LTO Islamabad Refunds Rs. 2 Billion to IESCO to Avoid Contempt of Court Proceedings

On the basis of serious notice by the Islamabad High Court (IHC) against forced bank recoveries, Large Taxpayer Office (LTO) Islamabad has refunded a further amount of Rs. 2.0732 billion to the Islamabad Electric Supply Company (IESCO) to avoid contempt of court proceedings against the delinquent FBR officers.

Sources told ProPakistani that the development took place solely due to strict intervention by the IHC and LTO has returned Rs. 2,073,206,658/- vide Refund Order No.01/2024 dated 28-02-2024 issued by the office of DCIR, Unit VII, Zone-II,LTO Islamabad to the IESCO out of tax recovered from attachment of bank accounts of IESCO.

When contacted tax lawyer Waheed Shahzad Butt told ProPakistani that earlier IHC summoned Member (Operations-IR) and Chief CIR, LTO Islamabad to appear in person before IHC, for violation of the order passed by IHC in tax recovery matters, by the field formations, specifically LTO, Islamabad.

The petitioner (IESCO) stated that the high handedness by the department (LTO Islamabad) over a period of time has almost resulted in the collapse of the IESCO economic activity. The respondents (LTO) in order to meet their revenue targets have targeted the petitioner. In order to achieve their revenue target they even paid no heed to the orders of the court.

Butt further added that IHC has also ordered to submit names of LTO Islamabad officers who are involved in tax recovery moves through attachments of bank account of IESCO while in the second petition by IESCO IHC has issued notices to high-ranking officials, including the chairman of the FB, the member operations-IR, and tax employees of the LTO including Chief CIR, CIR and DCIR, Zone-II, Islamabad.

IHC earlier order states, “The petitioner is aggrieved by recovery notices dated 22-02-2023 pursuant to which coercive recovery has been affected from the accounts of the petitioner. The learned counsel states that the assessment was pending adjudication before the CIR (Appeals), who by order dated 21-02-2023 had dismissed the petitioner’s appeal. Such order was communicated to the petitioner at 02:00 p.m. on 22-02-2023. ‘

However, without issuing any prior notice after the dismissal of the petitioner’s appeal or even the communication of the appeal order to the petitioner, coercive recovery was affected at 09:00 a.m. on 22-02-2023 in breach of law. Coercive recovery is also in breach of the instructions issued by FBR by letter dated 20-03-2017 directing the Commissioners that coercive recoveries are not to be affected against discourse without the prior approval of FBR.”