| Case ID |
41c4f7ce-0875-40c7-ae3d-2e1e92e314e9 |
| Body |
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| Case Number |
I.T.A. No. 200/MB/2022 |
| Decision Date |
Apr 13, 2022 |
| Hearing Date |
Mar 10, 2022 |
| Decision |
The Appellate Tribunal ruled in favor of the taxpayer, M/S Shabbir Feed Mills (PVT.) LTD., stating that the adjustment of prior year's refunds was in accordance with the law and established past practice. The Tribunal found that the Officer of Inland Revenue (OIR) failed to prove any mistake apparent from the record, thus the disallowance of the adjustment was unjustified. The Tribunal annulled the previous orders and accepted the appeal, emphasizing that taxpayers cannot be penalized for the inaction of the Department. |
| Summary |
In the case of M/S Shabbir Feed Mills (PVT.) LTD. vs. THE CIR, CTO, MULTAN, the Appellate Tribunal Inland Revenue addressed the issue of tax refund adjustments under the Income Tax Ordinance, 2001. The case revolved around the taxpayer's adjustment of an unverified refund from the previous year against the current year's tax liability, amounting to Rs. 25,731,483. The Tribunal noted that the adjustment was made in accordance with the prescribed format of the return of total income. The Tribunal emphasized that the OIR must substantiate any claims of inadmissibility concerning refunds. The ruling reinforced the principle that established past practices have the force of law, and unless a refund claim is proven inadmissible, it cannot be dismissed merely on the basis of being 'unverified'. This case highlights the importance of due process in tax assessments and the rights of taxpayers to adjust refunds without undue penalties. |
| Court |
Appellate Tribunal Inland Revenue
|
| Entities Involved |
M/S SHABBIR FEED MILLS (PVT.) LTD.,
THE CIR, CTO, MULTAN
|
| Judges |
SARFRAZ ALI KHAN, JUDICIAL MEMBER,
RIZWAN AHMAD URFI, ACCOUNTANT MEMBER
|
| Lawyers |
Mr. Muhammad Imran Ghazi, Advocate for the Appellant,
Mr. Tahir Bhatti, DR, for the Respondent
|
| Petitioners |
M/S SHABBIR FEED MILLS (PVT.) LTD.
|
| Respondents |
THE CIR, CTO, MULTAN
|
| Citations |
2022 SLD 1185,
(2022) 126 TAX 280,
2024 PTD 511
|
| Other Citations |
PTR No.15/2012 titled CIR vs. Sheikh Manzoor Ahmad (2015 LHC 226),
CIR vs. Chicago Metal Works (2015 LHC 2276),
(PLD 1998 SC 64),
Radaka Corporation, Others vs. Collector of Customs (1989 SCMR 353),
(2020 PTD 2163)
|
| Laws Involved |
Income Tax Ordinance, 2001
|
| Sections |
120,
120(1),
122(2),
170,
170(3),
221
|