RAWALPINDI: The Lahore High Court (LHC) Rawalpindi bench has limited the Federal Board of Revenue’s (FBR) power under Section 122(5A) of the Income Tax Ordinance, 2001. The court ruled that this section cannot be used for “roving or fishing inquiries” or speculative attempts to recover revenue. This important ruling came in the income tax reference case of Commissioner Inland Revenue versus Sajid Hussain Gondal and others. Justices Mirza Viqas Rauf and Jawad Hassan clarified how and when amendments can be made under Section 122. The case involved a deemed tax assessment for 2019 filed by Sajid Hussain Gondal. The department claimed errors and discrepancies in the taxpayer's declared revenues and expenses. Despite explanations, the tax was amended in June 2022. This amendment was first upheld by the Commissioner (Appeals) but was later overturned by the Appellate Tribunal Inland Revenue (ATIR) in November 2023. The LHC emphasized that a deemed assessment under Section 120 is firm and cannot be easily disturbed. The court drew a clear line between Section 122(5) and 122(5A). Section 122(5) applies when there is definite proof of escaped income or mistakes. Section 122(5A) is a revisional power and can be used only if the assessment order is both erroneous and harmful to revenue. Justice Rauf explained, “The revisional jurisdiction under Section 122(5A) is not a licence for roving or fishing inquiries.” The error must be clear and proven from the records, and any loss to revenue must be real, not just suspected or based on arithmetic errors. This decision brings needed clarity to a power often used by tax officials and protects taxpayers from speculative tax demands.