The document outlines the record keeping and audit requirements and powers of the Commissioner under the tax ordinance. It discusses (1) the records taxpayers must maintain, (2) the Commissioner's powers to enter premises, search, seize records and computers, and require assistance; and (3) the Commissioner's powers during audits, including amending assessments. It also covers assistance other government agencies must provide and translating non-English records.

1. RECORDS, INFORMATION
COLLECTION AND AUDIT

2. RECORDS, INFORMATION COLLECTION AND AUDIT
Records. —
(1) Unless otherwise authorised by the Commissioner, every taxpayer
shall maintain in Pakistan such accounts, documents and records as may
be prescribed.
(2) The Commissioner may disallow or reduce a taxpayer‘s claim for a
deduction if the taxpayer is unable, without reasonable cause, to provide a
receipt, or other record or evidence of the transaction or circumstances
giving rise to the claim for the deduction.
(3) The accounts and documents required to be maintained under this
section shall be maintained for six years after the end of the tax year to
which they relate
[Provided that where any proceeding is pending before any authority or
court the taxpayer shall maintain the record till final decision of the
proceedings.]
[Explanation.— Pending proceedings include proceedings for assessment
or amendment of assessment, appeal, revision, reference, petition or
prosecution and any proceedings before an Alternative Dispute Resolution
Committee.

3. RECORDS, INFORMATION COLLECTION AND AUDIT
Records. —
(4) For the purpose of this section, the expression
“deduction” means any amount debited to trading
account, manufacturing account, receipts and
expenses account or profit and loss account.
(5) The Commissioner may require any person to
install and use an Electronic Tax Register of such
type and description as may be prescribed for the
purpose of storing and accessing information
regarding any transaction that has a bearing on the
tax liability of such person.

4. RECORDS, INFORMATION COLLECTION AND AUDIT
Power to enter and search premises.
(1) In order to enforce any provision of this Ordinance (including for the purpose of making an
audit of a taxpayer or a survey of persons liable to tax), the Commissioner or any officer
authorised in writing by the Commissioner for the purposes of this section –
(a) shall, at all times and without prior notice, have full and free access to any premises,
place, accounts, documents or computer;
(b) may stamp, or make an extract or copy of any accounts, documents or computer-stored
information to which access is obtained under clause (a);
(c) may impound any accounts or documents and retain them for so long as may be
necessary for examination or for the purposes of prosecution;
(d) may, where a hard copy or computer disk of information stored on a computer is not made
available, impound and retain the computer for as long as is necessary to copy the
information required; and
(e) may make an inventory of any articles found in any premises or place to which access is
obtained under clause (a

5. RECORDS, INFORMATION COLLECTION AND AUDIT
Power to enter and search premises.
(2) The Commissioner may authorize any valuer or expert to enter any premises
and perform any task assigned to him by the Commissioner.]
(3) The occupier of any premises or place to which access is sought under subsection (1) shall provide all reasonable facilities and assistance for the effective
exercise of the right of access.
(4) Any accounts, documents or computer impounded and retained under subsection (1) shall be signed for by the Commissioner or an authorised officer.
(5) A person whose accounts, documents or computer have been impounded and
retained under sub-section (1) may examine them and make extracts or copies
from them during regular office hours under such supervision as the
Commissioner may determine.
(6) Where any accounts, documents or computer impounded and retained under
sub-section (1) are lost or destroyed while in the possession the Commissioner,
the Commissioner shall make reasonable compensation to the owner of the
accounts, documents or computer for the loss or destruction.
(7) This section shall have effect notwithstanding any rule of law relating to privilege
or the public interest in relation to access to premises or places, or the
production of accounts, documents or computer-stored information.
(8) In this section, “occupier” in relation to any premises or place, means the owner,
manager or any other responsible person on the premises or place

6. RECORDS, INFORMATION COLLECTION AND AUDIT
Notice to obtain information or evidence.
(1) The Commissioner may, by notice in writing, require any person,
whether or not liable for tax under this Ordinance –
(a) to furnish to the Commissioner or an authorised officer, any information
relevant to any tax 1[leviable] under this Ordinance as specified in the
notice; or
(b) to attend at the time and place designated in the notice for the purpose
of being examined on oath by the Commissioner or an authorised
officer concerning the tax affairs of that person or any other person
and, for that purpose, the Commissioner or authorised officer may
require the person examined to produce any accounts, documents, or
computer-stored information in the control of the person or
(c) the firm of chartered accountants, as appointed by the [Board or the
Commissioner], to conduct audit under section 177, for any tax year,
may with the prior approval of the Commissioner concerned, enter the
business premises of a taxpayer, selected for audit, to obtain any
information, require production of any record, on which the required
information is stored and examine it within such premises; and such
firm may if specifically delegated by the Commissioner, also exercise
the powers as provided in sub-section (4).]

7. RECORDS, INFORMATION COLLECTION AND AUDIT
Notice to obtain information or evidence.
(2) The Commissioner may impound any accounts or
documents produced under sub-section (1) and retain them
for so long as may be necessary for examination or for the
purposes of prosecution
(3) The person from whom information is required, may at his
option, furnish the same electronically in any computer
readable media.] Where a hard copy or computer disk of
information stored on a computer is not made available as
required under sub-section (1), the Commissioner may
require production of the computer on which the
information is stored, and impound and retain the computer
for as long as is necessary to copy the information
required.

