ISLAMABAD: The government has made it mandatory for the Federal Board of Revenue (FBR) to issue final orders on matters pertaining to tax-related disputes within 90 days of receipt of recommendations of the Alternative Dispute Resolution Committees (ADRCs).

In this regard, the FBR has issued a notification on Thursday to seek viewpoint of stakeholders on the amendment proposed to the Income Tax Rules. Now, the board would be bound to submit ADRC orders within a specific time-frame for speedy resolution of tax disputes. The decision would also be instrumental in finalising pending ADRC cases at the FBR level and further streamline income tax alternative disputes resolution mechanism. The FBR may reject or accept ADRC recommendations, but within 90 days period.

According to SRO. 681(I)2008, the board after receipt of recommendations make such orders as it may deem fit for the resolution of the dispute or hardship within 90 days of receipt of such recommendations under intimation to the applicant, the Committee chairman and the Commissioner concerned.

Under Rule 231C of Income Tax Rules, 2002, the rule shall apply to all cases of disputes brought or specified for resolution under section 134A. Any person or class of persons interested in the resolution of any dispute under section 134A shall submit a written application for alternative dispute resolution to the board in the form as set out in the schedule.

The board, after examination of the contents of an application by a taxpayer and facts, stated therein and on satisfaction that the application may be referred to a Committee for the resolution of the hardship or dispute, shall constitute a Committee consisting of the following members: Director General, Large Taxpayers Unit or Commissioner, Medium Taxpayers Unit or any other Commissioner or officer of the Income Tax Department nominated by the board; a Fellow of Chartered Accountants, registered with the Institute of Chartered Accountants of Pakistan or an Associate of Cost and Management Accountant, an advocate of High Court or income tax practitioner and a reputable taxpayer.

The board may appoint one of the members of the Committee to be its Chairman. An application filed under this rule may be disposed of by the Committee within 30 days of its constitution: Provided that the time so specified may, if requested by the Chairman of the Committee for reasons to be recorded in the request, be extended by the board to such extent and subject to such conditions and limitations as it may deem proper.

The Committee chairman shall be responsible for deciding the procedure to be followed by the Committee, which may inter-alia, rule said. The Committee may determine the issue and may thereafter seek further information or data or expert opinion or make or cause to be made such inquiries or audit as it may deem fit, to formulate its recommendations in respect of any specified matter.

The applicant may withdraw the application at any time before the Committee submits its recommendations to the board. The Committee chairman shall send a copy of the recommendations of the Committee to the board, applicant and the Commissioner concerned simultaneously. The board on its own motion or at the request of the applicant, may refer back the recommendations of the Committee for rectification of any mistake apparent from record or for reconsideration of the facts or law, as the case may be, not considered earlier by the Committee.

The Committee after rectification of the mistake or reconsideration of the facts or law as aforesaid shall furnish to the board its fresh or amended recommendation within such period as specified by the board.

The board, after examining the recommendations of the Committee, shall finally decide the dispute or hardship and make such orders as it may deem fit for the resolution of the dispute or hardship within 90 days of receipt of such recommendations under intimation to the applicant, Chairman of the Committee and the concerned Commissioner.

Provided that the resolution reached by the taxpayer and the board shall not bind them for tax year not covered by the agreement. Any such resolution shall not be used as precedent, except as provided in the agreement.

The copy of order passed by the board shall be provided to the applicant and to the commissioner having jurisdiction over the case for modification of all decisions, orders and judgements passed in respect of the said dispute or hardship, within such period as may be specified by the board in the order.

On receipt of the board's order, the commissioner concerned shall implement the order in such manner and within such period as may be specified by the board, the rule added.