupees ten thousand and the 
remaining amount shall be paid lump sum at the time of 
payment of the tax due.”; and 
(ii) in column No.3, the expression “Rs.600/ - per annum ” shall be 
omitted. 
5. Amendment in Act XV of 1977  .– In the Punjab Finance Act 1977 (XV of 
1977), in  the Second Schedule, at S.No.1 , in colum 2, for the expression 
“Companies registered under Companies Ordinance, 1984 with paid up capital–“, the 
expression “Com panies registered under the Companies Ordinance, 1984 , 
modarabas, mutual fund s or any other bod ies corporate with the paid -up capital or, 
as the case may be, the reserves in the preceding year–“shall be substituted.  
6. Amendment in Act XV of 2010. – In the  Punjab Finance Act 2010 (VI of 
2010), for section 6, the following shall be substituted:– 
“6. Capital value tax on immovable property .– (1) This section shall 
have effect notwithstanding anything contained in any other law. 
(2) For purposes of this section– 
(a) “association of persons” includes a firm, a Hindu undivided 
family, a juridical person and a body of persons formed under a 
foreign law, but does not include a company; 
(b) “Board of Revenue” means the Board of Revenue established 
under the Punjab Board of Revenue Act, 1957 (XI of 1957); 
(c) “Collector” means the Collector of the district appointed under 
the Punjab Land Revenue Act, 1967 (XVII of 1967) and includes 
the Collector of a subdivision or any other officer specially 
empowered by the Board of Re venue to exercise and perform 
the functions of Collector; 
(d) “company” means– 
(i) a company as defined in the Companies Ordinance, 
1984 (XLVII of 1984); 
(ii) a body corporate formed by or under any law in Pakistan; 
(iii) a modarba; 
(iv) a body incorporate d by or under the law of a country 
outside Pakistan relating to incorporation of companies; 
(v) a trust, a co -operative society or a finance society or any 
other society established or constituted by or under any 
law; and 
(vi) a foreign association, whethe r incorporated or not, which 
the Government has, by general or special order, 
declared to be a company for  purposes of this section ; 
(e) “Government” means Government of the Punjab; 
(f) “person” includes– 
(i) an individual; 
(ii) an association of persons; 
(iii) a company; 
(iv) a foreign government; 
(v) a political subdivision of foreign government; and  
(vi) a public international organization; 
(g) “recorded value” means the value declared by the 
transferee in the instrument , provided that the declared 
value of the property shall not be less than the value 
specified in the valuation table notified by the Collector  of 
the district; 
(h) “registration authority” includes the person responsible 
for registering or attesting or recording the transfer of an 
immovable property or of the right to use an immovable 
property for more than twenty years, and in the case of a 
cooperative society  or a private housing society , its 
principal officer s including president, secretary, 
accountant or any similar officer declared by the Collector 
as the principal officer of the society; 
(i) “tax” means capital value tax and includes any penalty, 
fee and charge or any sum or amount leviable or payable 
under this section;  
(j) “urban area” means an area which is – 
(i) a rating area under  the Punjab Urban Immovable 
Property Tax Act, 1958  (V of 1958)  except the area 
where the rate of tax is zero in terms of section 117 
of the Punjab Local Government Ordinance, 2001 
(XIII of 2001); or 
(ii) an area notified by the Board of Revenue in the 
official Gazette. 
(3) A tax on the capital value of an immovable property shall be 
payable by a person who acquires an immovable property by purchase, gift, 
exchange or power of attorney , surrender or relinquishment of right by the 
owner or a right to use thereof for twenty years or more or renewal of lease so 
that the total period of lease in favour of the same lessee is twenty years or 
more at the rates specified in sub-section (5). 
(4) The tax shall not be payable if– 
(a) immovable property is acquired through inheritance; or 
(b) immovable property is acquired through gift between 
spouses, father , mother, son, daughter, grandparents 
and grandchildren, siblings, or from one wife  or widow to 
another wife or widow of the same husband; or 
(c) power of attorney is executed be tween spouses or from 
one wife or widow to another wife or widow of the same 
husband, or father, mother, son, daughter, grandparents, 
grandchildren and siblings. 
(5) The rate of tax in respect of immovable property is as under:– 
(a) Immovable property  other than commercial  or industrial 
property, plaza or multi -storeyed building situated in 
urban area measuring at least two hundred and fifty 
square yards or ten marla, whichever is less – 
No.  Description Rate of tax 
(i) Where the value of the 
immovable property is 
recorded. 
