Federal Tax Ombudsman rebuts Revenue Board view on jurisdiction of inquiry

ISLAMABAD (February 03 2003) : Federal Tax Ombudsman former Justice Saleem Akhtar has strongly rebutted the Central Board of Revenue (CBR) contention that the former had no jurisdiction to investigate and inquire into matters, which relate to assessment and where remedy of appeal is available as this has been provided under sub-section 2 (b) of the establishment of Federal Tax Ombudsman Ordinance.

Discussing the issue at a great length in Wah Nobel's complaint for refund of tax, the FTO observed that such a stance would frustrate the very object of this welfare legislation.

It would never have been the intention of the legislature to create an institution with the object to eradicate maladministration and yet to deny the jurisdiction for investigation and granting relief under the ordinance.

The FTO decided the case last week in favour of the complainant Wah Nobel, Rawalpindi, flaying CBR functionaries for delaying refunds of tax on one pretext or the other.

Rejecting the department's stand on jurisdiction, the relevant portions of the FTO's order read:

“The department has objected to the jurisdiction and contended that its barred under sub-section 2 (a) and 2 (b) section 9 of the establishment of the office of the Federal Tax Ombudsman Ordinance, 2000.

“According to subsection (2) (a) of section 9 matters, which are sub judice before a court of competent jurisdiction or tribunal or board or authority on the date of the receipt of a complaint or motion, the FTO will have no jurisdiction to investigate or inquire into the matter.

It is clear that the bar will apply where any complaint is received during the pendency of any matter.

But if the complaint, motion or reference has been received in the FTO Secretariat before the same matter became subject matter of any proceeding in a competent forum, the bar will not apply.

“It may further be clarified that even in matters, which are sub judice prior to filing of complaint, if any allegation of maladministration has been made independent of the issues raised in the pending matter, then the Federal Tax Ombudsman will have jurisdiction to investigate and inquire into such allegations.

“In the present case, the complaint was filed earlier than the appeal and, therefore, there was no matter sub judice at the time the complaint was filed.

WELFARE STATUTE: “The next objection under subsection 2 (b) of section 9 has been discussed in many earlier cases and ruled that where maladministration is established, the Federal Tax Ombudsman has the jurisdiction to investigate in the matter.

“It is pertinent to point out that the cardinal principle of construction and interpretation of a welfare statute as is the present ordinance, is that it is expounded according to the intention of the legislature or authority, which made it. The object of establishment of the office of the Federal Tax Ombudsman Ordinance is to eradicate malaministration and grant relief to the aggrieved parties.

“It is in the nature of a welfare legislation introducing accountability in tax administration for achieving good governance, healthy tax culture and providing clean and friendly atmosphere which may restore trust of taxpayers and confidence of investors, thereby increasing the Revenue.

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