LAHORE: Due to the tax authorities’ failure to specify a reasonable payment timeframe, a corporate taxpayer received reimbursement for the amount recovered from his bank account, said sources.

While terming it coercive measure, the taxpayer was of the view that the recovery against tax dues was made without issuing prior notice as per the law. It may be noted that the tax authorities had afforded an opportunity of hearing to the taxpayer before reassessment of the e-return by the taxpayer. However, it preferred to jump to the recovery proceedings by attaching bank accounts without issuing notice to the taxpayer.

He further maintained that revenue functionaries have an obligation to exercise their authority in a way that it does not undermine rights of taxpayers to due process, fair trial and access to justice.

According to the taxpayer, tax authorities are also under obligation to afford protection of law to the citizens rather than becoming instruments of denying taxpayers of such protection. He said regardless of whether it is commissioner (appeals), income tax appellate tribunal or high court upholding an assessment order, tax authorities are under an obligation to issue notice under the relevant provisions of the law before they resort to use of coercive means.

The competent authority upheld his stance and maintained that the relevant provision of the law conceives that a reasonable timeframe is to be specified by the commissioner within which tax due is to be paid. It was further pointed out that it is inconceivable that such reasonable time could be a period of less than seven days as the purpose of such provision is to put the taxpayer on notice to discharge tax obligation within a reasonable time period and also afford taxpayer an opportunity to avail his statutory right of appeal.

Accordingly, the competent forum set aside the recovery proceedings, as the same was without lawful authority and of no legal effect for not complying with mandatory requirement of issuing a notice under the relevant provision of the law. It further directed the authorities to ensure reimbursement of amount recovered from bank accounts of taxpayer pursuant to recovery proceedings, or to credit it to the same bank accounts.

Copyright Business Recorder, 2024