Unchecked powers to taxation officers will hit economy: LHC

The Lahore High Court (LHC) has observed that unchecked powers to the taxation officers (TOs) to enjoy "free access", unobstructed inspection and unqualified right to custody and seizures will decline economic activity and such powers will diminish the sources that generate the state revenue, and no doubt it will be incompatible with and obstructive for the country's economic growth.
The court passed these observations while disposing of two petitions filed by Diplex and Food Consults.
The court directed the respondent officials to return the record, accounts, or other property seized during the alleged raids and searches of the premises of the petitioners' companies - Diplex and Food Consults.
The court also restrained the respondents from using the seized material or records etc against the petitioners in any manner whatsoever in any proceedings of actions.
The court held that all the proceedings and actions taken in consequence of such raids, searches and seizures are also adjudged to illegal, unlawful and without lawful authority.
The court further held that such resort to free access and free inspection provisions without essential safeguards will be subversive of the guarantees under Articles 09,14,15,18,23 and 24 of the constitution. Furthermore, without reasonable standards upon the exercise of such powers by the taxation officers, economic activity will decline.
The court observed that the respondents appear to be oblivious of the effects of such an interpretation. Under guise of revenue collection, the officers will come to possess the unrestricted state power and unlimited authority.
The citizens will be at their whim, wish and unrestrained discretion. The "free assess" provision will become usable as "free for all" process.
It will be abused as a free entry pass to the business or manufacturing places or the work premises of the citizens. Armed therewith evidence, information or admissions to the officer's liking will not be hard to obtain. More often than not these provisions in the hands of the revenue office will become the instruments of terror, intimidation, harassment and exaction.
The outcome will be a patent offence to the rights of freedom, dignity, privacy of life and sanctity of the business, trade and calling, the court held.