Islamabad, December 2, 2024 – The Appellate Tribunal Inland Revenue (ATIR) Islamabad dismissed an appeal filed by the Federal Board of Revenue (FBR) against M/s. Supernet Limited. The tribunal ruled the appeal non-maintainable under the amended provisions of the Income Tax Ordinance, 2001, introduced through the Tax Laws (Amendment) Act, 2024.
The case originated from an appeal filed by the Commissioner Inland Revenue (CIR) of the Large Taxpayers Office (LTO), Islamabad. This appeal challenged an earlier decision by the Commissioner Inland Revenue (Appeals-I), dated April 30, 2024, concerning tax matters for the year 2018. The core issue revolved around whether the amended Section 131 of the Income Tax Ordinance allowed the Commissioner to appeal as a “person.”
During the proceedings, objections were raised by the respondent’s legal representative regarding the applicability of Section 131, as redefined in the amendment. The revised section replaced the terms “taxpayer or Commissioner” with “any person” as eligible appellants. This shift sparked a legal debate about whether the Commissioner, as defined under Section 2(13), could be categorized as a “person” under Section 2(42) and Section 80 of the ordinance.
The ATIR highlighted the deliberate exclusion of the term “Commissioner” from the revised section, noting that while the unamended version explicitly granted appeal rights to both taxpayers and Commissioners, the amendment restricts appeals to “any person” other than a state-owned enterprise (SOE). Furthermore, the tribunal observed that while the amended Section 133 still allows the Commissioner to file a reference application before the High Court, such provisions do not extend to appeals under the newly substituted Section 131.
The department’s representative argued that the appeal was filed before the amendment’s implementation and should therefore be considered under the earlier provisions. However, the tribunal rejected this argument, asserting that the amendment applied at the time of adjudication.
In its detailed judgment, the ATIR concluded that the appeal did not align with the amended legal framework and dismissed it as non-maintainable. This ruling underscores the importance of understanding legislative changes and their implications on ongoing and future tax cases. It also highlights the need for clear statutory language to avoid ambiguities in legal interpretations.
