PHC stops FBR from shifting KP’s taxation cases to Islamabad

PESHAWAR: The Peshawar High Court on Thursday stayed the order of Federal Board of Revenue (FBR) for shifting the tax affairs of over 360 mega taxpayer organizations and industrial units from Regional Tax Office, Peshawar, to Islamabad.

A division bench of PHC comprising Justice Ishtiaq Ibrahim and Justice SM Atiq Shah after arguments of lawyers for various organisations and industrial units accepted various petitions with regard to the shifting of tax affairs to Islamabad from Peshawar office.

The court stayed the FBR order of August 5, 2020 and directed the relevant department to keep maintaining the tax affairs of petitioners in the Peshawar Tax Office. Earlier, while representing various organizations and industrial units, lawyers Ishaq Ali Qazi, Qazi Ghulam Dastagir, Sheraz Butt, Ishtiaq Ahmad Senior and others pleaded that FBR had issued directives for shifting the tax affairs of mega organizations and industrial units of Khyber Pakhtunkhwa from Peshawar office to Islamabad in August 2020.

Subsequently, they said that the affairs of taxpaying organizations and industrial units of Khyber Pakhtunkhwa were then shifted to Islamabad from the Peshawar office, which had created great hardships for the taxpayers and owners of industrial units and organizations.

The counsels said that the FBR order was against law and constitutions and contrary to the set rules, which also led to discouraging the installation of new industrial units in KP.

They pleaded that FBR had issued directives in haste and had not taken into account the ground realities with regard to the share National Finance Commission award of the province.

They presented a detailed judgment of Balochistan High Court in a similar case and informed the court that if the FBR was allowed to shift the affairs of KP taxpayers to Islamabad then the province would be deprived of its mega share in NFC award.

They said that BHC had declared null and void such amendments to FBR laws and had given verdict in favour of the petitioners in a similar case there.

The lawyers argued that there were clear laws and rules under which the tax affairs of individuals and industrial units were being dealt with by the local or regional tax offices.

They also pointed out that the KP had already lost everything, including businesses, agriculture, tourism and industry in the recent wave of terrorism and floods and the FBR steps would ruin the remaining potential for the business and agriculture and others in the province.

They said that industrialists and investors would prefer to install industry and launch businesses in other areas instead of KP if the FBR was allowed to continue with the current procedure of tax collection.