Federal Tax Ombudsman (FTO) has issued a guiding policy to the Federal Board of Revenue (FBR) for dealing with overseas Pakistanis to ensure the smooth inflow of foreign remittances in the country.
In this regard, the FTO issued an order on Wednesday.
The FTO has also directed the FBR that the concerned field formation should tender an apology to the based professor.
The FBR should direct all the field formations of the Inland Revenue Service (IRS) and Pakistan Customs Service (PCS), that cases of overseas Pakistanis need to be treated with due compassion and deep regard. Such a treatment is even otherwise warranted in the face of current position of dwindling foreign remittances, FTO directed the FBR.
The FBR should ensure by all means that notices are properly served through all possible means (especially at the given email ID) and that no adverse action is taken without proper service of notices.
FTO reprimanded the FBR, “None in the tax hierarchy appreciated the fact that the Professor has remitted foreign currency to Pakistan, his country, which money is still lying in the bank account, duly declared.
Contrary to encouragement extended to the professor, he is being subjected to the extensive rigmarole of proceedings and as a direct corollary, making him wary to remit any amount to his country in the future. It might have devastating horizontal adverse connotations. The renowned academic surely deserves better treatment”.
Brief facts of the case are such that the Complainant is a professor by profession at TEXAS University in the USA, having resided there for the past 30 years, and is a non-resident Pakistani.
The Complainant remitted an amount of $100,000 through the banking channel. Additionally, the Complainant declared taxable income received from lectures delivered at seminars organized by educational institutions in Pakistan. The department (Deptt) issued show cause notice u/s 122(9) of the ITO, 2001 based on the wealth statement filed by the Complainant.
However, since the complainant was a non-resident and was not in Pakistan during the relevant period, he did not receive any notice from the Deptt. Later, the Deptt finalized an ex-parte assessment u/s 122(1) of the ITO.
When the Complainant returned to Pakistan, he found an assessment order at his house. Subsequently, a rectification application was filed before the assessing officer, along with all the proof of foreign remittances, such as bank statements, uploaded on IRIS.
However, the application remained unattended for reasons unknown. As a result, the appellant had no option but to file an appeal before the Commissioner IR (Appeals), Hyderabad.
The Commissioner IR (Appeals) however dismissed the appeal vide order dated 16.06.2023 on the grounds that no details were produced, despite the fact that all details were personally presented and uploaded on the IRIS portal.
After careful consideration of averments and perusal of the record, it has been observed that the dismissal of appeal by the Commissioner IR (Appeals) on the ground that no details were produced appears to be un-sound because details were provided to him as well as uploaded on the IRIS portal.
It has further been observed that the Commissioner-IR (Appeals) did not appreciate the facts of the case, including the Complainant’s non-resident status as well as non-withdrawal of the amount of remittances as is evident from the bank statement.
Moreover, the objection raised by the Commissioner IR (Appeals) Hyderabad regarding the bar of jurisdiction in terms of Section 9(2)(a)(b), appears to be misconceived as the matter at hand warrants deduction of the element of maladministration on the part of the Commissioner lR (Appeals) Hyderabad for not considering the corroborating evidence(s) provided by the appellant, and not relating to assessment of income or wealth, FTO order added.
