Case of Rs1.34b tax theft facing delay for two years

Published: July 21, 2019

ISLAMABAD: Owing to a lack of cooperation between two institutions of the Federal Board of Revenue (FBR), a case of tax theft amounting to Rs1.34 billion has faced delay for the past two years.

The FBR unearthed hidden and undeclared bank transactions and undeclared sales amounting to billions of rupees by Kashif Zia, the owner of Decent Traders. Apart from this, bank account details and transaction details of Decent Traders’ Chief Accountant Naimatullah and another employee Hassan Raza have also been acquired.

Owing to interference of an important political personality during the tenure of previous government, the subordinate institutions of the FBR acquitted the above two employees of Decent Traders against whom investigation into tax theft and tax fraud was under way.

Officials of the Inland Revenue Lahore Directorate General Intelligence and Investigation stated that they had completed investigation into the tax evasion case and prepared over 40-page report, which was sent to the Regional Tax Office (RTO) Lahore. They said the case was now with the Inland Revenue Lahore Deputy Commissioner (DC) Noreen and it was the responsibility of RTO Lahore to recover the amount.

Officials of the RTO Lahore said Decent Traders had earlier challenged the FBR’s order and now the Supreme Court had given Inland Revenue DC the authority to issue an order, therefore the written verdict was awaited.  As soon as the decision would be issued, the process to recover Rs1.34 billion from Decent Traders would commence, they added.

According to the 43-page report available with The Express Tribune, it was learnt that Decent Traders, located in Shah Alam market, paid mere Rs457,866 in sales tax from 2009 to 2015 while it had sales transactions of billions of rupees. According to a copy of the investigation report, Decent Traders had been involved in sales tax evasion of Rs1.34 billion, federal excise duty worth Rs256 million and special excise duty worth Rs14.8 million.

In the report, it was said the company was found guilty of tax theft and tax fraud violating Section (37) (2) of the Sales Tax Act 1990 and clause 19 sub-section 3 and 12 of the Federal Excise Duty Act 2005. It was said the tax with default surcharge was payable according to clause (3) (11) of the Sales Tax Act 1990 and clause 14 of the Federal Excise Duty Act 2005.

Published in The Express Tribune, July 21st, 2019.

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