Inland Revenue Act 2017 · As enacted · Part II
172. Preservation of assets
Official English translation. The Sinhala text prevails. Open the official Sinhala text, official PDF on documents.gov.lk
Official translationFrom Department of Government Printing, unchanged
This section shall apply where the
Commissioner-General has reasonable cause to believe that:—
a taxpayer will not pay the full amount of tax owing when due; and
the taxpayer will take steps to frustrate the recovery of the tax, including the dissipation of the taxpayer’s assets.
The Commissioner-General may make an ex-parte application to the District Court having jurisdiction, for an order (hereinafter referred to as an “Asset Preservation
Order”) for the preservation of the assets of the taxpayer and prohibiting any person holding, controlling or managing assets belonging to the taxpayer from transferring, withdrawing, disposing or otherwise dealing with the assets.
The Commissioner-General may take such steps as necessary to secure the assets of the taxpayer, including seizure of the assets, pending making an application for an order under subsection (2), which application shall be made within twenty four hours from taking steps to secure the taxpayer’s assets.
The District Court shall issue an asset preservation order when such court is satisfied that the requirements in subsection (1) are satisfied and the order shall be served on the taxpayer and any person having custody, control or management of the taxpayer’s assets.
An Asset Preservation Order shall be valid for ninety days and may be extended by the District Court on application by the Commissioner-General.
A taxpayer whose funds are the subject of an Asset
Preservation Order may, within fifteen days of being served with the order, apply to the District Court to discharge or vary the order.
Where the District Court has issued an Asset
Preservation Order, the Commissioner-General shall, within thirty days of service of notice of the order, determine the tax due by the taxpayer to whom the order relates and serve a notice of a tax assessment on the taxpayer and commence recovery of the tax assessed in accordance with the provisions of this Act.
An Asset Preservation Order shall automatically expire upon service of a notice of assessment under subsection (7)
unless the District Court extends the Order upon application by the Commissioner-General under subsection (5).
A person who preserves funds pursuant to an Asset
Preservation Order shall be, for all purposes, deemed to have acted within the authority thereof and such person and all other persons concerned shall be indemnified in respect of the actions taken in connection with the Order, against all proceedings, civil or criminal and all process, judicial or extrajudicial, notwithstanding any provisions to the contrary in any written law, contract or agreement.
A person who, without reasonable cause, fails to comply with an Asset Preservation Order served on the person shall be personally liable for the amount specified in the Order.