LHC sets aside notices to banks for taxpayers’ account statements
LAHORE: The Lahore High Court (LHC) has set aside notices sent by the Inland Revenue authorities to commercial banks seeking the account statements of taxpayers, holding that a power to gather information cannot be used to keep assessment proceedings alive that have become barred by limitation. A division bench, comprising Justice Hassan Nawaz Makhdoom and Justice Muhammad Ajmal Zahid, allowed…
Lahore's Lahore High Court (LHC) recently dismissed notices from the Inland Revenue authorities requesting account statements from commercial banks, stating that the authority to gather information should not be used to keep assessment proceedings alive that are barred by limitation. The division bench, consisting of Justice Hassan Nawaz Makhdoom and Justice Muhammad Ajmal Zahid, upheld two constitutional petitions, including one by Syed Naved Amjad Andrabi, against the notices issued under Section 176 of the Income Tax Ordinance 2001.
The notices requested details of accounts held by the petitioners, of which the counsel argued that the relevant bank statements had already been provided to the tax authorities. The bench found that the power to obtain information under Section 176 could not be used to bypass the jurisdictional limits set by sections 120, 121, 122 and 124.
Chief Justice Zahid emphasized that limitation is not merely a procedural formality, but it defines the temporal boundaries within which a statutory authority can lawfully exercise its jurisdiction. The court concluded that the requisition of information could not be used as a substitute for the statutory proceedings through which a taxpayer's liability might lawfully be determined, thus setting aside the impugned notices.
Written by urgent.news from Dawn - Pakistan's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
