The Federal Board of Revenue (FBR) has withdrawn a tax policy clarification of 2018 in which an electronic mode of serving notice to the taxpayers may be resorted to as an additional means of service for the facilitation of the taxpayers.
Keeping in view the serious practical difficulties due to changes made in section 218 through Finance Act 2017, the FBR had issued a ‘Facilitation & Practical’ letter in 2018 whereby electronic service was declared as an additional means of service and will not be treated as a legal mode of service. The said letter has now been withdrawn through a new letter issued by the FBR on Feb 3, 2021.
Through a new letter addressed to the Chief Commissioners of Inland Revenue, the FBR now stated that the old clarification is in contradiction to the following provisions of Income Tax Ordinance (ITO), 2001:
- Clause (d) of sub-section (1) of section 218, Income Tax Ordinance 2001;
- Clause (d) of sub-section (2) of section 218 of the Income Tax Ordinance 2001
- Rule 74 of the Income Tax Rule, 2002.
In order to bring consistency in the administration of the Income Tax Ordinance 2001 and to remove anomaly from the statutes, the FBR’s Clarification of 2018 has been withdrawn with effect from Feb 3, 2021, FBR letter added.