Lahore High Court Curbs Federal Tax Ombudsman in Cigarette-Seizure Dispute

The Lahore High Court set aside orders by the Federal Tax Ombudsman and the President of Pakistan in a cigarette-seizure dispute involving 641 cartons taken from a private dealer’s premises in Multan. The court held that the complaint about delayed adjudication belonged within the tax appeal framework.

The dispute concerned confiscated cigarettes and the time taken to adjudicate their status. The court treated that delay complaint as part of the underlying tax matter, rather than as a separate issue the ombudsman could decide.

The decision was reported on September 25, 2026. Both orders were set aside.

The ruling addressed the available legal route in this case. It did not remove the ombudsman’s authority to examine maladministration within the limits set by law.

The court applied the ombudsman’s limits to a complaint about delay

Section 9(1) of the Federal Tax Ombudsman Ordinance, 2000, gives the FTO authority over maladministration by the Revenue Division and its personnel. The court considered that authority alongside the legal process for contesting the seizure and the treatment of the goods.

Section 9(2)(b) restricts the FTO from examining income or wealth assessments, tax or duty liability, and the classification or valuation of goods when the law provides appeal, review or revision. The court said those limits applied to the dispute before it.

The complaint arose from delayed adjudication, but its subject was confiscated goods within the statutory tax system. The reported holding links the complaint to that system; it does not establish that every delay complaint involving tax officials falls outside the FTO’s remit.

That distinction keeps the ruling tied to its facts. The court addressed a dispute for which the tax law supplied a route to challenge the underlying action, rather than announcing a general bar on complaints about administrative conduct.

Section 33 offered a route to contest the seizure and duty issues

The court identified an appeal under Section 33 of the Federal Excise Act, 2005, as the available first step. Further review could then be sought before the appellate tribunal.

That process could address the seizure, its legality and questions of tax or duty. Those were the issues the statutory forum could consider in the dispute, according to the reported decision.

The appeal route helps explain why the court set aside both the FTO order and the President’s order. The court treated the statutory tax process, rather than ombudsman review, as the forum for resolving the contested seizure and related liability questions.

The wider effect should not be overstated. The decision identifies the applicable route where statutory appeal or review remedies exist; it does not say that the FTO cannot investigate any conduct by revenue officials.

Other FTO cases turned on different complaints

A separate proceeding in Bahawalpur concerned investigation proceedings against an Additional Commissioner Revenue. On September 11, 2026, the court suspended those proceedings and described the FTO’s authority in that matter as “very limited jurisdiction.” It was a different case from the Multan seizure dispute.

Another matter concerned confidentiality of taxpayers’ financial data and personal information. The President dismissed two representations filed by the Federal Board of Revenue and upheld the FTO’s findings of maladministration.

The contrasting outcomes involve different underlying issues. The cigarette case concerned seized goods and tax remedies; the other presidential matter concerned taxpayer information. The available account of each proceeding does not make one a general precedent for the other.

Representations to the President are governed by the Federal Ombudsmen Institutional Reforms Act 2013. In the seizure case, the court set aside the presidential order along with the original FTO order, after finding that the underlying dispute belonged in the statutory tax process.