FBR told to quickly issue ST refund cheques

RECORDER REPORT

ISLAMABAD: Federal Tax Ombudsman (FTO) Dr Muhammad Shoaib Suddle has directed the Federal Board of Revenue (FBR) not to keep any refund cheque pending with the Central Sales Tax Refund Office (CSTRO) for more than a week.

According to FTO’s order issued on Friday, the FBR was further told to direct the Chief of CSTRO to issue cheques expeditiously and report compliance within 15 days.

The complainant alleged maladministration against the Department for failure to issue cheques against refund claims for December 2001, March 2012 and April 2012.

According to the complainant, the Assistant Commissioner, Inland Revenue, RTO, Karachi, through Refund Processing Orders (RPO), sanctioned refund for December 2001, March 2012 and April 2012 claimed against ‘zero-rated supplies’ under Section 10 of the Sales Tax Act, 1990. However, the Department did not issue cheques till the filing of the complaint before the FTO. In response to the notice, the Department filed comments, contending that refund claims for December 2011, March 2012 and April 2012 amounting to Rs691,000, Rs3,063,633 and Rs219,288, respectively, had been settled and RPOS have been issued. The issuance of cheques was stated to be pending at CSTRO.

Arguments of both parties were given due consideration and record perused. “It is evident that RPOs for the period under complaint were generated by the Department. However, cheques of respective refund claims were still not delivered to the Complainant. The Chief CSTRO, FBR, who was specifically asked to offer his comments on the issue failed to do so, FTO maintained.

The FTO stated that the delay in issuing cheques against RPOs for December 2011, March 2012 and April 2012 “has been established which is tantamount to maladministration in terms of Section 2(3)(ii) of the Federal Tax Ombudsman Ordinance, 2000”. The delay in issuing cheques “is a systemic problem, requiring particular attention by the Chairman FBR”.