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CIRCULAR NO. 01 OF 2023-24: (1) Finance Act 2023 has introduced a new sub-section(2A) in section 236C of the Ordinance which places a bar on the transferring authority for registering, recording, or attesting transfer of any immovable property unless the seller or transferor has discharged his tax liability under section 7E of the Ordinance and evidence to this effect has been furnished to the transferring authority in the prescribed mode, form and manner.
(2) The following instructions are issued under CIRCULAR NO. 01 OF 2023-24 for catering for situations arising out of change in law prescribing mode, form, and manner of collection of payment of tax u/s 7E:
(A) Where the seller or transferor is on ATL:
The said seller or transferor will provide evidence to the transferring authority that he has discharged his liability u/s 7E in any of the following modes:
i- If the seller has not already paid the tax under 7E of the Income Tax Ordinance, 2001 along with his income tax return then such person is required to pay the tax under section 7E of the Ordinance through preparing separate payment tax challan provided in FBR online payment system and submit the payment through CPR into the government treasury department and the seller will also provide the evidence before the Commissioner Inland Revenue (CIR) for the purpose and to the extent of newly inserted sub-section (2A) of section 236C of the Ordinance: or
ii- If the seller/transferor has already paid the tax under section 7E of the Ordinance along with his income tax return for the tax year 2022 or the said seller/transferor is not required to pay tax under section 7E of the Ordinance due to any stay granted by any court of law or authority, then the seller/transferor will furnish a certificate annexed as Form ‘A ‘ to this circular issued by the Commissioner Inland Revenue(CIR) . The certificate issued by the Commissioner will be treated as evidence for the purpose of newly inserted sub-section (2A) of section 236C of the Ordinance;
iii- For the issuance of the above certificate, the seller/transferor will fill the requisite particulars in Form ‘A’ and submit the same to the Commissioner, and the Commissioner after examining the particulars filled by the seller/transferor will accordingly issue the certificate.
iv- The said certificate will be issued by the Commissioner Inland Revenue within 7 days of the receipt of the pre-filled form ‘A’ submitted by the seller/transferor.
v- If there is more than one owner of the property then each person is required to discharge tax liability under section 7E of the Ordinance with respect to his or her share in the said property in any of the modes described above.
(B) Where the seller/transferor is a non-ATL person:
Such person is required to pay the tax liability under 7E of the Ordinance and provide evidence to the transferring authority. The payment is made through a separate payment challan provided in FBR system and deposited into the government treasury department and this will be treated as evidence for the purpose of new inserted sub-section (2A) of section 236C of the Ordinance.
Reference/ citation
https://download1.fbr.gov.pk/Docs/2023721217646921CircularNo.1of2023-2024.pdf
