FTO Orders FBR to Withdraw Un-Warranted Rejection Letter to Taxpayer

While disposing of a complaint, the Tax ombudsman has directed FBR to revisit the condonation order by considering the genuine ground/facts mentioned by the aggrieved.

Brief facts of the case were that earlier, the complainant filed a complaint before the FTO forum for the delay in disposal of the condonation application for filling of refund claim for the tax period April 2016. However, FBR rejected the complainant’s request for condonation.

The Complainant prayed that the FBR be directed to withdraw the un-warranted rejection letter issued in haste and grant condonation of delay of one day for submission of the sales tax claim. The Complainant submitted that as per the directions of the DCIR, the Complainant without wastage of time applied for condonation, before the concerned CIR but no decision was made by the CIR.

After a lapse of five years, the Complainant submitted a reminder request letter to the Department for condonation of submission of a refund claim. Meanwhile, the Complainant has approached the Hon’ble FTO who decided the complaint on 22.09.2021 with the recommendations to FBR/CIR to decide the request of the Complainant for condonation of delay in submission of refund claim for the tax period April 2016, as per law.

In compliance of the recommendations of the Hon’ble FTC, the matter was referred to the FBR Headquarters, for necessary action. FBR rejected the request of the complainant on the ground that “as the delay has not been substantiated with plausible reason/explanation and relying on the judgments of the Honourable Supreme Court of Pakistan and Honourable FTO that substantive reasons for each and every day must be given before delay can be condoned, FBR prayed for the rejection of the Complaint.

FTO’s finding also stated that it was a settled principle of law that the right of a taxpayer cannot be denied on the plea of limitation or on any other technical plea as held by the Supreme Court of Pakistan in judgment PTCL 1998 CL. 354 as under:

“the denial of refund of the amount involved would be violative of Article 24(1) of the Constitution which lays down that “no person shall be deprived of his property save in accordance with the law. The latest judicial trend is to deprecate and to discourage withholding of a citizen’s money by a public functionary on the plea of limitation or on any other technical plea if it was not legally payable by him”.

Considering the above, there is no justification for the FBR to withhold the refund. Accordingly, the Tax ombudsman has directed FBR to direct Member-IR (Operations) to revisit the condonation order and condone the delay.

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