Special Judge Customs, Taxation and Anti-Smuggling has admitted two cases filed by Directorate General of Intelligence and Investigation Inland Revenue against a leading Islamabad-based school in the Diplomatic Enclave and a real estate investor for alleged misdeclarations in their income tax returns and wealth statements.
It is learnt that for the first time the directorate of intelligence IR has been able to file two major cases of income tax misstatements before the court. The court has admitted complaints filed by the directorate and summoned both the accused to appear on September 17. In this regard, the directorate of intelligence IR has submitted complaint number 1/2015 and complaint number 2 of 2015 to the court.
The first case is related to concealment of assets owned by the offender and furnishing inaccurate particulars of assets in the statement filed u/s 116 of the Income Tax Ordinance, 2001 and making false declaration and verification on form prescribed for statement u/s 116 of the said Ordinance. Details of the case revealed that a real estate investor in Rawalpindi is carrying on business of sale and purchase of immovable property.
The accused filed returns of income for Tax Years 2010,2011, 2012 and 2013 under section 114 of the Income Tax Ordinance, 2001 and declared taxable income of Rs 500,878, Rs 2,317,715, Rs 4,110,000 and Rs 6,995,100, respectively . The accused also filed wealth statements u/s 116 of the Income Tax Ordinance, 2001 for the years ending on 30-6-2010, 30-06-2011, 30-6-2012 and 30-06-2013 declaring net wealth of Rs 16,265,000,Rs 18,572,888, Rs 19,040,000 and Rs 22,150,000, respectively.
Inquiry by the complainant's office revealed that the accused has furnished inaccurate particulars of his assets and willingly did not declare his bank accounts. The accused person has made huge investments of Rs 61, 256,500 in a housing scheme, Rawalpindi during tax years 2010 to 2014, however, the said investments have not been declared in his Wealth Statements for the said tax years. The accused thus intentionally furnished inaccurate particulars, fake declaration and verified fake document and has thus committed an offence u/s 192 of the Income Tax Ordinance, 2001.
Scrutiny of the declared as well as concealed bank accounts reveal that the taxpayer has also concealed huge cash amount for the period relating to tax years 2009 to 2014. However, when it was compared with the declarations of the taxpayer in wealth statements, huge amount of undeclared cash in bank was detected: year-wise details are given as under:
The amount of Rs 257, 693,902 thus remains totally unexplained and surely is a deliberate attempt/act on part of the taxpayer to conceal this amount from levy of tax thus attracting the provisions of 192 of the Income Tax Ordinance, 2001, agency said. Apart from huge unexplained credits of the complaint, the taxpayer without any doubt has intentionally and dishonestly concealed the following amounts in his wealth statements as on 30-06-2010, 30-06-2011, 30-06-2012, 30-06-2013 & 30-06-2014: Undisclosed balance in bank accounts Rs 257,693,902 and investment in 96 undisclosed plots in Rs 61,256,500 Housing Scheme, Rawalpindi. Total comes to Rs 318, 950,402.
The investigation has thus established the involvement of the accused in concealing the true particulars of his income/assets and verification of false documents, directorate of intelligence IR added. The directorate said that section 192 of the Income Tax Ordinance, 2001 states that "Any person who makes a statement in any verification in any return or other document furnished under the Ordinance, which is false and which the person knows or believes to be false, or does not believe to be true, the person shall commit an offence punishable on conviction with a fine up to hundred thousand rupees or imprisonment for a term not exceeding three years, or both."
It is established beyond shadow of doubt that the person verified false document (wealth statement and returns of income) by concealing the true particulars including bank accounts, closing balance in the accounts and value of the property in Housing Scheme, Rawalpindi.
The directorate has submitted complaint under Section 203(1) of the Income Tax Ordinance, 2001 for trial by the court under Section 203 read with section 192 of the Income Tax Ordinance, 2001. The court is empowered to try offences punishable under different provisions of the Income Tax Ordinance, 2001. The undersigned is competent under the Income Tax Ordinance, 2001 read with SRO 115(l) 2015 dated 09.02.2015 to file this complaint.
The directorate may also be allowed to add/alter any ground during the course of hearing/process of prosecution proceedings against the accused, DG I&I IR added. The second case is related to the concealment of assets owned by the offender and furnishing inaccurate particulars of assets in the statement filed u/s 116 of the Income Tax Ordinance, 2001 and making false declaration and verification on form prescribed for statement u/s 116 of the said Ordinance.
Brief facts of the case are that the proprietor of a School, Islamabad, the accused is an existing taxpayer. The accused has filed returns of income for tax years 2010, 2011, 2012 and 2013 u/s 114 of the Income Tax Ordinance, 2001 and declared net income of Rs 463,739, Rs 1,295,936, Rs 1,755,634 and Rs 3,731,278 respectively.
The accused has filed wealth statements u/s 116 of the Income Tax Ordinance, 2001 for the years ending on 30.06.2010,30.06.2011, 30.06.2012 and 30.06.2013 declaring net wealth of Rs 16,265,000, Rs 18,572,888, Rs 19,040,000 and Rs 22,150,000, respectively. During the course of investigation, analysis of taxpayer's record available with integrated tax management system (ITMS) and information obtained through third party sources, including scrutiny of various bank accounts, it has been established that the taxpayer has furnished inaccurate particulars and also suppressed material facts required to be disclosed under the law in her wealth statement u/s 116 of the Income Tax Ordinance, 2001 verified by her to be true. She has thus made misstatement and concealment of facts which warrants prosecution Proceedings as envisaged in sections 192 of the Income Tax Ordinance, 2001.
The taxpayer has concealed crucial information and receipts in her returns of income to evade taxes. This office obtained complete bank statements in respect of taxpayer's bank accounts and found that the following bank accounts have not declared by the taxpayer. Credit entries in bank accounts are found to be extraordinary and do not commensurate with the declared business receipts of the taxpayer.
The agency said that the taxpayer has declared the value of property at Plot No 15, Diplomatic Enclave, Islamabad, in her wealth statements at Rs 90,000,000. However, a copy of the actual sale dead of the said property has been obtained which reveals that the actual purchase price of the said property has been misdeclared by the taxpayer in as much as the sale deed executed between the sellers and the accused purchaser, ie, the taxpayer.
The taxpayer has thus suppressed/understated the value of the said property vis-à-vis the actual transaction, as under. It is thus clearly established that the taxpayer has wilfully declared inaccurate value of her actual investment in purchase of the said property and verified false statement attracting the provisions of section 192 of the Income Tax Ordinance, 2001, directorate said.
It is beyond shadow of doubt that the person verified false document (wealth statement and return of income) by concealing true particulars including bank accounts, and actual value of the property in diplomatic enclave. In view of the above, the complaint is submitted under Section 203(1) of the Income Tax Ordinance, 2001 for trial by the court under Section 203 read with section 192 of the Income Tax Ordinance, 2001. The court is empowered to try offences punishable under different provisions of the Income Tax Ordinance, 2001. The undersigned is competent under the Income Tax Ordinance, 2001 read with SRO 115(l) 2015 dated 09.02.2015 to file this complaint.
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