Petition against ‘illegal’ benches of tribunal: LHC issues notices to PM, law ministry and ATIR chairman

ISLAMABAD: The Lahore High Court (LHC) has issued notices to Prime Minister (Rules Framing Authority), the secretary law, the Ministry of Law and Justice, and the chairman Appellate Tribunal Inland Revenue (ATIR) in a constitutional petition against the chairman ATIR accused of constituting illegal benches of the tribunal, under the new income tax law.

Lahore-based lawyer Waheed Shahzad Butt has moved a petition before the LHC with the arguments that ATIR is a “Judicial Forum” presently working under the administrative control of the Law Ministry and chairman ATIR is allegedly involved in the constitution of benches of the tribunal, after the substitution of Section 130 of the Income Tax Ordinance, 2001 through Tax Laws (Second Amendment) Ordinance, 2019, dated 26.12.2019.

Prima facie, an act having no effect in the eyes of law.

Petitioner states that after substitution of Section 130 subsequently made as an Act No XVII of 2020 of the Parliament, through Tax Laws (Amendment) Act, 2020, the powers of chairman to constitute benches have totally been changed/withdrawn by the legislature and the prime minister is legally authorised to frame rules for the constitution and functioning of benches in the tribunal.

At present, the Benches of Tribunal constituted by the chairman for the purposes of hearing and deciding the appeals is not in consonance and conformity with the Sub-sections (5) and (6) of the newly-substituted Section 130 of the Income Tax Ordinance.

As a consequence after 26.12.2019, no Division/Full Bench/Special Bench/ Touring Bench could also be constituted under the above Sub-sections (6) and (7) of Section 130, because the said entire Section 130 was substituted through the Ordinance, 2019 ibid., while ATIR Rules, 2010, do not empower the chairman to constitute the Benches of the Tribunal.

When contacted, International Constitutional lawyer Mohammad Azhar Siddique, who is representing the petitioner told that all orders passed by division/full bench/special bench/touring bench would be ultimately set-aside by the respective high courts of the country whether decided for and against taxpayers/FBR, resulting huge loss to the public exchequer (taxpayer money) in futile litigation, which runs counter to the landmark judgment of the Supreme Court of Pakistan in 2018 SCMR 939. The LHC has issued notices to the respondents for March 26, 2021.

Copyright Business Recorder, 2021