FBR directed to transfer ST, FED jurisdiction of all cases from AEOI Zones to original jurisdiction

ISLAMABAD: The Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) to immediately transfer sales tax and federal excise duty (FED) jurisdiction of all cases lying in Automatic Exchange of Information (AEOI) Zones back to its original jurisdiction all over Pakistan.

This important directive has been issued by the FTO to the FBR, here on Friday.

In its order, the FTO office has expressed serious concern over the pending proceedings of assessment, audit, show cause notices and appeals etc in large number of cases lying in AEOI Zones.

According to the FTO order, Board’s vide jurisdiction order dated 28.02.2019 transferred sales tax and FED jurisdiction of all cases lying in AEOI Zone back to its original jurisdiction all over Pakistan. But FBR IT software has not been able to incorporate this change of separate jurisdiction of sales tax and FED even after lapse of more than four years.

As a result, a substantial number of cases pending proceedings of assessment /audit/ show cause notices/ appeals etc in sales tax against which separate jurisdiction of sales tax and FED was allotted to its original jurisdiction but still lying in AEOI Zones in FBR web portal got barred due to limitation of time prescribed under Sales Tax Act 1990 and FED Act 2005 causing huge loss of revenue.

This is a clear case of neglect, inattention, delay, incompetence, inefficiency and ineptitude, in the administration or discharge of duties and responsibilities causing huge loss of revenue on the part of the FBR IT wing and PRAL, the FTO said.

The non-transfer of jurisdiction of the complainant over sales tax from AEOI Zone LTO Karachi to RTO-1 Karachi through FBR web portal despite Board’s jurisdiction order dated 28.02.2019 tantamounts to maladministration in terms of Section 2(3)(ii) of FTC Ordinance.

The FTO has recommended the FBR that the Member (IT) and the Chief PRAL to make necessary changes in IT software to implement the jurisdiction order dated 28.02.2019 for separate jurisdiction of sales tax and FED as per policy of the Board.

The secretary (Jurisdiction) directed to transfer the jurisdiction of the complainant over sales tax from AEOI Zone LTO Karachi to RTO-1 Karachi.

The Member (Admn) in coordination with Member (IT) and Member (Ops) to initiate fact finding inquiry for delay to implement the jurisdiction order for separate jurisdiction of Sales Tax and FED pending for over four years causing huge loss of revenue and report compliance within 45 days, the FTO order added.

Copyright Business Recorder, 2023