Senate Standing Committee on Finance has shown concern over the use of anti-money laundering law against the businesses and described it as "alarming," saying people are getting scared. Chairman Senate Standing Committee on Finance, Senator Saleem Mandviwalla raised the issue and stated that some reports were brought into his knowledge that tax authorities are using anti-money laundering law against the businesses.
Mandviwalla maintained that "a limited activity was allowed under law and asked the Federal Board of Revenue chairman why it is being used so frequently against the businesses." He said, "This is alarming and people are getting scared. After audit and raids, if AML law will be used against businesses, people will run away from the country."
On the issue of Benami Law, the chairman FBR stated that rules of Benami law were framed and sent to Law Division for vetting and it will take a few more days. The rules of Benami Law would be made available to the committee as soon as these are received, he added.
The Senate Standing Committee on Finance also decided to take a ruling from the chairman Senate whether the committee can request the Supreme Court of Pakistan to get the documents which the FBR had provided to the Joint Investigation Team (JIT) in the Panama Papers case, after the Law Division stated that FBR under the tax law was not allowed to provide information to the committee.
Mandviwalla also read out the response received from Law Division in writing on the question whether the committee can demand information from the FBR which was provided to the JIT. Law Division replied that the FBR can not share information with the committee under the Income Tax Ordinance 2001. An official of Law Division explained that section 216 of the ITO 2001 relating to disclosure of information prevails over article 66 of the Constitution.
The committee chairman after a detailed discussion decided to refer the matter along with the response of Law Division to the chairman Senate for his ruling on the matter.
Senator Kamil Ali Agha suggested that anything that is part of the verdict becomes a public document and the committee can request the Supreme Court for either information or guidance on the matter, while Senator Saud Majeed suggested for moving an amendment in the law.
The committee also urged the Finance Ministry to resolve the issue of the separation of Auditor General of Pakistan (AGP) and Controller General of Accounts (CGA) cadres after it was informed that matter remains dormant since 2015. AGP and CGA officials stated that there has been no progress on the matter since 2015 when the last meeting of the stakeholders took place. A summary of Finance Division was approved by the Prime Minister in January 2014 and subsequently the matter was refereed to the Establishment Division to resolve the operational issues. However, the consensus was hard to achieve during several meetings and last one took place in 2015, the committee was informed.
The committee also took briefing from the Securities & Exchange Commission of Pakistan (SECP) on 70% right shares issued by the Bank of Punjab in 2017. The committee after a detailed briefing on how much shares were offered to underwriters and whether or nor any inside trading was involved deferred the matter.
The chairman of the committee asked the SECP to provide information to the chairman that it does not want to share in the presence of others so that the decision could be taken on the matter. The meeting was informed that 70 percent shares (1.1 billion shares) mobilized Rs 13 billion proceeds.
However, the committee was stated earlier that one of the CEOs of the bank had sold one million shares three month before the offer of right shares was made. The SECP officials also acknowledged that proposal of right share was under discussion before the shares were offloaded by the CEO.
The chairman of the committee after an in camera briefing on Euro Bond, stated that the committee has decided to summon the consortium of banks to take briefing about those who had purchased Euro Bonds issued by the government.
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