The Federal Board of Revenue (FBR) is likely to prescribe a time limit, of one month, in the Finance Act 2009-10, to finalise recommendations of the Alternative Dispute Resolution Committee (ADRC), facilitating the business community. Sources told Business Recorder on Sunday that FBR has drafted some recommendations to improve the working of the ADRC from next financial year.
According to sources, the FBR has observed that ADRCs recommendations were pending in various cases on taxation matters involving substantial revenue. To effectively resolve the disputes on taxation matters, the FBR has finalised a set of measures to expedite clearance of pending ADRC cases. The FBR has decided that concerned Members should pursue the matter with ADRC for early decision, or set up ADRC where applications had been received.
It was further decided that a time limit may be prescribed, in the next Finance Act, for finalisation of ADRC recommendations and FBR should also take a decision on ADRC recommendations within one month after receipt of such committees recommendations.
It was observed that the Large Taxpayers had been excluded from the ADR mechanism but no alternative facility had been provided for cases pertaining to large taxpayers. It has also been decided that a threshold should be prescribed for cases to be eligible for ADR facility. It was decided that Line Members should ensure recovery in appeal cases where reportedly an amount of Rs 86 billion was stuck up.
The FBR has further observed that 550 sales tax cases were pending before ADRCs for their recommendations. The FBR has taken following decisions to expedite disposal of ADR cases: First, Panel of Members of ADRC to be increased and those Members be engaged for ADRC who are quality-professional and enjoy good reputation. Second, Members should be provided some honorarium. In this connection, the enabling provision be created in tax laws, if required. Third, the time limit be prescribed for ADRCs to formulate their recommendations. Fourthly, applicants should pay some percentage of the due amount for taking up his/her case in ADRC.
It is worth mentioning that a time limit of 90 days was provided in the Income Tax Rules 2002 for making an order by the Board to accept or reject recommendations of Alternative Dispute Resolution Committee in last budget.
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