This fundamental disagreement was decisively settled by the Appellate Tribunal in its judgment on Appeal No. 282/2024 (M/s Noor Pak Developers), dated October 23, 2025. The PRA had levied sales tax on the developer for the outright sale of developed plots. The Tribunal, in its ruling, dismantled this assessment. It established a critical legal distinction, ruling that a "sale, being a conveyance of proprietorship," is a transfer of title and fundamentally different from a "lease" or "licence," where ownership is retained by the provider. The Tribunal concluded that an outright sale "falls outside that genus and is not a 'service' so conceived" by the statute. This judgment effectively invalidated the PRA's interpretation and confirmed that the law, as written, did not empower the authority to tax the sale of immovable property.

Simultaneously, the executive branch also tried to provide clarity. On October 22, 2025, the Punjab Finance Department released Notification No. SO(TAX)1-10/2025-26. This notification amended the schedules of the Sales Tax Act to insert a new, distinct taxable service: "Sr. No. 27: Supply of immovable property by way of lease, license or such similar arrangement." This action codified the very distinction the Tribunal would affirm. By explicitly and separately listing only these service-based arrangements, the government prospectively clarified the law. The notification did not create a new tax on property sales; rather, it reinforced that the only taxable component of immovable property transactions was the service of leasing or licensing, not the act of selling.