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FTO settles case filed by M/s Sheikh Brothers Chemicals, Faisalabad

FTO settles case filed by M/s Sheikh Brothers Chemicals, Faisalabad

ISLAMABAD: The Federal Tax Ombudsman has disposed of a complaint with directions and recommendations to the Federal Board of Revenue on curtailing maladministration among its raiding teams.

The FTO had issued these recommendations in response to a complaint filed by M/S Sheikh Brother Chemicals, Faisalabad. The complaint stand disposed of along with recommendations drawing the lawful raiding procedure for FBR’s raiding teams under Section 38 of the Sales Tax Act, 1990.

The appellant had filed a complaint against the secretary revenue division, Islamabad and officials of the FBR field office.

According to the complainant deputy directors of Directorate General of Intelligence and Investigation, RTO, Faisalabad raided the site without authorization from the competent authority as per Section 38 of the Sales Tax Act, 1990.

After conducting the inquiry, the FTO disposed the case of with some important recommendation proving to be the guidelines for the FBR raiding personnel.

FTO stated that record impounded from a site without the prescribed procedure cannot be used against the taxpayer (complainant).

The visit by the department officials under section 38 of the act would be confined to inspecting the records and documents that are in plain sight of those that are made voluntarily available for inspection by the person(s) present at the premises on request.

Consequently, custody within the meaning of Section 38 can only be taken of such record and documents that are in plain sight, FTO stated.  The documents or records taken into custody must be against a receipt signed by the officer.

The officers have no powers under section 38 to compel the production of any record or document that is not plain sight or that has not been made available voluntarily.

FTO cautioned that during a raid departmental team should consider the following: ” the dignity of a man and, subject to law, the privacy of home, shall be inviolable … no person should be subjected to torture for the purpose of extracting the evidence

He further stated that any action that is contravention of the foregoing would be action that falls short of the requirements to act fairly, justly and reasonably and, therefore, wholly illegal and void. Permitting the department to benefit from such actions would be equally illegal.

The complainant had complained that unauthorized FBR team entered his place and harassed the complainant, compelled them to produce records and documents.