Text of ITO Section 230E

Directorate General of International Tax Operations.

(1) The Directorate General of International Tax Operations shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors, Assistant Directors, and such other officers as the Board may, by notification in the official Gazette, appoint.

(2) The Board may, by notification in the official Gazette,
(a) specify the functions and jurisdiction of the Directorate General and its officers; and
(b) confer the powers of authorities specified in section 207 upon the Directorate General and its officers.

(3) The functions and powers of the Directorate General of International Tax Operations shall include but not be limited to-
(a) receive and send information from other jurisdictions under spontaneous, automatic, and on-demand exchange of information under exchange of information agreements;
(b) levy and recover tax by passing an assessment order under section 123(1A) in case of undeclared offshore assets and incomes;
(c) receive, transmit, and exchange country reports to the jurisdictions that are parties to international by-country agreements with Pakistan; and
(d) conduct transfer pricing audit in cases selected for such audit by the Director General of International Tax Operations.

(4) The Board may, by notification in the official Gazette, specify the criteria for selection of the taxpayer for transfer pricing audit.

Explanation: For the removal of doubt, it is clarified that transfer pricing audit refers to the audit for determination of transfer price at arm's length in transactions between associates and is independent of tax audit under section 177 and 214C, which is audit of the income tax affairs of the taxpayer.

(5) Transfer pricing audit of cases selected under clause (d) of sub-section (3) shall be conducted as per procedure given in section 177 and all the provisions of the Ordinance, except the first proviso to sub-section (1), sub-section (6A), (10), and (14) of section 177, shall apply accordingly.

(6) Nothing contained in this section shall prevent the Commissioner from determination of transfer price at arm’s length in transactions between associates while conducting audit of income tax affairs of a taxpayer under section 177 or 214C or during proceedings under section 122.