By Abdul Wajid Khan ISLAMABAD, Feb. 24 (INP-WealthPK): The Federal Board of Revenue (FBR) is taking steps to resolve tax-related disputes, including the recovery of Rs3.5 trillion revenue, which has been stuck up for many years due to litigation in different courts. The FBR Chairman Dr. Ashfaq Ahmed recently informed the Standing Committee of National Assembly on Finance that Rs3.5 trillion revenue has been stuck up due to the cumbersome process of four stages of appeals regarding these tax-related cases in different courts. While talking to WealthPK, former chairman Customs, Federal Excise and Sales Tax Appellate Tribunal Hafiz Ahsaan Ahmad Khokhar Advocate said the FBR should make a strong legal strategy to highlight revenue yielding cases and sectors to the field formations and remove impediments to the early disposal of pending cases in order to protect its revenue. He said one of the reasons for the deficit in tax collection is thousands of pending cases before the Supreme Court, high courts, tribunals and Commissioner Appeals Inland Revenue and Collector Appeals (Customs) involving billions of rupees revenue. He said such a situation has now become a big challenge not only for the government and FBR, but also for the courts. Thus, the situation requires immediate and urgent strategy by coordinating with all stakeholders for a positive way forward. “It is essential to immediately establish Special Litigation Management Resource Centre (SLMRC) headed by an appropriate tax and corporate expert at the FBR headquarters having linkages with field formations to resolve the issue. It should apply Automated Legal Management System (ALMS) application that ensures online status of all pending litigation cases involving revenue impact at all appellate fora including Supreme Court and High Courts,” Hafiz Ahsaan, who is also a noted tax-lawyer of the Supreme Court of Pakistan, told WealthPK. He further said that there are big capacity issues within the FBR and its tax offices to manage pending litigation which need to be improved on priority basis. Also, proper representation must be ensured before superior courts and adjudicating tax forums. Another aspect of this backlog is frivolous litigations by either side, including taxpayers, which causes waste of resources. It is important to implement the mandatory timeline to decide tax cases by every adjudicating forum under the relevant tax laws and to request the Supreme Court and the high courts as well to suitably amend their rules and orders. Hafiz Ahsaan suggested that special measures should be adopted against stay orders granted in revenue cases by the superior courts as per Article 199 of the Constitution where statutory period of six months has elapsed. He said the government should also suitably amend the tax laws as per observations and judgments of the superior courts through new tax legislation. He said the government should also introduce such amendments to laws, which create a complete automation environment within the FBR for adjudication. It should build trust among taxpayers, minimise tax officials’ discretionary powers, and end the so many tax regimes to simplify the tax collection procedures. It is also important to take immediate steps with good legal management strategy as the new jurisdiction has been vested with the FBR for Benami and Anti Money Laundering laws. Dr. Ashfaq said the FBR is taking several steps to fix the problem and efforts are underway to reduce the stages of appeals and to simplify the process. He said various stages of appeal procedure are time-consuming. He said the FBR is increasing its tribunals and appellate commissioners and trying to decrease the forums of appeals. The FBR chairman said the FBR will establish a new court of inland revenue to resolve tax-related disputes on fast-track basis. “Work is in progress to create inland revenue court in the FBR to settle such cases in future. Also, work on simplification of tax system is underway to avoid unnecessary litigation. Inland revenue courts will simplify the system and facilitate the citizens in resolving their issues,” he said. Dr. Ashfaq said the FBR’s alternate dispute resolution mechanism has failed to produce tangible results and now arbitration system will be introduced to resolve pending tax-related cases and recover the revenue stuck in litigation.