Reissuance of show-cause notices after 19 years illegal: FTO

LAHORE: The Federal Tax Ombudsman (FTO) has held that reissuing show-cause notices after 19 years, without incriminating evidence, would be a blatant violation of the law and previous orders.

In a landmark case, the FTO decided the matter in favor of a commercial importer/exporter who had been embroiled in a nearly two-decade-long dispute with tax authorities.

The dispute centered on the importer’s refund claims for zero-rated supplies, which were repeatedly delayed and obstructed by tax authorities. The tax authorities proceeded against the importer alleging him of using fake/flying invoices while the taxpayer tried his level best to satisfy the authorities.

The importer approached the office of FTO and filed a complaint against the authorities for issuing show-cause notice to him (claimant/importer) in present matter which remained unresolved for about two decades with series/rounds of litigations, even in presence of order in his favour having been duly passed by the Commissioner (Appeal) and the Department neither filed second appeal nor sanctioned him the refund amount.

The FTO maintained that the case of the complainant had been mishandled badly by the department due to rapid changes in the jurisdiction and transfer/posting of the officers from one place to another.

Situation of the present matter had reached a stage where the department would have no choice other than to give effect to the order of the Commissioner Appeals as the same (order) had attained finality and department’s representation before the President against the FTO order had also been rejected.

Copyright Business Recorder, 2024