Inadmissible input tax adjustments: LTUs and RTOs differ over Rs 100 billion figure

Some of the Chief Commissioners of the Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) differed with the figure of Rs 100 billion of inadmissible input tax adjustments given by Federal Board of Revenue Member Taxpayer Audit at the Chief Commissioner Conference held on August 4, 2011.
Sources told Business Recorder here on Friday that the FBR Member Taxpayer Audit shared the computer-generated data of the FBR showing inadmissible input tax adjustments to the tune of Rs 100 billion. During the last two years, the FBR is sending computerised generated data pertaining to inadmissible input tax adjustments to the field formations, but there is no proper response on the issue. The FBR has been engaged in regularly providing computerised information to the field offices, but field formations have not submit the requisite reports, sources quoted Member Taxpayer Audit as saying to the Chief Commissioners.
According to sources, certain Chief Commissioners of the Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) have termed the figure of Rs 100 billion of inadmissible input tax adjustments as very high and said that the actual amount of such illegal adjustments is lower as compared to the figure presented by FBR Member Taxpayer Audit.
The Chief Commissioners of the LTUs and the RTOs have further informed that taxpayers are eligible to claim tax adjustments within a period of six subsequent tax periods under section 7 of the Sales Tax Act. It is not likely that all such taxpayers would have claimed input tax adjustments during the first month whereas they have been allowed to claim such adjustment within a period of six subsequent tax periods.
When we have sent notices to the taxpayers in the field formations, the reconciliation of data revealed that most of the taxpayers have claimed tax adjustments within the admissible period of six months. Thus, it was unjustified to confront the taxpayers on such grounds, few Chief Commissioners responded.
FBR Member Taxpayer Audit informed the Chief Commissioners of the LTUs and the RTOs that the inadmissible input tax adjustments come to around Rs 100 billion. Even if six moths period has been allowed for claiming tax adjustments whether the Chief Commissioners of the LTUs and the RTOs have submitted report in this regard?, FBR Member Taxpayer Audit raised a question. What is the status of the cases where six months have been expired? However, all the field officials were silent and have not responded to the query of the FBR Member Taxpayer Audit.