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ISLAMABAD: The Directorate General of Intelligence & Investigation-Inland Revenue has arrested five senior companies’ officials including four Chief Financial Officers (CFOs) of Faisalabad-based textile units and a Lahore-based battery manufacturer on the charges of abetment/connivance in sales tax fraud.

Sources told Business Recorder that Large Taxpayer Offices (LTOs) have already convened meetings with a large number of CFOs of companies at LTOs and apprised them about possible arrests in case of evidence tax fraud or illegal tax credits/adjustments.

The Regional Directorates of Intelligence & Investigations Inland Revenue arrested five accused across the country including one of the leading fraudsters engaged in creating chains of dummy businesses and four members of top management of end users/beneficiaries (CFOs) responsible for the tax fraud involving billions of sales tax loss to the national exchequer.

‘War on tax fraud’: Pakistan faces revenue gap of Rs3.4tr due to tax evasion & fraud, says finance ministry

While taking action in a registered FIR involving billions of sales tax fraud, the Directorate of Intelligence & Investigation-Inland Revenue, Hyderabad, has arrested the CFO and Purchase Officer of a leading Lahore-based Battery Manufacturer on charges of abetment/connivance in Sales Tax fraud by claiming fake input tax on Lead.

In this intelligence-based operation, the Hyderabad team was assisted by the Directorate Lahore. The revenue loss caused by the arrested accused alone is more than a billion to the national exchequer.

In a separate intelligence-based operation, the Directorate of Intelligence & Investigation-Inland Revenue, Faisalabad, has arrested CFOs of two sister concerns and leading Faisalabad-based textile unit on the charges of abetment/connivance in Sales Tax fraud by claiming fake input tax on coal.

The revenue loss caused by the fraudulent practices involving a gang of fraudsters runs in hundreds of millions of PKR to the national exchequer.

An FIR had already been registered against the suppliers, beneficiaries, connivers, and others.

In another development, the pre-arrest bail of accused Taswar Shahid, nominated in several FIRs, was rejected by the Court on Monday. Subsequently, he was arrested from outside the courtroom.

He is a leading member of the gang operating fake and dummy units for generating fake sales tax input, which is used by the end users/beneficiaries, causing billions of losses to the national kitty. These arrests have been executed in the wake of the country-wide crackdown against the organised mafia and beneficiaries involved in sales tax fraud and in line with FBR’s enforcement measures to enhance tax compliance. This is for the first time that the CFOs of big textile companies have been arrested.

The FBR has asked the CFOs to pay the due amount of unpaid taxes of billions including principal amount and additional tax/penalties to avoid prosecution, sources revealed.

The revenue loss caused by the fraudulent practices, involving a gang of fraudsters, runs in multi millions to the national exchequer. An FIR had already been registered against the suppliers, beneficiaries, connivers and others.

Copyright Business Recorder, 2024

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NotSurprised Oct 15, 2024 11:51am
Good. Arrest the accountants and get them to turn on their seths who have been cheating the system for decades. A welcome development.
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sadiq Oct 15, 2024 12:17pm
Textile mills owners are biggest thief, more than IPPs.
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UA Oct 15, 2024 12:18pm
And what about arresting and apprehending those in the FBR facilitating these frauds?
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sadiq Oct 15, 2024 12:20pm
Textile mills owners always cry then they export and earn US$. "national" interest. What a pity.
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Arif Oct 15, 2024 12:24pm
What about Sales Tax officials ? No one can defraud FBR without connivance and support from its own staff.
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