Tax disputes with the Board: FBR instructs SOEs to pursue resolution through ADRCs

ISLAMABAD: The Federal Board of Revenue (FBR) has directed all state-owned enterprises to resolve their tax-related disputes with the FBR through Alternate Dispute Resolution Committees (ADRCs), irrespective of the amount of tax liability involved in such disputes.

The FBR has issued an SRO.1290 (l)2024 here on Saturday to amend Income Tax Rules, 2002.

Under the revised ADRC rules, the “State-owned enterprise” shall have the same meaning as assigned thereto in the State-Owned Enterprises (Governance and Operations) Act, 2023.

Around 24 SOEs to be privatised in coming years

In the case of a state-owned enterprise, this rule shall apply to any dispute irrespective of the amount of liability of the tax.

It is mandatory for the state-owned enterprise to apply to the Board for appointment of a Committee if it is aggrieved. Any person or class of persons including a state-owned enterprise seeking resolution of any dispute shall submit a written application for alternate dispute resolution to the Board.

The Board shall notify a panel comprising officers of Inland Revenue Service retired in BS-21 and above, chartered accountants, cost and management accountants, advocates, having minimum of ten years’ experience in the field of taxation and reputable businessmen, in accordance with eligibility criteria specified in Part II of the Schedule to this rule. The member of the Committee shall provide secretariat support to the Committee.

The Committee may determine the issue and may thereafter seek further information or data or expert opinion or make or cause to be made such inquiries or audit as it may deem fit, and shall decide the dispute by majority, within 45 days of its appointment, extendable by another 15 days, for reasons to be recorded in writing.

The decision of the Committee shall be binding on the Commissioner when the applicant; being satisfied with the decision, has withdrawn the appeal pending before the court of law or any appellate authority in the form as set out in Part III of the Schedule to this rule and has communicated the order of the withdrawal to the Commissioner.

Provided that if the order of the withdrawal is not communicated to the Commissioner within sixty days of the service of decision of the Committee upon the aggrieved person, the decision of the Committee shall not be binding on the Commissioner.

On receipt of the Committee’s decision the applicant shall make the payment of income tax and other taxes as decided by the Committee under this rule and all decisions and orders made or passed shall stand modified to that extent.

Members of the Committee appointed shall on decision of the application by the Committee, be paid a lump sum one-time remuneration of Rs 100,000 each for their services, the FBR added.

The remuneration specified shall be paid by the Board from its budget allocation within 15 days of the receipt of the decision of the Committee.“

Copyright Business Recorder, 2024