The new three-member committee will review tax cases before the FBR can pursue references, appeals or reviews before superior courts.
ISLAMABAD: The Federal Board of Revenue (FBR) has introduced an Independent Case Scrutiny Committee under newly inserted Section 133A of the Income Tax Ordinance, 2001, through the Finance Act, 2026.
Under the new provision, a reference under Section 133 before a High Court, or an appeal or review before the Federal Constitutional Court or the Supreme Court of Pakistan, can only be filed by the Commissioner Inland Revenue after obtaining approval from the Independent Case Scrutiny Committee constituted by the FBR.
The committee has been established to provide an independent review of tax cases before the department proceeds with litigation before the superior judiciary.
Three-member committee established
Section 133A provides for a three-member Independent Case Scrutiny Committee comprising:
• A retired judge of the superior courts, who will serve as chairman.
• An advocate with at least 15 years of experience in tax and commercial litigation.
• A serving or retired senior FBR officer of BS-20 or above.
The committee may also co-opt a chartered accountant as a non-voting member where it considers this appropriate.
Committee approval binding on Commissioner
The recommendations of the Independent Case Scrutiny Committee will be binding on the Commissioner Inland Revenue having jurisdiction over the relevant case.
As a result, the Commissioner cannot independently proceed with a reference, appeal or review covered by Section 133A without first obtaining the committee’s approval.
The new mechanism introduces an additional level of scrutiny before tax disputes are taken to higher courts and is aimed at ensuring that cases meet the required grounds before further litigation is pursued.
Legal protection provided to committee members
The Finance Act, 2026 also provides immunity from legal proceedings to members of the Independent Case Scrutiny Committee and the Commissioner in respect of actions taken under the new provision.
In addition, the period spent obtaining approval from the committee will be excluded when calculating the limitation period for filing the relevant reference, appeal or review.
This exclusion is intended to ensure that the mandatory scrutiny process does not reduce the statutory time available to tax authorities to pursue litigation.
Section 133A creates new litigation review mechanism
Section 133A therefore establishes an institutional review mechanism within the FBR before tax cases can proceed to the superior judiciary.
By requiring prior approval from an independent committee and making its recommendations binding on the concerned Commissioner, the new provision adds a formal scrutiny stage to the FBR’s tax litigation process.