M/s Sprint Oil and Gas Services, Vs Commissioner Inland Revenue, CTO, Islamabad.

 

APPELLATE TRIBUNAL INLAND REVENUE, DIVISION BENCH-I,

ISLAMABAD 

MA (Implementation) No.01/IB/2025

In

ITA No.299/IB/2021

 (Tax Year 2019)

 

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M/s Sprint Oil and Gas Services, FZC Plot # 5-B, Main Road, Sector I-10/3, Islamabad.		Applicant
	Vs
Commissioner Inland Revenue, CTO, Islamabad		Respondent
Appellant By:		Mr. Waheed Shahzad Butt, Advocate
Respondent By:		Ms. Naila Gul, DR
Date of Hearing:		27.08.2025
Date of Order:		27.08.2025

 

ORDER

M. M. AKRAM (Judicial Member): The applicant–taxpayer has filed the instant miscellaneous application, seeking implementation of this Tribunal’s order dated 04.10.2021, by placing reliance on the judgment of the Hon’ble Supreme Court of Pakistan in the case of Khalid alias Muhammad Khalid and others v. Collector of Customs (Adjudication), Custom House, Lahore and another, (2024 SCP 285). While adjudicating the main appeal of the applicant, this Tribunal, inter alia, held that both the order dated 02.12.2020, whereby the assessing officer had declared the return of income for Tax Year 2019 as invalid, and the order dated 25.02.2021 passed by the learned Commissioner Inland Revenue (Appeals), were illegal and without lawful authority. Consequently, both orders were annulled, and the concerned Commissioner Inland Revenue was directed to forthwith treat and mark the return of income filed by the applicant–taxpayer for Tax Year 2019 as a valid return.

Facts of the case:

2.      The brief facts of the case are that this Tribunal, vide order dated 04.10.2021, decided the matter in favour of the taxpayer. The Department subsequently filed a reference application before the Hon’ble Islamabad High Court. However, the Hon’ble High Court did not suspend the operation of the Tribunal’s order, and the said reference application is still pending adjudication. In the meantime, the taxpayer has moved an application seeking implementation of the Tribunal’s order, placing reliance upon the judgment of the Hon’ble Supreme Court cited supra, wherein it has been categorically held that the Tribunal is vested with the power to enforce and implement its own orders.

Submission of the Parties:

3.      The matter was fixed on multiple occasions and was finally heard on 27.08.2025, when the learned Authorized Representative (AR) for the appellant, at the very outset, placed on record the implementation order dated 14.07.2025 passed by the learned Commissioner Inland Revenue, Zone-1, Corporate Tax Office (CTO), Islamabad. He, however, vehemently contended, inter alia, that the order passed under section 120(3) of the Income Tax Ordinance, 2001 for Tax Year 2019 was patently illegal, unconstitutional, and contrary to binding judicial precedents, which had already been set aside by the Hon’ble ATIR, yet despite repeated requests, the Department failed to implement the Tribunal’s decision under section 124(4). It was further argued that the officials of FBR/IRS deliberately circumvented due process, thereby violating Articles 4, 5(2), and 10A of the Constitution, and their refusal to implement the Tribunal’s order was inconsistent with the binding judgment of the Islamabad High Court in W.P. No. 1900/2022. The learned AR also submitted that the omissions and commissions of the Respondents amounted to maladministration, denial of justice, and arbitrary deprivation of property, as taxpayers who had already paid more than the lawful tax were subjected to deliberate inaction and abuse of authority. He further highlighted that the FBR is the largest “compulsive litigant,” indulging in frivolous appeals without accountability, thereby wasting public money and judicial resources, and emphasized that arbitrary discretionary powers must be curtailed in line with the pronouncement of the Hon’ble Supreme Court reported as 2018 PTD 1204. It was also contended that the Respondents had disregarded several binding decisions and statutory directions, including those of the Federal Tax Ombudsman (FTO), the President of Pakistan, the High Courts, and the Hon’ble Supreme Court, in addition to ignoring statutory obligations under section 124(4) of the Ordinance. The taxpayer also raised constitutional and legal questions, namely: why the statutory order under section 124(4) was not passed within the prescribed time; whether the law was being applied selectively in Islamabad Capital Territory (ICT) at the whims of IRS officials; and whether any lawful directive from higher authorities existed which obstructed the implementation of Tribunal orders. In light of the above, the taxpayer prayed for referral of the case to the FTO under section 9(1) of the FTO Ordinance, 2000; initiation of proceedings against the responsible officials for wilful non-compliance; award of costs against the Department for maladministration and wastage of taxpayer money; and grant of any other appropriate relief in the interest of justice.

 

4.      Conversely, the Department has also placed on record the implementation order and submitted that the taxpayer has already derived the intended benefit. It was, therefore, urged that the application may kindly be disposed of accordingly.

 

Findings of the Tribunal:

5.      We have given due consideration to the rival submissions advanced by the parties, examined the record with care, and analysed the relevant provisions of law. It is an undisputed fact that the Tribunal’s order dated 04.10.2021 was never suspended or stayed by any superior judicial forum. Consequently, the Department was under a statutory obligation to give effect to the said order in terms of section 124(4) of the Income Tax Ordinance, 2001, within the prescribed time frame. Any omission or delay in implementing a judicial pronouncement not only constitutes maladministration but also erodes the rule of law and undermines public trust in the tax administration.

 

6.      Although the Department has now produced the implementation order, such compliance appears to have been made belatedly and only as a consequence of the initiation of the present proceedings. This Tribunal deems it imperative to reiterate that once an order of this forum attains finality, it is binding upon the Department and must be implemented in its true letter and spirit, unless expressly suspended or set aside by a competent higher forum. Any departure from or delay in implementation is legally impermissible and may render the concerned officials liable to appropriate proceedings under law.

 

7.      In light of the foregoing, the present application is disposed of with specific directions:

(i)          The Department shall ensure that orders of this Tribunal are implemented forthwith and without exception, unless stayed by a higher judicial forum.

(ii)         Any deliberate or willful non-compliance in the future shall attract consequences in accordance with law, including possible referral to the Federal Tax Ombudsman under section 9(1) of the FTO Ordinance, 2000; and

(iii)        The learned Chairman, FBR, is advised to issue necessary instructions to all field formations to strictly observe the mandate of section 124(4) of the Ordinance in order to uphold institutional credibility and avoid needless litigation.

This order is intended to reinforce the foundational principle that judicial decisions must be respected and implemented expeditiously. Prompt compliance not only enhances the credibility of the Department but also reduces avoidable litigation and conserves valuable judicial time. With the foregoing observations, the miscellaneous application stands disposed of accordingly.

	Sd/- (M. M. AKRAM) JUDICIAL MEMBER
Sd/- (DANISH ALI QAZI) MEMBER