Islamabad, September 2025 – The Federal Tax Ombudsman (FTO) has issued strong remarks against the Federal Board of Revenue (FBR) officials in Karachi for passing what it termed “patently illegal” and ex parte tax assessment orders against an old-age citizen.
The Ombudsman has ordered the detachment of the complainant’s bank accounts and directed FBR to launch an inquiry into the conduct of the responsible officers.
The case was filed by Mr. Mehmood Ali Ahmed, a 78-year-old proprietor of Saba Oil, who declared salary income, exempt pension, share income from an association of persons (AOP), and bank profit in his returns for tax years 2014 and 2015. Despite this, FBR officials allegedly passed arbitrary assessment orders, creating tax demands of Rs. 1.9 million for 2014 and Rs. 8.8 million for 2015, without providing proper notice or opportunity of hearing.
According to the complaint, the department delayed action for several years and issued show-cause notices only days before the limitation period expired, allowing insufficient time for compliance. The Ombudsman observed that the assessing officer failed to issue mandatory audit reports and wrongly added exempt income and pension amounts, which resulted in “administrative excesses and hardship” for the taxpayer.
The FTO also highlighted procedural violations, noting that the department assumed uploading notices on the IRIS portal constituted valid service, despite the complainant not receiving any SMS or email alerts. “Mere placement of notices on IRIS does not constitute valid service within the meaning of law,” the order stated, citing rules under the Income Tax Ordinance.
The Federal Tax Ombudsman further criticized the Commissioner-IR (Appeals) for upholding the illegal assessments without addressing core issues, including non-service of notices. Such actions, the FTO ruled, amounted to maladministration under the law.
In its recommendations, the Ombudsman directed FBR to:
1. Revisit and remand the disputed assessment orders back to the trial court for fresh decision on merit.
2. Immediately detach the complainant’s bank accounts.
3. Initiate an inquiry into the assessing officer’s conduct, citing possible corrupt or improper motives.
4. Submit a compliance report within 45 days.
The ruling underscores the FTO’s role as an accessible forum for taxpayers facing arbitrary actions. It also signals the need for accountability within FBR, particularly in cases involving old-age citizens and vulnerable taxpayers.