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August 15, 2020

FBR unearths huge sales tax evasion

National

August 15, 2020

ISLAMABAD: Federal Board of Revenue (FBR) chairman has issued directions to all the FBR field offices to expedite operation against tax evasion and play active role in stopping the menace of fake and flying invoices.

FBR Headquarters has further explained that all the people who are found involved in fake and flying invoices and causing tax evasion will be dealt with strictly in accordance with law. The organisation will also take prompt action against its own employees if found involved in crime.

While implementing the directions, the Directorate of Intelligence & Investigation (Inland Revenue), Faisalabad has arrested Syed Muhammad Azhar, owner of M/s Fazal Awais Textiles, Faisalabad for his involvement in tax fraud by way of issuing fake and flying invoices to a non-existing unit M/s Arrow International. The Directorate has unearthed a big sales tax evasion scam of issuing and adjusting fake and flying invoices involving tax fraud of millions of rupees.

Accordingly, tax fraud proceedings against the sales tax fraudsters have been initiated and the First Information Report (FIR) has been lodged against M/s Arrow International, its buyers, suppliers and other beneficiaries under section 37A of the Sales Tax Act, 1990. The investigation revealed that M/s Arrow International is a non-existent and dummy unit, which had been registered by the fraudsters for the purpose of issuance/adjusting fake/flying invoices and to facilitate buyers and suppliers to avoid payment of due sales tax, including further tax.

Moreover, 65 registered persons also declared fictitious purchasers to avoid the payment of due tax. These 65 registered persons have evaded further tax amounting to Rs134.453 million.

Given the facts, tax fraud case under section 37A read with section 2(37) of the Sales Tax Act 1990 has been registered against the firm M/s Arrow International, its buyers and suppliers and other beneficiaries involved in defrauding national exchequer from tax revenue of Rs134.453 million.

FBR has encouraged the people to come forward and reveal the identity of the people who are involved in causing tax evasion by using fake and flying invoices. FBR will grant reward to such whistle blowers under its Reward Rules. The names of the whistle blowers will be kept secret. The information can be given to the Director HQ I & I Inland Revenue on office number 0519260167 and fax number 0519260156.