ISLAMABAD: The Federal Board of Revenue (FBR) has extended the deadline to September 16 for transferring pending cases involving multi-billion tax amounts to the Appellate Tribunal Inland Revenue (ATIR) to expedite the resolution.

The tax disputes pending before the Commissioner Inland Revenue-Appeal (CIRA) involving more than Rs20 million in income tax or refund, more than Rs10m in sales tax and Rs5m in federal excise duty would be moved to the newly established ATIR.

The CIRA will hear cases below the ATIR’s threshold. The new appeal system was implemented through the Tax Laws (Amendment) Act 2024, which was not part of the Finance Bill 2024.

The new appeals will also follow the threshold to determine whether ATIR or CIRA will file the case, and the decisions of these bodies can be contested before the high courts by the aggrieved persons.

According to the new amendment, the commissioner will not recover any tax for 30 days from the date of communication of the CIRA or ATIR order. The commissioner begins collecting taxes from individuals shortly after the order is issued, even if the aggrieved party still needs to receive a copy of the decision.

Extends deadline to Sept 16 for transferring pending cases to ATIR

The ATIR will decide appeals within 90 days of filing, except those pending at the beginning of the Tax Laws (Amendment) Act 2024, which must be resolved within 180 days. If a decision is not reached within these time frames, the minister of law and justice must issue a condonation that cannot exceed 90 days.

The ATIR has decreased the maximum term of stay granted from 180 days to 90 days; nevertheless, if the tribunal does not consider the appeal within the statutory time limit, the stay will remain in place until the decision is made.

The ATIR is required to inform the taxpayer of the opportunity to pursue the matter in the Alternative Dispute Resolution Committee (ADRC), and if the taxpayer chooses to proceed with the appeal, a date for hearing and determination will be established.

The federal government has the authority to designate the chairman and members of the ATIR. Previously, such powers belonged to the prime minister. The eligibility criteria for becoming an ATIR member have been amended to erode the distinction between judicial and accountant members.

On an application based on a specific reference, the high court may issue a stay of tax collection conditional on the deposit of at least 30 per cent of the ATIR-determined amount. The stay order will expire in six months unless the reference is decided or the court withdraws it.

State-owned enterprises, defined by the State-Owned Enterprises (Governance and Operations) Act 2023, must first apply to the board to create a committee to resolve disputes. If the committee does not reach a decision, an appeal can be made with the ATIR, the High Court, or the Supreme Court, as the case may be.

The ADRC provisions have been updated to include tax disputes of Rs50m or more for non-SOE taxpayers. Furthermore, ADRC decisions will be binding on taxpayers.

Published in Dawn, June 20th, 2024