Latest news with #WaheedButt
Business Recorder
12-05-2025
- Business
- Business Recorder
Automated income tax refund system: FBR has failed to enforce IHC's directive
ISLAMABAD: The Islamabad High Court's landmark judgment for effective enforcement of an automated income tax refund system remains unimplemented by the Federal Board of Revenue (FBR) despite assurances from Member (Policy) FBR The court's directive aimed to facilitate taxpayers and minimize interaction with tax functionaries, but the FBR has failed to take concrete steps in this regard. According to tax lawyer Waheed Shahzad Butt, the FBR's failure to enforce the court's directive appears to be a case of 'planned negligence,' allowing certain field formations within the department to continue obstructive practices when there is an issue of returning taxpayer money in the shape of tax refunds. Automated income tax refund system: FBR fails to implement IHC judgement Instead of embracing automation and transparency as directed by the IHC, some FBR officials are playing a hide-and-seek game with refund claimants. This deliberate inaction undermines taxpayer trust and perpetuates a corrupt manual culture that the court sought to eliminate. The FBR demanded $25 million from the donor agency to effectively enforce an automated tax refund system under the ITO 2001. The FBR submitted a report titled 'Findings and Recommendations of Committee for Effective Enforcement of Section 170A' before the IHC in a public interest petition. Report submitted by the FBR revealed that the FBR's e-portal had no direct electronic linkage with the biggest government withholding agents i.e. Accountant General Pakistan Revenues (AGPR), which deducted income tax on gross salary of the government employees. This is perhaps the most glaring impediment in the way of enforcement of automated tax refunds process. Tax deducted by other withholding agents such as power distribution companies (Discos), excise and taxation departments, educational institutes, travel agents, airlines, Sui Northern Gas Pipelines Limited (SNGPL), Sui Southern Gas Company Limited (SSGCL), telephone and internet service providers, semi-autonomous government entities, government departments etc was not visible in the FBR's database. The judgment in question was intended to streamline the refund process through automated means, reducing human intervention and curbing discretionary power. However, despite the passage of time, the FBR has yet to roll out the mandated system, and no official explanation has been provided for the delay, Waheed Butt added. Copyright Business Recorder, 2025
Business Recorder
05-05-2025
- Business
- Business Recorder
Abbottabad: DG I&I IR Peshawar officers can't recover ST liabilities: PHC
ISLAMABAD: Peshawar High Court (PHC) has declared that the Audit Officers of Directorate General of Intelligence and Investigation – Inland Revenue (DG I&I-IR), do not possess independent statutory powers to assess, adjudicate, or recover sales tax liabilities of sales tax registered persons. It is reliably learnt that this landmark decision came in response to a sales tax reference filed by an Abbottabad-based taxpayer, who challenged the jurisdiction of DG I&I (IR) Audit Officer from Peshawar. Case was argued by tax lawyer Waheed Shahzad Butt and the Division Bench agreed, observing: 'It is unclear how an officer of the DG I&I (IR), Peshawar, could independently calculate and assess the sales tax liability of the Applicant situated in Abbottabad. Such actions are beyond the statutory framework governing their powers.' PHC order states: 'Since the entire exercise has been conducted, the liability in question assessed and contravention report has been made by the Audit Officer of DG I&I (IR), Peshawar. Audit Officers of the DG I&I (IR), Peshawar do not have independent statutory powers to assess, adjudicate, or recover sales tax liabilities. Their powers were limited to detection, investigation, and reporting of cases involving tax evasion, fraud, or non-compliance, preparation of contravention reports, conduct audits and seek information Every registered person operating within the supply chain claims adjustment or refund of input tax. Without a proper determination of the input tax claimed or claimable, it is unclear how an officer of the DG I&I (IR), Peshawar, could independently calculate and assess the sales tax liability of the Applicant situated in Abbottabad. Audit Officer of DG I&I, Peshawar, unlawfully assumed jurisdiction, prepared a contravention report without conducting an audit under Section 25 or examining records under Section 38, and improperly determined a sales tax liability. These actions were without jurisdiction and void ab initio. The Adjudicating Officer, without conducting any independent inquiry or applying his own mind, simply endorsed the findings of the Audit Officer DG I&I (lR). Similarly, both the CIR (Appeals) and the Appellate Tribunal failed to address these jurisdictional and procedural defects, culminating in an unjustified imposition of huge liability upon the taxpayer Waheed Butt informed that the said judgment reinforces the principle of jurisdictional integrity and legal authority in tax administration. It provides much-needed clarity on the limits of power vested in investigative officers and ensures that taxpayers are not subjected to arbitrary assessments. It is therefore concluded that the entire proceedings, from their very inception, being without jurisdiction and without lawful authority, are void and of no legal effect, PHC order added. Copyright Business Recorder, 2025
