AGL 40.30 Increased By ▲ 0.10 (0.25%)
AIRLINK 130.29 Increased By ▲ 1.18 (0.91%)
BOP 6.29 Decreased By ▼ -0.31 (-4.7%)
CNERGY 4.03 No Change ▼ 0.00 (0%)
DCL 8.85 Increased By ▲ 0.40 (4.73%)
DFML 42.74 Increased By ▲ 1.49 (3.61%)
DGKC 87.50 Increased By ▲ 0.50 (0.57%)
FCCL 33.78 Increased By ▲ 0.43 (1.29%)
FFBL 65.96 Increased By ▲ 0.06 (0.09%)
FFL 10.67 Increased By ▲ 0.13 (1.23%)
HUBC 113.85 Increased By ▲ 3.15 (2.85%)
HUMNL 16.09 Increased By ▲ 0.86 (5.65%)
KEL 4.80 Increased By ▲ 0.02 (0.42%)
KOSM 7.98 Increased By ▲ 0.15 (1.92%)
MLCF 42.09 Increased By ▲ 0.19 (0.45%)
NBP 61.10 Increased By ▲ 0.60 (0.99%)
OGDC 184.90 Increased By ▲ 2.10 (1.15%)
PAEL 25.60 Increased By ▲ 0.24 (0.95%)
PIBTL 7.26 Increased By ▲ 1.00 (15.97%)
PPL 146.60 Decreased By ▼ -1.21 (-0.82%)
PRL 24.59 Increased By ▲ 0.03 (0.12%)
PTC 16.48 Increased By ▲ 0.24 (1.48%)
SEARL 70.51 Increased By ▲ 0.01 (0.01%)
TELE 7.36 Increased By ▲ 0.06 (0.82%)
TOMCL 36.16 Decreased By ▼ -0.14 (-0.39%)
TPLP 8.15 Increased By ▲ 0.30 (3.82%)
TREET 16.00 Increased By ▲ 0.70 (4.58%)
TRG 51.40 Decreased By ▼ -0.30 (-0.58%)
UNITY 27.46 Increased By ▲ 0.11 (0.4%)
WTL 1.28 Increased By ▲ 0.05 (4.07%)
BR100 9,896 Increased By 54.4 (0.55%)
BR30 30,314 Increased By 277.4 (0.92%)
KSE100 93,019 Increased By 499 (0.54%)
KSE30 28,879 Increased By 92.5 (0.32%)

LAHORE: Taxpayers from sugar industry have challenged the power of Commissioner Inland Revenue (CIR) to make a random selection of sales tax returns for audit, terming it arbitrary as well as a roving and fishing inquiry into their tax affairs.

According to sources, the CIR had issued notices under Sales Tax Act Excise Act allegedly on the scrutiny of the returns filed under the self-assessment regime. In some cases, the department had not even conducted scrutiny of the returns and selected cases for the audit purposes.

The taxpayers were of the view that the Commissioner cannot issue notice without assigning reasons. They further contended that the notices were not only based on mala fide and arbitrary approach but also issued mechanically on or about the same time to all of them.

They further maintained that the CIR does not have power to make a random selection for audit and any such power vests only with the FBR. In some cases, they added, the CIR had selected returns for audit for a second time within a period of three years, which is prohibited by the law. In addition, the department had also proceeded to select returns for audit for consecutive tax years in one go, which is again not the spirit of the law.

The department, on the other hand, maintained that audit was the most effective tool to assess the veracity of the tax return filed under the self-assessment regime and the taxpayers are provided with remedies once adverse order is passed against them.

The department also dispelled the impression that notices were issued arbitrarily, saying that they were issued after examining the tax returns filed by the millers. Since sales tax, unlike income tax, is not out of the pocket of the sugar mills, therefore, no reason was requited to be assigned to the taxpayers for access to record or documents.

However, the relevant appellate forum maintained that the notices were of no legal effect because they were issued by the CIR while failing to disclose reasons for selecting the returns for audit.

Copyright Business Recorder, 2024

Comments

Comments are closed.