KARACHI: Textile industry, in its recommendations for budget 2017-18, has demanded compensation for delayed issuance of cheques against Refund Payment Orders (RPOs) along with refund payment.
The textile industry said that after issuance of RPOs by the respective refund division in the Regional Tax Offices (RTOs) the refund cheques are issued by the FBR.
Invariably, there is substantial time gap between the issuance of RPOs and refund cheques. No compensation is paid for delayed issuance of refund cheques.
Similarly, FBR at times roll backs the RPOs without assigning any reason or passing a speaking order. Whereas a new phenomenon is rolling back of RPOs on the pretext of proper scrutiny. The CSTRO under the FBR established under the rule 27 of the Sales Tax Rules for centralized payment of refund amount should be abolished.
Compensation for delayed issuance of cheque against RPO should be made, along with refund payment, in pursuance to section 67 of the sales tax Act 1990.
Under the law, there is no concept of roll back of RPOs. It is suggested that it is formally incorporated in refund rules that refund cheque would be issued simultaneously with the RPO.
The industry said that it is consistent policy of the FBR to delay the issuance of cheques after issuance of RPOs and for this centralization of issuance of cheques, is being used to hold refunds instead of streamlining the procedure and facilitating to the taxpayer.
Therefore CSTRO should be abolished by amending the Refund Rules. Recently, the FBR has rolled back all the RPOs and has issued instructions dated April 5, 2017 to the RTOs for proper scrutiny.
Since post refund audit is provided in the refund rules therefore there is no rationale of rolling back the RPOs and that too by the FBR who has no legal role either in the processing of refund or post refund audit.
