The Federal Board of Revenue (FBR) has issued a new recovery procedure for the Inland Revenue field formations to avoid illegal attachment of bank accounts of the taxpayers.
In this connection, the FBR issued new instructions to the field formations.
According to the FBR’s instructions, in supersession of Board’s earlier instructions and in the light of the interim order of the Islamabad High Court in Writ Petition No.229812016, the the following instructions shall be implemented by field formations for recovery of tax and proposing reference applications or civil petitions for leave to appeal.
In respect of the officers of Inland Revenue, the Zonal Commissioners shall ensure that the jurisdiction in respect of a taxpayer is exercised by the concerned officer. All notices issued are properly served in the manner as provided in the Income Tax Ordinance, 2001, They must ensure that the orders under any provisions of the said Ordinance are passed after providing sufficient opportunity of being heard to the taxpayer and recovery measures under the provisions of sections 138 or 140 shall be undertaken only after the statutory time provided under section 137 (2) of the said Ordinance for payment of tax has passed.
No further proceedings for recovery of tax shall be taken when an order restraining the recovery of tax by any court of law i.e. the Honorable Supreme Court or Honorable High Court is received. In case, the restraining order is received after initiation of recovery measures under any provisions of the said Ordinance, but before actual recovery of the tax amount, no further action shall be taken for recovery of tax, FBR maintained.
Similarly no further proceedings for recovery of tax shall be taken when a stay order by the Appellate Tribunal Inland Revenue (Tribunal) or the Commissioner Inland Revenue (Appeals) is received. In case, the stay order from the Tribunal or the Commissioner IR (Appeals) is received after initiation of recovery measures under any provisions of the said Ordinance, but before actual recovery of the tax amount, no further action shall be taken for recovery of tax.
The proceedings under the provisions of section 138 and 140 are separate and are also governed by separate rules under the Income Tax Rules, 2002. Rules contained in Chapter – XVI of the said rules prescribe procedure for recovery of tax under the provisions of section 138 whereas rules contained in Chapter XVIA of the said rules prescribe procedure for recovery of tax under the provisions of section 140.
However, without prejudice to departmental appeals or reference applications before appellate authorities or courts of law, notice under section 138 (1) shall invariably be issued allowing taxpayers seven days’ time to make payment of tax, prior to recovery proceedings under section 140 of the said Ordinance.
In case, there is no restraining order by any court or law, or there is no stay order by the Commissioner IR (Appeals) or the Tribunal, the recovery of tax through bank attachment under section 140 of the said Ordinance shall only be undertaken with the prior approval of the committee to be constituted at formation level. The committee shall comprise two senior Commissioners and be headed by the Chief Commissioner Inland Revenue.
Moreover, while proposing filing reference applications and civil petition for leave to appeal before the higher courts, the Zonal Commissioners are expected to exercise good judgment while filing reference application or civil petition for leave to appeal in cases where question of law is involved.
I don’t understand what is the difference between new method and the old??