The appeal was initially filed by the Commissioner Inland Revenue (CIR) of the Large Taxpayers Office (LTO), Islamabad, challenging a decision by the Commissioner Inland Revenue (Appeals-I) issued on April 30, 2024. The matter pertained to tax issues for the year 2018, specifically focusing on whether the amended Section 131 of the Income Tax Ordinance allowed the Commissioner to file an appeal as a “person.”
The crux of the case centered on changes to Section 131 of the Income Tax Ordinance. The amendment replaced the terms “taxpayer or Commissioner” with “any person” as eligible to file an appeal. This prompted a legal debate on whether the Commissioner, defined under Section 2(13), could qualify as a “person” as per Sections 2(42) and 80 of the ordinance.
The ATIR observed that the amendment explicitly excluded the term “Commissioner” from Section 131, limiting appeal rights under this section to “any person,” excluding state-owned enterprises. The tribunal further noted that while Section 133 still allows the Commissioner to file a reference application in the High Court, this provision does not extend to appeals under the revised Section 131.
Arguments and Decision
The FBR’s representative contended that since the appeal was initiated before the amendment’s enactment, it should be governed by the earlier provisions. However, the tribunal disagreed, ruling that the amended provisions applied at the time of adjudication, regardless of when the appeal was filed.
The ATIR emphasized the deliberate legislative intent behind the amendment and stated that the appeal did not comply with the updated legal framework. Consequently, it dismissed the FBR’s appeal as non-maintainable.
This ruling highlights the critical importance of understanding legislative amendments and their impact on ongoing legal proceedings. The case underscores the necessity for precise statutory language to minimize ambiguities in tax law interpretations.
The decision also serves as a reminder to tax authorities and legal practitioners to remain vigilant about legislative changes to ensure compliance with updated legal frameworks in future cases.
