2020 PLP 1388 (PTD)
N/A
| Citation | 2020 PLP 1388 (PTD) |
| Forum / Court | Federal Tax Ombudsman |
| Bench Members | Mushtaq Ahmad Sukhera, Federal Tax Ombudsman |
| Parties | N/A |
| Primary Law | Sales Tax Act (VII of 1990) |
Q1: What are the key laws and sections cited in 2020 PLP 1388 (PTD)?
This judgment primarily cites: Sales Tax Act (VII of 1990) as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2020 PLP 1388 (PTD)?
The case was heard and decided by the Federal Tax Ombudsman bench comprising: Mushtaq Ahmad Sukhera, Federal Tax Ombudsman.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2020 PLP 1388 (PTD) (N/A). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Headnotes / Summary
S.21
Sales Tax Rules, 2006, R.11
Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), Ss.10, 9(1) & 2(3)
Jurisdiction, functions and powers of the Federal Tax Ombudsman
Bogus sales tax refunds
Own motion complaint against maladministration committed by Department and its officials in field formations, in processing and sanctioning of bogus sales tax refund
Contention of Department, inter alia, was that after issuance of red alert, proceedings under S.21(2) of Sales Tax Act, 1990 were initiated and registration of taxpayer was suspended, and said taxpayer was backlisted
Matter was promptly attended to by Department upon receipt of red alert, therefore no case of maladministration could be attributed to Department
Complaint was closed, in circumstances. Syed Ayaz Mahmood, Advisor Dealing Officer. Shahid Ahmed, Advisor Appraisal Officer.
Judgment & Decree
FINDINGS MUSHTAQ AHMAD SUKHERA, FEDERAL TAX OMBUDSMAN.
This is an own motion investigation initiated while exercising powers conferred under Section 9(1) of the Federal Tax Ombudsman Ordinance, 2000 to investigate irregularities committed by the FBR field formations in processing and sanctioning of bogus sales tax refunds during the period 2011-14 identified by Directorate General I&I IR of FBR. The Red Alerts in such cases were issued to the field formations concerned but neither any action was initiated against the fake claimants and their connivers in the Deptt, who were involved in bogus registration; processing and sanctioning of fraudulent refund and issuance of refund cheques, nor was any action proposed against the related officers/officials of bank branches concerned and PRAL management.
2. In the case of M/s Sajida Enterprises STRN 170039248619, a Registered Person (RP) engaged in the manufacturing of paper and paperboard, the investigation conducted by I&I-IR Karachi, revealed that: i) the RP was registered on 12.03.2012 and filed refund claim of Rs. 4.082 million for the tax period March 2012; and ii) the input tax claimed by the RP from Messrs Sajjad and Brothers and M/s Knit Corn for the tax period March 2012 was bogus and the refund created on this basis was also fake.
3. Thus, Red Alert was accordingly issued by the Directorate of I&I-IR Karachi vide letter dated 16.06.2012 for verification whether registration requirements was fulfilled and initiating statutory proceedings against the RP for claiming bogus refund.
4. Comments of the Secretary, Revenue Division, Islamabad were sought in terms of Section 10(4) of the FTO Ordinance read with Section 9(1) of the Federal Ombudsmen Institutional Reforms Act, 2013. In response thereto, the Commissioner-IR, Zone-IV, RTO-II: Karachi submitted para-wise comments vide letter dated 30.12.2019. It was contended that proceedings under section 21(2) of the Sales Tax Act, 2012 were initiated and the RP was suspended vide order dated 18.09.2012 and subsequently blacklisted on 03.07.2013. It was further informed that the Deptt. did not process the refund claim filed by the RP for the tax period March, 2012.
5. Averments of the Deptt. considered and case record perused.
6. It is noted that the Directorate was of the view that entire input claimed by the RP during the month of March 2012 from Messrs Sajjad and Brothers and Messrs Knit Com International was bogus. From the perusal of the tax profile of the RP, it emerged the no refund was processed by the Deptt.
7. In view of supra, as the matter was promptly attended by the Deptt. upon receipt of the Red Alert no maladministration can be attributed to the Deptt. The investigation is accordingly, closed. File be consigned to record. KMZ/34/FTO Order accordingly.