Cyclostyle replies against POS integration notices adding to miseries of taxpayers, dept

LAHORE: Filing of cyclostyle replies against Point of Sale (POS) integration notices for Tier-1 Retailers (T-1Rs) was adding to the miseries of the taxpayers as well as the Tax department, said sources.

They said leading tax houses are involved in filing misconceiving replies while annexing no tangible documentary proof to establish that the integration notices are issued wrongly to their respective clients.

As and when the field formations take approval for sealing of the outlet from their higher ups, these tax houses urged their clients to approach the competent authority for withdrawal of penal proceedings. Meanwhile, they said, senior tax lawyers shift the blame to their young and amateur associates for filing irresponsible replies, leading to departmental proceedings to invoke penalties up to the level of sealing of the outlet.

It is interesting to note that most of the POS integration matters are being handled by the new comers in the tax practice and their senior associates seldom visit the tax authorities to plead their clients. However, these tax houses charge heavy fees from their clients and let their juniors to carry out apprentices while mishandling the issues of their clients.

The sole purpose of these young associates is to obtain adjournment of proceedings until the department invokes penal provisions of sales tax law against their client.

In one such notice, copy available with Business Recorder, the tax lawyer confined his reply to a single page, saying that the taxpayer was a service provider and not a manufacturer without providing any documentary evidence. However, the tax record was showing that the taxpayer had registered itself as a manufacturer, involved in online trading of his embroidery brand. Meanwhile, the said unit was also providing embroidery services to other manufacturers.

Therefore, the tax lawyer claimed in his reply that his client was a service provider and not a manufacturer. It is also interesting to note that tax record was showing that the taxpayer was claiming deductions on electricity supply. Also, there was no registration with Punjab Revenue Authority on the record to establish that the taxpayer was a service provider, and not a manufacturer.

Accordingly, the department rejected the reply and invoked penal provisions of the law and field teams were ready to visit the manufacturing site of taxpayer for sealing when the taxpayer appeared before the concerned authority to explain the situation on ground. However, said sources, since the taxpayer had wasted all the opportunities while he was left with the only option of filing an appeal before the tribunal.

Departmental sources said most of the tax matters are being spoiled due to mistreatment by the tax practitioners, leading to a long legal battle between the department and taxpayers.

Copyright Business Recorder, 2023