LHC nullifies Multan corporation order over retrospective commercialisation fee

Lahore High Court has set aside an order passed by Municipal Corporation Multan in commercialisation fee matter saying that the financial obligations should be assessed under legislation and rates prevailing when cause of action accrued.

The court ruled that once the legal conditions had been completed, it was unconstitutional to implement a policy retrospectively or to demand further money.

The ruling was given by Justice Javed Hassan on a petition filed by Mian Abbas Ahmed that threw aside an order dated May 11, 2026 issued by the chief officer of Municipal Corporation Multan.

According to the judgement, the petitioner had requested for approval of a commercial site plan of a land measuring about six marlas on December 8, 2005. He was told to pay Rs42,470 as building fee and Rs12,000 as processing charge by the authorities concerned.

The petitioner’s counsel said that the site plan application has not been decided by the municipal authorities within the stipulated period and the matter is pending before the commercialisation committee. The petitioner thereafter completed the building but the controversy regarding marketing remained unresolved.

Though the petitioner had made an application for authorisation to construct a second story in the year 2022, the matter was still under litigation before multiple venues.

The judgement said that on May 11, 2026, the Chief Officer Municipal Corporation Multan rejected the application and directed to impose commercialisation fee per the rules applicable for the financial year 2025-26.

The court found the officer had failed to explain the essential statutory provisions and rules, as well as significant reasons for denying the application. It held that an order issued without reasons could not be properly sustained.

Justice Javed Hassan further said that public authorities and officials are bound to take choices according to the law and give clear reasons for their directives. Administrative and judicial decisions should be based on the relevant facts, applicable law and court precedents.

The court held that the rights of the parties in financial affairs must be determined according to the law in existence at the time of the arising of the relevant legal right or the origin of the dispute. A policy implemented afterward could not be applied to past matters to impose an added financial burden.

The Lahore High Court on Tuesday accepted the constitutional appeal of Mian Abbas Ahmed and set aside the order of the chief officer dated May 11, 2026.