Finance Bill 2026
The Finance Bill 2026 is part of the federal budget for FY 2026-27. This page reproduces the text of its 110 PDF pages, extracted automatically from the official PDF published by the Federal Board of Revenue.
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Page 1
A
BILL
to give effect to the financial proposals of the Federal Government for the year
beginning on the first day of July, 2026, and to amend certain laws
WHEREAS, it is expedient to make provisions to give effect to the financial
proposals of the Federal Government for the year beginning on the first day of July,
2026, and to amend certain laws for the purposes hereinafter appearing;
It is hereby enacted as follows:-
1. Short title and commencement. ─ (1) This Bill shall be called the Finance Bill,
2026.
(2) It shall, unless otherwise provided, come into force on the first day of
July, 2026.
2. Amendments of the West Pakistan Motor Vehicles Taxation Act, 1958 (WP
Act XXXII of 1958).- In the West Pakistan Motor Vehicles Taxation Act, 1958 (WP
Act XXXII of 1958) as in force in the Islamabad Capital Territory, in the Schedule, for
the Tables 2, 3, 4 and 5, the following shall be substituted, namely:-
“SCHEDULE
[see section 3]
Table 2
Token Tax on Motor Vehicles
S.No Category Tax Rates for ICT
(1) (2) (3)
1 Engine capacity upto 1000 CC 20,000
2 Engine capacity from 1001 to 1300 cc 0.25 % of Invoice Value
3 Engine capacity from 1301 to 1500 cc 0.25 % of Invoice ValuePage 2
4 Engine capacity from 1501 to 2000 cc 0.25 % of Invoice Value
5 Engine capacity from 2001 to 2500 cc 0.35 % of invoice Value
6 Engine capacity from 2501 and above 0.35 % of invoice Value
Table 3
Motor Cabs
S.No Category Tax Rates for ICT
(1) (2) (3)
1 Engine capacity upto 1000 CC 600
2 Exceeding 1000cc but not more than 1,000
1300cc
3 Exceeding 1300cc but not more than 1,700
1500cc
4 Exceeding 1500cc but not more than 2,500
2000cc
5 Exceeding 2000cc but not more than 3,400
2500cc
6 Exceeding 2500cc 4,200
Table 4
Public Service Vehicle
S.No Category Tax Rates in ICT Per seat per
annum
(1) (2) (3)
1 Vehicle (8 seater) 350
2 Vehicle (13 seater) 400Page 3
3 Vehicle (15 seater) 500
4 Vehicle (16 seater) 600
5 Vehicle (42 seater) 700
6 Vehicle (52 seater) 850
Table 5
Commercial Vehicle/Loading Vehicles
S.No Category Proposed Rates
(1) (2) (3)
1 Vehicles not exceeding 1250 KG in laden weight 500
2 Vehicles with maximum laden capacity exceeding 1,000
1250 KG but not exceeding 2030 KG
3 Vehicles with maximum laden capacity exceeding 1,000
2030 KG but not exceeding 4060 KG
4 Vehicles with maximum laden capacity exceeding 6,600
4060 KG but not exceeding 6090 KG
5 Vehicles with maximum laden capacity exceeding 6,600
6090 KG but not exceeding 8120 KG
6 Vehicles with maximum laden capacity exceeding 12,000
8120 KG
7 Vehicles with maximum laden capacity exceeding 12,000
8120 Kg, but not exceeding 12000 Kg
8 Vehicles with long trailers or other vehicles with 18,000
maximum laden capacity exceeding 12000 Kg, but
not exceeding 16000 KgPage 4
9 Vehicles with long trailers or other vehicles with 24,000
maximum laden capacity exceeding 16000 Kg
10 Tractor (With trolley) 2,600
11 Tractor (Without trolley) 2,600.”.
3. Amendments of the Petroleum Products (Petroleum Levy and Climate
Support Levy) Ordinance, 1961 (XXV of 1961).- In the Petroleum Products
(Petroleum Levy and Climate Support Levy) Ordinance, 1961 (XXV of 1961), the
following further amendments shall be made, namely:-
1. in section 2,-
(a) for clause (1), the following shall be substituted, namely:-
“(1) “company” means an oil marketing company and includes
a person engaged in the manufacturing, refining or reclaiming of
lubricating oil from used lubricating oil under a license granted
by OGRA;”;
(b) after the omitted clause (4D), the following new clauses shall be
inserted, namely:
“(4E) “Oil Marketing Company” means a company, other than
lubricant marketing company, engaged in purchasing or
obtaining of petroleum products from refineries or blending
plants or through sources abroad for selling, distributing or
marketing, directly through his agents or dealers at his
dispensing outlets or filling stations; and
(4F) “OGRA” means the Oil and Gas Regulatory Authority of
Pakistan established under the under the Oil and GasPage 5
Regulatory Authority Ordinance, 2002 (Ordinance XVII of
2002);”;
(c) for clause (7), the following shall be substituted, namely:-
“(7) “refinery” means a facility or industrial plant where crude
oil is refined to produce petroleum products.”;
2. in section 3,-
(a) for sub-section (1), the following shall be substituted, namely:-
“(1) The payment of Petroleum Levy and Climate Support Levy
shall deemed to be a license condition of every company, refinery
or licensee from the date of issue of license by OGRA and such
company, refinery or licensee shall pay to the Federal
Government, Petroleum levy and Climate Support Levy on
petroleum products at such rates as may respectively be notified
by the Federal Government in the official Gazette, from time to
time.”; and
(b) sub-section (3) shall be omitted;
3. after section 3A, the following new sections shall be added, namely:-
“3B. Late payment surcharge.- (1) Where any amount of the
Petroleum Levy and Climate Support Levy are not paid within the
prescribed due date i.e. the date of filing of Sales Tax or Federal Excise
Returns in case of local production and date of payment of custom duty
in case of imported products, the defaulting company, refinery or
licensee shall, in addition to the amounts due, be liable to pay late
payment surcharge calculated in the manner as specified in sub-section
(1) of section 40D of the Public Finance Management Act, 2019.Page 6
3C. Recovery of amounts due under this Ordinance.- (1)
Notwithstanding anything contained in the Public Finance Management
Act, 2019 and subject to sub-section (2) of this Act, if the Petroleum Levy
and Climate Support Levy due or the late payment surcharge are not
paid within ninety days, the relevant department responsible for
collecting the Petroleum Levy and Climate Support Levy under sub-
section (2) of section 3A of this Act, may request the Commissioner
(Inland Revenue) to exercise powers of recovery in the same manner as
income tax arrears under Part IV of Chapter X of the Income Tax
Ordinance, 2001 (XLIX of 2001) or rules made thereunder in this behalf:
Provided that the Commissioner (Inland Revenue) shall have no
authority to grant extension of time to the notice of recovery or allow
payments of outstanding levies under this Ordinance including late
payment surcharge in instalments of equal or varying amounts.
(2) The relevant department under sub-section (2) of section 3A of
this Act, as it deems fit and proper, may either, separately or
simultaneously, initiate recovery of the Petroleum Levy and Climate
Support Levy, or, the late payment surcharge, as the case may be.
(3) Any irregularity or infirmity in the recovery proceedings under this
section shall not be grounds of challenge before a tribunal or courts of
law.
(4) The Commissioner (Inland Revenue) shall be bound to submit a
report every fortnight to the divisions concerned to whom subjects of
finance and petroleum are allocated under the Rules of Business, 1973Page 7
on the progress of recovery proceedings, and failure to recover the
amounts due shall be explained in writing.
(5) Prior to commencement of the Finance Act, 2026, where any
amount of the Petroleum Levy and Climate Support Levy or the late
payment surcharge are due under sections 40B and 40D of the Public
Finance Management Act, 2019, it shall be recoverable under this
section.”;
4. after section 4, the following new section (4A) shall be inserted, namely:-
“4A. Mandatory reporting mechanism for petroleum levy and
climate support levy payments.- (1) Every company, refinery or
licensee under this Ordinance shall submit monthly statement regarding
the payment of the Petroleum Levy and Climate Support Levy on sale of
petroleum products. The statement shall be supported by documentary
evidence including monthly sales invoice submitted to the Federal Board
of Revenue established under the Federal Board of Revenue Act, 2007
(Act No. IV of 2007) including any other document required by the
relevant department from time to time.
(2) Every company, refinery or licensee under this Ordinance shall
furnish an annual audited certificate to the Petroleum Division, issued by
the Authorized Audit Firm, certifying the accuracy of the levy and or
levies accrued and paid under this Ordinance.
Explanation: For purposes of this section, Authorized Audit Firm means
an audit firm registered with the Audit Oversight Board under the
Securities and Exchange Commission of Pakistan Act, 1997 (XLII of
1997).Page 8
(3) The costs and expenses of such audit shall be borne solely by the
relevant company, refinery or licensee.”;
5. Omission of the Second Schedule, Ordinance XXV of 1961.- In the
said Ordinance, the Second Schedule shall be omitted.
6. Omission of the Fourth Schedule, Ordinance XXV of 1961.- In the
said Ordinance, the Fourth Schedule shall be omitted.
4. The Customs Act, 1969 (IV of 1969).- In the Customs Act, 1969 (IV of 1969),
the following further amendments shall be made, namely: -
(1) in section 2, after clause (ssss), a new clause shall be added, namely: -
“(ssssa) “State warehouse” means any place authorized by the
Collector of Customs to store the detained, seized or confiscated goods,
as the case may be”;
(2) in section 19, in sub-section (5), in the second proviso, for the figure
“2026”, the figure "2027" shall be substituted;
(3) in section 32, -
(a) in sub-section (3), in the first proviso, the words “in a case” shall
be omitted; and
(b) in sub-section (3A), in the proviso, the words “in a case” shall be
omitted;
(4) in section 80, in sub-section (4), -
(a) after the word “examined”, a comma shall be inserted and
thereafter the word “scanned” shall be inserted; and
(b) in the proviso, after the word “examined”, the words “or scanned”
shall be inserted;
(5) in section 82, -Page 9
(a) in sub-section (1), -
(i) for the words “Federal Government”, the word “Board”
shall be substituted; and
(ii) in the first proviso, after the word “waive”, the words “or
reduce” shall be inserted and for the full stop at the end a
colon shall be substituted and thereafter the following new
proviso shall be added, namely: -
“Provided further that the Board may notify the
rules to regulate the implementation of above provisions,
including the process of appeal against imposed penalties
and the Customs stations, goods or class of goods, where
the provisions of sub-section (1) shall not be applicable.”;
and
(b) in sub-section (2), after the fifth proviso, the following new proviso
shall be added, namely; -
“Provided also that the Board may authorize any person,
to auction any auctionable goods, in the manner as notified by the
Board.”;
(6) in section 156, in sub section (1), in the Table. -
(a) against S.No. 7A, in the third column, for the words “five hundred
thousand”, the words “ten million” shall be substituted;
(b) after S.No.62, the following S.No. shall be added, namely: -Page 10
“62 A If any person is found to such person shall be liable General
be involved or abetting in to a penalty not exceeding
the removal, substitution, two times the value of the
damage or otherwise goods involved; and upon
tempering with any conviction by a Special
goods, whether or not Judge, shall further be
confiscated, at any such liable to imprisonment for a
place as authorized by period not exceeding five
the Collector as a State years, or fine or the both.”;
Warehouse. and
(c) against S.No. 83, in the second column, for the existing entry, the
following shall be substituted, namely: -
“If an officer of any authority who is duty bound under section 170
to deposit the impugned goods with customs, neglects so to do.”;
(7) in section 157, after sub-section (2), the following explanation shall be
added, namely: -
“Explanation: - The word “removal” includes, and shall be deemed to
have always included, every act of carrying, transporting, depositing,
harbouring, keeping, concealing, retailing, or any other act involving
movement of smuggled goods.”;
(8) for section 170, the following shall be substituted, namely: -
“170. Procedure in respect of goods seized or detained by other
authorities.- Notwithstanding anything contained in any other law for the
time being in force, when any goods liable to confiscation under this Act
are detained or seized by any other authority on any violation,Page 11
irrespective of any pending proceedings under the laws of that authority,
the customs authorities upon confirmation that such goods are liable to
confiscation shall intimate that authority in writing and that authority shall
be bound to deposit the impugned goods with customs for further
processing under this Act.”;
(9) in section 179, after sub-section (5), the following sub-section shall be
added, namely: -
“(6) Notwithstanding anything contained in this Act, or any other
law for the time being in force, the Board may notify a procedure for
faceless adjudication whereby adjudication proceedings shall be
conducted without any face-to-face interaction between the adjudicating
officer and the respondent. The virtual mode shall be in such manner as
may be prescribed by the Board from time to time.”;
(10) in section 185A, after sub-section (5), the following sub-section (6) shall
be added, namely: -
“(6) Where a Special Judge during trial of an offence punishable
under this Act, is satisfied that there is any reasonable grounds for
believing that the accused has committed an illegal transfer of funds into
or out of Pakistan, he may order the freezing of the assets of the
accused, whether in his possession or in the possession of any other
person on his behalf.”;
(11) after section 196J, the following section shall be added, namely; -
“196JJ. Independent case scrutiny committee.- (1) Any Civil petition,
reference, civil petition for leave to appeal or review petition before the
High Court, the Federal Constitutional Court or the Supreme Court ofPage 12
Pakistan shall only be filed by the Collector or Director of Customs, or
any officer of Customs not below the rank of Deputy Collector or Deputy
Director authorized by the Collector or Director of Customs, in writing,
subject to approval by an independent case scrutiny committee, as
constituted by the Board under sub-section (3).
