FBR’s audit wings accused of violating law on attaching taxpayers’ bank accounts

LAHORE: The audit wings of the Federal Board of Revenue (FBR) are violating law related to attachment of bank accounts of taxpayers, said sources.

The audit wings are also found involved in defeating the relief extended by the tribunals to taxpayers, they added.

The sources said the modus operandi of the audit wings suggested that they are hand in glove with the enforcement wings in harassing taxpayers as the attachment proceedings are initiated when ill-fated taxpayers are required to face demand notices against fake tax demands worth millions of rupees issued by them.

In most of the cases, taxpayers are yet busy with challenging fake demands when the audit wings direct their banks to hand over the amount lying in their bank accounts to the department.

Interestingly, the audit wings carry out such exercises while violating the prescribed procedure for attaching bank accounts to withdraw the disputed amount from taxpayers.

According to the procedure, the sources said, the department is bound to serve upon the taxpayer a notice in the prescribed form requiring him to pay the disputed amount within specified period, failure of which may lead to another opportunity.

In case, a taxpayer is failed to respond to these notices, only then the audit wing can only attach his bank account or sale his moveable or immoveable property, appoint a receiver and even arrest the taxpayer for six months.

However, no such notice is served upon the taxpayer and the department prefers to withdraw the disputed amount directly from his bank account, which is a discrimination against a taxpayer for denying him the right of fair trial and due process, the sources added.

They further pointed out that it is mandatory on the audit wings to follow the procedure, especially when appeal is already pending against a fake demand created by the concerned field formation.

Tax practitioners have further pointed out that it is well settled law that an act require to be done in a particular way has to be done in that manner.

However, the departmental sources are of the view that serving upon any such notice is mandatory only where attachment and sale is to be effected and simple attaching the bank account for recovery of tax liability does not fall under the said provision of law. But this argument fails to stands on its legs before the higher courts where the principle of fair trial and due process supersede all such excuses.

Copyright Business Recorder, 2023