Islamabad, December 30, 2024 – The Islamabad High Court (IHC) on Monday ruled in favor of the Pakistan Telecommunication Authority (PTA), granting its petition against the Federal Board of Revenue (FBR) for the improper deduction of an additional amount under the pretext of advance tax.
The court’s ruling followed a long-running legal battle, with PTA challenging the FBR’s decision to deduct Rs1.37 billion as advance tax from its accounts. Justice Babar Sattar issued a detailed order on the matter, which had been initially filed by PTA in 2018.
The court not only ruled in favor of the PTA but also imposed a fine of Rs100,000 on the deputy commissioner of Inland Revenue, who was instructed to pay the fine to the PTA within one month. The crux of the case centered on the FBR’s failure to follow proper legal procedures before making the deductions. According to the PTA, the tax authority made the advance tax deduction without providing prior notice, in violation of the Income Tax Ordinance. The court found that the FBR’s actions lacked the required notification, which is a fundamental step to ensure taxpayer rights are protected.
Justice Sattar emphasized that the actions of the FBR amounted to a direct violation of the PTA’s fundamental rights, as the deduction occurred without due process. The PTA had raised its concerns with the FBR by filing an application to protest the extra deduction. However, despite being bound by law to resolve such matters within two months, the Inland Revenue commissioner failed to address the PTA’s petition in the stipulated time frame.
The IHC directed the FBR to take a decision on the PTA’s application within two months of the verdict, urging the tax authority to adhere to the legal timelines moving forward. This ruling underscores the critical importance of following proper legal protocols when dealing with tax matters, especially when it comes to informing taxpayers and addressing their grievances in a timely and transparent manner.