In a case that lays bare the persistent gaps in FBR’s digital infrastructure, the Federal Tax Ombudsman (FTO) has disposed of a taxpayer’s long-standing complaint — one that stemmed entirely from a failure to update a sales tax deregistration on the FBR’s online IRIS portal, a clerical oversight that haunted the complainant for over a decade with repeated and wrongful non-filing notices.
The Complaint: A Decade of Wrongful Notices
The Federal Tax Ombudsman has disposed of a complaint filed by a taxpayer regarding the non-reflection of their sales tax deregistration status on FBR’s IRIS portal. The complainant, represented by Advocate Miss Riffat Naeem of the High Court, had been formally deregistered under Section 21(1) of the Sales Tax Act, 1990, by the Commissioner-IR, Zone-I, RTO-II Karachi, as far back as August 18, 2015.
Despite the deregistration being legally valid for over ten years, the status was never updated in FBR’s system. The failure to reflect the deregistration online meant the taxpayer continued to receive repeated notices for non-filing of sales tax returns — notices they were no longer legally obligated to respond to.
FTO Intervention Triggers Swift Action
Upon referral of the matter by the FTO, the Commissioner uploaded the deregistration application on January 14, 2026, thereby resolving the underlying grievance. FTO Ombudsman M. Zafar ul Haq Hijazi subsequently closed the case, noting that the intervention had ensured redressal of the taxpayer’s complaint.
While the closure is a welcome outcome for the taxpayer, the case raises an uncomfortable question: why did it take a formal complaint to the FTO — rather than routine administrative action — to correct an entry that had been pending for over a decade?
A Symptom of Deeper IRIS Systemic Issues
This case is far from isolated. FBR’s IRIS portal has been at the centre of repeated grievances from taxpayers and trade bodies across Pakistan.
In a separate ruling, the FTO previously held that simply placing tax notices on the IRIS portal does not constitute valid or legal service to taxpayers, stating that mere placement on IRIS cannot be considered valid service within the meaning of Section 218(1)(d) read with Rule 74 of the Income Tax Rules, 2002. The order stressed that FBR’s digital system must ensure proper communication through SMS or email alerts, rather than expecting individuals to check their IRIS accounts daily.
The Karachi Tax Bar Association (KTBA) has also formally urged FBR to address persistent malfunctions in the IRIS portal, noting that system-generated notices were issued to taxpayers who then could not file returns before deadlines due to the portal’s non-functionality — with many subsequently receiving recovery notices and facing threats of bank account attachments.
In a strongly worded letter to the Prime Minister, KCCI President Muhammad Jawed Bilwani described how thousands of tax-compliant businesses were unable to file their sales tax returns due to serious flaws in the IRIS system, and criticized the indifferent attitude of senior FBR officials when approached for urgent resolution.
FTO’s Expanding Role in Digital Accountability
The disposal of this complaint is part of a broader pattern of FTO intervention in cases where FBR’s own digital systems have created administrative injustice for taxpayers.
The main function of the Federal Tax Ombudsman is to ensure the disposal of complaints of tax maladministration promptly, justly, and fairly — and to rectify any injustice done to a taxpayer by actions of FBR’s tax employees.
In another recent order, the FTO directed FBR to ensure uniform tax treatment on net metering electricity bills after a complaint alleged that inconsistent taxation practices across different utility companies were causing repeated grievances for consumers — again highlighting how administrative inconsistency translates into taxpayer hardship.
What This Means for Taxpayers
The case serves as a reminder that deregistered businesses and individuals must actively verify that their status change has been correctly reflected on the IRIS portal — and that FBR’s backend systems cannot always be relied upon to accurately reflect administrative decisions, even those made years ago.
Tax practitioners are advising clients who have undergone deregistration, ownership changes, or business closures to cross-check their IRIS portal status and, where discrepancies exist, to escalate promptly through the FTO’s complaint mechanism before unlawful notices snowball into penalties, recovery actions, or enforcement proceedings.