Establishment of the Office of Federal Tax Ombudsman
ORDINANCE NO. XXXV OF 2000
11th August, 2000
An Ordinance to provide for the appointment of the Federal Tax Ombudsman:
WHEREAS it is expedient to provide for the appointment of the Federal Tax Ombudsman to diagnose, investigate, redress and rectify any injustice done to a person through maladministration by functionaries administering tax laws;
AND WHEREAS the National Assembly and the Senate stand suspended in pursuance of the Proclamation of Emergency of the fourteenth day of October, 1999, and the Provisional Constitution Order No. 1 of 1999;
NOW, THEREFORE, in pursuance of the aforesaid Proclamation of the fourteenth day of October, 1999, and Provisional Constitution Order No. 1 of 1999, as well as Order No. 9 of 1999, and in exercise of all powers enabling him in that behalf, the President of the Islamic Republic of Pakistan is pleased to make and promulgate the following Ordinance:-
1. Short title, extent and commencement :
(1) This Ordinance may be called the Establishment of the Office of Federal Tax Ombudsman Ordinance, 2000.
(2) It extends to the whole of Pakistan.
(3) it shall come into force at once.
2. Definitions :
In this Ordinance, unless there is anything repugnant in the subject or context:-
(1) "Federal Tax Ombudsman" means the Federal Tax Ombudsman appointed under section 3;
(2) "Inspection Team" means the Inspection Team constituted under section 17;
(3) "maladministration" includes:-
(i) a decision, process recommendation, act of omission or commission which-
(a) is contrary to law, rules or regulations or is a departure from established practice or procedure, unless it is bona fide and for valid reasons;
(b) is perverse, arbitrary or unreasonable, unjust, biased, oppressive, or discriminatory;
(c) is based on irrelevant grounds; or
(d) involves the exercise of powers, or the failure or refusal to do so, for corrupt or improper motives, such as bribery, jobbery, favouritism, nepotism, and administrative exceses;
(ii) neglect, inattention, delay, incompetence, inefficiency and ineptitude, in the administration or discharge of duties and responsibilities.
(iii) repeated notices, unnecessary attendance or prolonged hearings while deciding cases involving-
(a) assessment of income or wealth;
(b) determination of liability of tax or duty;
(c) classification or valuation of goods;
(d) settlement of claims of refund, rebate or duty drawback; or
(e) determination of fiscal and tax concessions or exemptions.
(iv) wilful errors in the determination of refunds, rebates or duty drawbacks;
(v) deliberate withholding or non-payment of refunds, rebates or duty drawbacks already determined by the competent authority;
(vi) coercive methods of tax recovery in cases where default in payment of tax or duty is not apparent from record; and
(vii) avoidance of disciplinary action against an officer or official whose order of assessment or valuation is held by a competent appellate authority to be vindictive, capricious, biased or patently illegal.
(4) "Office" means the office of the Federal Tax Ombudsman;
(5) "prescribed" means prescribed by rules made under this Ordinance;
(6) "Relevant Legislation" means:-
(i) the Provisional Collection of Taxes Act 1931 (XVI of 1931);
(ii) the Commercial Documents Evidence Act, 1939 (XXX of 1939);
(iii) the Central Excises Acts 1944 (I of 1944);
(iv) the Wealth Tax Act, 1963 (XV of 1963);
(v) the Customs Act, 1969 (IV of 1969);
(vi) the Workers' Welfare Fund Ordinance, 1971 (XXXVI of 1971);
(vii) the Prevention of Smuggling Act, 1977 (XII of 1977);
(viii) the Income Tax Ordinance, 1979 (XXXI of 1979);
(ix) the Import of Goods (Anti-dumping and Countervailing Duties) Ordinance, 1983 (III of 1983);
(x) section 7 of the Finance Act, 1989 (V of 1989);
(xi) the Sales Tax Act, 1990;
(xii) section 12 of the Finance Act, 1991 (XII of 1991);
(xiii) such other laws having nexus with taxation as the Federal Government may, by notification in the official Gazette, specify to be the Relevant Legislation for the purposes of this Ordinance; and
(xiv) the rules, regulations and notifications made or issued thereunder.
(7) "Revenue Division" means the administrative unit responsible for the conduct of business of the Federal Government in matters relating directly or indirectly with the collection of revenue from federal taxes, levy of taxes, duties, cesses or fees and declared as such by the Federal Government, and includes all its subordinate departments, offices and agencies;
(8) "Staff Member" means any officer or employee of the Office appointed under section 8 and includes advisers, commissioners, consultants, experts, fellows, interns, liaison officers, bailiffs and other staff appointed under section 20;
(9) "Standing or Advisory Committee" means a Standing or Advisory Committee established under section 18; and
(10) "Tax Employee" means an employee of the Revenue Division and includes an officer and any other functionary serving in, or any office subordinate to, the said Division.
3. Appointment of Federal Tax Ombudsman :
(1) There shall be a Federal Tax Ombudsman who shall be appointed by the President.
