KARACHI: Current provisions of Alternative Dispute Resolution in Ordinance are plagued by multiple caveats in country, which limit its applicability when viewed from standpoint of common taxpayer. Necessary amendments shall be made in section 134A of Ordinance, 2001 for positive outcome.

Aga Faquir Muhammad well-reputed tax lawyer urged that any taxpayers should be allowed to apply for ADR for resolution of tax disputes at any stage may be it assessment, appeal and reference. Aggrieved taxpayers may be permitted to appoint an independent mediator to appear before ADRC on their behalf.

Massive public enlightenment and awareness campaigns must be initiated. Exchequer should engage with taxpayers to understand shared interests and divert major tax risks.

He said that ADR facilitation service must be cost-free and trained independent mediators notified by FBR be appointed to assist participants to negotiate their dispute. Tax laws and procedures should be simplified and complexities of ADR process be removed.

“Alternate (or Alternative) Dispute Resolution (ADR)” is process opted by parties to resolve their disputes other than adjudication by courts of law. It is flexible service by which parties of dispute, agree to utilise services of neutral party to aid them in reaching an agreement and avoiding litigation.

He said that ADR is invariably cost effective and methodical route to consensual dispute resolution. Role of ADR in tax matters was realised in 19th century when revenue administrations formally adopted ADR mechanism to encourage taxpayers’ trust in tax collection for efficiently resolving disputes and yielding progressive revenue growth. Opting for ADR for tax dispute resolution has met with immense success and is an accepted tool of reform for revenue dispute management globally. ADR in taxation is flourishing concept in many countries like United States of America, United Kingdom, Canada, Hong Kong, Australia, New Zealand, Bangladesh and India.

Published in The Daily National Courier, March, 06 2023

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