LAHORE: The customs department is facing intense criticism for issuing time-barred notices, creating unnecessary hurdles for importers and fuelling concerns of corruption within the department.
A recent case has brought this issue to the forefront, where an importer rightfully contested a show-cause notice issued beyond the stipulated 180-day period, as mandated by Section 32(A)(2) of the Customs Act, 1969.
In this instance, the notice was issued after one year and seven months, rendering it time-barred. The department’s failure to provide any explanation for this delay has raised eyebrows, with experts arguing that such instances undermine the department’s credibility and perpetuate corruption.
“Once a matter becomes time-barred, subsequent enhancements in the period of limitation cannot reopen closed transactions,” stated the importer, citing established legal principles. This principle is supported by various judicial precedents, he added.
The incident has sparked concerns about the department’s efficiency and potential abuse of power. The public deserves transparency and accountability from government agencies, and the customs department’s actions seem to fall short of these expectations.
According to legal experts, the department’s delay in issuing show-cause notices can have significant implications.
They said the world practices on issuing show-cause notices by customs departments emphasize fairness, transparency, and adherence to statutory requirements. The primary purpose of a show-cause notice is to provide taxpayers with a reasonable opportunity to respond to allegations of non-compliance or wrongdoing.
It may be noted that show-cause notices are a statutory requirement in many jurisdictions, including Pakistan. It is generally presumed that the notice must be comprehensive, clearly stating the grounds for the action, and providing the taxpayer with sufficient information to respond effectively. Further, notices must be issued within a stipulated time frame, ensuring that taxpayers are not taken by surprise and have adequate time to respond.
The Federal Board of Revenue has previously clarified that proceedings that need to be initiated or compliances that need to be done by taxpayers should be done as per the time limit provided under the law. However, in this case, the customs department’s inaction has led to a time-barred notice, rendering it legally ineffective.
Copyright Business Recorder, 2024
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