Taxpayers registered with PRAs/AJK tax office: FBR can overrule objections to invoices of services

ISLAMABAD: The Federal Board of Revenue (FBR) can overrule objections raised by its system relating to the invoices of services provided by taxpayers registered with provincial revenue authorities/Azad Jammu and Kashmir (AJK) after verification from the relevant authority/AJK tax office.

The FBR has issued a circular No 1 of 2020.

The FBR has explained the overruling procedure where sales tax invoices relating to services provided by taxpayers registered with Provincial Authorities or invoices issued by the suppliers registered in AJK. The tax officials of the FBR may overrule system objections on submission of invoices of services, sales tax return and proof of payment subject to verification from the relevant Provincial Revenue Authorities and AJK tax Office.

The FBR has issued a standard procedure for over-ruling of objections raised by STARR/Risk Management System (RMS) during processing of sales tax refund claims of the taxpayers from August 1, 2020.

According to the circular, for the purposes of over-ruling of objections raised by STARR/Risk Management System (RMS) while processing the Sales Tax Refund claims, multiple instructions, SOPs, and guidelines are in the field. The gaps, contradictions, and variance in the implementation of these instructions & SOPs produced below par outcomes. In order to bring uniformity into the system, and avoid discretion and delays in the processing of refunds there is need to issue rules for the purpose at the national level. Accordingly, in supersession of all previous instructions, SOPs and guidelines on the matter, it is hereby laid down that henceforth an officer not below the rank of Additional Commissioner-IR shall over-rule the objections raised by the electronic system mentioned after completion of all legal formalities and scrutiny of record as mentioned. Evidence and reasons shall be duly recorded in the database, or as the case y be, on the note-sheet side of the relevant file.

The FBR stated that the refund claimant shall furnish soft copies of all the scanned documents which are under dispute requiring overruling. These scanned documents shall be loaded in the system by the DBA as Annexures to a particular refund claim. Board shall create a tab in STARR/system to upload scanned documents for over-ruling of the objections. Till the creation of tab in STARR System, scanned documents may be saved as per existing practice and over-ruling may be done as per the above guidelines.

To deal with the refund claims refused by FASTER/ERS systems, the FBR said that if result of automated processing of refund claims through FASTER or ERS, the claimants are not satisfied with the outcome of automated processing including calculation of refunds or carry forward amounts or amounts deferred, the claimant may apply to the Board through concerned Chief Commissioner for reprocessing of the refund claim or revision of Annex-H mentioning therein the reasons. After scrutiny of the written request of the Claimant, the Chief (Projects & Refunds) may allow reprocessing of the claim or revision of Annex-H for necessary corrections. The procedures for over-ruling shall become applicable with effect from August 1, 2020, the FBR added.

Copyright Business Recorder, 2020