Fake transactions: FBR illegally takes action against salaried individual

ISLAMABAD: The Federal Board of Revenue (FBR) has illegally taken action against a salaried individual, whose tax profile was showing 23,800 fake entries of import declarations and withholding transactions.

The Federal Tax Ombudsman (FTO) has taken serious notice of the situation and directed Member (Information Technology) to thoroughly investigate this matter and order an IT audit of all fake transactions to be conducted by Directorate General Intelligence and Investigation Inland Revenue so as to gauge the extent of revenue leakage and fix responsibility on the individuals concerned.

Briefly, the complainant is a Deputy Secretary in the Ministry of Law and Justice and filing income tax returns declaring income from salary only.

Reportedly he has discovered thousands of unknown entries appearing in his tax profile. In panic he contacted Commissioner-IR, RTO Islamabad but no response was received. He had filed a complaint to FTO against tampering of his tax profile which was disposed of with the recommendation to update complainant’s tax profile. Even after lapse of over almost five years the recommendation does not seem to have been implemented.

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Perusal of the record produced by the complainant shows that there are approximately 23,800 fake entries in the complainant’s name including import declarations and withholding transactions under various sections of the Ordinance. These are probably due to the fact that a test NTN 1234567-9 had been allotted to the complainant.

Any person who doesn’t have an NTN or anyone who doesn’t want to disclose his NTN, could insert this test number and got away with it. This situation speaks volumes about systemic inefficiency and neglect of FBR and PRAL employees, which needs to be addressed.

FTO has further directed the FBR Member-IR (Operations) to issue instructions to all field formations for taking action under the law against those withholding agents identified through referred investigative IT audit, who have misused the identity of the complainant and recover the short paid tax.

The GM PRAL’s explanation may be called for not responding to the situation, raised by this office and earlier by concerned IR field formation and report compliance in 45 days, FTO added.

“In view of the above analysis neglect, inattention, incompetence and ineptitude of the officers of FBR, especially PRAL is obvious which tantamount to maladministration in terms of Section 2 (3)(ii) of the FTC Ordinance,” FTO order added.

Copyright Business Recorder, 2023