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ISLAMABAD: The Federal Board of Revenue (FBR) shared a plan with the Senate Standing Committee on Finance to deal with litigation of Rs2.3 trillion involving 76,349 cases of Inland Revenue Service.

FBR Chairman Asim Ahmed, Tuesday, briefed the Senate Finance and Revenue Committee that the Alternate Dispute Resolution (ADRCs) system is not very useful and effective.

The top 100 cases involving the highest amount of revenue have been shared with high courts and the Supreme Court of Pakistan to prioritise the top cases under litigation. Focal persons have been nominated in Large Tax offices and special benches have been constituted by the higher courts to dispose of cases involving a huge amount of revenue.

Asim Ahmed also said that the deprecation of the rupee against the dollar has helped to bridge the expected shortfall in revenue collection of the FBR.

The Senate Finance and Revenue Committee urged the FBR to seek speedy disposal of weighty cases by the FBR before various courts, specifically those bringing significant revenue to the country.

The committee was apprised that a total of 76,349 pending litigation cases Inland Revenue service till December 31, 2022, amounted to a total of Rs2.3 trillion.

Out of which, 63,655 cases are pending in the Appellate Tribunal Inland Revenue involving an amount of Rs1.4 trillion. The FBR informed the committee that they are trying to approach the secretary and Minister Law for the record of these cases.

FBR field formations start blocking release of refund claims

The FBR chairman informed the committee that back-to-back meetings with the chief Justice Lahore High Court and chief justice Islamabad High court are being conducted to make all efforts to liquidate pendency.

Committee Chairman Saleem Mandviwalla said that the Customs Operation Wing has already set up an Alternate Dispute Resolution (ADRCs) mechanism for quick and amicable disposal of pending litigation cases and settlement should be made through ADRCs.

The committee also suggested efforts if the cases can be resolved outside court. It was also suggested that cases should be disposed of on the basis of the “benefit of the doubt”.

The FBR informed that the Supreme Court of Pakistan has prioritised the disposal of revenue cases by constituting three benches where revenue cases are fixed on a daily basis.

Likewise, the matter of notices being sent by the FBR to business persons, under the Anti-Money Laundering Act, was also taken under discussion once again.

The FBR chairman commented that we are cautiously identifying cases. He said that huge tax evasion was detected in the case of PEB Industries (Pvt) Limited during the inquiry and in the light of information received from the Financial Monitoring Unit (FMU), it was further informed that the accused was provided ample opportunities but it failed to respond.

The chairman committee reserved that there is a difference between tax evasion and AMLA and failing to respond cannot fall under the category of money laundering.

The chairman committee compelled the FBR to avoid bundling up cases under the AMLA Act hampering the business community to do trade. He also put special emphasis on keeping a close check on pending cases in different fora for early disposal and discouraging frivolous litigation.

The committee was informed that all chief collectors/ director general have been asked to forward the recommendations for filing appeals/ SCRAs after satisfying themselves to the legality involved in order to dispose of cases.

Discussion on the matter referred by the Chairman Senate regarding amendments in Customs Act 1969 and inclusion of import issues in the next budget raised by the Senior Vice Chairman, Rawalpindi Goods Forwarding Association was also taken up.

The Rawalpindi Goods Forwarding Association complained that Customs goods already cleared at entry points are unnecessarily checked during transportation across the country on the pretext of being smuggled.

“Road interruption, simply corruption,” Senator Kamil Ali Agha remarked while regretting the norms of the field formation. He said that these field formations are in wait of bribes, and added that deliberate snubbing of the business vehicles is unjustified and causing enormous loss to the vehicle companies.

The Federal Minister of State for Finance, Aisha Ghaus Pasha, said that it is an administrative procedure and an amendment in the Act is not required at this stage.

It was further informed by the FBR that the complaint has been examined and the field formations have been directed by the Board that vehicle carrying customs–cleared imported goods duly accompanied by import documents and showing the direct transportation from the port/ station of clearance, may initially be subjected to tallying the documents with the transport/ container.

Copyright Business Recorder, 2023

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