(2) The Board may constitute one or more such committees
and assign them jurisdiction which shall exercise the powers and
functions in a manner, and from the date, as may be notified by the
Board.
(3) The independent case scrutiny committee shall comprise
of the following Members, namely: -
(a) a retired judge of superior judiciary who shall also
act as Chairman of the Committee;
(b) an advocate having not less than fifteen years of
experience in customs and commercial litigation
before the High Court or Supreme Court of
Pakistan; and
(c) a serving or retired officer not below the rank of
Director or Collector of Customs.
(4) The members shall receive such renumeration as may be
prescribed by rules.
(5) Recommendations of the committee shall be binding upon
the concerned Collector or Director of Customs.Page 13
(6) No suit, prosecution or other legal proceedings shall lie
against the members of the committee in relation to the decisions made
under this section.”;
(12) in section 215, in clause (c), for the full stop at the end, the expression “
;or ” shall be substituted and thereafter the following new clause shall be
added, namely: -
“(d) in the manner prescribed for service of a summons under the
Code of Civil Procedure, 1908 (Act V of 1908).”;
(13) The amendment set out in the First Schedule to this Act shall be made
in the First Schedule to the Customs Act, 1969 (IV of 1969): and
(14) The Fifth Schedule to the Customs Act, 1969 (IV of 1969), shall be
substituted in the manner provided for in the Second Schedule to this
Act.
5. Amendments in the Sales Tax Act, 1990.- In the Sales Tax Act, 1990 (VII
of 1990), the following further amendments shall be made, namely: -
(1) in section 2,-
(a) after clause (1A), the following new clauses shall be inserted,
namely:-
“(1AA) “advance receipt invoice” means an invoice in the
format as may be notified by the Board from time to time;
(1AAA) “algorithmic settlement mechanism” means
algorithmic settlement mechanism provided under section
26AAA of this Act”
(b) after the omitted clause (9AA), the following new clause shall be
inserted, namely:-Page 14
“(9AB) “electronic invoicing system” means such electronic
system or mechanism as may be prescribed or approved
by the Board for issuance and recording of sales tax
invoices in electronic form;”;
(c) after clause (17), the following new clause shall be inserted,
namely:-
(17A) “National faceless centre” means National faceless
centre as defined in section 32C of the Act;”;
(d) after clause (22), the following new clause shall be inserted,
namely:-
“(22)(1A) “production monitoring system” means any
system or technology, used for the purposes of monitoring
production and sale of goods, whether in real-time or otherwise,
including such systems or technologies as may be prescribed by
the Board from time to time;
(e) in clause (43A),-
(i) in sub-clause (d), after the expression, “wholesaler-cum-
retailer”, the expression “having turnover more than two
hundred million” shall be inserted;
(ii) sub-clauses (f) and (g) shall be omitted;
(iii) after omitted sub-clause (ga), the following new sub-clause
shall be inserted, namely:-
“(gb) a retailer having turnover exceeding two hundred
million rupees either by way of declaration or from
worked back value of turnover from tax deductionPage 15
under section 236G or 236H of Income Tax
Ordinance, 2001 (XLIV of 2001) during the
immediately preceding twelve consecutive months;
and” and
(iv) in sub-clause (h), for full stop at the end, a colon shall be
substituted and thereafter the following proviso shall be
added, namely:-
“Provided that the Board may also exclude any
person or class of persons through a notification in the
official gazette.”.;
(f) in clause (44), after sub-clause (a), the following explanation shall
be added, namely:-
“Explanation.- For the removal of doubt, the term goods are
delivered or made available mean the goods become ready for
dispatch from the business premises including but not limited to
factory, warehouse, godown or branch.”; and
(g) in clause (46), in sub-clause (j), in the first proviso, at the end, for
the colon, the full stop shall be substituted and thereafter the
following expression shall be added, namely:-
“For this purpose of valuation, the Board may use the
valuation of such goods as notified by Pakistan Bureau of
Statistics immediately before the start of tax period. The Board
may also where deems fit outsource the functions of valuation of
goods to third party in the mode and manner as may be
prescribed:”;Page 16
(2) in section 6, in sub-section (2), after the first proviso, for full stop at the
end, a colon shall be substituted and thereafter the following new proviso
shall be added, namely:-
“Provided further that in the case of steel melters, steel re-rollers
and composite units, the tax shall be collected on the basis of per unit
electricity consumption at the rate as prescribe by the Board, through
notification in the official Gazette. The tax so collected shall be
adjustable and the excess amount, if any, shall be refunded on monthly
basis through Board’s automated refund system to those registered
persons who integrate with the Board’s prescribed production monitoring
and digital invoicing systems.”;
(3) in section 8B, in sub-section (1), in the second proviso, for full stop at the
end, a colon shall be substituted and thereafter the following new proviso
shall be added, namely:-
“Provided further also that the Board may by notification in the
official Gazette, reduce or enhance the limit provided in this sub-section
for any registered person on the basis of compliance or non-compliance
with the production monitoring, digital invoicing, e-bility, POS, or any
other electronic system prescribed by the Board for digital integration of
data.”;
(4) in section 9, for full stop at the end, a colon shall be substituted and
thereafter the following proviso shall be added, namely:-
“Provided that the issuance of debit and credit notes shall be
governed by the mechanism including electronic adjustments, as may
be prescribed by the Board.”;Page 17
(5) after section 11G, the following new section shall be inserted, namely:-
“11H. Faceless audit and assessment.- (1) Notwithstanding anything
to the contrary contained in any other provision of this Act, any audit
under sections 25 and 72B, any order made under section 11E, and
rectification under section 57 with respect to the cases referred to in sub-
section (2), may be made in a faceless manner as may be prescribed by
the Board from time to time.
(2) The faceless assessment under sub-section (1) shall be made in
respect of such persons or class of persons, or incomes or class of
incomes, or cases or class of cases, as may be specified by the Board.
(3) The provisions of section 25 shall apply to the audit conducted in
faceless manner under this section:
Provided that where opportunity of being heard is to be provided
to the taxpayer during the course of this audit or a statement under oath
is required to be obtained from a taxpayer or any other person under
section 37 of this Act, the same shall be done through E-hearing:
Provided further that the identity of the officer, including facial and
voice identity, conducting such E-hearing shall be kept confidential.”;
(6) in section 21, in sub-section (2), after the word “invoices”, the expression
“, has committed non-compliance of sub-sections (5) and (6) of section
23 or section 40C” shall be inserted;
(7) in section 23, in sub-section (1),-
(i) for the words “supply shall issue a serially numbered tax invoice”
the expression “as well as exempt supply shall issue a tax invoicePage 18
including an advance receipt invoice, bearing a verifiable and
unique FBR invoice number” shall be substituted; and
(ii) in clause (b), after the Explanation, for the existing provisos, the
following shall be substituted, namely:-
“Provided that the Board may notify any person or class of
persons who may be allowed to issue an advance receipt invoice
within the notified system:
Provided further that the condition of verifiable and unique
FBR invoice number shall be applicable from a time as notified by
the Board.”;
(8) in section 25,-
(i) after sub-section (8), the following new sub-sections shall be
inserted, namely:-
“(8A) If, at any stage of the proceedings before him, if the
Commissioner is of the opinion that having regard to, -
(a) the nature and complexity of the accounts; or
(b) volume of the accounts; or
(c) doubts about the correctness of the accounts; or
(d) multiplicity of transactions in the accounts; or
(e) specialized nature of business activity of the registered
person, and interests of the revenue, is of the opinion that
it is necessary so to do, he may, after giving the registered
person a reasonable opportunity of being heard, and with
the previous approval of the Chief Commissioner, directPage 19
the registered person to get either any or all of the
following:-
(i) accounts re-audited by an accountant, and to
furnish a report of such audit duly signed and
verified by such accountant including answers to
the specific queries as the Commissioner may
require; or
(ii) inventory re-valued by a cost accountant, and to
furnish a report of such inventory valuation duly
signed and verified by such cost accountant
including answers to the specific queries as the
Officer of Inland Revenue may require;
Explanation:- The accountant or the cost
accountant, as referred to in this sub-section shall
be nominated by the Commissioner for the
purposes of the said sub-section from amongst the
panel of such accountants or cost accountants
nominated by the Board.”; and
(8B) After completion of the audit, the officer of Inland Revenue
shall, after obtaining the registered person’s explanation on all the
issues raised in the audit, issue an audit report containing audit
observations and finding.”;
(ii) in sub-section (9), for the words “completion of the audit”, the
words “issuing the audit report” shall be substituted; and
(iii) in sub-section (11),-Page 20
(a) for the words “wishes to deposit”, the word “deposits” shall
be substituted; and
(b) in the second proviso, for the words “full amount”, the
words “fifty percent” shall be substituted;
(9) after section 30A, the following new section shall be inserted, namely:-
“30AA. Faceless jurisdiction. - (1) Notwithstanding anything
contained in this Act, the Inland Revenue tax authorities appointed in
National faceless center shall perform all or such functions, and exercise
all or such powers under this Act as may be assigned to them in respect
of such persons, or classes of persons, for such tax periods of a person
through algorithms developed by the Board.
(2) The jurisdiction so assigned may be exclusive or concurrent.
(3) The Board may transfer jurisdictions in respect of persons or
classes of persons, for a specific tax period, for which the jurisdiction has
already been assigned under this section, from National faceless center
to the officer of Inland Revenue having jurisdiction under section 30 of
this Act, on the recommendation of the Chief Commissioner or on its own
accord.
(4) The Chief Commissioner appointed in the National faceless
center may request the Board to direct the officer of Inland Revenue
having jurisdiction under section 30 or any other Authority under this Act,
as it may deem fit, to conduct physical verification including nature and
size of the business, assets, investments, expenditures, and any other
information or verification required by the Chief Commissioner for
conducting any proceedings assigned to the National faceless centre:Page 21
Provided that the Board may exercise its power of allocation of
verification through an algorithm based system.
(5) Notwithstanding anything contained in any law for the time being
in force, the identity of the authority exercising jurisdiction in the National
faceless centre shall be kept confidential from the registered person, the
authorized representative of the registered person, and any
unauthorized person.
(6) No notice, order , or other communication by an authority
appointed at the National faceless centre shall be called in question or
set aside merely on the ground that such authority did not have
jurisdiction over the taxpayer under section 30 of this Act, or lack of
notified delegation of power under section 32 of this Act, or because of
the fact that identity of the authority has been kept confidential from the
taxpayer as per sub-section (5).”;
(10) after section 30DDDA, the following new section shall be inserted,
namely:-
“30DDDB. Directorate General (Field Compliance) Inland
Revenue.- (1) The Directorate General (Field Compliance) Inland
Revenue shall consist of a Director General and as many Directors,
Additional Directors, Deputy Directors, Assistant Directors and such
other officers as the Board may, by notification in the official Gazette,
appoint.
(2) The Board may, by notification in the official Gazette,--
(a) specify the functions and jurisdiction of the Directorate
General and its officers; andPage 22
(b) confer the powers of authorities specified in section 30
upon the Directorate General and its officers.”
(11) after section 32B, the following new section shall be inserted, namely:-
“32C. National faceless centre.- (1) Notwithstanding anything to the
contrary contained in any of the provisions of this Act, the Board may,
for the purposes of proceedings under this Act in faceless manner,
establish a National faceless center (hereinafter referred to as “the
Centre”) and specify its jurisdiction, powers, and functions.
(2) The centre shall comprise a Director General and as many
officers of Inland Revenue along with support staff, as the Board may
deem fit for the purposes of this section.
(3) The Board may design algorithms for assigning any function or
jurisdiction under this section to any of the authorities mentioned in sub-
section (2).
(4) The centre shall comprise as many wings and units as may be
prescribed by the Board.
(5) The functions of audit, assessment, and quality control in a
specific case for a specific tax period shall be performed by separate
officers.
