Law: Income Tax Ordinance, 2001

Section: 12,153,171

Law: Federal Tax Ombudsman Ordinance, 2000

Section: 2(3),9,10

Income Tax Ordinance (XLIX of 2001)--- ----Ss.12, 153 & 171---Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), Ss. 2(3), 9 & 10---Excess deduction of income tax at source---Delayed refund---Maladministration---Refunds in the case arose as a result of excess deduction of income tax at source on payments received for service rendered---Refund pertaining to tax years 2007 to 2009, was issued by the department on 17-8-2012, which prima facie was delayed one---Refund claim was required to be processed within the timeframe, stipulated in the statute after the deemed assessment made under S.120(1) of Income Tax Ordinance, 2001---In the tax year 2009, the time limit was 45 days, after the return was admitted and acknowledgment issued to the taxpayer---Refund due for tax years 2007 to 2009, having not been determined by the department within the stipulated time period of 45 days from the date of deemed assessment in each year, delay had occurred, and compensation under S.171 of Income Tax Act, 2001, was payable---Compensation amount was to be reckoned from the date of deemed assessment, and not from the date of any order for issuance of refund passed belatedly by the department---Delay in issuance of refund, was tantamount to "maladministration" under S.2(3)(ii) of Establishment of Office of Federal Tax Ombudsman Ordinance, 2000---Such delay also created the right to receive compensation under S.171 of Income Tax Ordinance, 2001---Ombudsman recommended that Federal Board of Revenue to direct the Chief Commissioner to issue compensation due as per law and report compliance within 30 days. 2010 PTD (Trib.) 519 ref. FINDINGS/RECOMMENDATIONS DR. MUHAMMAD SHOAIB SUDDLE, FEDERAL TAX OMBUDSMAN.---This complaint is against non-issuance of refund/ compensation for Tax Year 2009. 2. The Complainant Company claimed refunds of Rs.1,686,711, Rs.1,986,963, Rs.2,104,716 and Rs.4,756,052 respectively in Tax Years 2007 to 2010, aggregating to Rs.10,534,442. The refunds arose as a result of excess deduction of income tax at source on payments received for services rendered. The complainant received refund voucher No.38/14350 dated 17-8-2012 for Rs.…

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