IHC orders Centre to dissolve CDA, transfer powers to metropolitan corporation

• IHC orders any amount collected by CDA must be refunded.
• Purpose for which CDA was established has been fulfilled: IHC
• Court says taxes can't be imposed without approval of local govt.

ISLAMABAD: The Islamabad High Court (IHC) on Saturday directed the federal government to initiate and complete the process of dissolving the Capital Development Authority (CDA).

Justice Mohsin Akhtar Kayani issued the written verdict, ordering that all powers and assets of the CDA should be transferred to the Metropolitan Corporation Islamabad (MCI).

The high court declared the CDA's Statutory Regulatory Order (SRO) pertaining to 'Right of Way' and 'Access Charges' as null and void. All actions taken by the CDA under this SRO have been declared illegal. The IHC further ruled that any amount collected by the CDA under this SRO must be refunded.

"The SRO No.576 (I)/2015 dated 09.06.2015 is declared illegal, ultra vires, without lawful authority or jurisdiction, therefore, same is hereby struck down. However, any amount collected from any person or entity under the said SRO is liable to be refunded, and all actions taken pursuant thereto are declared void and without legal effect," it added.

The court observed that the CDA Ordinance was originally enacted for the establishment of the federal government and its development works. However, the verdict stated that the practical utility of the CDA Ordinance has ceased to exist due to new laws and governance frameworks. The court asserted that the purpose for which the CDA was established has been fulfilled, therefore, the government should dissolve it.

The IHC emphasised that after the transfer of powers, it must be ensured that the Islamabad administration operates transparently and accountably, and that the rights of Islamabad's citizens are protected under the law.

The court highlighted that the entire administrative, regulatory, and municipal framework of Islamabad now operates under the Local Government Act. The Islamabad Local Government Act is a special law for governance through elected representatives. The IHC clarified that, according to the law, taxes cannot be imposed without the approval of the local government, therefore, the CDA has no legal authority to impose taxes.

It is pertinent to mention that the CDA had previously imposed 'Right of Access Tax' on petrol pumps and CNG stations, as well as a direct access tax on housing societies for access from main roads. These actions are now deemed illegal by the court's ruling.