(6) All communications, among the units, or with the registered
person, or an authorized representative of the registered persons, or with
any other person with respect to the information or documents or
evidence or any other details, as may be necessary, shall be through
electronic means.”;
(12) in section 33, in the Table, in column (1),-Page 23
(a) against S. No. 1, in column (2),-
(i) for the word "ten ", the word "fifty " shall be substituted; and
(ii) in the proviso, for the word " hundred", the word " thousand
" shall be substituted;
(b) against S. No. 2, in column (2), for the expression "five thousand
rupees or three per cent", the expression "twenty-five thousand
rupees or five per cent" shall be substituted;
(c) against S. No. 3, in column (2),-
(i) for the word "ten ", the word "fifty" shall be substituted; and
(ii) for the word "five", the word "ten" shall be substituted;
(d) against S. No. 5, in column (2),-
(i) for the expression "ten thousand rupees or five per cent of
the amount of the tax involved, whichever is higher", the
expression "fifty thousand rupees or five per cent of the
amount of the tax involved, whichever is higher" shall be
substituted; and
(ii) in the first proviso, for the word " hundred", the word
"thousand" shall be substituted;
(e) against S. No. 7, in column (2), for the word "ten", the word "fifty"
shall be substituted;
(f) against S. No. 8, in column (2), for the word "ten", the word "fifty"
shall be substituted;
(g) against S. No. 25, in column (1) and entries related thereto in
column (2), the following shall be substituted, namely:-Page 24
25. Any person, who is Such person shall be liable to pay
required to integrate a penalty up to one million rupees,
his business for if he continues to commit the
monitoring, tracking, offence after one month of the
reporting or recording imposition of first penalty, he shall
of sales, production be liable to second penalty of up
and similar business to five million rupees.
transactions with the Notwithstanding, his business
Board or its premises shall be liable to be
computerized sealed with or without imposition
system, fails to get of penalty by an officer of Inland
himself registered Revenue in the manner as may be
under this Act, and if prescribed.
registered, fails to
integrate in the
manner as required
under law within the
stipulated time as
notified by the Board.
(h) after S. No. 28, the following new S. Nos. and entries relating
thereto in columns (1), (2) and (3) shall be added, namely:-
29. Where any (i) Such person shall 2(37)
registered pay a penalty equal to
person issues a the face value of thePage 25
tax invoice for a simulated or fictitious
transaction invoice or invoices.
which is (ii) The Board shall,
simulated or after issuance of a
fictitious, or for show cause notice and
which no actual an opportunity of being
supply of goods heard, place the name
or services has and registration
taken place, as number of such person
established on a publicly accessible
after notice and simulated invoice
adjudication. issuers register
maintained on the
Board's computerized
system.
(iii) Any input tax credit
claimed by a
counterparty on the
basis of invoices issued
by a person on the
simulated invoice
issuers register shall be
reversed automatically
and treated asPage 26
inadmissible with effect
from the date of listing.
(iv) Listing on the
register shall be
removed upon full
payment of the penalty
and default surcharge,
and upon satisfactory
demonstration of
compliance.
30. Where the Such person shall pay 7, 8A
Board's a penalty of twenty per
computerized cent of the unmatched
system identifies that input tax amount, in
input tax credit addition to reversal of
claimed by a the inadmissible credit
registered person in and payment of default
respect of any tax surcharge under
period cannot be section 34.
matched to
corresponding
output tax declared
by the supplier for
the same orPage 27
proximate tax period, and such mismatch is confirmed after issuance of notice and provision of opportunity of being heard. 31. Where a Such person shall pay 7, 8A, 33 registered person a penalty of twenty per (S.No.29) has claimed input tax cent of the unreversed credit on the basis of input tax credit, in invoices issued by a addition to the reversal person who is of such credit and subsequently placed default surcharge on the simulated under section 34. invoice issuers register under S. No. 29, and such registered person fails to reverse the inadmissible input tax credit within sixty days of the listing of
Page 28
the invoice issuer on
the register.
(13) in section 40C,-
(a) for sub-sections (2) and (3), the following shall be
substituted, namely:-
“(2) From such date as may be prescribed by the Board,
no taxable goods shall be removed or sold by the
manufacturer or any other person unless such goods
are affixed with tax stamps, band role stickers or
labels are monitored through a Production
Monitoring System, video analytics or any other
prescribed monitoring mechanism, etc. in any such
form, style and manner as may be prescribed by the
Board in this behalf;
(3) Such tax stamps, banderols, stickers, labels,
barcodes, production monitoring equipment etc.,
shall be acquired by the registered person referred
to in sub-section (2) from a licensee appointed by the
Board.”; and
(b) after the omitted sub-section (5), the following new sub-
section shall be added, namely:-
“(6) Any taxable goods in respect of which monitoring,
tracking or identification has been prescribed under this
Act or rules made thereunder, which are manufactured,
produced, removed, transported, supplied or otherwisePage 29
dealt with or without affixing the prescribed tax stamps,
banderoles, stickers, labels, barcodes or without
compliance with the prescribed monitoring system, shall
be liable to seizure and confiscation in the prescribed
manner, along with the conveyance used for the
movement, carriage or transportation of such goods.”;
(14) after section 40E, the following new section shall be inserted,
namely:-
“40F. Sale of confiscated goods by auction.- (1) Where any goods
liable to confiscation under any provision of this Act have been
confiscated, these goods, without prejudice to other action
specified against such goods, shall be sold by public auction.
(2) The goods may be sold under sub-section (1)
through electronic means, as prescribed by the Board.
(3) For the purpose of sub-sections (1) and (2) of this
section, the Board shall be bound by Public Procurement
Regulatory Authority Rules, 2014.
(4) The sale proceeds shall be applied to the following
purposes in their respective order, namely:-
(a) first to pay the expenses of the sale;
(b) then to pay the sales tax, other taxes and
dues including penalty and surcharge
payable to the Federal Government in
respect of such goods; andPage 30
(c) the balance in respect of confiscated goods
excluding those liable for outright
confiscation, if any, shall be paid to the
owner of the goods, provided he applies for
it within six months of the sale of the goods
failing which the balance amount shall be
deposited into government treasury:
Provided that, in case wherein goods
declaration has been filed, the share of
importer in sale proceeds shall not exceed
the declared value of the goods.”;
(15) after section 45B, the following new section shall be inserted,
namely:-
“45C. Faceless appeals. - (1) Notwithstanding anything
contained in this Act, any appeal filed under section 45B of this
Act may be processed through the National faceless center as
may be prescribed by the Board.
(2) The provisions of section 45B of this Act, shall apply to
faceless appeals accordingly.
(16) after section 47A, the following new sections shall be inserted,
namely: -
“47AA. Algorithmic settlement mechanism.- (1)
Notwithstanding anything contained in this Act, the Board may
establish digitally operated algorithmic settlement mechanism
(hereinafter referred to as "the mechanism") for settlement of taxPage 31
proceedings at any stage before any order under sections 11D or
11E of the Act.
(2) In case, the mechanism calculates and presents to the
registered person a settlement offer as per the criteria provided
under sub-section (3), the registered person may avail the offer
as provided in sub-section (4).
(3) The system generated settlement offer shall be calculated
on the basis including but not limited to:
(a) the stage of proceedings at which settlement is
offered;
(b) the registered person’s compliance history, as
maintained in FBR's data;
(c) the nature and character of the discrepancy; and
(d) any other basis the Board may consider relevant.
(4) A registered person who opts to avail this mechanism shall
within ten days from the date of settlement offer to accept the
settlement offer on IRIS and deposit the settlement offer amount.
(5) The issues confronted to the registered person, if any,
through a notice or an audit report under this Act shall stand
abated if the registered person deposits the settlement amount as
provided in sub-section (4).
(6) Payment of tax consequent upon acceptance of offer
under sub-section (4) of this section shall not preclude
proceedings in respect of any other issue or discrepancy notPage 32
covered by the settlement offer, nor shall it affect proceedings for
any other tax period.
“47AAA. Independent case scrutiny committee. - (1) A
reference under section 47 before the High Court, or an appeal or
review before the Federal Constitutional Court or the Supreme
Court of Pakistan, as the case may be, shall only be filed by the
Commissioner Inland Revenue after the same has been
approved by an independent case scrutiny committee as
constituted by the Board.
(2) The Board may constitute one or more such committees
and assigned them cases or classes of cases decided by the
Appellate Tribunal Inland Revenue or the High Court as the case
may be.
(3) The Committee shall comprise of the following Members
as nominated by the Board -
(a) a retired judge of Supreme Court of Pakistan, the
Federal Constitutional Court, or any of the High
Courts of Pakistan who shall also act as Chairman
of the Committee;
(b) an Advocate having not less than fifteen years of
experience in tax and commercial litigation before
the High Court or Supreme Court of Pakistan, to be
nominated from a panel notified by the Board from
time to time; andPage 33
(c) a senior serving or retired officer of the FBR (BS 20
or above).
(4) The powers, functions, and procedure of the Committee
along with remuneration of its Members shall be governed as
prescribed.
(5) Recommendations of the committee shall be binding upon
the Commissioner Inland Revenue having jurisdiction over the
case.
(6) Notwithstanding anything contained in any other law for
the time being in force, no suit, prosecution, or other legal
proceedings shall lie against the Members of the Committee and
the Commissioner Inland Revenue having jurisdiction over the
case, in relation to the decisions made under this section.;
(7) The Committee constituted under this sub-section shall
exercise its powers and functions with effect from the date of its
constitution as notified by the Board.”;
(17) in section 56B, after sub-section (2), the following new sub-
section shall be added, namely:-
“(3) Notwithstanding anything contained in sub-section (1), the
Board shall have the power to share data contained in Sales Tax
returns of registered persons belonging to a sector amongst all
registered persons of the same sector under strict non-disclosure
agreements to create market equity and to enhance tax
compliance subject to such limitations, restrictions and conditions
as may be specified by the Board.”;Page 34
(18) in the Third Schedule, in the Table, in column (1), after Serial No.
55, the following new Serial Nos. and entries relating thereto in
columns (2) and (3) shall be added, namely:-
“56. Vegetable and animal fats and oils, sold in Respective
retail packing. headings
56. Respective
Sugar Confectionary, sold in retail packing.
headings
57. Pasta, whether or not cooked or stuffed
(with meat or other substances) or
otherwise prepared, such as spaghetti,
19.02
macaroni, noodles, lasagne, gnocchi,
ravioli, cannelloni; couscous, whether or
not prepared, sold in retail packing.
58. Sauces, ketchup and other preparations
therefor; mixed condiments and mixed Respective
seasonings; mustard flour and meal and headings
prepared mustard, sold in retail packing.
59. Fermented beverages, sold in retail Respective
packing. headings
60. Petroleum jelly, paraffin wax, micro-
crystalline petroleum wax, slack wax,
ozokerite, lignite wax, peat wax, other 27.12
mineral waxes, and similar products
obtained by synthesis or by otherPage 35
processes, whether or not coloured, sold in
retail packing.
61. Insecticides, rodenticides, fungicides,
herbicides, anti- sprouting products and
plant- growth regulators, disinfectants and
similar products, put up in forms or 38.08
packings for retail sale or as preparations
or articles put up in forms or packings for
retail sale.
62. Plates, sheets, film, foil, tape, strip and
39.19,
other flat shapes, of plastics, whether or not
39.20,39.21
in rolls, sold in retail packing.
63. Tableware, kitchenware, plastic furniture,
storage items, hygienic or toilet articles,
Chapter 39
and allied other household articles of
plastics, sold in retail packing.
64. Trunks, suit- cases, vanity- cases,
executive- cases, briefcases, school
satchels, spectacle cases, binocular cases,
camera cases, musical instrument cases,
gun cases, holsters and similar containers; 42.02
travelling- bags, insulated food or
beverages bags, toilet bags, rucksacks,
handbags, shopping- bags, wallets,
purses, map- cases, cigarette- cases,Page 36
tobacco- pouches, tool bags, sports bags,
bottle- cases, jewellery boxes, powder-
boxes, cutlery cases and similar
containers, of leather or of composition
leather, of sheeting of plastics, of textile
materials, of vulcanised fibre or of
paperboard, or wholly or mainly covered
with such materials or with paper, put up for
retail sale.
65. Respective
Footwear (all types)
headings
66. Bathroom accessories and bath items,
sanitaryware including taps, showerheads,
Respective
fittings, mixers, valves and other washroom
headings
accessories and fixtures, sold in retail
packing
67. Respective
Crockery Items, sold in retail packing
headings
68. Car and automobile accessories, sold in Respective
retail packing headings
69. Milk, fat filled milk, preparations suitable for
Respective
infants, and other products of milk, sold in
headings
retail packing
70. Preparations for use on the hair, sold in
33.05
retail packingPage 37
71. Pre- shave, shaving or after- shave
preparations, personal deodorants, bath
preparations, depilatories and other
perfumery, cosmetic or toilet preparations,
33.07
not elsewhere specified or included;
prepared room deodorisers, whether or not
perfumed or having disinfectant properties,
sold in retail packing
72. Toilet or facial tissue stock, towel or napkin
stock and similar paper of a kind used for
household or sanitary purposes, cellulose
wadding and webs of cellulose fibres,
4803.0000, 48.18
whether or not creped, crinkled, embossed,
perforated, surface- coloured, surface-
decorated or printed, in rolls or sheets, put
up for retail sale.