Two percent of the 
recorded value of 
the landed area. 
(ii) Where the value of the One hundred 
immovable property is not 
recorded. 
rupees per square 
feet of the landed 
area. 
(iii) Where the immovable 
property is a constructed 
property. 
Ten rupees per 
square feet of the 
constructed area in 
addition to the value 
worked out above. 
(b) Commercial or industrial immovable property other than plaza or 
multi-storeyed building of any size situated in an urban area:  
No. Description Rate of tax 
(i) Where the value of the 
immovable property is recorded. 
Two per  cent of the 
recorded value of the 
landed area. 
(ii) Where the value of the 
immovable property is 
not recorded. 
One hundred rupees 
per square feet of the 
landed area. 
(iii) Where the immovable 
property is a constructed 
property. 
Ten rupees per 
square feet of the 
constructed area in 
addition to the value 
worked out above. 
(c)  Immovable property whether c ommercial, residential or 
composite in plazas and multi-storeyed buildings of any size 
situated in an urban area: 
No. Description Rate of tax 
(i) Where the value of the 
immovable property is recorded. 
Two percent of the 
recorded value of 
the immovable 
property or one 
hundred rupees per 
square feet of the 
constructed area, 
whichever is higher. 
(ii) Where the value of the 
immovable property is not 
recorded. 
One hundred rupees 
per square feet of 
the constructed area 
of the immovable 
property. 
(6) The tax shall be collected  at the time of registering or attesting 
the transfer by the person res ponsible for registering or attesting the transfer 
of the immovable property for which the tax is payable. 
(7) The registration authority or any other person mentioned in sub-
section ( 6) shall submit to the Collector a monthly statement by 10 th of the 
succeeding month in such Form as may be prescribed.  
(8) In case the statement mentioned in sub -section ( 7) is not 
submitted within the prescribed time, Collector of the district  may impose a 
penalty on the registration authority or any other person mentioned in sub -
section (6) up to rupees one hundred thousand.  
(9) The Collector of the district or any authority to whom he is 
subordinate, may himself  or through a person or agent appointed by him for 
the purpose conduct or cause to be conducted the audit of the capital value 
tax including examination of accounts and records of that registration authority 
or any other person  mentioned in sub -section (6) and may make an 
assessment of the tax on the basis of such audit.  
(10) The Collector may, by notice in writing, require any person–  
(a) to furnish to the Collector or an officer authorised by him any 
information or produce any accounts, documents or computer 
stored information in his possession and relevant to the tax 
specified in the notice; and 
(b) to attend at  such time and place as mentioned in the notice for 
purposes of examin ing him on oath by the Collector or the 
authorised officer in respect of the matters relating to the tax. 
(11) The Collector may impound any accounts or documents 
produced in terms of su b-section (10) and retain the  documents so long as 
may be deemed necessary for purposes of examination. 
(12) Where a hard copy or computer disk of information stored on a 
computer is not made available as required under sub-section ( 10), the 
Collector may require production of the computer on which the information is 
stored, and impound and retain the computer for such period as may be 
necessary. 
(13) For purposes of this section, the Collector shall have the same 
powers as are vested in a Court under the C ode of Civil Procedure, 1908 (V 
of 1908), in respect of the following matter:–  
(i) enforcing the attendance of any person and examining the 
person on oath or affirmation; 
(ii) compelling the production of any accounts, records, computer 
stored information, or computer;  
(iii) receiving evidence on affidavit; or 
(iv) issuing commissions for the examination of witnesses. 
(14) Where a registration authority or any other person mentioned in 
sub-section (6) fails to– 
(i) furnish prescribed monthly statement; or  
(ii) provide information or produce documents or record in terms of 
sub-section ( 10) within the stipulated time, Collector of the 
district may make an assessment of the tax on the basis of the 
information or material available to him. 
(15) As soon as may be  after maki ng an assessment under sub -
section (9) or sub-section (14), Collector of district shall issue the assessment 
order to the registration authority or any other person, stating– 
(i) the amount of tax due; 
(ii) the time, place and manner of filing an  appeal against the 
assessment order. 
(16) The powers under sub -section (9) or sub-section (14) shall not 
be exercised after the expiry of five years from the conclusion of the financial 
year to which the assessment relates.      
(17) Where the tax is not collected from the person liable to pay it, 
the tax may be collected by an officer designated by the Board of Revenue in 
this behalf from the said person and the provisions of the Punjab Land 
Revenue Act 1967 (XVII of 1967)  shall, so far as may be, apply to the 
collection of the tax as they apply to the recovery of arrears of land revenue. 
