FBR orders action against SRO misuse

KARACHI: The Federal Board of Revenue (FBR) has ordered an inquiry into the misuse of a concessionary regulatory order related to the textile sector and directed tax departments to identify persons responsible for revenue leakages, official sources said on Wednesday.


“FBR chairman Tariq Bajwa and Member Inland Revenue (Operations) Muhammad Ashraf Khan have taken prompt action on the information regarding the misuse of exemption and concession granted through the SRO 1125,” an official at the local tax office said. The official said that the FBR high-ups have directed the RTO concerned to take up the cases that were referred in a news item appeared on March 4. “The case of misusing sales tax registration number by some elements has especially been highlighted in the directives,” the official said. The case of misusing STRN had been identified and was registered with the RTO-I, which has the jurisdiction over textile units, the officials said. The News approached the person, who got the registration in July 2008 and applied for deregistration the next month of the same year but he declined to comment on the case, as it was sub judice in the higher court.


The background of the case revealed that recently the revenue body had issued a recovery notice of Rs35 million to the person who had closed the business in 2008 and applied for deregistration. Some elements having knowledge about the dormant STRN activated the same and filed sales tax return in October and November 2011 to ensure its activity for the future use.


“There may be involvement of the FBR officials or staff at Pakistan Revenue Automation (Pvt) Limited (PRAL) because they have information about dormant STRNs,” a senior tax official said. “The FBR should investigate why the registration was kept alive for three years when it had no activity,” the official added. The officials said that the thorough investigation may unveil several companies, who availed OF the benefit of SRO 1125, through fake invoices.


The FBR blacklisted hundreds of cases belonging to three RTOs located in Karachi on the evidence of obtaining refunds of billions of rupees through fake and flying invoices. So far, no concrete measures have been taken to recover the amount from fraudsters, the official added.

Source: The NEWS