FBR asked to pursue court cases: Finance Division fears financial liabilities

ISLAMABAD: The Finance Division has asked the Federal Board of Revenue (FBR) to vigorously pursue pending cases in courts, where financial liabilities may arise for the federal government in case of any adverse order/decree.

According to the Finance Division’s official memorandum issued to ministries and divisions, the pending cases may be vigorously pursued in the courts of law, where financial liability may arise for the federal government in case of any adverse order/decree.

In case of passing of any order/decree by the court, necessary legal recourse i.e. filing of review, appeal etc, as the circumstances warrant, may be adopted within the prescribed time limit, so that the order does not attain finality.

If the matter attains finality after due judicial process, appropriate provisioning of funds may be ensured through budgetary process, as withdrawal of funds from Federal Consolidated Fund without budgetary provisioning is sheer violation of Article 83 of the Constitution of Pakistan and section 23 of the Public Finance Management Act, 2019.

The Finance Division stated that in some cases it has been noticed that the ministries, divisions, attached departments, subordinate offices etc do not actively pursue court

cases and due to lack of response, filing of appeals etc, the courts' decrees attain finality. Resultantly, the courts start implementation proceedings and direct the concerned to ensure payment to the plaintiff as per the decree.

On the failure to make payment by the concerned ministries, divisions, attached departments, sub-ordinate offices, the court directs the SBP to Debit Central Account No I (Non-Food) and make payment to the plaintiff.

Such direct debit is against the provisions of Section 23 of Public Finance Management Act, 2019.

It stated that the inaction by ministries, divisions, attached departments and subordinate offices is against the principles of financial property and causing financial loss to the federal government.

Henceforth, if any deduction from the Federal Consolidated-Fund is made by the SBP incompliance of any court's orders, the same amount will be deducted from the budget of the respective department, Moreover, SBP is required to seek Finance Division's authorisation before deduction, the Finance Division added.

Copyright Business Recorder, 2021