The Appellate Tribunal Inland Revenue (ATIR) has ruled that a series of pending appeals involving state-owned enterprises (SOEs) should be transferred to the Alternate Dispute Resolution Committee (ADRC). This decision follows the enactment of Section 134A of the Income Tax Ordinance, 2001, as amended by the Finance Act of 2023.
Under the new provisions, the Finance Act mandates that all SOEs must resolve their tax disputes through the ADRC.
However, a legal debate emerged over whether this requirement should apply to ongoing cases or only to future disputes. While the Federal Board of Revenue (FBR) argued that the amendment applies retroactively to all disputes, SOEs contended that it should only affect cases filed after the amendment was passed.
The ATIR, after hearing the case, ruled in favor of the FBR’s position, confirming that all tax disputes, both past and present, should be referred to the ADRC. This ruling is expected to affect numerous pending tax appeals involving SOEs and could significantly reduce the burden on appellate forums while speeding up the resolution of complex disputes.
Legal experts predict that this move will streamline the resolution of high-value tax cases, benefiting both the tax authorities and the SOEs involved.
