Supply of boats to Coast Guards: FBR acts against firm involved in ST evasion

The Federal Board of Revenue has launched recovery drive against a trading company involved in non-payment of substantial amount of sales tax on 12 high speed boats acquired by Pakistan Coast Guards. Sources told Business Recorder here on Thursday that the FBR has started action against the company after the issue raised by Ministry of Interior on non-payment of sales tax to the tune of Rs 58,88,223 on supply of boats to the Pakistan Coast Guards.
The law enforcement agency has asked the FBR to trace the company for lodging an FIR on the charges of tax evasion. The case was of 2005-2006, the FBR has now started recovery proceedings against the firm following intervention of the Interior Ministry. After passage of five years, tax machinery is tracing the company in co-ordination with the Ministry of Interior and Pakistan Coast Guards to recover the defaulted sales tax. It is clear that the FBR 'Recovery of Sales Tax Plan 2009-2010' issued to the field formations remained unable to recover huge amount even from supplies made to law enforcement agencies.
On the request of the Interior Ministry, the FBR has issued instructions to the Regional Tax Offices for immediate recovery of the amount. The Interior Ministry has further informed the FBR that the tax authorities should ensure recovery from the defaulter company on non-payment of GST on supply of such boats to the law enforcement agency.
According to the report of the Pakistan Coast Guards to the FBR, a trading firm had supplied six fast petrol boats and six utility boats to this force in 2005-2006 at a total cost of Rs 4,51,43,043. However, the firm has not deposited the GST amounting to Rs 58,88,223 to the government treasury on account of buying 12 boats.
In compliance with the directorates of the Public Accounts Committee, Pakistan Coast Guard has already requested the Collector of Sales Tax Lahore for their assistance in recovery of sales tax from the defaulting firm. The FBR should issue instructions to the concerned collector of sales tax to co-ordinate with Pakistan Coast Guards for tracing/locating the firm and advised with regard to registration of the FIR against the company. The report added that the Interior Ministry should also pursue the FBR for early recovery of the defaulted amount from the firm, sources said.