FINDINGS/RECOMMENDATIONS ' DR. MUHAMMAD SHOAIB SUDDLE, FEDERAL TAX OMBUDSMAN.--- The complainant, Messrs Latif Textile Mills (Pvt.) Limited, is carrying on business at Karachi as a registered company engaged in export of Textile items. During the course of business, the complainant filed refund claims pertaining to periods from June, 2005 to April, 2009 and involving Rs,13,529,538. He received Rs,4,152,374, whereas the payment of balance amount of Rs,9,377,164 was deferred due to negligence of the officials of the Department. The complainant wrote several letters to the Department which were not responded to. The complainant has approached this forum for redress of hid grievance.
2. Parawise comments were filed by the Department stating therein that the complainant had filed claims on RCPS but failed to provide taxable consumption of raw material either on RCPS or through a hard copy. Therefore the claims could not be processed in the absence of taxable consumption in stock statement. It is further stated that during The course of the proceedings of the complaint, the stock consumption statement was supplied by the complainant's representative. Resultantly, some of the cases were processed, while the remaining refund claims would be processed after the complete stock statement was provided. Some claims of the complainant were deferred and objection memos issued to the complainant for want of documents. As such, there was no maladministration on the part of the Department.
3. The learned AR has contended that the Department was not vigilant in processing the complainant's claim of refund within 45 days as provided under law. This period could be extended to another period of 60 days and for 120 days by F.B.R. It is urged that the complainant was running from pillar to post, but no heed was being paid by the Department. Even when supportive documents were filed on RCPS and acknowledgement issued, the claim was not settled. It is urged that after the complainant approached the Hon'ble FTO's forum, the Department adverted to the Complainant's grievance and part payments were made, which suggests that the complainant had fully met his part of obligation.
4. The DR has primarily contended that the complaint being time-barred is hit by the provision of section 10(3) of the Federal Tax Ombudsman Ordinance, 2000, and also the delay is due to non- submission of requisite documents by the complainant.
5. Adverting to the objections raised by DR, the consensus of the superior courts is that no preferential treatment can be offered to a public functionary and both the parties are treated on equal footing with regard to the condonation of period of limitation. In the context, reliance is placed on the case of Muhammad Bashir and another v. Province of Punjab through Collector of District Gujrat (2003 SCMR page 83) in which it is held that technicalities of law are always avoided and discouraged in order to' do complete justice. Rules of procedure are enacted for fostering the ends of justice and preserving the rights rather than to stifle the dispensation of justice. In case of Khalil Cotton Factory, Multan v. Income Tax Office, E-Circle, Multan 1979 PTD 429, it was observed that the delay in making an application, if satisfactorily explained, is liable to be condoned on the basis of above discussion. The objections of DR that the complaint is time-barred is therefore over- ruled.
6. The learned AR has satisfactorily explained that he had approached the public functionaries for the purpose of processing of refund claims by addressing letters which were not replied to.
Adverting to the merits of the case, an application for the refund of claim is required to be filed under Rule 26 of Sales Tax Rules 2006 by a registered person who acquires tax paid inputs for use zero percent under the Act or a notification issued thereunder and after receiving the requisite data on RCPS format, the claim of the claimant is to be expedited under Rule 28 within 120 days of the filing of return provided that the period of 120 days is to be reckoned from the date BCA is issued by the concerned Bank. It thus seems that the case of complainant was not decided within the specified time on flimsy ground.
Findings:
7. The question of jurisdiction is not attracted in the circumstances as the officials concerned had proceeded with part claims during the pendency of the complaint. Which shows that documents were in their possession. It was on account of their negligence, inefficiency and ineptitude that the matter could not be processed within the statutory time limit.
Recommendations: 8.. F.B.R. To direct the Chief Commissioner, Regional Tax Office, Karachi, to--
(i) ensure finalization of the case of the refund claim as per law; and
(ii) report compliance within 30 days.