The term sometimes refers to a form of mockery in which the mocker exaggerates the other person’s characteristics; pretending to take on his or her attitudes, etc., in order to make them look funny. Or it may be used to refer to a ruse where a person is led to believe something is true that is not (usually a fairly unbelievable story) for the purpose of ridicule of the subject.
[Taking the piss - Wikipedia
"Taking the mic" has many meanings all of which are not congruent with one another. Sometimes it is an expression of disbelief and at other times it is a joke, and at other times it is used in place of sarcasm ... The context where I believe it is used for Pakistanis is when it means "teasing".