Settle a KPRA Tax Dispute Through an ADR Committee in Khyber Pakhtunkhwa: Section 73 Steps
KPRA ADR under section 73 settles tax, penalty and surcharge disputes: a committee in 30 days, advice in 90, an order in 45. See who can apply and how.
A business registered with the Khyber Pakhtunkhwa Revenue Authority (KPRA) can settle a sales tax dispute through an alternative dispute resolution (ADR) committee under section 73. You apply to KPRA's Management Committee. It appoints a committee of at least three within 30 days, the committee recommends within 90 days, and the Management Committee rules within 45 days after that.
ADR is a way to settle a tax fight by negotiation in front of a panel, instead of a full appeal. It can cover the tax itself, a waiver of penalty and default surcharge, or a missed deadline. We read section 73 and the related appeal sections in KPRA's updated copy of the Khyber Pakhtunkhwa Sales Tax on Services Act, 2022 on 20 October 2026. That copy includes the Finance Act 2026.
Four kinds of dispute can go to a KPRA ADR committee
Section 73 covers disputes about tax liability, the extent of waiver of default surcharge and penalty, relaxation of procedural or technical lapses and condonation of time limits, and any other specific relief needed to end the dispute. Only a registered person can apply.
| Section 73(1) | What it covers | A plain example |
|---|---|---|
| (a) | Tax liability | KPRA says a service is taxable and you say it is not |
| (b) | Waiver of default surcharge and penalty | You paid the tax late and want the surcharge reduced |
| (c) | Procedural or technical lapses, and time limits | A return or document was filed late for a genuine reason |
| (d) | Any other specific relief | Anything else needed to settle the dispute, stated in detail |
The examples are ours, to make the clauses easier to read. The Act asks you to describe the dispute "in detail in the application", so the application itself decides what the committee looks at.
Two kinds of case cannot go to ADR
The Management Committee shall not accept an application where criminal proceedings have started. It can also refuse where it thinks the case turns on a question of law with a larger impact on revenue, or on many similar cases. Those go through the normal appeal route.
So ADR suits a dispute about your own facts. A quarrel over how a whole sector should be taxed is likely to be refused, because a ruling on it would affect many other taxpayers. If KPRA has already started a prosecution, ADR is closed.
The committee has at least three members from a notified panel
The committee must include a KPRA officer not below the rank of Additional Collector. The other members come from a panel the Management Committee notifies from time to time. The panel can include accountants, advocates, trade body members, retired judges and retired officers.
The full list in section 73(3) is chartered or cost accountants, advocates, representatives of trade bodies or associations, retired officers of at least grade BS-20, retired judges, and "any other reputable taxpayers". The committee can hold an inquiry, take expert opinion, and direct an officer or another person to carry out an audit.
A KPRA ADR case can take up to 255 days
Section 73 sets each step's limit. The Management Committee appoints the committee within 30 days and receives its recommendation within 90. If none comes, a new committee gets another 90 days. The Management Committee then passes an order within 45 days of the recommendation.
| Step | Limit in section 73 | Running total |
|---|---|---|
| Committee appointed after your application | 30 days | 30 days |
| Committee recommends to the Management Committee | 90 days | 120 days |
| Only if it fails: new committee decides | 90 more days | 210 days |
| Management Committee passes its order | 45 days after the recommendation | 165 or 255 days |
The running totals are our sums: 165 days when the first committee reports on time, 255 when a second one is needed. If the second committee also fails, the Act sends the matter back to the normal forum for a decision.
Apply in writing and keep your appeal rights alive
The Act does not stop the 30 day appeal clock when you apply for ADR. It expects ADR to run beside a pending case: the final order goes to the forum, tribunal or court hearing the matter. So file your appeal on time, then apply for ADR as well.
- Read the KPRA order and note the date you received it.
- File your appeal within 30 days, so the right to appeal is not lost.
- Write the ADR application to the KPRA Management Committee, describing the dispute in detail.
- Name the relief you want: tax, penalty and surcharge waiver, or condonation of a time limit.
- Attach the order, your returns and the papers that support your facts.
- Follow up if no committee is appointed within 30 days.
- Pay the tax the Management Committee settles, and file its order before your appeal forum.
There is a helpful link between the two routes. Section 68(5) says time spent in ADR does not count toward the Collector (Appeals) 120 day limit for deciding your appeal. So running both does not rush the appeal.
ADR is not unique to KP. FBR has its own version for federal taxes, explained in our guide to FBR alternative dispute resolution under section 134A. In Sindh, the usual first step is an appeal against an SRB order.
| Point | KPRA ADR, section 73 | Collector (Appeals), section 66 |
|---|---|---|
| Who can use it | Registered persons only | Any aggrieved person |
| Deadline to apply | None stated | 30 days from the order |
| Fee | None stated | Rs 1,000 company, Rs 500 others |
| Decision time | 165 to 255 days | 120 days, plus up to 60 |
| Who decides | KPRA Management Committee | Collector (Appeals) |
Keep your monthly filings clean while the case runs. A fresh late return is a fresh penalty, and it will not help your request for a waiver. The routine steps are in our guide to filing a KPRA sales tax return.
Common questions
Who can apply for KPRA ADR?
A registered person aggrieved by a dispute over tax liability, penalty and surcharge waiver, procedural lapses or time limits, or other specific relief, under section 73(1).
How long does KPRA have to form the committee?
30 days from receiving the application, under section 73(3).
Can KPRA refuse my ADR application?
Yes, if criminal proceedings have started, or if the case involves a question of law with a larger impact on revenue or on many similar cases.
Is there a fee for KPRA ADR?
Section 73 does not state one. We did not find KPRA rules on the application form or fee.
Does applying for ADR stop the appeal deadline?
The Act does not say so. File your appeal within 30 days and apply for ADR alongside it.
Who makes the final ADR decision?
The KPRA Management Committee, within 45 days of the committee's recommendation, under section 73(6).
How we verified this
What we checked, where we read it, and what we could not confirm.
Last checked on 20 October 2026. We read sections 55, 66, 68 and 73 of the Khyber Pakhtunkhwa Sales Tax on Services Act, 2022, updated with the Finance Act 2026, linked from the KPRA website. The running day totals and examples are ours. We could not find KPRA's notified panel of ADR members, an application form or any rules on fees, and we did not apply.
About the author
Senior Writer, Public Services and Technology
Shahid joined us in 2024 as an author. He is a senior contributor to Pakistan's leading technology websites. He writes detailed articles, mostly covering his expertise in the latest tech, mobiles, apps, gadgets, and step-by-step guides. His ideology is to help people understand the latest trends and explain complex methods through very easy-to-understand guides.