73. Jams, fruit jellies, marmalades, fruit or nut
puree and fruit or nut pastes, obtained by
cooking, whether or not containing added
20.07, 20.08
sugar or other sweetening matter, other
fruit and vegetable preparations, sold in
retail packing
74. Household utensils, including Stainless
Respective
steel, aluminum, melamine and other
headings
utensils and tableware.Page 38
75. Ceramic Products including wash basins,
commodes, tiles and allied ceramic 69.10”;
sanitary products, put up for retail sale.
Note: Where the Federal Government has notified that the sales tax
shall be charged, levied and paid at a rate higher than eighteen
percent, the same rate shall continue to be charged, levied and
paid after their inclusion under the Third Schedule.
(19) in the Sixth Schedule,
(a) in Table-1, in column (1),-
(i) for Serial No. 32 and entries relating thereto in
columns (2) and (3), the following shall be substituted,
namely: -
“32 Newsprint, books, and 4902.1000, and
magazines but excluding 4902.9000”
brochures, leaflets and
directories.
(ii) against serial number 157, in corresponding column
(2), for the expression “2026”, the expression “2027”
shall be substituted;
(iii) for serial number 181, and corresponding entries
relating thereto in columns (2) and (3), the following
shall be substituted, namely:-
“181. Import or lease of aircrafts and 8802.1200
parts thereof by Pakistan 8802.3000
8802.4000Page 39
International Airlines Corporation 8801.0000,
Limited (PIACL) 8802.2000,
8804.0000
Provided that the custom 8805.2900
authorities shall ensure that the 8807.3000
quantities of things imported are 9104.0010
limited to the requirements of 8544.2000
materials and articles to be used 7007.1900
in operations and maintenance of and 9931.”
the aircrafts operated by the
airline:
Provided further that the
ground handling equipment,
service and operation vehicles,
catering equipment and fuel
trucks, not manufactured locally,
and imported shall be used within
airport premises as aforesaid.
(iv) after Serial No 181, the following new Serial Nos. and
entries relating thereto in columns (2) and (3) shall be
added, namely: -
“182 Contraceptives 3926.9020 and
4014.1000
183 Female Sanitary Pads / 9619.0030
TamponsPage 40
184 Import of:
- Tankers, 8901.2000
- Dredgers, 8905.1000
- Floating or submersible 8905.2000
drilling, or production
platforms, 8905.9000
- Others floating
structures and vessels. 8901.9000
- Other vessels for the
transportation of goods
Excluding Cruise ships,
excursion boats and
similar vessels principally
designed for the transport
of persons; ferry- boats of
all kinds
Provided that the quantity
of imported goods under
this entry shall be
approved by Ministry of
Maritime Affairs
185. Import of bullet proof Respective
vehicles by the: heading.”
(i) Federal Government for
logistic arrangements forPage 41
Shanghai Cooperation
Organization (SCO)
summit subject to the prior
approval from the Ministry
of Foreign Affairs and the
Ministry of Interior and
Narcotics Control
(ii) By the Federal
Government or Provincial
Government for threat of
terrorism against a public
functionary as determined
by the Ministry of Interior
and Narcotics Control,
subject to approval by the
Federal Government.
(b) in Table-3, in Annexure, in column (1), after Serial No 22, the
following new Serial Nos. and entries relating thereto in columns
(2), (3) and (4) shall be added, namely:-
“23 Import of following The goods shall
machinery/ be imported
equipment for directly by the
upgradation of 8419.8990, refinery after
existing refineries: 8419.5000, approval by the
1. Reactors,Page 42
2. Shell and Tube 8419.8990, division Exchangers, concerned. 3.Vessels (Strippers/ 8418.6990, Separators/ K.O. 8419.8990, Drums), 4. Trim Coolers, 8417. 8000 5. Air Coolers 8413.7090 (Condensers), 8413.5000 6. Fired Heaters, 7. Centrifugal 8414.8090 Pumps, 8. Reciprocating 8414.8090 Pumps, 9.Centrifugal 8417.8000, Compressors, 10.Reciprocating 8421.3990 Compressors, 11. Steam Reformer Furnaces, 12 Filters, Provided that all such imports shall be essentially made for expansion of
Page 43
balancing,
modernization, and
rehabilitation of
existing refineries
and the quantity
imported by each
refinery shall be
approved by Ministry
of Petroleum and
Natural Resources.
24 Import of machinery, Respective The Division
equipment, raw headings as dealing with the
materials, approved by subject matter
components and the shall certify in the
other capital goods, concerned prescribed
by Karachi Shipyard Division. manner and
and Engineering format as per
Works Limited Annex-B that the
imported goods
are bona fide
requirement.
The authorized
officer of the
Ministry shallPage 44
furnish all
relevant
information
online to Pakistan
Customs
Computerized
System against a
specific user ID
and password
obtained under
section 155D of
the Customs Act,
1969.”;
(20) in the Eighth Schedule, in Table: -
(a) against serial No. 71, in column (2), for the words “30th
June, 2026”, the words “30th June, 2027” shall be
substituted; and
(b) for serial No. 80 in column (1), and corresponding entries
relating thereto in columns (2), (3) and (4), the following
shall be substituted, namely: -
“80. EV transport buses of 25 seats or 8702.4090 1%”
more and electric trucks in CBU 8704.6030
condition
(21) in the Eleventh Schedule, in the Table, in column (1), -Page 45
(a) against serial No. 4, in column (2), after the word
“companies”, a comma shall be added, and thereafter the
words “association of persons and individuals” shall be
added; and
(b) after S. No. 13, the following new S. No. and entries
relating thereto in columns (2), (3) and (4) shall be added,
namely:-
“14. Registered Person other four times of the
persons engaged than registered tax charged on
in toll person conversion
manufacturing charges.”;
(22) in the Twelfth Schedule, after the Table, under the heading,
“Procedure and Conditions”, in clause (2), after sub-clause (i), a
colon shall be added and thereafter the following provisos shall
be inserted, namely: -
“Provided that the manufacturer shall be liable to pay 3%
value addition tax on ad valorem basis, along with default
surcharge in case the imported goods are supplied in the same
state whether in the same packing, repacked, or in bulk:
Provided further that where-
(i) benefit of waiver of 3% value addition tax is availed,
declaring that the goods are imported for in-house
consumption in manufacturing process;
(ii) such imported goods are not used for in-house
consumption;Page 46
(iii) imported goods are supplied in the same state
whether in the same packing, repacked, or in bulk;
and
(iv) such supply exceeds 50% of total imports in a
financial year;
such person will be liable to prosecution.”.
6. Amendments in the Income Tax Ordinance, 2001 (XLIX of 2001). - In the
Income Tax Ordinance, 2001 (XLIX of 2001), the following further amendments shall
be made, namely: -
(1) in section 2, -
(a) after clause (1A), the following new clause shall be inserted,
namely: -
“(1AA) “algorithmic settlement mechanism” means
algorithmic settlement mechanism provided under
section 134B of this Ordinance;”;
(b) in clause (5), for the words “and amended assessment”, the
expression “, amended assessment and faceless assessment”
shall be substituted;
(c) after clause (6), the following new clause shall be inserted,
namely: -
“(6A) “authorised shipping agent” means a person in Pakistan
who is authorised, expressly or impliedly, by a non-
resident ship owner, charterer or operator to act on its
behalf in respect of a vessel, and who in relation to such
vessel or voyage -Page 47
(a) is responsible for the receipt, collection, control or
accounting of total freight and any related amounts,
and undertakes or is responsible for documentation,
manifest filing, or reporting of cargo or total freight,
including having, directly or indirectly, the control,
custody or disposal of any freight or related receipts
attributable to such vessel or voyage; and
(b) furnishes the return under section 143 of this
Ordinance, in respect of such vessel or voyage and
such person shall, for the purposes of this
Ordinance -
(i) be treated as the representative of the non-
resident under section 172;
(ii) be jointly and severally liable for payment of
tax and all obligations, proceedings,
assessments and recovery in respect of such
vessel or voyage; and
(iii) be treated as such, and the provisions of
sub-section (3) of section 172 shall apply
accordingly;”;
(d) after clause (19D), the following new clause shall be inserted,
namely:-
“(19DA) “electronically readable format" means any digital
format in which data is structured so that it can be
automatically read, extracted, validated andPage 48
processed by computer systems without human
intervention, including spreadsheet formats (such
as CSV or XLSX), XML, XBRL, JSON, and other
structured or semi-structured data formats but
excluding formats primarily designed for human
readability, such as PDF, scanned images or
photographs;";
(e) clause (22A), shall be omitted;
(f) in clause (30A), for the expression “Board through approved fiscal
electronic device and software”, the expression “Board’s
computerized system through a licensed integrator” shall be
substituted;
(g) after clause (30C), the following new clause shall be inserted,
namely:-
“(30D) “Licensed integrator” shall have the same meaning as
defined under clause (15A) of section 2 of the Sales Tax Act, 1990
(VII of 1990);
(h) after clause (35A) the following new clause shall be inserted,
namely:-
“(35)(1A) “National faceless center” means National faceless
center as defined in section 227D of this Ordinance;”;
(i) after clause (42A), the following new clause shall be inserted,
namely:-
“(42AA) “PRAL” means Pakistan Revenue Automation (Pvt)
Limited, a State Owned Enterprise which has been assignedPage 49
functions related to software development and maintenance of
the Board’s IT infrastructure;”; and
(j) clause (60) shall be omitted;
(2) in section (4AB), -
(a) in the heading, for expression “(4AB), the expression “4AB” shall
be substituted; and
(b) in the proviso, for the words “a surcharge shall be payable at the
rate of nine percent of the income tax imposed under Division I of Part I
of the First Schedule where the income exceeds rupees ten million in a
tax year”, the expression “no surcharge shall be payable.”; shall be
substituted;
(3) in section 6A, after sub-section (2), the following new sub-section shall
be added, namely:-
“(3) Notwithstanding the provisions of section 8, the tax
imposed under this section on a person, whose turnover in a tax year
exceeds two hundred million rupees shall be adjustable.”;
(4) section 7E shall be omitted;
(5) after section 7F, the following new section shall be inserted, namely: -
“7G. Tax on certain payments by life insurance business. -
(1) For tax year, 2026 and onwards, a tax shall be imposed, at the rate
specified in Division IC of Part III of the First Schedule on every individual
who receives any payout, benefit, surrender value, maturity proceeds or
similar payment (hereinafter referred to as payout) from a life insurance
business on account of insurance policy, family takaful certificate, plan
or any similar arrangement.
(2) For the purposes of sub-section (1), the amount liable to
tax shall be the gross amount of payout reduced by aggregate amount
of premiums or contributions paid by the policy holder or participant.”;
(3) The provisions of sub-section (1) shall not apply where the
payout or benefit is made-Page 50
(a) on account of death of the insured or participant;
(b) on account of disability of the insured or participant;
or
(c) after completion of seven years from the date of
issuance of the policy, certificate or plan.
(4) Tax deducted under this section shall be treated as final
tax on the income arising from such payout or benefit.”;
(6) in section 8, -
(a) in the heading, for the expression “7E”, the expression “7G” shall
be substituted; and
(b) in sub-section (1), for the expression “7E”, wherever occurring,
the expression “7G” shall be substituted;
(7) in section 21, for clause (r), the following shall be substituted, namely: -
“(r) up to five percent of the expenditure claimed by any person, who
fails to install electronic resource or to act as an integrated
enterprise as required by law, subject to the method, manner, and
procedure as may be prescribed;”;
(8) after section 53, the following new section shall be inserted, namely:-
“53A. Rationalization of rates of withholding taxes in the
nature of minimum tax. - (1) The Federal Government may reduce the
rate of any of the withholding taxes in the nature of minimum tax as given
in First Schedule of this Ordinance, other than minimum tax chargeable
under section 113 of this Ordinance, up to 1% on the basis of economic
viability in cases of persons or class of persons, subject to such
restrictions and limitations as the Federal Government may specify.Page 51
(2) The Federal Government shall place before the National
Assembly all amendments made in rates of withholding taxes in the First
Schedule, in a financial year under this section.”;
(9) for section 64D, the following shall be substituted, namely: -
“64D. Tax credit for integration. - (1) Any person required,
under this Ordinance, the Sales Tax Act, 1990 or the Federal Excise Act,
2005, to integrate with the computerized system of the Board for real-
time production monitoring, or for the recording or reporting of sales or
receipts, shall be entitled to a tax credit in respect of expenditure incurred
exclusively on the purchase, acquisition, installation or implementation
of such equipment, hardware, software or other electronic components
as are directly and exclusively utilized for the purposes of such
integration:
Provided that the Board may prescribe limitations, conditions, and
restrictions for availing the tax credit under this section.
