PTA’s Request for Tax Refund: Fine Imposed on Commissioner Inland Revenue
Islamabad High Court has imposed a fine of PKR 100,000 on the Commissioner Inland Revenue for failing to decide on a tax refund request within two months regarding advance tax deductions.
Justice Babar Sattar of the Islamabad High Court issued the decision in the case concerning the deduction of PKR 1.37 billion in advance tax from the Pakistan Telecommunication Authority (PTA).
The court accepted PTA’s petition against the Federal Board of Revenue (FBR) and directed the tax department to decide on the refund request within two months. Additionally, the court fined the Deputy Commissioner Inland Revenue PKR 100,000 and ordered the amount to be paid to the petitioner within one month.
The court noted in its judgment that the tax department recalculated the advance tax and deducted the amount from the bank without issuing any notice to the taxpayer. Under the Income Tax Ordinance, it is mandatory to issue a notice to taxpayers. The court declared that the action taken without following due process violated the petitioner’s fundamental rights.
The petitioner argued that the additional amount deducted was unjustified and submitted a refund request. However, the Commissioner Inland Revenue failed to decide on the request within the legally prescribed two-month period.
It is pertinent to mention that PTA initially filed the petition in 2018 against the deduction of PKR 1.37 billion by the tax department.
