Law: Income Tax Ordinance, 2001

Section: 153,153(1)(b),153(6)

Law: Federal Tax Ombudsman Ordinance, 2000

Section: 2(3)(ii)

Income Tax Ordinance (XLIX of 2001)---Ss. 153(1) (b) & 153(6)--- Federal Tax Ombudsman Ordinance (XXXV of 2000), S. 2(3)(ii)--- Public interest complaint---Corporate tax payers--- Web portal of the Federal Board of Revenue (FBR) ---Tax computation defects in the electronic Income Tax Return--- Complainant contended that for corporate tax payers deriving income by providing/rendering services chargeable under Ss. 153(1)(b) & 153(6) of the Income Tax Ordinance, 2001, the electronic Income Tax Return (IT-1) for Tax year 2010 placed on the Federal Board of Revenue (FBR) web portal gave misleading information to taxpayers and tax payable by them was not being correctly computed; that the electronic Income Tax Return understated a taxpayer's due income tax liability for the tax year 2010 and was not designed to take into account receipts/income liable to tax under normal tax regime, besides the income taxable under the minimum tax regime--- Validity--- Defectively designed electronic return for corporate taxpayers (service sector) showed incompetence, inefficiency and inaptitude on the part of the concerned officials and was tantamount to systematic mal-administration under S. 2(3)(ii) of the Federal Tax Ombudsman Ordinance, 2001--- Federal Tax Ombudsman recommended that the Federal Board of Revenue to ensure that in the future a fool-proof electronic Return was placed on the Federal Board Revenue's official web portal; to direct field formations to determine revenue losses that occurred due to defective e-Return, and to take steps to retrieve the loss, without charging any penalty or default surcharge to the concerned taxpayers. FINDINGS/RECOMMENDATIONS DR. MUHAMMAD SHOAIB SUDDLE, FEDERAL TAX OMBUDSMAN.---The complainant, a practicing income tax lawyer, filed the instant public interest complaint, highlighting tax computation defects in the electronic Income Tax Return (IT-1) placed on the F.B.R. web portal required to be e-filed by service sector corporate taxpayers, in Tax Year 2010. 2. The complainant contends that for corporate taxpayers deriving income by providing/rendering services chargeable under section 153(1) (b), read with section 153(6) of the…

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