8. RECORDS, INFORMATION COLLECTION AND AUDIT
Notice to obtain information or evidence.
(4) For the purposes of this section, the Commissioner shall have the
same powers as are vested in a Court under the Code of Civil
Procedure, 1908 (Act V of 1908), in respect of the following matters,
namely: (a) enforcing the attendance of any person and examining the person on
oath or affirmation;
(b) compelling the production of any accounts, records, computer-stored
information, or computer;
(c) receiving evidence on affidavit; or
(d) issuing commissions for the examination of witnesses.
(5) This section shall have effect notwithstanding any law or rules relating
to privilege or the public interest in relation to the production of
accounts, documents, or computer-stored information or the giving of
information

9. RECORDS, INFORMATION COLLECTION AND AUDIT
Audit.
(1) The Commissioner may call for any record or documents including books of
accounts maintained under this Ordinance or any other law for the time being in
force for conducting audit of the income tax affairs of the person and where
such record or documents have been kept on electronic data, the person shall
allow access to the Commissioner or the officer authorized by the
Commissioner for use of machine and software on which such data is kept and
the Commissioner or the officer may have access to the required information
and data and duly attested hard copies of such information or data for the
purpose of investigation and proceedings under this Ordinance in respect of
such person or any other person:
Provided that—
(a) the Commissioner may, after recording reasons in writing call for record or
documents including books of accounts of the taxpayer; and
(b) the reasons shall be communicated to the taxpayer while calling record or
documents including books of accounts of the taxpayer:
Provided further that the Commissioner shall not call for record or documents of the
taxpayer after expiry of six years from the end of the tax year to which they
relate

10. RECORDS, INFORMATION COLLECTION AND AUDIT
Audit.
(2) After obtaining the record of a person under sub-section
(1) or where necessary record is not maintained, the
Commissioner shall conduct an audit of the income tax
affairs (including examination of accounts and records,
enquiry into expenditure, assets and liabilities) of that
person or any other person and may call for such other
information and documents as he may deem appropriate.
(3) After completion of the audit, the Commissioner may, if
considered
necessary,
after
obtaining
taxpayer‘s
explanation on all the issues raised in the audit, amend the
assessment under sub-section (1) or sub-section (4) of
section 122, as the case may be

11. RECORDS, INFORMATION COLLECTION AND AUDIT
Audit.
(4) The fact that a person has been audited in a year shall not preclude the
person from being audited again in the next and following years where
there are reasonable grounds for such audits.
(5) The [Board] may appoint a firm of Chartered Accountants as defined
under the Chartered Accountants Ordinance, 1961 (X of 1961) or a firm
of Cost and Management Accountants as defined under the Cost and
Management Accountants Act, 1966 (XIV of 1966)], or a firm of Cost
and Management Accountants as defined under the Cost and
Management Accountants Act, 1966 (XIV of 1966) to conduct an audit
of the income tax affairs of any person or classes of persons and the
scope of such audit shall be as determined by the [Board] or the
Commissioner on a case to case basis.
(6) Any person employed by a firm referred to in sub-section (8) may be
authorized by the Commissioner, in writing, to exercise the powers in
sections 175 and 176 for the purposes of conducting an audit under
that sub-section.

12. RECORDS, INFORMATION COLLECTION AND AUDIT
Audit.
(7) Notwithstanding anything contained in sub-sections (2) and (6) where a
person fails to produce before the Commissioner or a firm of Chartered
Accountants or a firm of Cost and Management Accountants appointed
by the Board or the Commissioner under sub-section (8) to conduct an
audit, any accounts, documents and records, required to be maintained
under section 174 or any other relevant document, electronically kept
record, electronic machine or any other evidence that may be required
by the Commissioner or the firm of Chartered Accountants or the firm
of Cost and Management Accountants for the purpose of audit or
determination of income and tax due thereon, the Commissioner may
proceed to make best judgment assessment under section 121 of this
Ordinance and the assessment treated to have been made on the
basis of return or revised return filed by the taxpayer shall be of no
legal effect.

13. RECORDS, INFORMATION COLLECTION AND AUDIT
Assistance to Commissioner.- Every Officer
of Customs, Federal Excise, Sales Tax,
Provincial Excise and Taxation, District
Coordination Officer, District Officers
including District Officer – Revenue, the
Police and the Civil Armed Forces is
empowered and required to assist the
Commissioner in the discharge of the
Commissioner‘s
functions
under
this
Ordinance.

14. RECORDS, INFORMATION COLLECTION AND AUDIT
Assistance to Commissioner.- Every Officer
of Customs, Federal Excise, Sales Tax,
Provincial Excise and Taxation, District
Coordination Officer, District Officers
including District Officer – Revenue, the
Police and the Civil Armed Forces is
empowered and required to assist the
Commissioner in the discharge of the
Commissioner‘s
functions
under
this
Ordinance.

15. RECORDS, INFORMATION COLLECTION AND AUDIT
Accounts, documents, records and computerstored information not in Urdu or English
language.
Where any account, document, record or computerstored information referred to in section 174, 175
or 176 is not in the Urdu or English language, the
Commissioner may, by notice in writing, require
the person keeping the account, document, record
or computer-stored information to provide, at the
person's expense, a translation into the Urdu or
English language by a translator approved by the
Commissioner for this purpose

16. RECORDS, INFORMATION COLLECTION AND AUDIT
Power to collect information regarding
exempt income.—
The Board may, by notification in the official
Gazette, authorise any department or
agency of the Government to collect and
compile any data in respect of incomes from
industrial and commercial undertakings
exempt from tax under this Ordinance.