ISLAMABAD: Tax authorities have raided the offices of Nue Multiplex and Entertainment Company and impounded its records on suspicion of evasion of millions of rupees in income tax by overstating expenditures and allegedly concealing income.
Officers of the Intelligence and Investigation wing of the Inland Revenue Service of Federal Board of Revenue searched the premises of the company, according to sources in the FBR headquarters.
The Nue Multiplex and Entertainment Company is engaged in the business of provision of entertainment services and has five theatres, totalling 1,100 seats and is home to three of the country’s largest silver screens.
“The FBR officers had come to my office and sought some information, which we provided to them,” said Mirza Muhammad Jamil Baig, a shareholder in the company, told The Express Tribune.
He, however, denied that the FBR conducted a formal raid and impounded documents and computers.
Jamil Baig owns 60 per cent shares in the company, followed by Mirza Uzma Jamil who has a 35 per cent stake and Muhammad Tariq Baig who owns the remaining five per cent of the shares.
FBR sources stated that the intelligence wing took the action under Section 175 of the Income Tax Ordinance, 2001, which allows the authorities to enter and search premises. They said the field office took all necessary approvals before conducting the raid.
According to the initial inquiry by the tax authorities, the company showed huge losses during the first four years of business, amounting to Rs143.6 million. It showed the total investment at only Rs200,000, which is beyond comprehension, given the size and quality of infrastructure, they added. The sources further said that the taxpayer has also inflated its expenses to evade taxes.
Sources said that the expenses shown by the taxpayer were very high, which resulted in relatively low profits compared with other business of the same line.
Published in The Express Tribune, January 4th, 2017.