FBR asked to clear pending ST refund claims
KARACHI: The Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) to clear payments of all pending sales tax refund claims within a prescribed period of four weeks.
The FTO issued the order on a suo motu notice against non-settlement and payment of long due ST refunds worth millions of rupees belonging to exporters. The FBR has been asked to direct its field offices to clear all pending refund claims.
Ombudsman Dr Muhammad Shoaib Suddle had taken action on media reports which suggested that the Pakistan Apparel Forum (PAF) and the Site Association of Industry had levelled serious allegations against FBR’s field offices for non-settlement of refund claims. He took both the trade bodies as complainants in its proceedings.
In his order issued by the FTO secretariat recently, he asked the FBR to put in place an efficient and foolproof mechanism for expeditious disposal of bona fide refund claims. The ombudsman also settled 214 outstanding ST refund claims amounting to Rs1.262 billion.
Dr Suddle also asked the trade bodies to file a monthly statement with the FTO registrar on more than two months’ old pending claims and submit its copy to the chief commissioner concerned so that it could be monitored on a regular basis at the FTO office.
During the proceedings, the ombudsman sought details from PAF and Site Association about their members’ pending ST refund claims filed with the FBR field offices under Section 10 of the Sales Tax Act, 1990.
The trade bodies said that 214 cases of outstanding sales tax claims having a revenue impact of Rs1.262 billion were pending with the FBR field offices. The PAF filed 169 cases with outstanding refund of Rs975 million and the Site Association 45 cases with outstanding refund of Rs288 million.
The FTO sought information from the revenue division secretary about the refund claims. According to details, out of 169 pending claims submitted by PAF members, regional tax offices in Karachi already sanctioned refunds in 70 cases. About 90 per cent of the claims submitted by Site Association members have already been settled.
However, the revenue division requested the FTO to seek complete monthly details, along with supporting evidences, from the PAF and Site Association in respect of pending claims so that the same could be processed and refunds sanctioned as per law. The two parties sought time and held various meetings to reconcile the discrepancy in the number and
amount of claims and sort out jurisdictional issues as well.
The department in the case of PAF accepted pendency of 67 claims amounting to Rs410 million. But the PAF submitted a revised list and claims of 77 cases with outstanding refund claims of Rs559 million.
Similarly, the cases submitted by the Site Association on reconciliation reduced to 15, with outstanding refund amount at Rs57.997 million.