The Appellate Tribunal Inland Revenue (ATIR) Islamabad has ruled that commissioners no longer qualify to file appeals under the amended Section 131 of the Income Tax Ordinance, 2001. The tribunal clarified that the term “commissioner” does not fall under the definition of “person” as specified in Section 2(42), read with Section 80 of the Ordinance.
According to a news report, the ruling came in response to an appeal filed by the Appellant Department on May 17, 2024, challenging an order dated April 30, 2024, issued by the Commissioner Inland Revenue (Appeals-I), Large Taxpayer Office (LTO), Islamabad, for the tax year 2018.
The appeal revolved around the amendments introduced in the Tax Laws (Amendment) Act 2024, which redefined Section 131 of the Income Tax Ordinance. The amendment replaced the earlier provision that allowed both the taxpayer and the commissioner to file appeals before the ATIR.
During the hearing, the departmental representative (DR) argued that the appeal was filed before the amendments came into effect and, therefore, should be governed by the earlier provision. The representative contended that under the unamended Section 131, commissioners were explicitly authorized to file appeals.
However, the ATIR observed that the amended Section 131 limits the right to appeal to “any person,” as defined under Section 2(42), which does not explicitly include commissioners. The tribunal noted that the deliberate exclusion of “commissioner” from the amended language suggests a legislative intent to restrict appeal rights.
The ATIR order also highlighted that the newly substituted Section 133, which governs references to the High Court, continues to include the term “commissioner.” This distinction further indicates the deliberate removal of commissioners’ appeal rights under Section 131.
The tribunal concluded that the departmental appeal was not maintainable under the revised Section 131 and dismissed it accordingly. The ruling has significant implications for the power of commissioners in tax-related disputes, narrowing the scope of who can approach the appellate forum under the amended law.
The decision underscores the need for clarity and careful interpretation of legislative amendments, particularly in cases where substantial procedural rights are affected.
