ISLAMABAD: There is some legal/ technical anomaly in the Federal Board of Revenue’s (FBR) “IRIS” system where notices are not visible to the taxpayers in their IRIS system, but the department’s system is showing/ confirming issuance of such notices.
Tax experts told Business Recorder that frequent instances are surfacing wherein the “IRIS” of the taxpayer does not reflect the notices issued to the taxpayer but the “IRIS” of the Department is reflecting the issuance of the same. Resultantly, the taxpayers are not getting the opportunity of being heard in person or file replies online.
Due to the ignorance of taxpayers about serving of such notices, adverse assessment orders are passed by the officers by incorrectly observing that compliance of the notice has not been made.
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A tax adviser shared that a recent instance of such anomaly surfaced during the hearing of the appeal before Commissioner Inland Revenue (Appeals), Lahore in the case of a taxpayer having NTN: 0453485-9. The Counsel of the taxpayer argued that an addition under section 111 (un-explained income and assets) of the Income Tax Ordinance 2001 has been made without issuing/ serving separate notice under section 111 of the Income Tax Ordinance, 2001.
A copy of a printout of the IRIS data was provided in support of contention where no such notice was appearing. However, when the Commissioner Inland Revenue (Appeals) logged into the IRIS data of the Department the same was showing issuance of separate notice under section 111.
Responding to this, the counsel provided the login details of the taxpayer’s IRIS account to ascertain the anomaly. The CIR (Appeals) observed that many taxpayers are taking the plea of non-issuance/ service of notices online but when the official IRIS is checked the notices are appearing.
When contacted, Shahid Jami, a Lahore-based lawyer explained that through the Finance Act, 2020 legal backing to the IRIS was given by inserting its definition in section 2 of the Income Tax Ordinance which means a web-based computer program for operation and management of Inland Revenue and the laws administered by the Board.
Prior to this legal backing, clause (d) was inserted in section 218(1) and 218(2) of the Ordinance through Finance Act, 2018 pertaining to the service of notices and other documents, and the new clause provided that notices and other documents can be served electronically in the prescribed manner.
After the aforesaid amendments, the assessing officers are issuing notices on the IRIS only as the issuance on the IRIS is treated as service as envisaged under Rule 74 of the Income Tax Rules though the electronic service was envisaged as an additional mode of service to the basic mode of service of personal service or service through registered post or courier.
Jami pointed out that the anomaly at the IRIS is a very serious issue and is a bad reflection of the administration by the Board.
He observed that usually the contention of the taxpayer that no notice was served through the IRIS or otherwise is viewed as a lame excuse though now it has been clearly established beyond any shadow of a doubt that the IRIS of the Department and IRIS of the taxpayer as far as notices are concerned is at variance.
He urged that the anomaly should be investigated and appropriate remedial measures are taken by the PRAL to rectify the same and meanwhile, directions are issued to the field formations that any contention of the taxpayer regarding non-service through electronic means should not be brushed aside, the tax expert added.
Copyright Business Recorder, 2023
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