ISLAMABAD: The Federal Board of Revenue (FBR) Policy Wing of Inland Revenue has refused to give policy viewpoint in court matters and referred the matters to the FBR Legal Wing for interpretation of federal tax laws.

It is apprehended that the court may decide a case against the FBR chairman due to absence of policy viewpoint of the FBR Policy Wing Inland Revenue in the said case.

The matter is related to the sales tax exemption on the import of solar panels by the importers which becoming discriminatory for the local assemblers.

The officials dealing with the FBR Legal Wing and court matters have requested the chairman FBR to sensitise the IR-Policy Wing with regards to the submission of para-wise comments in the court cases requiring, interpretation of fiscal laws.

The legal counsel of the FBR has telephonically communicated the stance of the IR-Policy Wing being awaited by the court. Since the case is pending since long, therefore, due to want of para-wise comments on behalf of the FBR, the judge may pass an adverse order against the chairman FBR.

The background of the case is that the petitioner has challenged entry 164 of the Sixth Schedule of Sales Tax Act. The said entry grants an exemption to PV cells used in solar panels. As per the petitioner, the FBR grants the importer of solar panels exemption on complete panel because of entry 164.

However, local assemblers who assemble PV cells and other equipment to assemble a panel are only granted an exemption to the extent of PV cells only and not on the complete panel. Due to the said reasons, the petitioner has challenged vires of entry 164 being discriminatory and a violation of Article 25 of the Constitution. The IR Policy Wing is again requested to submit para-wise comments/ policy statement in respect of the said case at the earliest.

Earlier, in response the Policy Wing returned it with the remark that since FBR Member IR-Policy is not the respondent in the subject petition. Therefore, the same may be forwarded to the concerned quarters for further necessary action. Since the matter involves a policy issue which can be tendered by the Policy Wing only, officials added.

Copyright Business Recorder, 2023