(2) The amount of tax credit allowed under sub-section (1) for
a tax year in which electronic resource is installed, integrated and
configured with the Board's computerized system shall be ten percent of
the amount actually invested in the electronic resource.
(3) Such tax credit shall not be allowable against operation
and maintenance expenses related to such electronic resource.
(4) This tax credit shall be available only against normal tax
payable under Division I or Division II of Part I of the First Schedule.”;
(10) in section 76, after sub-section (8), a new sub-section (8A) shall be
added:Page 52
“(8A) Where an immovable property is acquired by an individual
through inheritance, the cost of such property in the hands of that
individual shall be the fair market value of the property as provided under
sub-section (5) of section 68 of this Ordinance on the day of the death
of the original owner.”;
(11) In section 79, in sub-section (1), in clause (b), the following explanation
shall be insertred, namely: -
“Explanation: For the removal of doubt it is clarified that
transmission of an asset, in the nature of immovable property, to
a beneficiary on the death of a person shall also include the
transmission of assets by reason of family settlement amongst
the family members consequent upon death of the person.”;
(12) in section 80, in sub-section (2), in clause (a), after the word “person”,
the expression “, limited liability partnership” shall be inserted;
(13) in section 92, -
(a) in sub-section (1), the explanation shall be omitted; and
(b) after the omitted sub-section (4), the following new sub-section
shall be inserted, namely: -
“(4A) Where the income of a limited liability partnership is
exempt from tax, the amount received by a member of a limited
liability partnership in the capacity as a member of such
partnership shall be taxable in the hands of the member of such
partnership.”;Page 53
(14) in section 99B, for the expression “and payment of tax, filing of return”,
the expression”, rate and payment of tax including fixed tax, filing of
return, audit” shall be substituted;
(15) in section 100B, -
(a) in sub-section (2), -
(i) in clause (b), the expression “, a non-banking finance
company,” shall be omitted and after the semicolon at the
end, the word “and” shall be added; and
(ii) clauses (c) and (d) shall be omitted;
(b) after sub-section (2), amended as aforesaid, the following new
sub-section shall be added, namely: -
“(3) NCCPL, in case of banking company, insurance
company and mutual funds shall compute and determine the
capital gain as per the mechanism prescribed under section 37A,
however, these entities shall continue to deposit tax on amount of
capital gain as per the applicable provisions of this Ordinance.”;
(16) in section 114, -
(a) for sub-section (2A), the following shall be substituted, namely: -
“(2A) A return of income shall be filed electronically on
IRIS as may be prescribed by the Board for the purpose of sub-
section (1) and sub-section (1A) of this section and the Board
may, by notification in the official Gazette, make rules for such
filing and determine the process of verification, digital signatures
and other matters relating to electronic filing of returns,
statements or documents, etc.:Page 54
Provided that in case of companies for tax year, 2026 and
onwards the financial statements accompanying the return shall
only be filed in electronically readable file format.”;
(b) in sub-section (6), after the word “therein”, the expression, “or
avails a settlement offered by algorithmic settlement mechanism”
shall be inserted
(c) after sub-section (6A), the following new sub-section shall be
inserted, namely:-
“(6B) Notwithstanding anything contained in sub-sections
(6) and (6A) of this section, if a taxpayer avails a settlement
offered by the algorithmic settlement mechanism, he may file a
revised return, and the -
(a) approval of Commissioner shall not be
required to file the revised return;
(b) taxpayer shall pay the amount of tax
determined by the mechanism and no
separate penalty or default surcharge shall
be payable; and
(c) return so filed shall be accompanied by such
documents as required under sub-section (6)
and shall be treated as revised return under
this section.”;
(17) after section 122D, the following new section shall be inserted, namely:
-Page 55
“122E. Faceless audit and assessment. - (1)
Notwithstanding anything to the contrary contained in any other provision
of this Ordinance, any audit under sections 177 or 214C, any order made
under section 111, any assessment under this Part and rectification
under section 221, with respect to the cases referred to in sub-section
(2), may be made in a faceless manner as may be prescribed by the
Board.
(2) The faceless assessment under sub-section (1) shall be
made in respect of such persons or class of persons, or incomes or class
of incomes, or cases or class of cases, as may be specified by the Board.
(3) The provisions of section 177 shall apply to the audit
conducted in faceless manner under this section:
Provided that where opportunity of being heard is to be provided
to the taxpayer during the course of this audit or a statement under oath
is required to be obtained from a taxpayer or any other person under
section 176 of this Ordinance, the same shall be done through E-hearing
under section 227E of this Ordinance:
Provided further that the identity of the officer, including facial and
voice identity, conducting such E-hearing shall be kept confidential.”;
(18) after section 129, the following new section shall be inserted, namely, -
“129A. Faceless appeals. - (1) Notwithstanding anything
contained in this Ordinance, any appeal filed under section 127 may be
processed through the National faceless center as may be prescribed by
the Board.Page 56
(2) The provisions of sections 127, 128, and 129 of this
Ordinance, shall apply to faceless appeals accordingly.”;
(19) after section 133, the following new section shall be inserted, namely: -
“133A. Independent case scrutiny committee. - (1) A
reference under section 133 of this Ordinance before the High Court, or
an appeal or review before the Federal Constitutional Court or the
Supreme Court of Pakistan shall only be filed by the Commissioner
Inland Revenue after the same has been approved by an independent
case scrutiny committee as constituted by the Board.
(2) The Board may constitute one or more such committees
and assign them cases or classes of cases decided by the Appellate
Tribunal Inland Revenue or the High Court, as the case may be.
(3) The Committee shall comprise of the following Members
as nominated by the Board -
(a) a retired judge of the Supreme Court of Pakistan,
the Federal Constitutional Court, or any of the High
Courts of Pakistan who shall also act as Chairman
of the Committee;
(b) an Advocate having not less than fifteen years of
experience in tax and commercial litigation before
the High Court or Supreme Court of Pakistan, to be
nominated from a panel notified by the Board from
time to time; and
(c) a senior serving or retired officer of the FBR (BS 20
or above).Page 57
(4) The powers, functions, and procedure of the committee
along with remuneration of its Members shall be governed as may be
prescribed by the Board.
(5) Recommendations of the committee shall be binding upon
the Commissioner Inland Revenue having jurisdiction over the case.
(6) Notwithstanding anything contained in any other law for
the time being in force, no suit, prosecution, or other legal proceedings
shall lie against the Members of the committee and the Commissioner
Inland Revenue having jurisdiction over the case, in relation to the
decisions made under this section.
(7) The Committee constituted under this sub-section shall
exercise its powers and functions with effect from the date of its
constitution as notified by the Board.”;
(20) in section 134A, -
(a) after sub-section (10), the following new sub-section shall
be inserted, namely:-
“(10A) Notwithstanding the dissolution of the
committee, the committee may, by an order in writing,
rectify any mistake apparent from the record on its own
motion or any mistake brought to its notice by the taxpayer
or the Commissioner, within thirty days of the receipt of
decision of the committee by the taxpayer or the
Commissioner, as the case may be.”; andPage 58
(b) in sub-section (11), in the proviso for the full stop at the
end, a colon shall be substituted and thereafter the
following new proviso shall be added, namely: -
“Provided further that where, at any stage of the
proceedings, any member of the committee becomes
unavailable or is unable to perform his functions for any
reason whatsoever, the Chairman of the Board shall,
within fifteen days of the occurrence of such vacancy,
appoint another person in accordance with the provisions
of sub-section (3) of this section to fill such vacancy, and
the committee so reconstituted shall continue to function
subject to the same terms, conditions and limitations as
were applicable to the original committee:
Provided also that upon such reconstitution, the
committee shall be allowed a further period of sixty days to
conclude the proceedings and perform its functions under
this section:
Provided also that the total period available to the
committee, including the period already consumed prior to
such reconstitution, shall in no case be less than ninety
days from the date of its original constitution.”;
(21) after section 134A, as amended above, the following new section shall
be inserted, namely:-
“134B. Algorithmic settlement mechanism. - (1)
Notwithstanding anything contained in this Ordinance, the Board mayPage 59
establish digitally operated algorithmic settlement mechanism
(hereinafter referred to as "the mechanism") for settlement of tax
proceedings at any stage before any assessment or amendment of
assessment order under sections 121, 122 or 122E of this Ordinance
through revision of return under sub-section (6) of section 114 in certain
cases.
(2) In case, the mechanism calculates and presents to the
taxpayer a settlement offer for voluntary revision of return as per the
criteria provided under sub-section (3), the taxpayer may avail the offer
as provided in sub-section (4).
(3) The system generated settlement offer shall be calculated
on the basis including but not limited to -
(a) the stage of proceedings at which settlement is
offered;
(b) the taxpayer's compliance history, as maintained in
FBR's data;
(c) the nature and character of the discrepancy,
including whether it involves a valuation or legal
interpretation dispute, unexplained income or
assets, or concealment; and
(d) any other basis the Board may consider relevant to
ensure revenue adequacy and equitable treatment
of taxpayers.
(4) A taxpayer who opts to avail this mechanism shall within
ten days from the date of settlement offer to -Page 60
(a) accept the settlement offer on IRIS;
(b) deposit the settlement offer amount along with
revised return; and
(c) revise the relevant return of income to incorporate
the settled amount.
(5) The issues confronted to the taxpayer through notice of
selection of audit, a notice under section 111, an audit report under sub-
section (6) of section 177, a notice under sub-section (9) of section 122,
as the case may be, shall stand abated, if the taxpayer revises the return
by accepting the offer as provided in sub-section (4).
(6) Revision of return consequent upon acceptance of offer
under sub-section (4) of this section shall not preclude proceedings in
respect of any other issue or discrepancy not covered by the settlement
offer, nor shall it affect proceedings for any other tax year.”;
(22) in section 143, -
(a) in sub-section (1), after the word “ship”, occurring for the second
time, the expression “, or the authorised shipping agent as defined in
clause (6A) of section 2,” shall be inserted;
(b) after sub-section (1), amended as aforesaid, the following new
sub- sections shall be inserted, namely: -
“(1A) Notwithstanding anything contained in this
Ordinance, only one return shall be furnished for each vessel or
voyage, and such return shall cover the total freight and all related
amounts attributable to the ship.Page 61
(1B) The master of ship or the authorised shipping agent
responsible for manifest filing and freight handling in respect of a
vessel shall furnish the return under this section, and no other
person shall furnish such return for that vessel or voyage.”;
(c) in sub-section (2), -
(i) after the word “ship”, occurring for the first time, the
expression “or authorised shipping agent” shall be
inserted; and
(ii) after the word “master”, the words “or authorised shipping
agent” shall be inserted;
(d) in sub-section (3), for the words “shall be”, the words “or
authorized shipping agent shall be jointly and severally” shall be
substituted;
(e) in sub-section (4), after the word “ship” occurring for the second
time, the words “or authorised shipping agent” shall be inserted
and after the word “charterer”, occurring for the second time, the
expression “or authorised shipping agent” shall be inserted;
(f) in sub-section (5), after the word “Commissioner”, occurring at the
end, the words “and electronic confirmation of filing of return and
payment of tax under this section has been received in the
prescribed manner” shall be inserted; and
(g) in sub-section (6), after the word “ship”, occurring for the second
time, the words “or authorised shipping agent” shall be inserted;
(23) in section 147, sub-section (6C) shall be omitted;Page 62
(24) after section 151A, the following new section shall be inserted, namely:
-
“151B. Certain payments by life insurance companies and
takaful operators. - (1) Every life insurance company, including a
family takaful operator or a window takaful operator, making any payout,
benefit, surrender value, maturity proceeds or similar payment to an
individual under a life insurance policy, family takaful certificate, plan or
arrangement shall, at the time of making such payment, deduct tax at
the rate specified in Division IC of Part III of the First Schedule.
(2) For the purposes of sub-section (1), the amount liable to
tax deduction shall be the gross amount of payout or benefit reduced by
the aggregate amount of premiums or contributions paid by the
policyholder or participant.
(3) The provisions of sub-section (1) shall not apply where the
payout or benefit-
(a) is made on account of death of the insured or
participant;
(b) is made on account of disability of the insured or
participant; or
(c) is made after completion of seven years from the
date of issuance of the policy, certificate or plan.
