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February 19, 2016
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AGP raises Rs257m audit objections against excise dept

Lahore

February 19, 2016

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LAHORE

Auditor General of Pakistan (AGP) raised audit objection of worth rupees 257.412 million against Punjab Excise and Taxation Department in its report for the year of 2014-15 which was presented on Thursday in Punjab Assembly. 

As per the audit report, 18 Audit PARAS highlighted the missing arrears of rupees 257.412 million and the matters regarding the said amount were reported to Principal Accounting Officers concerned but no satisfactory replies were furnished.

As per the audit Para 3 (3) of the Presidential Order No 13 of 1979 dated August 1979, 15 per share of net proceeds of house tax collected by a Cantonment Board within its is payable to the Provincial government concerned. During Audit of three Excise and Taxation officers including ETO-I Multan, ETP Property Tax Multan and ETO Jhelum for the period up to 2013-14, it was observed that provincial government’s share of house tax Cantonment Boards was not realised.

Audit was of the view that negligence e on the part of management resulted in non recovery of provincial government’s share house tax which was Rs. 89.59 million.

During audit of Excise and Taxation Department, it was observed that 57 Excise officer neither recovered property tax in 7,764 cases nor took appropriate steps to recover the outstanding government revenue causing accumulation of arrears of proper tax up to 30-06-2014. 

As per the audit, ineffective recovery mechanism and weak management controls resulted in non-short recovery of arrears of property tax 48.59 million rupees. 

Another audit Para stated in the report that the audit of 48 Excise officers for the period up to 2013-14 revealed that contrary to above provisions, property tax on properties of certain autonomous bodies such as Wapda, PTCL, art councils, development authorities, market committees, banking companies was not collected.

It was observed that annual rental values was assessed and enfettered in the tax demand and recipes register but demand notices were not issued indicating weak supervisory controls of and recovery mechanism.

The excise officers’ negligence resulted in non-recovery f 24.18 million rupees of property tax. 

Furthermore, 35 excise officers did not recover the professional tax in 2,375 cases. Further neither the demand was raised nor notices were issued to lawyers for recovery of profession tax and it resulted in non recovery of profession tax which was 16.97 million. 

Similarly, 20 excise officers allowed exemptions in 98 cases without fulfilling the requisite formalities which resulted in non recovery of 14.17 million.

The no-recovery of 13.48 million rupees was in head of hotel tax collection while the negligence on the part of excise management related to expiry stay order of property tax resulted in non recovery of property tax which was 11.53 million.

Unauthentic exemptions granted to widows for property tax by the excise officers which resulted in non-recovery of 8.77 million rupees. While recovery mechanism of token tax from motor vehicle was weak which resulted in 7.49 million rupees. Cotton fee, 7.28 million, income tax on commercial vehicles Rs 6.51 million, loss of property tax due to non-consolidation of property tax Rs 2.49 million, short realisation of property tax due to miscalculation of Rs 2.48 million, property tax relating to 5-marla houses 2.24 million rupees, non carrying forward of arrears of property tax 2.17 million, irregular exemption to 5-marla houses Rs 1.25 million, unlawfully allotments 0.5 million and permit fee Rs. 0.212 million rupees. 

All audit Paras were reported to the respective formations as well as to the Principals Accounting Officers concerned from February to December 2014 but no satisfactory replies were furnished by the Excise and Taxation Department, Punjab. The audit recommends that the department should strengthen its internal controls fix the responsibilities and made necessary measures to recover the pending arrears. 

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