Law of precedent: Lower fora bound to follow decision of higher appellate, admits FBR

ISLAMABAD: Member Legal (Inland Revenue) Federal Board of Revenue (FBR) admitted before Federal Tax Ombudsman (FTO) that the lower forum of Commissioner Inland Revenue (Appeals) under the law of precedent is bound to follow the decision of the higher appellate for a (Appellate Tribunal).

It is reliably learnt that on the basis of a public interest complaint moved by Waheed Shahzad Butt, Advocate, the office of FTO had issued notice to the Member Legal to submit a reply to the allegations contained in the complaint and appear before the FTO at Regional office at Lahore.

The FTO is probing the allegations of maladministration as to why the FBR’s legal wing is not vigilant to respond to queries raised by the taxpayers.

Unchallenged tax demand case: FTO waiting for tax officials’ response

In his comments before the office of the FTO in the subject matter, FBR Member Legal informed that it is a settled proposition that the lower fora under the law of precedent are bound to follow the decision of the higher appellate fora.

The question with regard to following or non-following of Tribunal’s order by the Commissioner (Appeals), is purely a judicial function of the Commissioner (Appeals) and in terms of provisions of section 214(2) of the Income Tax Ordinance, 2001 Board cannot interfere therein in any manner as the decision of the Commissioner (Appeals) on this score is subject to judicial scrutiny by the higher appellate authorities, i.e., the Appellate Tribunal, High Court, and the Supreme Court“, FBR Member Legal added.

Earlier, the FTO has summoned Member Legal for his silence to clarify the matter of futile litigation. In his complaint, Waheed Butt raised crucial questions “whether a relief allowed by the ATIR being final fact-finding authority under fiscal laws in a tax year is applicable and binding on the forum of CIR- Appeals for succeeding tax year and whether the forum of CIR-Appeals can disregard any order passed by the ATIR while deciding appeals where the same issue has been contested?”

The complainant Waheed Butt added, in the instant case long silence (May 30, 2023 to August 21, 2023) on the part of Member Legal for not clarifying a simple matter pertaining to avoidance of futile litigation at the cost of taxpayer money in court, reflects nothing but extreme maladministration of justice, worst incompetence and violation of fiscal laws.

Copyright Business Recorder, 2023