ISLAMABAD: The Federal Tax Ombudsman (FTO) has ordered an investigation against Inland Revenue officer of Federal Board of Revenue (FBR) for openly violating the Supreme Court judgment in the Pakistan LNG case, while recovering taxes in blunt contempt of the apex court’s ruling, FBR’s own instructions, and the provisions of the Sales Tax Act, 1990.
It is reliably learnt that notice under Section (u/s) 10(4) of the FTO Ordinance 2000 has been issued to Secretary Revenue Division and Chief Commissioner, ordering them to submit para-wise comments/ reply duly signed by the concerned Commissioner to the allegations contained in the complaint.
Even after 10 years period, the case related to the blockage of refunds of a corporate taxpayer falling under the jurisdiction of Islamabad by tax employees despite clear directions of the appellate tribunal inland revenue (ATIR), FTO and President of Pakistan.
Talking to Business Recorder, tax lawyer Waheed Shahzad Butt accused that “the planned contemptuous moves by some tax employees represent the worst kind of corrupt practices.”
Referring to a case, tax lawyer said that the order passed by ACIR under Section 170(4) is nothing but “a fraud on the statute, deception, and a blatant attempt to undermine the lawful authority of the FTO, President, and the Supreme Court in 2025 SCP 267, wherein the High Court judgment 2022 126 TAX 584 has already been confirmed to halt state-sponsored robbery attempts by some tax officers”.
Surprisingly, the concerned official deliberately also ignored the binding FBR Circular dated 07.02.2024, in violation of the law enacted by Parliament under Section 40 of the Sales Tax Act, 1990 read with Rule 71 of the Sales Tax Rules, 2006. Tax recovery is not meant to be a ‘grab and go’ process. Even coercive recovery measures must follow a proper and fair procedure. Tax authorities should not act as penalizing agencies, but as institutions of the State tasked with facilitating compliance through clarity, transparency, and procedural propriety. Coercive recovery is bound by law and rules and must work within this framework. This behaviour, Waheed Shahzad added, is backed by the “internal understanding that a tax employee can do no wrong.
The FTO has been requested to initiate disciplinary proceedings against the delinquent officials to restore taxpayer confidence and ensure that rule of law is not trampled by arbitrary administrative highhandedness.
Copyright Business Recorder, 2025
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