ISLAMABAD: The Federal Tax Ombudsman (FTO) has warned the Federal Board of Revenue (FBR) that the harsh treatment of tax authorities with overseas Pakistanis in taxation matters would stop the inflow of foreign remittances in the country.
Through an order issued on Wednesday, the FTO has also issued a guiding policy to the FBR while dealing with the cases of overseas Pakistanis.
In a unique case of mistreatment of the FBR with a US-based professor, the FTO has directed the FBR that the concerned field formation should tender apology to the overseas Pakistani; though it is the least, tax department owes to the complainant.
Overseas Pakistani: FTO concerned over repeated changes in tax jurisdiction
The FBR should direct all the field formations of Inland Revenue Service (IRS) and Pakistan Customs Service (PCS) that cases of overseas Pakistanis need to be treated with due compassion and deep regard. Such a treatment is even otherwise warranted in the face of current position of dwindling foreign remittances.
The FBR should ensure by all means that notices are properly served through all possible means (especially at given email ID) and no adverse action is taken without proper service of notices.
The FTO reprimanded the FBR that, “None in the tax hierarchy appreciated the fact that the Professor has remitted foreign currency to Pakistan, his country, which money is still lying in the bank account, duly declared.”
“Contrary to encouragement extended to professor, he is being subjected to extensive rig morale of proceedings and as a direct corollary, making him wary to remit any amount to his country in the future. It might have devastating horizontal adverse connotations.
The renowned academic surely deserves better treatment.“
Brief facts of the case are such that the complainant is a professor at Texas University in the USA, having resided there for the past 30 years and is a non-resident Pakistani.
The complainant remitted an amount of $ 100,000 through the banking channel. Additionally, the complainant declared taxable income received from lectures delivered at seminars organized by educational institutions in Pakistan. The department issued show-cause notice u/s 122(9) of the ITO, 2001 based on the wealth statement filed by the Complainant. However, since the
complainant was a non-resident and was not in Pakistan during the relevant period, he did not receive any notice from the Deptt.
Later, the department finalised an ex parte assessment u/s 122(1) of the ITO.
When the complainant returned to Pakistan, he found an assessment order at his house.
Subsequently, a rectification application was filed before the assessing officer, along with all the proof of foreign remittances, such as bank statements, uploaded on IRIS. However, the application remained unattended for reasons unknown.
As a result, the appellant had no option but to file an appeal before the Commissioner IR (Appeals), Hyderabad. The commissioner IR (Appeals) however dismissed the appeal vide order dated 16.06.2023 on the grounds that no details were produced, despite the fact that all details were personally presented and uploaded on IRIS portal.
Copyright Business Recorder, 2023
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