FBR swoops on benami assets as amnesty ends

Provisionally attaches 14 properties owned by suspects close to PML-N, PPP

Shahbaz Rana July 04, 2019

The Federal Board of Revenue (FBR) has started crackdown against Benami property holders and attached billions of rupees assets one day before expiry of the Pakistan Tehreek-e-Insaf (PTI) government’s tax amnesty scheme that has been availed by 129,000 people.

The FBR has provisionally attached 14 ‘benami properties’ worth billions of rupees that it suspects are owned by people close to Pakistan Muslim League-Nawaz (PML-N) and Pakistan Peoples Party (PPP) but are held in the names of others, according to provisional attachment orders.

These orders have been passed by Benami Transaction (Prohibition) Zone-I Islamabad and Benami Zone-III Karachi. The properties have been attached for a period of three months and during this time all the parties will have time to explain their positions before an adjudicating authority.

SBP turns down FBR request for data of account-holders

If the crime of holding a benami property is proved, the government will have the right to confiscate the property. Courts can give up to seven-year rigorous imprisonment to such people and can impose a fine on them equal to 25% of the fair market value of the property.

The Islamabad Zone has targeted six properties owned by a PML-N lawmaker. The Karachi Zone has provisionally attached eight properties that it suspects belong to the Omni Group, show the official documents of the FBR.

FBR Chairman Shabbar Zaidi confirmed to The Express Tribune that a PML-N lawmaker’s properties were provisionally attached by the FBR. He said the action against the Benami owners of the properties would accelerate in coming days.

The last PML-N government had enacted Benami Transactions (Prohibition) Act 2017 but its rules have been framed by the PTI government about four months ago to make it operational.

Before launching the crackdown, the government had offered tax amnesty scheme to the people at very low rate of 1.5% to 4%. The scheme, which was originally planned to end on June 30, was extended for three days and ended on Wednesday.

“As many as 103,532 people have availed the scheme and another 25,130 have filed the draft returns, bringing the total number to 128,662,” said Shabbar Zaidi. He said the number could touch nearly 135,000. These people paid around Rs60 billion in taxes.

The FBR has not yet determined value of assets that have been whitened by these nearly 129,000 people. The analysis of these assets will be released by Adviser to Prime Minister on Finance Dr Abdul Hafeez Shaikh on Friday.

Out of the total declarations filed, nearly 80% were related to domestic assets and 20% foreign assets. The FBR’s initial estimates suggest that about 90,000 non-filers have availed the scheme and most of them are middle and upper-middle income group people.

The FBR expects that due to the condition of depositing cash in the bank accounts the banking sector deposits have improved. The last tax amnesty scheme had been availed by 83,000 people who paid Rs124 billion in taxes.

On back of tax amnesty scheme, the total income tax return filers have crossed 2 million – for the first time. During the past ten days, nearly 95,000 income tax returns have been filed.

The FBR has also extended the date for filing the income tax returns for fiscal year 2017-18 to August 2. This would still allow the people to revise their previous returns by paying 30% penalty as against 4% tax that they paid under the amnesty scheme.

The FBR took action against Benamidars in Karachi and Islamabad a day before the expiry of the tax amnesty scheme. The provisional orders to attach the properties were issued on Tuesday.

The FBR documents showed that eight properties allegedly belonging to the Omni Group have been provisionally attached. Their value is estimated at Rs2.5 billion. These properties are in the names of Plaza Enterprises Pvt Limited, Marshal Homes Builders Developers and Nadeem Ahmad Khan.

Amnesty scheme is no NRO, says FBR

Six stocks and shares have also been provisionally attached for three months. These are in the names of Al-Miftah Holding Private Limited, Sky Pak Holding Limited, Rising Star Holding Limited that owns Thatta Cement Company Limited.

The Seracom Stock and Capital Private Limited and Parkview Stock Capital Limited have also been provisionally attached that own preference shares of Summit Bank valuing at Rs600 million.

The FBR also provisionally attached six properties in Rawalpindi that it believes belong to the PML-N lawmaker. These properties are held in the names of Muhammad Basharat, Raja Abdul Shakoor, Shah Jahan Begum, Azhar Ali and Abdul Aziz, according to the FBR’s official documents.

The government has established the Adjudicating Authority under Benami Transactions (Prohibition) Act 2017 that is headed by Jamil Ahmed, a retired officer of Pakistan Administrative Service.

Muhammad Tanvir Akhtar, a retired Inland Revenue officer and Khaqan Murtaza, an officer of Pakistan Administrative Services who also has worked in an intelligence agency, are appointed as members of the Adjudicating Authority.

After giving an opportunity to a Benamidar and beneficiary of a Benami property to present their point of view, the Adjudicating Authority can order to confiscate the property if it is unsatisfied with the replies of the accused persons, according to section 25 of the Benami Act.

The accused will have a right to appeal before an Appellate Tribunal. If the tribunal rejects the appeal, the aggrieved party will have a right to appeal before a high court within 2 months of issuing the orders.

In case the benami possession is established, the courts can award the accused rigorous imprisonment of up to seven years or a fine equal to 25% of fair market value of the property.


Awais Qureshi | 4 years ago | Reply Confiscate benami properties and bring them on roads. Set them an example for others. At borders soldiers give their life for this country but inside these parasites are devouring our resources and depriving millions of people of basic necessities of life
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