(4) Tax deducted under this section shall be treated as final
tax on the income arising from such payout or benefit.”;
(25) in section 152, for sub-section (1DA), the following shall be substituted,
namely:-Page 63
“(1DA) Every banking company maintaining a Foreign Currency
Value Account (FCVA), Foreign Currency Business Value Account
(FCBVA), Non-Resident Rupee Value Account (NRVA), or Non-
Resident Rupee Business Value Account (NRBVA) shall deduct tax from
capital gain arising on the disposal of debt instruments and Government
securities and certificates (including Shariah compliant variant) invested
through aforesaid accounts at the rate specified in Division II of Part III
of the First Schedule.”;
(26) after section 154A, the following new section shall be inserted, namely:
-
“154B. Withholding tax on revenues Received from social
media platforms. - (1) Every banking and non-banking financial
institution shall, at the time of credit or receipt of any amount in an
account of a person, deduct tax at the rate specified in Division IIIAB of
Part III of the First Schedule, where such amount represents revenues
received from social media platforms.
(2) For the purposes of this section -
(a) “digital content creator” or “social media influencer”
means any individual or entity deriving income from
creation, publication, or monetization of content on
digital platforms including but not limited to
YouTube, Facebook, Instagram, Tik Tok or such
others similar platforms; and
(b) “payment” includes any inward remittance, transfer,
or credit received through banking channels,Page 64
including through intermediaries such as online
payment service providers or digital financial
platforms.
(3) The tax deducted under this section shall be -
(a) minimum in the case of a resident person; and
(b) final tax in the case of a non-resident person not
having a permanent establishment in Pakistan.
(4) The Board may, by notification in the official Gazette,
prescribe rules for implementation, including identification and reporting
mechanisms.”;
(27) in section 159, after sub-section (1B), the following new sub-section shall
be inserted, namely: -
“(1C) Where a person has distributed ninety percent or more of its
accounting income amongst the unit or certificate holders or
shareholders, as the case may be, in accordance with the provisions of
clause (99) of Part I of the Second Schedule for the last three years, the
person shall be eligible for issuance of exemption certificate under sub-
section (1) and the certificate shall be issued for the subsequent whole
tax year.
(1D) Where a person has been issued approval under the provision of
sub-clause (c) of clause (36) of section 2 of this Ordinance for a tax year,
the person shall be eligible for issuance of exemption certificate under
sub-section (1) and the certificate shall be issued for the said whole tax
year.”;Page 65
(28) after section 165A, amended as aforesaid, the following new section
shall be inserted, namely: -
“165AB. Reporting of financial transaction data by banking
companies and financial institutions. - (1) Notwithstanding anything
contained in the Banking Companies Ordinance, 1962 (LVII of 1962),
the State Bank of Pakistan Act, 1956 (XXXIII of 1956), the Protection of
Economic Reforms Act, 1992 (XII of 1992), or any other law for the time
being in force, every banking company and Electronic Money Institutions
(EMIs) shall electronically upload the information, as mentioned in sub-
section (2), to the Central Data Hub, for algorithmic cross-matching of
tax and bank information.
(2) Information in respect of an account holders having
deposits or withdrawals exceeding one hundred million Rupees during a
reporting period in any or all of the bank accounts maintained by the
account holder, specifying particulars of deposits or withdrawals,
including opening and closing balances, peak credits, and total credits
during the reporting period.
(3) This information as shared above shall be digitally
processed and shall not be visible to any of the Income Tax Authorities
during this cross-matching process.
(4) In case of gross mismatch in the information in respect of
an account holder, the digital system of the Board shall feed the
information so required into the Compliance Risk Management (CRM)
system of the Board and further proceedings shall be conducted by the
National faceless centre as provided in this Ordinance.Page 66
(6) The Board shall ensure that such information, shared by
the banks, remains strictly confidential and in no case is disclosed or
misused in a manner to disregard the confidentiality measures provided
in the statutes and rules governing commercial banking, save as
provided in this section.
(7) In this section -
(a) “reporting period” means, in respect of a Financial
Year, a period of six months, starting from:
(i) 1st day of July and ending on 31st day of
December; and
(ii) 1st day of January and ending on 30th day of
June,;
(b) “specified date” means the-
(i) 31st day of January in case of reporting
period ending on 31st day of December; and
(ii) 31st day of July in case of reporting period
ending on 30th day of June;
(c) “accounts” means bank accounts maintained by a
person including current deposits, call deposits,
saving deposits, fix deposits, term deposits, or any
other such deposits by whatever name called;
(d) “peak credits” means the highest credit balance in
all the bank accounts of the account holder on any
given date during the reporting period;Page 67
(e) “Central Data Hub” means a virtual repository of
data and information maintained by the Board
through PRAL; and
(f) “compliance risk management (CRM)” means a
computer programme for identification and
communication of compliance risks, including
understatement of sales, overstatement of
expenses, non-reporting or under-reporting of
incomes, assets, and transactions.”;
(29) in section 169, in sub-section (1), in clause (b), after the expression
“154A”, the expression “, clause (b) of sub-section (3) of section 154B,”
shall be inserted;
(30) in section 174, for sub-section (5), the following shall be substituted,
namely: -
“(5) The Board may require any person or class of persons to
install and use an electronic resource of such type and description as
may be prescribed, or to act as an integrated enterprise through a
notification in the official Gazette for the purpose of receiving, storing,
matching and accessing information regarding any transaction that has
a bearing on the tax liability of such person.”;
(31) in section 175AA, in sub-section (1), -
(a) in clause (a), -
(i) after the word “with”, occurring for the first time, the words
“the State Bank of Pakistan and” shall be inserted; andPage 68
(ii) after the word “the”, occurring for the fourth time, the
expression “State Bank’s Central Data Repository (by any
name) and” shall be inserted and the word “and” occurring
at the end shall be omitted;
(b) in clause (b), after the word “the”, occurring for the first time, the
words “State Bank of Pakistan, Microfinance banks, and
Electronic Money Institutions (EMIs) and” shall be inserted and
for the full stop occuring at the end, the expression “; and” shall
be substituted; and
(c) after clause (b), amended as aforesaid, the following new clause
shall be added, namely: -
“(c) the State Bank of Pakistan may establish, operate
and maintain a secure centralized virtual repository
of banking data, comprising such information,
records, and financial transactions of persons
maintained by Scheduled banks on the basis of
unique identifiers, as may be prescribed by the
Board and collect and provide data and results as
per clauses (a) and (b) of this sub-section.”;
(32) in section 177, after sub-section (6A), the following new sub-sections
shall be added, namely, -
“(6B) If, at any stage of the proceedings before him, if the
Commissioner is of the opinion that having regard to, -
(a) the nature and complexity of the accounts; or
(b) volume of the accounts; orPage 69
(c) doubts about the correctness of the accounts; or
(d) multiplicity of transactions in the accounts; or
(e) specialised nature of business activity of the
taxpayer; and interests of the revenue, is of the
opinion that it is necessary so to do, he may, after
giving the taxpayer a reasonable opportunity of
being heard, and with the previous approval of the
Chief Commissioner, direct the taxpayer to get
either or all of the following to get the -
(i) accounts re-audited by an accountant, and to
furnish a report of such audit duly signed and
verified by such accountant including
answers to the specific queries as the
Commissioner may require;
(ii) inventory re-valued by a cost accountant,
and to furnish a report of such inventory
valuation duly signed and verified by such
cost accountant including answers to the
specific queries as the Commissioner may
require; and
(iii) actuarial values in the accounts determined
by an actuary and to furnish a report of such
valuation duly signed and verified by such
actuary including answers to the specific
queries as the Commissioner may require;Page 70
Explanation: The accountant,
the cost accountant, or actuary as referred to
in sub-section (6B) shall be nominated by the
Commissioner for the purposes of this sub-
section from amongst the panel of such
accountants, valuers, or actuaries
nominated by the Board.”;
(33) in section 182, in sub-section (1), in the Table, -
(a) against S. No. 1, in column (3), for the Explanation, the following
shall be substituted, namely: -
“Explanation. - For the purposes of this entry, it is
declared that the expression "tax payable" means the
higher of -
(i) tax chargeable on the taxable income on the
basis of assessment made or treated to have
been made under sections 120, 121, 122,
122D, or 122E; or
(ii) the highest tax payable by the person in any
of the three immediately preceding tax years
for which returns of income were duly filed.”;
(b) after S. No. 2, the following new S. Nos. and entries relating
thereto in columns (2), (3) and (4) shall be inserted, namely: -
“2A Where any person, One million rupees for 174(5)
having been required the first default, and
by the Board under two million rupees forPage 71
sub-section (5) of each subsequent section 174 to install default. and use an electronic resource of the type and description prescribed for the purpose of storing and accessing information regarding any transaction that has a bearing on the tax liability of such person, fails to install such electronic resource within the time specified, or having installed it, fails to use, maintain, or operate it in the prescribed manner, or tampers with, disables, or circumvents such electronic resource.
Page 72
2B Where any agency, A penalty of five 175A;
authority, institution, hundred thousand
or organisation that is rupees for the first
an integrated default and one million
organisation within the rupees for each
meaning of section subsequent default
175A, or has been shall be imposed on
notified as such by the the principal officer of
Board, fails without the integrated
reasonable cause to organisation.
- "principal officer" for
this purpose, means
(a) integrate its IT the person who, at the
platform such data time of the default or
interface as notified by during the period of
the Board within the continuing default,
time specified; or holds overall executive
responsibility for the
(b) share data of the administration and
categories and in the functioning of the
manner required integrated
under section 175A or organisation, by
the rules made whatever title or
thereunder; or designation that
person may be referredPage 73
(c) provide complete, to under this
accurate, and timely ordinance, rules, or
data as required; or instrument constituting
or governing that
(d) designate a focal organisation, including
person as required; or but not limited to the
Governor, Chairman,
(e) remedy a Chief Executive
deficiency or non- Officer, Director
compliance within General, Managing
thirty days of a written Director, Secretary, or
notice by the Board Principal Accounting
identifying the Officer, as the case
deficiency. may be; where
executive
responsibility is shared
between two or more
persons by virtue of a
collegiate body or
board structure, the
"principal officer" shall
be the person who,
within that body, holds
specific responsibility
for regulatoryPage 74
compliance, data
governance, or
information
technology; and the
absence of a formal
designation, or a
vacancy in the office,
shall not relieve the
person actually
exercising the
functions of the
principal officer from
liability under this
section.
(c) against S. No. 8,-
(i) in sub-entry (a), in column (3), for the expression "twenty-
five", the words "one hundred" shall be substituted;
(ii) in sub-entry (b), in column (3), for the word "fifty", the words
"two hundred " shall be substituted; and
(iii) in sub-entry (c), in column (3), for the word "one", the word
"three" shall be substituted;
(d) against S. No. 10, in column (3), for the word "twenty five ", the
words "five hundred" shall be substituted and for the expression
"50%", the expression "100%" shall be substituted;Page 75
(e) against S. No. 12, in column (3), for the words “hundred
thousand”, the word “million” shall be substituted;
(f) against S. No. 15, in column (3), for the word "forty", the
expression "five hundred" shall be substituted and for the full stop
occurring at the end a colon shall be substituted and thereafter
the following new proviso shall be added, namely:-
“Provided that where the defaulter in such case is a
company, its Principal Officer shall be personally liable to pay an
additional penalty of five hundred thousand rupees for such
offense.”;
(g) against S. No. 35, in column (2), -
(i) for the word " company”, the expression " person, including
a company" shall be substituted; and
(ii) after paragraph (c), the following Explanation shall be
inserted, namely: -
"Explanation. - For the purposes of this entry, audited
financial statements furnished in the form of image files,
scanned documents, or password-protected files that are
illegible or otherwise inaccessible to the concerned Inland
Revenue authority shall be deemed to have been
furnished as blank or incomplete documents."; and
(h) after S. No. 35, amended as aforesaid, the following new S. Nos.
and entries relating thereto in columns (2), (3) and (4) shall be
added, namely: -Page 76
“36 Where a person Such person shall pay a 168”;
claims a credit in penalty equal to the
respect of tax withheld amount of excess credit
at source under any claimed
provision of this
Ordinance in excess
of the amount
verifiably deducted
and deposited by the
withholding agent, as
confirmed through the
Board's computerized
system or otherwise.
