Source of wealth concealed: buyer of expensive house faces probe

A buyer of a house worth Rs 232,119,250 in posh sector (F-6/1) Islamabad is facing investigations of Directorate General of Intelligence and Investigation Inland Revenue (IR) Islamabad for not explaining source of wealth in her declaration of wealth statement for Tax Year 2015.
Sources told Business Recorder here on Monday that the tax department will invoke provisions of section 111 of the Income Tax Ordinance 2001 to determine source of investment in purchase of expensive real estate property. Mrs Saeed has purchased a house in sector F-6/1. She has declared asset worth Rs 250,066,410, but source of wealth has not been explained. The I&I IR has detected huge investment of Rs 232,119,250 made by her in purchase of the house in the said sector during tax year 2015. On scrutiny of taxpayer's record, it was noticed that she had not filed returns of income and wealth statements for tax year 2015 declaring wealth of Rs 250,066,410. As such it is a case of unexplained wealth. Therefore, the agency has sent an investigation report to the Chief Commissioner IR RTO Islamabad with the recommendations to invoke section 111 of the Income Tax Ordinance 2001.
The agency said that taxpayer's Reconciliation of wealth filed is invalid as it shows total increase in wealth of Rs 250,066,410 whereas actual total wealth is Rs 243,426,230 and the reconciliation contains no details of inflows and sources of increase in wealth. Taxpayer has also claimed personal expenses of Rs 2,391,800. Hence Rs 245,818,030 stands un-explained as she has been declaring either no income or NIL income since TY-2011 therefore warranting action under section 111 of the Income Tax Ordinance 2001.
Sources added that the income tax returns and wealth statements along with reconciliation of wealth for the Tax Year 2011 and 2012 may be enforced. On the basis of the said facts, wealth statement along with reconciliation may be enforced in respect of the taxpayer. Explanation of sources of investment of Rs 243,426,230 and personal expenses of Rs 2,391,800 was sought from the taxpayer, they added.