Appeal against the order was passed on multiple grounds including that the information has been obtained illegally and as per settled principle, no case can be made out on the basis of information which was not lawfully obtained. Before the Commissioner (Appeals) of PRA, it was explained that under section 216 of the Income Tax Ordinance, 2001 there is prohibition regarding disclosure of taxpayer's information to any person. However there is an exception to the aforesaid prohibition contained in section 216(3)(f) which reads as under:
"(f) to any officer of the Federal or provincial government authorised by such government in this behalf as be necessary for the purpose of enabling that government to levy or realise any tax imposed by it." It was pleaded that since the Additional Commissioner PRA Faisalabad was not an officer of the provincial government authorised in this behalf, hence, he information obtained by him through personal sources is illegal information and based on that illegal information no case can be made out as per multiple reported judgements of the superior courts of Pakistan.
However, the Commissioner (Appeals) observed that the illegality was on the part of officer of the FBR disclosing the information and not on the part of additional commissioner being the recipient of information and hence the information was lawful and rejected this ground of appeal.
The taxpayer is in further appeal before the Appellate Tribunal of PRA. The taxpayer has contended that under section 198 of the Income Tax Ordinance, 2001 there is prosecution for unauthorised disclosure of information by a public servant. Whereas, under section 199 where a person knowingly and willingly, aids, abets, assists, incites or induces another person to commit an offence under this Ordinance, the first mentioned person shall commit an offence punishable on conviction with a fine or imprisonment for a term not exceeding three years, or both. The taxpayer has contended that both the persons disclosing the information and the person receiving the information are punishable under section 198 and 199 respectively and hence the information obtained remains unauthorised and illegal and based upon that no case can be made out even if the information is true.
Shahid Jami added that when under section 216(3)(f) the mechanism of exchange of information through the authorised officer is prescribed, the obtaining of unauthorised information and utilisation of the same should have been deprecated and legal mechanism should have been devised by the provincial government instead of justifying the illegal act of its official. He further added that it is established principle propounded by the Supreme Court of Pakistan that if information/documents have been obtained illegally, the same cannot be used in tax adjudication against the taxpayer.
Copyright Business Recorder, 2017