(34) in section 182A, in sub-section (1), in clause (a), in the proviso, -
(a) in paragraph (i), for the word “twenty”, the words “one hundred”
shall be substituted;
(b) in paragraph (ii), for the word “ten”, the word “fifty” shall be
substituted; and
(c) in paragraph (iii), for the word “one”, the word “twenty-five” shall
be substituted;
(35) section 209A shall be omitted;
(36) after section 209A, omitted as aforesaid, the following new sections shall
be inserted, namely: -
“209B. Faceless jurisdiction of income-tax authorities. - (1)
Notwithstanding anything contained in this Ordinance, the InlandPage 77
Revenue tax authorities appointed in National faceless center shall
perform all or such functions, and exercise all or such powers under this
Ordinance as may be assigned to them in respect of such persons, or
classes of persons, for such tax years of a person through algorithms
developed by the Board.
(2) The jurisdiction so assigned under this Ordinance may be
exclusive or concurrent. In case of concurrent jurisdiction, the powers
and functions not assigned to the National faceless centre shall remain
with the Commissioner having jurisdiction under section 209 of this
Ordinance.
(3) The Board may transfer jurisdictions in respect of persons
or classes of persons, for a specific tax year, for which the jurisdiction
has already been assigned under this section, from National faceless
center to the Commissioner having jurisdiction under section 209 of this
Ordinance, on recommendation of the Chief Commissioner or on its own
accord.
(4) The Chief Commissioner appointed in the National
faceless center may request the Board to direct the Commissioner
having jurisdiction under section 209 or any other Income Tax Authority,
as it may deem fit to conduct physical verification including nature and
size of the business, assets, investments, expenditures, and any other
information or verification required by the Chief Commissioner for
conducting any proceedings assigned to the National faceless centre:
Provided that the Board may exercise its power of
allocation of verification through an algorithm-based system.Page 78
(5) Notwithstanding anything contained in any law for the time
being in force, the identity of the authority exercising jurisdiction in the
National faceless centre shall be kept confidential from the taxpayer, the
authorized representative of the taxpayer, and any unauthorized person.
(6) No notice, order, demand, or assessment passed by an
authority appointed at the National faceless centre shall be called in
question or set aside merely on the ground that such authority did not
have jurisdiction over the taxpayer under section 209 of this Ordinance,
or lack of notified delegation of power under section 210 of this
Ordinance, or because of the fact that identity of the authority has been
kept confidential from the taxpayer as per sub-section (5).”;
(37) in section 216, in sub-section (3), -
(a) for clause (ba), the following shall be substituted, namely: -
“(ba) to an auditor, audit mentors and sectoral experts appointed
on contractual basis or engaged through a third party
including a payroll firm in the Federal Board of Revenue,
after a non-disclosure agreement is made with such auditor
as may be prescribed, to assist any authority mentioned in
clauses (b) to (g) of sub-section (1) of section 207;”; and
(b) in clause (ke), for the words “and international”, the expression “,
international research institutions and international” shall be
substituted;
(38) in section 222, in sub-section (2), after the word “auditors”, occurring for
the first time, the expression “, audit mentors and sectoral experts” shall
be inserted;Page 79
(39) for section 227D, the following shall be substituted, namely: -
“227D. National faceless centre.- (1) Notwithstanding anything
to the contrary contained in any of the provisions of this Ordinance, the
Board may, for the purposes of proceedings under this Ordinance in
faceless manner, establish a National faceless center (hereinafter
referred to as “the centre”) and specify its jurisdiction, powers and
functions.
(2) The centre shall comprise a Director General and as many
Chief Commissioners, Commissioners, Additional Commissioners,
Deputy Commissioners, Assistant Commissioners, and any of the
Income Tax Authorities mentioned in section 207 along with support
staff, as the Board may deem fit for the purposes of this section.
(3) The Board may design algorithms for assigning any
function or jurisdiction under this section to any of the authorities
mentioned in sub-section (2).
(4) The Centre shall comprise as many wings and units as
may be prescribed by the Board.
(5) The functions of audit, assessment, and quality control in
a specific case for a specific tax year shall be performed by separate
officers.
(6) All communications, among the units, or with the taxpayer,
or an authorized representative of the taxpayer, or with any other person
with respect to the information or documents or evidence or any other
details, as may be necessary, shall be through electronic means.”;
(40) after section 228, the following new section shall be inserted, namely: -Page 80
“228A. Directorate General (Field Compliance), Inland
Revenue. - (1) The Directorate General (Field Compliance) Inland
Revenue shall consist of a Director General and as many Directors,
Additional Directors, Deputy Directors and Assistant Directors and such
other officers as the Board, may by notification in the official Gazette,
appoint.
(2) The Board may, by notification in the official Gazette, -
(a) specify the functions and jurisdiction of the
Directorate General and its officers; and
(b) confer the powers of authorities specified in section
207 upon the Directorate General and its officers.”;
(41) in section 231B, in sub-section (6), -
(i) in clause (b), after the semi colon, occurring at the end, the word
“and” shall be added, and
(ii) clause (c) shall be omitted;
(42) section 236CA shall be omitted;
(43) after section 237B, the following new section shall be inserted, namely
:-
“237C. Uniform. - The Board may by notification in the official
Gazette, prescribe rules for wearing of uniform by officers and staff of
Inland Revenue Service of Pakistan.”;
(44) in the First Schedule, -
(a) in Part I, -
(i) in Division I, in clause (2), for the Table, the following shall
be substituted, namely: -Page 81
“TABLE
S. No. Taxable Income Rate of Tax
(1) (2) (3)
1. Where taxable income 0%
does not exceed Rs.
600,000/-
2. Where taxable income 1% of the amount
exceeds Rs. 600,000/- exceeding Rs.
but does not exceed Rs. 600,000/-
1,200,000
3. Where taxable income Rs. 6,000 + 11% of the
exceeds Rs. 1,200,000/- amount exceeding Rs.
but does not exceed Rs. 1,200,000/-
2,200,000
4. Where taxable income Rs. 116,000 + 20% of
exceeds Rs. 2,200,000/- the amount exceeding
but does not exceed Rs. Rs. 2,200,000/-
3,200,000
5. Where taxable income 316,000 + 25% of the
exceeds Rs. 3,200,000/- amount exceeding Rs.
but does not exceed Rs. 3,200,000/-
4,100,000
6. Where taxable income Rs. 541,000 + 29% of
exceeds Rs. 4,100,000/- the amount exceeding
Rs. 4,100,000/-Page 82
but does not exceed Rs.
5,600,000
7. Where taxable income Rs. 976,000 + 32% of
exceeds Rs. 5,600,000/- the amount exceeding
but does not exceed Rs. Rs. 5,600,000/-
7,000,000
8. Where taxable income Rs. 1,424,000 + 35% of
exceeds Rs. 7,000,000/- the amount exceeding
Rs. 7,000,000/-:”;
(ii) in Division IIB, for the Table, the following shall be
substituted, namely: -
“TABLE
S. Income under section Rate of Tax
No. 4C and person
1. Income of a banking 10% of the income
company exceeding Rs.
150 million
2. Income of a person, 10% of the income
whose income is
computed as per Part I of
the Fifth Schedule,
exceeding Rs. 150
million, so far as it does
not exceed the limitPage 83
specified in rule 4 of that
Part
3 Income of a person, 10% of the income
engaged in deriving
income from sale of any
kind of fertilizer,
exceeding Rs. 150
million.
4 Income of a person other 8% of the income
than those mentioned in
S. No. 1, 2 and 3,
exceeding Rs. 500
million
(iii) in Division IVA, for the word “delivered”, the word “ordered”
shall be substituted;
(iv) in Division VII, in the third Proviso, after the word “shall”,
the words “charge and” shall be inserted;
(v) Division VIIIC shall be omitted; and
(vi) in Division IX, in the Table, in column (1), against S. No. 3
in column (2), entry (a) shall be omitted;
(b) in Part III, -
(i) after omitted Division IB, the following new Division shall
be inserted, namely:-
“Division ICPage 84
Certain payments by life insurance companies and
takaful operators
S. Description Rate of
No. Tax
(1) (2) (3)
1 Where payout or benefit is made 15%
within one year from the date of
issuance of the life insurance
policy, family takaful certificate or
plan
2 Where payout or benefit is made 10%”;
after one year but before
completion of seven years from
the date of issuance of the life
insurance policy, family takaful
certificate or plan.
(ii) in Division III, -
(A) in paragraph (2), -
(1) in sub-paragraph (i), for the expression “6%”,
the expression “7%” shall be substituted;
(2) for sub-paragraph (ii), the following new sub-
paragraph shall be substituted; namely: -
“(ii) 15% in the case of independent
professional services such as doctors,
lawyers, architects, accountants,Page 85
software engineers or developers,
working independently;”; and
(3) after sub-paragraph (ii), substituted as
aforesaid, the following new sub-paragraphs
shall be added, namely: -
“(iii) 1.5% of the gross amount payable to
electronic and print media in case of
advertising services; and
(iv) 14% of the gross amount in the case
of services other than those covered
in sub-paragraphs (i), (ii) and (iii).”;
(iii) in Division IIIAA, for the expression “15%”, the expression
“20%” shall be substituted;
(iv) after Division IIIAA, the following new Division shall be
inserted, namely: -
“Division IIIAB
Withholding Tax on Revenues Received from Social
Media Platforms
The rate of tax to be deducted under section 151B shall -
(a) 5% in case of resident persons whose name
appearing in the Active Taxpayers’ List; and
(b) 5% in case of non-resident person:
Provided that tax collected under clause (b)
shall be final tax.”;
(v) in Division IV, -Page 86
(A) in paragraph (1), for the expression “1%”, the
expression “1.25%” shall be substituted; and
(B) in paragraph (3), for the expression “1%”, the
expression “1.25%” shall be substituted.; and
(vi) in Division IVA, in the Table, in column (1), in S. No. (1), in
the entry in column (3), for the figure “2026”, the figure
“2029” shall be substituted; and
(b) in Part IV, -
(i) for Division X, the following shall be substituted, namely:
-
“Division X
Advance tax on sale or transfer of immovable
property
The rate of tax to be collected under section 236C
shall be 2.75% of the gross amount of the
consideration received.”;
(ii) for Division XVIII, the following shall be substituted,
namely: -
“Division XVIII
Advance tax on purchase of immovable
property
The rate of tax to be collected under section 236K
shall be 1.25% of the fair market value of the immovable
property.”;Page 87
(iii) in Division XXVII, for the expression “5%”, the expression
“0.5%” shall be substituted; and
(iv) Division XA shall be omitted;
(52) in the Second Schedule, -
(a) in Part I, -
(i) in clause (57), in sub-clause (4), in the Table, in
column (1), -
(A) against Sr. No. (xiii), in column (2), for the
expression “National Endowment Scholarship for
Talent (NEST)”, the words “Pakistan Education
Endowment Fund” shall be substituted; and
(B) after Sr. No. (lii), the following new Sr. Nos. and
entries relating thereto in column (2), shall be
added, namely: -
“liii Pakistan Red Crescent Society
liv Shaheen Foundation established by
Pakistan Air Force
lv Dawat-e-Hadiya
lvi Bahria Foundation established by
Pakistan Navy
lvii Sindh Institute of Urology and
Transplantation.”;Page 88
(ii) in clause (78), for the words “Foreign Currency Account
Scheme”, the expression “any foreign currency account
scheme(s)” shall be substituted; and
(iii) in clause (79), for the expression “non-resident individual
holding a Pakistan Origin Card (POC) or National ID Card
for Overseas Pakistanis (NICOP) or Computerized
National ID Card (CNIC)”, the expression “a person
maintaining a Non-Resident Pakistani Rupee Value
Account “NRVA” or Non-Resident Business Value Account
“NRBVA” under the scheme introduced by the State Bank
of Pakistan” shall be substituted;
(b) in Part II, -
(i) in clause (5AA), for the word “individual”, the word “person”
shall be substituted and for the expression “or a foreign
currency account”, the expression “Foreign Currency
Value Account (FCVA), Foreign Currency Business Value
Account (FCBVA), Non-Resident Rupee Value Account
(NRVA), or Non-Resident Rupee Business Value Account
(NRBVA)” shall be substituted;
(ii) after clause (24CB), the following new clause shall be
inserted, namely: -
“(24CC) The rate of tax under clause (b) of sub-
section (1) of section 153 to be deducted
from a person rendering terminal or portPage 89
service shall be twelve percent of the gross
amount of payment.”; and
(iii) for clause (24D), the following shall be substituted, namely:
-
“(24D) The rate of minimum tax under sub-section
(1) of section 113 in the case of distributors,
dealers, sub-dealers, wholesalers of
packaged food, fertilizer, locally
manufactured mobile phones, sugar and
electronics shall be 0.5%, subject to the
conditions that beneficiaries of reduced rate
are appearing on the active taxpayers’ lists
issued under the provisions of the Sales Tax
Act, 1990 and the Income Tax Ordinance,
2001 (XLIX of 2001).”;
(c) in Part IV, -
(i) in clause (12A), for the word “to”, occurring for the second
time, the word “by” shall be substituted;
(ii) in clause (47B), after the expression “151,”, the expression
“151A,” shall be inserted;
(iii) clause (46A) shall be omitted;
(iv) clause (57) shall be omitted;
(v) in clause (111AB), for the expression “non-resident
individual holding Pakistan Origin Card (POC) or National
ID Card for Overseas Pakistanis (NICOP) or ComputerizedPage 90
