F. HUSSAIN & SONS, KARACHI VS SECRETARY, REVENUE DIVISION, ISLAMABAD, 2008 PTD-FEDERAL-TAX-OMBUDSMAN-PAKISTAN 413 (2003)

Income Tax Ordinance (XXXI of 1979)---

----Ss. 92, 50 & 59(1)---C.B.R. Circular No. 18 of 1999 dated 11-9-1999---Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), S.2(3)---Refund---Assessment was finalized under Self-Assessment Scheme giving tax credit to the extent of tax liability only and tax paid in excess of tax liability was not refunded---Instructions were issued to the Commissioner to issue the refund voucher for relevant assessment year---Explanations had also been called from the concerned officer for showing carelessness in responding to the complainant's application---In compliance to instructions, Commissioner concerned had approved the issuance of refund---Federal Tax Ombudsman appreciated the prompt and just action taken by the Regional Commissioner of Income Tax in redressal of the genuine grievance of the taxpayers---Such vision and progressive attitude reflected service oriented trend which was a great improvement in the tax culture---Any reform in the tax administration will succeed if the reformers and administrators changed their minds---Federal Tax Ombudsman recommended that claim or refund for the assessment year 1999-2000 be issued within 15 days of the receipt of this order together with compensation for delayed payment of refund under S.102 of the Income Tax Ordinance, 1979 and that disciplinary proceedings initiated against the concerned officer be finalized and completed within 30 days of the receipt of this order and a copy of the same be wilt to this Secretariat.

S. A. Nasser, Dealing Officer.

Haider Naqi for the Complainant.

Agha Hidayatullah, IAC Range-III, Zone-C, Karachi for Respondent.

DECISION/FINDINGS

JUSTICE (RETD.) SALEEM AKHTAR (FEDERAL TAX OMBUDSMAN).---The grievance of the complainant relates to non-issuance of refund for the assessment year 1999-2000. The complainant has also claimed compensation under section 102 of the Income Tax Ordinance, 1979 repealed.

2. The complainant is an Unregistered Firm carrying on manufacturing business of plastic goods in Korangi Industrial Area, Return for the year 1999-2000 was filed under Self-Assessment Scheme and the assessment is deemed to have been completed under section 59(1) in accordance with sub-para (a) of para. 12 of C.B.R. Circular No.18 of 1999 dated 11-9-1999.

3. In the parawise comments dated 1-10-2003 the respondents have admitted that the return of income for the assessment year 1999-2000 was filed under Self-Assessment Scheme declaring total income at Rs.331,682 and the assessment was finalized under section 59(1) giving tax credit to the extent of tax liability only. Tax paid in excess of tax liability was, however, not refunded for which necessary explanation has been sought from the officer concerned. It has also been stated by the RCIT, Southern Region, Karachi in the parawise comments dated 1-10-2003 that the Commissioner of Income Tax concerned is being directed to settle the claim of refund of the complainant within 15 days and report compliance thereof. The concerned Commissioner has further been directed to fix responsibility for carelessness of the officer incharge for not responding to the complainant's application. Repeated requests were made to the concerned officers to issue necessary refund voucher for the assessment year 1999-2000. In this behalf application dated 17-3-2003 addressed to the Assessing Officer, Circle-05, Zone-C, Karachi was cited. Another request was made to the CIT, Zone-C, Karachi vide application dated 11-4-2003 and finally to the RCIT, Southern Region, Karachi dated 8-5-2003. The request of the complainant was, however, not responded to Maladministration is, therefore, established as the repeated requests of the assessee were ignored from time to time.

4. However, in view of the parawise comments of the respondents, necessary instructions have already been issued to the concerned Commissioner to issue refund voucher for the relevant assessment year and compliance report has been sought within 15 days. Explanations have also been called from the concerned officer for showing carelessness in responding to the complainant's application. In compliance to the instructions of the RCIT, Southern Region, Karachi, the Commissioner concerned has already approved the issuance of refund amounting to Rs.304,243.

5. The AR has vociferously pleaded that the complainant is entitled to compensation on delayed payment under section 102 of the Income Tax Ordinance, 1979 repealed. Refund should have been issued within three months after filing of return of income for the assessment year 1999-2000. The complainant filed return of income at Rs.331,682 under SAS and total tax paid for the assessment year 1999-2000 worked out to Rs.375,697. The respondent's representative has nothing to say in rebuttal of the complainant's claim for compensation under section 102. The complainant's AR has also mentioned that request was made for issuance of refund and compensation under section 102 vide letters dated 17-3-2003, 11-4-2003 and 8-5-2003 which were, however, not responded to.

6. We wish to place on record our appreciation for the prompt and just action taken by the learned RCIT Southern Region, Karachi in redressal of the genuine grievance of the taxpayers. Such vision and progressive attitude reflects service oriented trend which is a great improvement in the tax culture. Any reform in the tax administration will succeed if the reformers and administrators change their mindset.

7. It is, therefore, recommended that---

(i) Claim for refund for the assessment year 1999-2000 be issued within 15 days of the receipt of this order together with compensation for delayed payment of refund under section 102 of the Income Tax Ordinance, 1979 (repealed) as per law.

(ii) A compliance report in respect of above be sent to this office within 30 days.

(iii) Disciplinary proceedings initiated against the concerned officer be finalized and completed within 30 days of the receipt of this order and a copy of the same be sent to this Secretariat.

C. M. A./29/FTOOrder accordingly.