LTU issues show-cause notices: PIA asked to make payment or face legal action

Problems for a cash-starved Pakistan International Airline (PIA) are further aggravated as Large Taxpayers Unit (LTU), Karachi, has given final admonitory to pay over Rs 1.7 billion dues till 11am of September 30, 2015 (today) to avoid a legal action; it was learnt here on Tuesday.
According to sources, LTU, Karachi has issued show-cause notices to the Chief Financial Officer (CFO) and Deputy General Manager Fund (DGMF) of the national flag carrier. The large tax collecting arm of Federal Board of Revenue (FBR) is of the view that CFO and DGMF have collected Federal Excise Duty (FED) from passengers on international air travel for the tax periods March, April and May, 2015.
The FED collected from the passengers for the said tax periods (Rs 742.29 million in March, Rs 557.82 million in April and Rs 492.95 million in May) was required to be deposited by these officers till 15th day of July, August and September, respectively as per a decision made by the Economic Co-ordination Committee (ECC). Sources said these PIA officers had given undertakings in writing to the tax department that all aforementioned defaulted amounts would be paid by September 29, 2015. However, they have failed to pay off the said liability by the deadline. They said that LTU, Karachi also alleged the PIA for using the said FED collection for other purpose instead of depositing the same into kitty.
Moreover sources said that LTU, Karachi, had deemed the said failure from these officers as a offense under section 19(3) C read with section 19(7) of the Federal Excise Act 2005, attracting a penalty of five times of duty involved or punishment with imprisonment which may extent to five years or both. Sources said that these officers were directed through show-cause notices to produce the proof of payment of said dues till 11am of September 30, 2015 and if not, a strict legal action would be taken against both officers.
When contacted PIA spokesman Aamir Memon said that airline management had requested LTU, Karachi, to allow two more days for making the payment but they had issued show-cause notices. He said that management was looking into the matter and this issue would be resolve amicably.