The Federal Board of Revenue has introduced a formal electronic auction framework for the disposal of seized and confiscated goods through SRO 1889(I)/2026, amending the Sales Tax Rules, 2006. The framework establishes an online mechanism covering bidder registration, listing of goods, submission of bids, approval, payment, delivery and maintenance of electronic auction records. Individuals holding valid CNICs or NICOPs may register electronically upon payment of a one-time registration fee of at least Rs. 25,000.
Under the new framework, reserve prices will be determined by a valuation committee comprising designated Inland Revenue officers. Valuation may consider prices declared in sales tax returns during the preceding three tax periods, printed retail prices after appropriate margins, customs-assessed values and available market quotations. Online bidding will remain open for 72 hours from receipt of the first bid, with the system displaying the highest bid and maintaining electronic records of valid bids. Where goods remain unsold in three consecutive auctions, the committee may reduce the reserve price by up to 10% of the reference reserve price at a time.
What are the implications for businesses and prospective bidders? The framework is intended to introduce greater transparency, standardization and traceability into the disposal process. Importantly, goods subject to judicial stay orders cannot be auctioned until the relevant stay is vacated or withdrawn. Prospective bidders should examine applicable taxes, bid security requirements, inspection arrangements, payment conditions and delivery restrictions before participating. The recognition of electronic auction records also strengthens the documentary framework governing auction transactions.