The Attorney General for Pakistan (AGP) is urging the Federal Board of Revenue (FBR) to improve coordination on tax-related court cases. This move aims to expedite the resolution of pending tax disputes worth a staggering Rs2.7 trillion.
Challenges in Tax Litigation:
- Conflicting Responses: The AGP highlighted instances where the Ministry of Industries and the Revenue Division submitted contradictory replies in a case exceeding Rs1 billion. This creates confusion and delays court decisions.
- Disjointed Representation: The AGP identified a lack of coordination in hiring lawyers, with different departments engaging separate legal counsel for similar cases. This inefficiency increases costs and delays.
- Limited FBR Involvement: The AGP noted cases where the FBR failed to appear in court despite notices. Assigning a dedicated Grade-18 officer for court representation is recommended.
- Incomplete Information Sharing: The AGP pointed out the FBR’s failure to share copies of court replies with their office, hindering their ability to effectively assist the courts.
Proposed Solutions:
- Focal Person for Coordination: The AGP recommends appointing a focal person within the FBR to handle tax litigation matters and ensure better communication.
- Unified Legal Representation: Engaging a single senior lawyer for similar or connected cases would streamline legal strategy, reduce complexities, and potentially lower costs.
- Standardization of Responses: The AGP emphasizes the need for consistent replies across different ministries to avoid conflicting information presented to the courts.
- Prompt Appeals and Injunctions: The AGP recommends the FBR to file timely appeals against unfavorable tribunal decisions and seek injunctions when necessary.
Overall, the AGP’s recommendations aim to create a more unified and efficient approach to tax litigation in Pakistan. This could significantly reduce delays, minimize unnecessary legal expenses, and expedite the recovery of outstanding tax revenue.
