Islamabad:
The president of Pakistan’s office said Wednesday that the heads of the state head cannot be challenged in any court. The declaration came after the Federal Board of Revenue (FBR) obtained a residence order from a provincial law against the president’s decision in a taxable matter MH traders.
The unique case shows state organs in odds. Chairman FBR Rashid Langrial repeatedly told the Senate Standing Committee for Funding that FBR couldn’t even think of challenging the president’s orders.
Led by Senator Saleem Mandviwalla, the committee took the non-implementation of a president’s order. The president’s office had issued the order in July this year, but FBR did not enforce it.
“The president’s orders are absolute in nature, and being head of state, no agency or department can challenge them everywhere,” said Zia Basit, Director General of the President’s Secretariat.
In July this year, the President’s Secretariat accepted the representation of MH dealers in the event of mislassification of imported goods. FBR had classified the imported items as polyester fabric, while the importer had declared them as artificial leather to be used for football production.
The importer went to the Federal Tax Ombudsman’s office, which rejected the application due to jurisdiction. MH traders, along with another importer, challenged FTO’s order for the president. The president deposed both the FBRs and the FTO orders.
Last month, FBR went to Sindh High Court against the president’s order and got a stay.
Langrial said that FBR did not challenge the order in the president’s capacity as head of state. He said FBR challenged it as an appeal authority that has quasi law powers in tax cases.
“I don’t know from where this quasi-law concept of power came when the president has absolute authority,” said the Director General Legal.
Last September, the president’s secretariat wrote to the secretary of the Prime Minister. It sought clarity to enforce the president’s orders in representations against the Ombudsman’s findings.
Then the Prime Minister’s office instructed the law and the justice department to issue directions to all ministries and departments. They were asked to observe section 18 of the Federal Ombudsman Institutional Reforms Act, 2013 (Foira) when dealing with cases and appeals already decided by the Federal Ombudsman or the president as appeal authority.
It also instructed them to withdraw appeals and representations if anyone submitted against orders from the federal ombudsman or the president. Such appeals were called violation of section 18 of the law.
In December, the Law Department issued binding orders to all ministries. On Wednesday, Basit produced these instructions for the Senate Standing Committee for Financing.
The law department stated that the provisions of section 18 of the Federal Ombudsman Institutional Reforms Act, 2013, should be strictly observed while dealing with cases and appeals already decided by Federal Ombudsman or the president as appeal authority. It also said that appeals and representations, if filed, against orders from the federal ombudsman or the president, should be withdrawn as a violation of section 18 of the law.
According to FBR’s written response to the standing committee, M/S MH -trading goods were declared as artificial leather under a concession tax regime for football production. However, Customs Laboratory Surveys called the goods “Printed polyester fabric, not PU leather.”
FBR further said the importer was not registered as a producer. Registration is a prerequisite for using the concessional imports. FBR decided to judge the importer, but instead of participating in the assessment procedure, the importer filed a complaint with the federal tax ombudsman.
FTO rejected the complaint with reference to a lack of jurisdiction. The importer then filed a representation of the president of Pakistan.
The president’s office overturned FTO’s order and gave the importer relief. However, the Collectorate of Custom contested the president’s order for Sindh High Court, who awarded a stay in favor of FBR.
FBR told the standing committee that “the president cannot take on jurisdiction when FTO has explicitly rejected it.” It said a misleading order had already been issued against the importer, which the importer had contested in Custom’s Appellate Tribunal.
“To challenge the president’s order in the immediate case, the Cabinet Division’s instructions do not violate,” FBR said. “These instructions only faced challenges in which the president maintains FTO’s decision. Here, the president’s order contradicts FTO’s decision.”
But DG -Juridic for the President’s Secretariat revealed that the Cabinet’s 2016 Instructions allowing FBR to go to court when the FTOs and the president’s orders contradict. He said fresh instructions from the Law Division wore such actions from FBR.
FBR said that if its attitude is not accepted, the 1969 Customs Act and Allied Laws would be made useless. Instead of following the assessment procedure leading up to the Supreme Court in Pakistan at the appeal stage, dealers prefer to seek exemption directly from the president’s office. It would create serious enforcement problems for FBR’s field formations across the country.
FBR said that MH traders only operated sewing and knitting machines to sew clothes without proof of football production.
The FBR chairman said the department had also sought clarification from the Office of the Attorney General of Pakistan. He said that if the lawyer did not support the FBR’s position, the department would withdraw the case from Sindh High Court.
The committee postponed the matter until the next hearing.
