ISLAMABAD: Islamabad High Court (IHC) has granted conditional relief to a state-owned enterprise (SOE) to apply to the Federal Board of Revenue (FBR) for resolution of its tax-related dispute through formation of a dispute resolution committee.
In this regard, the IHC has issued an order in favour of M/s Universal Service Fund Company (the SOE).
The FBR’ side was represented by advocate Osama Shahid before the IHC.
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According to a latest order issued by the IHC, the contesting parties (FBR and SOE) arrived at the following consensus:-If in terms of section 134A of the Income Tax Ordinance, the petitioner (state own enterprise) applies to the FBR for the appointment of a committee for the resolution of the dispute, the petitioner’s appeal before the Commissioner (Appeals) against the order dated 29.06.2024 passed by the Assistant/Deputy Commis-sioner, Inland Revenue would be deemed to be pending.
If the said committee fails to decide the dispute within a period of sixty days and due to this the said committee is dissolved by the FBR, the petitioner would be at liberty to pursue this appeal before the Commissioner (Appeals) who shall also decide the question as to the maintainability of the said appeal, the IHC order said.
In the instant case, the amount in dispute under the order passed by the assistant/deputy commissioner is Rs6,080,396, being the amount which the petitioner was held liable to pay.
The value of assessment in the instant case is less than 20 million rupees, the forum for the appeal against the order dated 29.06.2024 would be the Commissioner (Appeals) and not the Appellate Tribunal Inland Revenue (“ATIR”).
Therefore, the petitioner’s appeal filed before the Commissioner (Appeals) under Section 127 could not have been transferred to the ATIR. After the ATIR refused to register the petitioner’s appeal, the impugned order dated 04.12.2024 was passed by the Commissioner (Appeals). Vide the said order, the Commissioner (Appeals) disposed of the petitioner’s appeal without hearing it on merits and pointed the petitioner in the direction of the FBR in terms of Section 134A.
The IHC order said that Section 134A has an overriding effect on the other provisions of the 2001 Ordinance as it contains a non-obstante clause. As the petitioner is admittedly State Owned Enterprise (“SOE”), Section 134A confers on it a right to apply to the Board for the appointment of a committee for the resolution of any hardship or dispute mentioned in detail in the application.
The quantum of the amount in dispute is of no consequence where the applicant is an SOE. By virtue of the second proviso to Section 134A(2), such an SOE has been conferred with the right to file an appeal to the Appellate Tribunal or a reference to the High Court in the event the committee fails to decide the dispute within a period of sixty days.
The counsel for the petitioner has candidly admitted that the petitioner has not even applied to the FBR for the appointment of a committee for the resolution of the dispute.
If the committee in the petitioner’s case fails to decide the dispute within 60 days, the petitioner would not be in a position to pursue its appeal before the Commissioner (Appeals), the IHC order added.
Copyright Business Recorder, 2025
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