(2) Before entering upon office, the Federal Tax Ombudsman shall make oath before the president in the form set out in the Schedule to this Ordinance.
(3) The Federal Tax Ombudsman shall, in all matters, perform his functions and exercise his powers fairly, honestly, diligently and independently of the executive and all executive authorities throughout Pakistan shall act in aid of the Federal Tax Ombudsman.
4. Tenure of the Federal Tax Ombudsman :
(1) The Federal Tax Ombudsman shall hold office for a period of four years and shall not be eligible for any extension of tenure or reappointment as Federal Tax Ombudsman.
(2) The Federal Tax Ombudsman may resign his office by writing under his hand addressed to the President.
5. Federal Tax Ombudsman not hold any other office of profit, etc. :
(1) The Federal Tax Ombudsman shall not :
(a) hold any other office of profit in the service of Pakistan; or
(b) hold any other position carrying the right to remuneration for rendering of services.
(2) The Federal Tax Ombudsman shall not hold any office of profit in the service of Pakistan before the expiration of two years after he has ceased to hold that office; nor shall he be eligible during the tenure of office and for a period of two years thereafter for election as a member of Majlis-e-Shoora (Parliament) or a Provincial Assembly or any local body or take part in any political activity.
6. Terms and conditions of service and remuneration of Federal Tax Ombudsman :
(1) The Federal Tax Ombudsman shall be entitled to such salary, allowances and privileges and other terms and conditions of service as the President may determine and these terms shall not be varied during the terms of office of a Federal Tax Ombudsman.
(2) The Federal Tax Ombudsman may be removed from office by the President on grounds of misconduct or of being incapable of properly performing the duties of his office for reasons of physical or mental incapacity:
Provided that the Federal Tax Ombudsman may, if he sees fit and appropriate to refute any charges, request an open public evidentiary hearing before the Supreme Judicial Council and, if such a hearing is not held within thirty days of the receipt of such request or not concluded within ninety days of its receipt, the Federal Tax Ombudsman may choose to leave his office and shall be entitled to receive full remuneration and benefits for the rest of his term.
(3) If the Federal Tax Ombudsman makes a request under the proviso to sub-section (2), he shall not perform his functions under this Ordinance until the hearing before the Supreme Judicial Council has concluded.
(4) A Federal Tax Ombudsman removed from office on the ground of misconduct shall not be eligible to hold any office of profit in the service of Pakistan or for election as a member of Majlis-e-Shoora (Parliament) or a Provincial Assembly or any local body.
7. Acting Federal Tax Ombudsman :
At any time when the office of Federal Tax Ombudsman is vacant, or the Federal Tax Ombudsman is absent or is unable to perform his functions due to any cause, the President shall appoint any acting Federal Tax Ombudsman.
8. Terms and conditions of service of staff :
Subject to the provision of section 20, the Staff Members shall be entitled to such salary, allowances and other terms and conditions of service as may be prescribed having regard tot he salary, allowances and other terms and conditions of service that may for the time being be admissible to other employees of the Federal Government in the corresponding Basic Pay Scales.
9. Jurisdiction, functions and powers of the Federal Tax Ombudsman :
(1) Subject to sub-section (2), the Federal Tax Ombudsman may on a complaint by any aggrieved person, or on a reference by the President, the Senate or the National Assembly, as the case may be, or on a motion of the Supreme Court or a High Court made during the course of any proceedings before it or of his own motion, investigate any allegation of maladministration o n the part of the Revenue Division or any Tax Employee.
(2) The federal Tax Ombudsman shall not have jurisdiction to investigate or inquire into matters which:
(a) are subjudice before a court of competent jurisdiction or tribunal or board or authority on the date of the receipt of a complaint, reference or motion by him; or
(b) relate to assessment of income or wealth, determination of liability of tax or duty, classification or valuation of goods, interpretation of law, rules and regulations relating to such assessment, determination, classification or valuation in respect of which legal remedies of appeal, review or revision are available under the Relevant Legislation.
(3) Notwithstanding anything contained in sub-section (1), the Federal Tax Ombudsman shall not accept for investigation any complaint by or on behalf of a Tax Employee concerning matters relating to the Revenue Division in respect of any personal grievance relating to his service.
(4) For carrying out the objectives of this Ordinance and, in particular for ascertaining the causes of corrupt practices and injustice, the Federal Tax Ombudsman may arrange for studies to be made or research to be conducted and may recommend appropriate steps for their eradication.
(5) The Federal Tax Ombudsman may set up regional offices as, when and where required.
10. Procedure and evidence :
(1) A complaint shall be made in writing on solemn affirmation or oath and shall be addressed to the Federal Tax Ombudsman by the person aggrieved or, in the case of his death, by his legal representative and may be lodged in person at the office or handed over to the Federal Tax Ombudsman in person or sent by any other means of communication to the Office.
(2) The Federal Tax Ombudsman shall not be entertain anonymous or pseudonymous complaints.
(3) A complaint shall be made not later than six months from the day on which the person aggrieved first had the notice of the matter alleged in the in the complaint, but the Federal Tax Ombudsman may conduct any investigation pursuant to a complaint which is not within time if he considers that there are special circumstances which he deems proper in the interest of justice to entertain the complaint.
