LAHORE: President Dr Arif Alvi has confirmed the prompt decision taken by Federal Tax Ombudsman (FTO) that the Federal Board of Revenue (FBR) has failed take timely action against non-filers/non-NTN holders, who concealed investment made in the purchase of expensive farm houses in Islamabad.
According to the details, an own motion investigation was initiated while exercising powers under Federal Tax Ombudsman ordinance, 2000 on account of neglect, inattention, delay incompetence and ineptitude of the FBR’s functionaries in the administration or discharge of duties and responsibilities in dealing with Investigation Report in the case of M/s Intelligence Bureau Employees Cooperative Housing Society (IBECH), Islamabad.
Brief background of the case is that during 2014, the Directorate of Intelligence & Investigation Inland Revenue (I&I-IR) had conducted a detailed investigation of M/s IBECH Islamabad in respect of booking expensive Farm Houses Farm Housing Scheme by various investors, NTN/Non-NTN holders.
The investigation report of the Directorate I&I-IR, besides having potential of detecting new taxpayers and unearthing huge revenue also contained prospective of checking levy and collection of Capital Value Tax (CVT) and implementation of tax withholding provisions under sections 236C and 236K of the Income Tax Ordinance 2001 (Ordinance).
The implementation status was checked and it was found that no action whatsoever was taken on investigation report by the Directorate General (DG), Broadening of Tax Base (BTB), FBR Islamabad. The FBR in the meanwhile designated Zones of BTB, whom the investigation report was shared afresh, for initiating appropriate action in accordance with law. The BTB Zones were however, suddenly dismantled during the year 2019, without giving any reason, as a result thereof, the such an invaluable data containing enormous revenue potential remained unutilized hence the whole exercise of Directorate I&I was lost in the FBR’s internal wasteland on account of neglect, inattention, delay, incompetence and ineptitude of the IR functionaries.
When Federal Tax Ombudsman sought Secretary Revenue Division’s comments, an interim report was provided to FTO identifying relevant 272 cases status of their declaration vis a vis actions/proceedings initiated under the law in the improperly cases. Moreover, data of remaining 323 cases was disseminated between the relevant LTO/CTO/RTO under the instructions of the FTO, officials maintained.
Finding delay, neglect, inattention, incompetence and ineptitude of FBR’s functionaries to timely utilizing information provided in the Directorate, I&I-IR’s investigation report-2014, the Federal Tax Ombudsman directed FBR to investigate and determine part of the official(s) in causing inordinate delay in utilizing important data provided in the Directorate I&I-IR’s investigation report, as per law.
FTO directed the Chief Commissioner’s-IR, other than Islamabad, Lahore and Sargodha, to complete the verification in respect of balance cases; book the ones not on NTN and probe investment in respect of the cases where either investment was not disclosed or if disclosed, is less than the actual investment; directed the Chief Commissioners-IR, Islamabad, Lahore and Sargodha to book the investors who are not on tax roll and also initiate proceedings in the case where the taxpayers have either not disclosed investment or in case the investment disclosed was less that actual, as per law. He also directed the Member (IT) FBR to develop a foolproof operational software, capturing
