ISLAMABAD: Taxpayers are shocked over a harsh and unjustified income tax amendment to the Finance Bill 2021, under which no appeal shall be made by a taxpayer before the Commissioner (Appeals) against an order of assessment unless the taxpayer has paid the full amount of due tax. Through Finance Bill, 2021 the lawmakers proposed under Section 127 of the Income Tax Ordinance that no appeal under sub-section (1), shall be made by a taxpayer against an order of assessment unless the taxpayer has paid the amount of tax due under sub section (1) of Section 137.

Tax expert Amer Javed, senior partner M/s Rafaqat Babar & Co explained to Business Recorder that it is a wrong provision beside other anomalies in the Finance Bill 2021.

Such measures are introduced to gain budgetary targets by recovery and stopping the right of appeal by way of compulsory payment of tax is time tested and exercised many times earlier.

Such harsh provisions did not stand the test of writ petition in higher courts.

He added, if we look back, the provision for filing of appeals, vide Finance Act, 1994 provision was promulgated, “No appeal under sub section (1) shall lie against any order of assessment unless tax payable under section 54 has been paid and not less than 15% of the amount of tax assessed has been paid.”

However, soon after passing the Finance Act, 1994, the law maker realised their mistake and anomaly rectified the provision by adding proviso “provided that the total amount payable under this sub section shall not exceed 20 percent of the total tax assessed for the preceding year” vide Income Tax Fourth Amendment Ordinance, 1994 dated October 16, 1994.

The law maker realised such harsh amendment of paying even 15 percent of tax assessed and immediately provided relief by issuance amendment ordinance.

The Finance Bill, 2021 making amendment and asking for 100 percent payment under Section 137 of the Income Tax Ordinance, 2021 is not only harsh but against the principle of natural justice.

The amendment introduces vide Finance Act, 1994 and amended through Amended Ordinance, 1994 was so harsh and impracticable that was taken away in the Finance Act 1996.

The law maker should have studied the development of law over history before suggesting the proposal. It would be in the interest of fair play and natural justice, suitable amendment is required before passing the bill, 2021, Amer Javed added.

Copyright Business Recorder, 2021