ISLAMABAD: Islamabad High Court (IHC) on Tuesday asked the Federal Board of Revenue (FBR) to show respect to taxpayers and not use its authority and powers to harass them.

Chief Justice Athar Minallah during the hearing of a petition filed by Shahid Chan Zeb, owner of Red Sun Associates, asked the FBR whether it had issued any notice to the private firm prior to raiding its office premises.

On Feb 6, the FBR raided the office of the petitioner and confiscated records, including his bank details.

As per the record, Mr Zeb declared six bank accounts with the FBR but concealed transactions in 17 others accounts.

According to the FBR documents, since 2013 the builder had declared Rs2.09 billion sales whereas the “sales as per data impounded” showed Rs10.54bn, hence the undeclared sales were Rs8.44bn.

The FBR estimated that the outstanding tax against the builder was Rs2.11bn which was more than the amount he had declared in the tax returns.

Advocate Qamar Afzal, counsel for the petitioner, on Feb 12 contended before the IHC that “though section 175 of the ordinance of 2001 empowers the commissioner to authorise in writing officials for the purposes described therein but such power cannot be exercised unless the preconditions explicitly mentioned in subsection (1) have been fulfilled.”

The counsel stressed that no proceeding under any other provision of the ordinance had been initiated.

Likewise, powers were not being exercised for the purposes of making an audit.

Justice Minallah asked FBR counsel Ishfaq Naqvi whether they had sought bank details from the National Database and Registration Authority (Nadra).

The counsel replied in the negative, adding Nadra did not provide details of bank accounts and it was the taxpayer’s obligation to disclose such information to the FBR.

The court sought a detailed reply from the FBR and adjourned further hearing to March 7.

Published in Dawn, February 27th, 2019