FTO Rules IRIS Portal Notices Not Legally Served to Taxpayers

The Federal Tax Ombudsman (FTO) has ruled that simply placing tax notices on the Federal Board of Revenue’s (FBR) “IRIS” portal does not constitute valid or legal service to taxpayers. In a detailed order, the FTO stated that mere placement of notices on IRIS cannot be considered a valid service within the meaning of Section 218(1)(d) read with Rule 74 of the Income Tax Rules, 2002. The order stressed that the FBR’s digital system must ensure proper communication with taxpayers through SMS or email alerts, instead of expecting individuals to check their IRIS accounts daily. Such a practice, the Ombudsman said, violates the principles of natural justice and fair play. The case involved a 78-year-old senior citizen, who had declared income from salary, exempt share income from an AOP, pension, and profit on bank deposits in his tax returns. The taxpayer’s case was selected for audit for tax years 2014 and 2015 through a computer ballot under Section 214C of the Income Tax Ordinance, 2001. The FTO has now directed the FBR to revisit the confirmation of the assessment orders for both tax years, which were passed by the Commissioner (Appeals-III) Karachi on January 12, 2024. The Ombudsman recommended that the case be remanded back to the trial court (before the DCIR) for a fresh decision on merit, in the interest of justice. The order also directed the Commissioner, Zone-III, RTO-II Karachi to immediately detach the complainant’s bank accounts, and asked the FBR Member Operations/Administration to initiate an inquiry against the Assessing Officer’s conduct toward the elderly taxpayer. The FTO emphasized that tax officials must exercise due care and fairness, particularly when dealing with senior citizens.