Sui Southern accounts frozen on Rs23 bn tax default

KARACHI: The Federal Board of Revenue (FBR) has attached all bank accounts of the Sui Southern Gas Company Limited (SSGC) on sales tax default of Rs23 billion, which the gas company alleges was done without following the legal process.

The FBR’s Large Taxpayer Office (LTO), Karachi, said it has recovered Rs312 million so far. According to a notification released by LTO Karachi, the default amount of the sales tax has also been confirmed by the Appellate Commissioner (Appeals).

“Zone Enforcement-II, LTO, Karachi has made recovery possible through bank accounts attachment u/s 48 of the Sales Tax Act, 1990,” read the notification. However, SSGC said the LTO had issued a notice to the banks to collect the sales tax from the company without following the legal process and without waiting for the decision of the independent forum, which was the appellate tribunal.

The SSGC said it has filed a constitutional petition in the Sindh High Court (SHC) against the FBR, which has frozen its bank accounts. The company also claimed that the SHC has suspended the recovery notice of the LTO for lack of legal standards.

It added that the SHC has directed the SSGC to pursue the matter before the appellate tribunal. But the FBR spokesperson Asad Tahir Jappa said the decision to attach SSGC accounts was taken lawfully by the LTO, Karachi.

Last month, the FBR had also frozen Pakistan International Airlines (PIA) bank accounts over non-payment of federal excise duty (FED) on air tickets, but later restored them on the same day after it was assured of early payment of dues.

According to the apex revenue collector, PIA had to pay Rs4.5 billion in federal excise duty, which it has been charging its passengers on tickets for the last two years. SSGC’s share price showed a negligible increase of 0.1 percent at the end of the day, as compared to the last day's closing price.