(4) When the Federal Tax Ombudsman proposes to conduct an investigation he shall issue to the Secretary of the Revenue Division, and to the person who is alleged in the complaint to have taken or authorised the action complained of, a notice calling upon him to reply to the allegations contained in the complaint.
Provided that the Federal Tax Ombudsman may proceed with the investigation if no response to the notice is received by him from the Secretary or other person within thirty days of the receipt of the notice or within such longer period as may be allowed by the Federal Tax Ombudsman, for sufficient cause to be recorded.
(5) Every investigation shall be conducted in private, but the Federal Tax Ombudsman may adopt such procedure as he considers appropriate for such investigation and he may obtain information from such persons and in such manner and make such inquiries as he thinks fit.
(6) A person shall be entitled to appear in person or be represented before the Federal Tax Ombudsman.
(7) The Federal Tax Ombudsman shall, in accordance with the rules made under this Ordinance, pay expenses and allowances to any person who attends or furnished information for the purposes of any investigation.
(8) The conduct of an investigation shall not affect any action taken by the Revenue Division, or any power or duty of the Revenue Division to take further action with respect of any matter subjected to the investigation.
(9) For the purposes of an investigation under this Ordinance, the Federal Tax Ombudsman many require any Tax Employee to furnish any information or to produce any document which in the opinion of the Federal Tax Ombudsman is relevant and helpful in the conduct of the investigation, and there shall be no obligation to maintain secrecy in respect of disclosure of any information or document for the purposes of such investigation.
(10) In any case where the Federal Tax Ombudsman decided not to conduct an investigation, he shall send to the complainant a statement of his reasons for not conducting the investigation.
(11) Save as provided in the Ordinance, the Federal Tax Ombudsman shall regulate the procedure for the conduct of business or the exercise of powers under this Ordinance.
11. Recommendations for implementation :
(1) If the Federal Tax Ombudsman is of opinion that the matter considered amounts to maladministration, he shall communicate his finding with a recommendation to the Revenue Division within a period of sixty days from the date of receipt of the complaint, reference or motion, as the case may be.
(2) The Revenue Division shall, within such time as may be specified by the Federal Tax Ombudsman, inform his about the action taken on his recommendations or the reasons for not complying with the same.
(3) In any case where the Federal Tax Ombudsman has considered a matter, or conducted an investigation, on a complaint or on a reference by the president, the Senate or the National Assembly or on a motion by the Supreme Court or a High Court, the Federal Tax Ombudsman shall forward a copy of the communication received by him from the Revenue Division in pursuance of sub-section (2) to the complainant or, as the case may be, the President, the Senate, the National Assembly, the Supreme Court or the High Court.
(4) If, after conducting an investigation, it appears to the Federal Tax Ombudsman that an injustice has been caused to the person aggrieved in consequence of maladministration and that the injustice has not been or will not be remedied, he may, if he thinks fit, lay a special report on the case before the President.
(5) If the Revenue Division does not comply with the recommendations of the Federal Tax Ombudsman or does not give reasons to the satisfaction of the Federal Tax Ombudsman for non-compliance, it shall be treated as "Defiance of Recommendations" and shall be dealt with as hereinafter provided.
12. Defiance of recommendations :
(1) If there is a "Defiance of Recommendations" by a Tax Employee with regard to the implementation of a recommendation given by the Federal Tax Ombudsman, the Federal Tax Ombudsman may refer the matter to the President who may, in his discretion, direct the Revenue Division to implement the recommendations and inform the Federal Tax Ombudsman accordingly.
(2) It shall be the duty of the Revenue Division and the Tax Employee to implement the finding made under section 11 and 12 within thirty days of such decision being communicated to the concerned Tax Employee. In each instance of "Defiance of Recommendations", a report by the Federal Tax Ombudsman shall become a part of the personal file or character roll of the Tax Employee primarily responsible for the defiance, and such Tax Employee shall be liable for contempt as provided hereafter in section 16: Provided that the Tax Employee concerned had been granted an opportunity to be heard in the matter.
13. Reference by Federal Tax Ombudsman :
Where, during or after an investigation, the Federal Tax Ombudsman is satisfied that any person is guilty of any allegations as referred to in sub-section (1) of section 9, the Federal Tax Ombudsman may refer the case to the Revenue Division for appropriate corrective or disciplinary action, or both corrective and disciplinary action, and the Revenue Division shall inform the Federal Tax Ombudsman within thirty days of the receipt of reference of the action taken. If no information is received within this period, the Federal Tax Ombudsman may bring the matter to the notice of the President for such action as he may deem fit, besides action for contempt under section 16 hereof.
14. Powers of the Federal Tax Ombudsman :
(1) The Federal Tax Ombudsman shall, for the purposes of this Ordinance, have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (Act V of 1908), in respect of the following matters, namely:
(a) summoning and enforcing the attendance of any person and examining him on oath;
(b) compelling the production of documents;