The intelligence agency of the Federal Board of Revenue (FBR) has strongly proposed the Federal Board of Revenue (FBR) to establish dedicated Investigation & Prosecution Range (IPR) in each Large Taxpayer Unit (LTU) and Regional Tax Office (ERTO) for speedy processing of extraordinary tax fraud cases under the new Financial Investigation Monitoring system.
Sources told Business Recorder here on Monday that the Directorate General of Intelligence and Investigation Inland Revenue (IR) has made the said recommendation to ensure disposal of major tax evasion cases and concealment of income detected by the agency. A new Financial Investigation Monitoring system (FIMS) has also been proposed to keep record for each stage of big tax fraud cases to be processed by the Investigation & Prosecution Range (IPR).
It seems that the agency's cases have not been given due importance and weightage by the LTUs/RTOs forcing the directorate to propose establishing of IPR in each LTU/RTO. According to the agency's recommendations to the FBR, tax authorities are expected to approve a standard operating procedure for expeditious disposal & monitoring of cases reported by intelligence & investigation-IR. The rationale behind the idea is to find a modality which is an improvement in the existing system and which also does not impinge on the sensibilities of the business community as well as fulfils the organisational needs. It is also suggested to remove systemic glitches and bridge existing gaps through institutionalised, transparent and IT based interface between RTOs/LTUs and Directorate General of I&I.
Salient features of proposed SOP devised by the directorate of intelligence IR revealed that the tax evasion cases would continue to be selected for investigation as per the existing procedure. However, the contravention/Investigation Reports and information pertaining to cases thus selected shall be transmitted (along with supporting evidence) to the concerned RTOs/LTUs by the DG, I & I (IR).
For processing of all cases forwarded by I&I-IR, each RTO/LTU shall create a dedicated Investigation & Prosecution Range (IPR) headed by an officer of BS-19 within an existing Zone would be established. Sources said that an IPR would normally consist of 2 to 4 Audit Officers, one Enforcement Officer and one Legal Officer. Directorate General I&I-IR shall propose to the Chief Commissioner Inland Revenue (CCIR) concerned the names of 4-6 officers known for their integrity and professionalism for posting in the IPR and their notification shall be issued by the Chief Commissioner concerned.
Sources said that the IPRs shall work under their respective existing administrative hierarchies. However, for the purposes of performance 4 evaluation Director General I&I-IR and the Director I&I-IR concerned shall act as the second countersigning authority in case of officers of BS-19 and BS-18 respectively.
For implementation of the Financial Investigation Monitoring system, the jurisdiction over the cases reported by I&I-IR shall be assigned to the officers of IPR by the Chief Commissioner. All the cases shall be forwarded online using special application software to he designed & developed by PRAL in consultation with DC, I&I-IR. This software shall also ensure that the concerned Chief Commissioner /Commissioner, Directors I&I-IR, DG I&I-IR, Member-IR (OPS) and Chairman FBR shall have "View Only" access for monitoring on real time basis.
All the proceedings shall be recorded in FIMS which shall maintain record of each step in each case and generate report as per given timelines, sources said. Within 10 days of the receipt of case (s), IPRs shall communicate their views/reservations with supporting evidence/ arguments) if any, in case they disagree with, the findings of I&I-IR. After the expiry of 10 days time limit, it shall be presumed that IPRs are in agreement with the observations conveyed by I&I-IR In case of disagreement Director concerned shall write to the DC for further instructions. All the proceedings shall be recorded in FIMS which shall maintain record of each step in each case and generate report as per given timelines.
In case the reports forwarded by I&I-IR to IPRs result in litigation at an stage of the ensuring proceedings, joint teams of officers of I&I-IR and IPRs shall be constituted which shall vigorously pursue the legal proceedings on a regular basis. A domain team from DG I&I consisting of a Project Director shall assist Pakistan Revenue Automation Limited (PRAL) in the development of FIMS. Best practices emerging from the processing of cases through above mentioned mode shall be widely circulated & publicised. Similarly international best practices on combating tax evasion shall be circulated among all IPRs.