(18) Where any person fails to collect the tax or having collected fails 
to deposit the tax into the Government Treasury, he shall be personally liable to 
pay the tax along with def ault surcharge at the rate of fifteen percent per 
annum for the period for which such tax or part thereof remains unpaid, and the 
Collector may recover it from the said person as arrears of land revenue after 
giving him an opportunity of hearing. 
(19) Where, at the time of recovery of tax under sub-section (18), it is 
established that the tax collected from the person has meanwhile been paid 
by the person liable to tax, no recovery shall be made from the person who 
had failed to collect the tax but the said  person shall be liable to pay default 
surcharge at the rate of fifteen percent per annum from the date he failed to 
collect the tax to the date the tax was paid. 
(20) A person personally liable for any amount of tax under sub-section 
(18) as a result of failing to collect the tax shall be entitled to recover the tax from 
the person from whom the tax should have been collected. 
(21) The recovery of tax under sub -section (17) does not absolve a 
person who failed to collect the tax from any other legal action  in relation to 
the failure or from a charge of default surcharge. 
(22) The order passed by an officer under this section shall be 
deemed to be an order passed by a Revenue Officer under the Punjab Land 
Revenue Act, 1967 (XVII of 1967). 
(23) The provisions of sections 13 and 14 of the Punjab Land Revenue 
Act 1967 (XVII of 1967), shall apply to the cases under this section. 
(24) For purposes of appeal, review or revision, an order passed 
under this section shall be deemed to be an order of a Revenue Officer within 
the meanings of sections 161, 162, 163 and 164 of the Punjab Land Revenue 
Act 1967 (XVII of 1967). 
(25) Where the tax has been recovered from a person not liable to 
pay the same or in excess of the amount actually payable, an application 
may, in wri ting, be made to the Collector for the refund of the tax or the 
excess amount. 
(26) The proceeds of the tax collected under this section shall be 
credited to the Provincial Consolidated Fund under the head specified by the 
Government. 
(27) The Board of Rev enue may, by notification in the official 
Gazette, make provisions relating to the collection and recovery of the tax or 
regarding any ancillary matters. 
(28) The Government may, by notification in the official Gazette, 
exempt a class of immovable property  or a class of persons or a mode of 
transfer of property from the levy or recovery of the tax subject to such 
conditions as may be specified in the notification. 
7. Amendment in Act XV of 2011. – In the Punjab Finance Act 2011 (XV of 
2011) – 
(a) in section 6 – 
(i) for sub-section (1), the following shall be substituted and shall 
be deemed to have always been so substituted – 
“(1) This section shall have effect, notwithstanding 
anything contained in any other law. 
(1A) The provisions of this section shall not apply to the 
rating areas in terms of the Punjab Urban Immovable Property 
Tax Act, 1958 (V of 1958) where the property tax is levied but 
shall apply to the rating areas which are zero rated in terms of 
section 117 of the Punjab Local Government Ordinance,  2001 
(XIII of 2001).”  
(ii) in sub-section (2), in clause (c), the full stop shall be replaced by 
a semi-colon and the following new clause shall be inserted:– 
“(d) “total minimum area” mean s the total land area including 
the area under farming even thoug h the farm house  is 
constructed on a portion of such area of land.”; 
(b) in section 7 – 
(i) in sub-section (2), for clauses (b) and (c), the following shall be 
substituted:– 
“(b) “amenities” include facilities of sports, swimming, 
gymnasium, fitness, confe rences, ceremonies, musical 
concerts and other social amenities; 
(c) “club” means an association or organization offering 
members amenities, services, meals or temporary 
residence with initial membership fee of rupees two 
hundred thousand for any category of members and 
notified as club by the Government; 
(d) “initial membership fee” includes all subscriptions or 
payments, charges, donations  made by an applicant for 
membership of the club; 
(e) “Government” means Government of the Punjab; and 
(f) “services” means all types of services provided by the 
club and includes goods sold at the club premises.” 
(ii) after sub-section (3), the following shall be inserted:– 
“(3A) Notwithstanding a ny reduction of initial 
membership fee after the club has been notified und er sub -
section (2) , the club shall remain notified and the cess under 
this section shall continue to be levied on such club. 
(3B) If a club is notified for purposes of this section, the 
cess shall be levied on actual initial membership paid by the 
applicant. 
(3C) The cess shall be levied on the services provided 
to any person or a member regardless of the date of 
membership.”