National ID Card (CNIC) maintaining a Foreign Currency
Value Account (FCVA) or Non-resident Pakistani Rupee
Value Account (NRVA)”, the expression “Foreign Currency
Value Account (FCVA), Foreign Currency Business Value
Account (FCBVA), Non-Resident Rupee Value Account
(NRVA), or Non-Resident Rupee Business Value Account
(NRBVA)” shall be substituted;
(vi) for clause (114A), the following shall be substituted,
namely :-
“(114A) The provisions of clause (ae) of sub-section
(1) of section 114 and section 181 shall not apply
to a person maintaining a Foreign Currency Value
Account (FCVA), Foreign Currency Business
Value Account (FCBVA), Non-Resident Rupee
Value Account (NRVA), or Non-Resident Rupee
Business Value Account (NRBVA) with authorized
banks in Pakistan under the foreign exchange
regulations issued by the State Bank of Pakistan:
Provided that this clause shall not apply if the
person referred in this clause has Pakistan-source
taxable income other than the following; namely:-
(a) profit on debt on FCVA, FCBVA, NRVA, or
NRBVA ;
(b) profit on debt earned on Government of
Pakistan (GOP) securities eitherPage 91
conventional or Shariah Compliant where
investment has been made from proceeds of
FCVA, FCBVA, NRVA, or NRBVA;
(c) capital gain on disposal of immovable
property acquired from proceeds of FCVA or
NRVA;
(d) capital gain on disposal of securities traded
on Pakistan Stock Exchange and units of
mutual funds that are acquired from
proceeds of FCVA, FCBVA, NRVA, or
NRBVA; or
(e) dividend income from securities traded on
Pakistan Stock Exchange and mutual funds
that are acquired from proceeds of FCVA,
FCBVA, NRVA, or NRBVA.”; and
(vii) in clause (115), for the word “one”, the word “two” shall be
substituted;
(53) in the Eighth Schedule, rule 5 shall be omitted; and
(54) in the Tenth Schedule, -
(a) rule 1A shall be omitted; and
(b) in rule 10, clause (y) shall be omitted;
7. Amendments in the Federal Excise Act, 2005.- In the Federal Excise Act,
2005, the following further amendments shall be made, namely: -
(1) in section 2,-Page 92
(a) after clause (2), the following new clause shall be inserted,
namely:-
“(2A)“algorithmic settlement mechanism” means algorithmic
settlement mechanism provided under section 26AAA of
the Sales Tax Act, 1990;”;
(b) after clause (9a), the following new clause shall be inserted,
namely:-
“(9b) “electronic invoicing system” means such electronic
system or mechanism as may be prescribed or
approved by the Board for issuance and recording of
sales tax invoices in electronic form;”;
(c) after clause (16), the following new clause shall be inserted,
namely:-
“(16A1) “National faceless centre” means the National faceless
centre as defined in section 32C of the Sales Tax Act,
1990 (VII of 1990); and
(d) after clause (19a), the following new clause shall be inserted,
namely:-
“(19b) “production monitoring system” means any system or
technology, used for the purposes of monitoring production
and sale of goods, whether in real-time or otherwise,
including such systems or technologies as may be
prescribed by the Board from time to time;”;
(2) in section 3, after sub-section (3A), the following new sub-section shall
be inserted, namely:-Page 93
“(3B) Notwithstanding anything contained in this section, there shall be
levied and collected a Special Excise Duty in addition to duty imposed
under sub-section (1), on such goods as listed in Table-IA of the First
Schedule to this Act at the rates specified therein:
Provided that the Board may prescribe time, mechanism,
procedure, mode and manner of collection for such duty.”;
(3) after section 7, the following new section shall be inserted, namely:-
“(7A) National faceless centre and application of the provisions of
the Sales Tax Act, 1990.- (1) Notwithstanding anything contained in this
Act, the audit and assessment proceedings under the Act may be
conducted in the faceless manner by the National faceless centre.
(2) The provisions of the Sales Tax Act, 1990 (VII of 1990) relating to
the establishment, assignment of jurisdiction, conduct of audit,
assessment and appeals shall apply mutatis mutandis.
(3) Notwithstanding anything contained in this Act, the Board may
establish digitally operated algorithmic settlement mechanism for
settlement of proceedings at any stage before any order under this Act
is passed and the provisions relating to algorithmic settlement
mechanism of the Sales Tax Act, 1990 (VII of 1990) shall apply mutatis
mutandis.
(4) in section 18, for sub-section (1), the following shall be substituted,
namely:-
“(1) A person registered under this Act shall issue for each transaction
an invoice including an advance receipt invoice, bearing a verifiable and
unique FBR invoice number at the time of clearance or sale of goodsPage 94
including goods chargeable to duty at the rate of zero per cent or
providing or rendering services containing the following particulars in
Urdu or English language, namely:-
(a) name, address and registration number of the seller;
(b) name, address and registration number of the buyer;
(c) date of issue of the invoice;
(d) description and quantity of goods or as the case may be,
description of services;
(e) value exclusive of excise duty;
(f) amount of excise duty; and
(g) value inclusive of excise duty:
Provided that the Board may notify any person or class of
persons who may be allowed to issue an advance receipt invoice
under the notified system:
Provided further that the condition of verifiable and unique
FBR invoice number shall be applicable from a time as notified by
the Board.”;
(5) in section 19,-
(a) in clause (a), in sub-section (2), for the words “Federal Excise
officer”, the words “Officer of Inland Revenue” shall be
substituted; and
(b) for sub-section (4), the following shall be substituted, namely:-
“(4) Any person who, without the approval of the
Commissioner, directly or otherwise destroys, damages, erases
or otherwise manipulates data stored in or used in connection withPage 95
a computer, equipment or system used for the electronic
monitoring of production, manufacture, sales, clearance, stocks
or any other related activity implemented under this Act and the
rules made thereunder, including any production monitoring
system, video analytics system or otherwise uses a computer,
the purpose or effect of which is to reduce, avoid or evade any
liability to duty of excise which would otherwise have been
imposed by this Act, or to defeat any provisions of this Act and
rules made there under shall be guilty of an offence and shall be
liable to fine which may extend to seventy five thousand rupees
or ten times of the duty involved whichever is higher and
punishment with imprisonment which may extend to five years or
both.”;
(6) in section 26, for sub-section (1), the following shall be substituted,
namely:-
“(1) The counterfeited cigarettes or beverages which have
been manufactured or produced unlawfully and other dutiable
goods on which duty of excise has not been paid in the manner
as required under this Act and the rules made thereunder or such
goods without affixing or affixing counterfeit tax stamps, bar
codes, banderols, stickers, labels or bar codes, as required under
section 45A of this Act, or goods which are required to be
monitored through a production monitoring system under this Act
and the rules made thereunder but are manufactured, produced,
transported, removed or otherwise dealt with without suchPage 96
monitoring in the prescribed manner, shall be liable to seizure
along with the conveyance, which has been used for the
movement, carriage or transportation of such goods.”;
(7) in section 27, for sub-section (1), the following shall be substituted,
namely:-
“(1) The cigarettes or beverages seized for the reasons of
counterfeiting or such goods without affixing or affixing
counterfeited tax stamps, banderoles, stickers, labels or
barcodes, as required under section 45A of this Act ,or goods
which are required to be monitored through a production
monitoring system under this Act and the rules made thereunder
but are manufactured, produced, transported, removed or
otherwise dealt with without such monitoring in the prescribed
manner, shall be liable to outright confiscation and shall be
destroyed in the manner prescribed in sub-section (10) of section
19.”;
(8) in section 33, in sub-section (1), for the words “Federal Excise officer”,
the words “officer of Inland Revenue” shall be substituted;
(9) after section 34A the following new section shall be inserted, namely: -
“34AA. Independent case scrutiny committee. - (1) A
reference under section 34A of the Act before the High Court, or
an appeal or review before the Federal Constitutional Court or the
Supreme Court of Pakistan shall only be filed by the
Commissioner Inland Revenue after the same has beenPage 97
approved by an independent case scrutiny committee as
constituted by the Board.
(2) The Board may constitute one or more such committees
and assigned them cases or classes of cases decided by the Appellate
Tribunal Inland Revenue or the High Court, as the case may be.
(3) The Committee shall comprise of the following Members
as nominated by the Board -
(a) a retired judge of the Supreme Court of Pakistan,
the Federal Constitutional Court, or any of High
Court who shall also act as Chairman of the
Committee;
(b) an Advocate having not less than fifteen years of
experience in duty and commercial litigation before
the High Court or Supreme Court of Pakistan, to be
nominated from a panel notified by the Board from
time to time; and
(c) a senior serving or retired officer of the FBR (BS 20
or above).
(4) The powers, functions, and procedure of the Committee
along with remuneration of its Members shall be governed as may be
prescribed.
(5) Recommendations of the committee shall be binding upon
the Commissioner Inland Revenue having jurisdiction over the case.
(6) Notwithstanding anything contained in any other law for
the time being in force, no suit, prosecution, or other legal proceedingsPage 98
shall lie against the Members of the committee and the Commissioner
Inland Revenue having jurisdiction over the case, in relation to the
decisions made under this section.
(7) The committee constituted under this sub-section shall
exercise its powers and functions with effect from the date of its
constitution as notified by the Board.”;
(10) in section 43A, for the words “federal excise”, the words “of Inland
Revenue” shall be substituted;
(11) in section 44, in sub-section (3), for the words “Federal Excise Officer”,
the words “Officer of Inland Revenue” shall be substituted;
(12) for section 45A, the following shall be substituted, namely:-
“(45A) Monitoring or tracking by electronic or other means.-
(1) Subject to such conditions, restriction and procedures as it may deem
fit to impose or specify, the Board may, by notification in the official
Gazette, specify any registered person or class of registered persons or
any goods or services or class of goods or services in respect of which
monitoring or tracking of production, sales, clearance, stocks or any
other related activity may be implemented through electronic or other
means as may be prescribed.
(2) From such date as may be prescribed by the Board, no
excisable goods shall be removed or sold by the manufacturer or any
other person without affixing tax stamp, band role stickers, labels, bar
code production monitoring system, video analytics, etc, in any such
form, style and manner as may be prescribed by the Board in this behalf.Page 99
(3) Such tax stamps, banderols, stickers, labels, barcodes,
production monitoring equipment etc., shall be acquired by the
registered person referred to in sub-section (2) from a licensee
appointed by the Board.”;
(13) in section 46,-
(a) for sub-sections (1), (2) and (2A), the following shall be
substituted, namely:-
“(1) The officer of Inland Revenue authorized by the Board or
the Commissioner may, after giving advance notice in writing,
conduct audit of the records and documents of any person
registered under this Act.
(2) In case the Commissioner has information or sufficient
evidence showing that such registered person is involved in fraud
or evasion of duty, he may authorize an officer of Inland Revenue
not below the rank of Assistant Commissioner, to conduct audit at
any time in a year.
(2A) After completion of the audit under this section of any other
provisions of this Act, the officer of Inland Revenue shall, after
obtaining the registered person’s explanation on all the issues
raised in the audit, issue an audit report containing audit
observations and finding.
(2B) For the purpose of sub-section (2), the Commissioner may
conduct audit proceedings electronically through video links, or
any other facility as prescribed by the Board.”;Page 100
(2C) After issuing the audit report under this section or any other
provision of law, the officer of Inland Revenue may, if required
pass an order under sub-section (2) of section 14, after providing
an opportunity of being heard to the registered person under sub
section (1) of section 14, imposing the amount of duty as per law,
charging default surcharge, imposing penalty and recovery of any
amount erroneously refunded.”;
(b) in sub-section (3), for the proviso, the following shall be
substituted, namely:-
“Provided that if a registered person deposits the amount
of duty not paid, short paid or amount of duty evaded along with
default surcharge during or after the audit but before the, issuance
of show cause notice under sub-section (1) of section 14, he may
deposit such amount along with twenty five percent of the amount
of penalty prescribed under this Act or the rules made there
under:
Provided further that if a registered person deposits the
amount of duty not paid, short paid or amount of duty evaded
along with default surcharge, after issuance of show cause notice
under sub-section (1) of section 14, he may deposit such amount
along with fifty percent of the amount of penalty prescribed under
this Act or the rules made there under and in such case, further
proceedings in the case shall abate.”;
(c) after sub-section (3) amended as aforesaid, the following new
sub-section shall be inserted, namely:-