Islamabad, January 6, 2025 – The Appellate Tribunal Inland Revenue (ATIR), Division Bench-I, Islamabad, has rejected an appeal filed by a non-resident taxpayer, citing strict procedural non-compliance. This decision highlights the challenges faced by taxpayers living abroad, particularly under a legal framework that does not accommodate digital or proxy submissions.
The tribunal emphasized that appeals must adhere rigorously to the procedural requirements stipulated by law. Under the current regulations, there is no provision for electronic submissions or remote participation, making it impossible for non-residents to file appeals without physical presence.
Legal experts have criticized this rigid approach, arguing that justice should not be sacrificed on the altar of technicalities. They stress that the Federal Board of Revenue (FBR), in collaboration with the Ministry of Law and ATIR, must introduce mechanisms to address these shortcomings, especially for non-residents who contribute significantly to Pakistan’s economy through foreign remittances.
According to Black’s Law Dictionary, a signature is defined as:
“(1) a person’s name or mark written by that person or at the person’s direction, or (2) any name, mark, or writing used with the intention of authenticating a document.”
The case underscores the inflexible nature of procedural requirements, which disproportionately impact non-resident taxpayers. In this instance, the taxpayer had submitted documents such as affidavits and applications for condonation of delay, all bearing scanned signatures. Despite substantial compliance in other aspects, the tribunal ruled these submissions invalid due to their failure to meet legal standards.
The appeal, filed under Section 131 of the Income Tax Ordinance, 2001, challenged a previous order issued by the Office of Inland Revenue, Unit-I, Zone South, RTO Islamabad, for the tax year 2018. Represented by M/s EY Ford Rhodes, the taxpayer filed the appeal electronically. However, the ATIR rejected the filing, citing Rule 77 of the Income Tax Rules, 2002, which mandates physical filing and handwritten signatures from the appellant or an explicitly authorized representative.
The tribunal further noted that while the Power of Attorney (POA) authorized representation in proceedings, it did not explicitly grant permission to file the appeal. This omission, combined with the reliance on scanned signatures, ultimately led to the appeal’s dismissal.
This decision has reignited calls for reforms in Pakistan’s tax administration system. Stakeholders argue that enabling electronic filings and remote access would simplify compliance for non-residents while enhancing the efficiency of tax administration. As Pakistan aims to modernize its fiscal policies, addressing these procedural bottlenecks will be crucial in fostering trust and ensuring equitable treatment for all taxpayers.