| Case ID |
0f78b577-0c53-4791-9082-68b1de8fc393 |
| Body |
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| Case Number |
Complaint No.192/LHR/ST(48)/390 of 2012 |
| Decision Date |
Aug 23, 2012 |
| Hearing Date |
|
| Decision |
The Federal Tax Ombudsman, Dr. Muhammad Shoaib Suddle, found that there was significant complicity and collusion within the Federal Board of Revenue (FBR) regarding input tax credit fraud. The Ombudsman highlighted the ease with which dummy entities were registered due to inadequate pre-registration checks, allowing fraudulent practices to flourish. Recommendations included restructuring the FBR and its associated departments to create a more effective system for preventing tax fraud, employing high-quality professionals for investigations, and ensuring swift action against tax employees involved in fraudulent activities. The Ombudsman urged for timely implementation of these measures to protect innocent buyers from fraudulent schemes. |
| Summary |
The case revolves around a complaint filed by a tax consultant concerning rampant sales tax fraud in Pakistan, specifically regarding the fraudulent claiming of input tax credits based on fake invoices. The Federal Tax Ombudsman investigated the collusion of tax employees with external criminal elements, leading to substantial revenue losses for the government. The Ombudsman emphasized the need for a robust automated system within the Pakistan Revenue Automation Limited to prevent such fraud. The findings underscored a lack of effective checks and the need for immediate reforms in how tax fraud is managed within the country. The recommendations aimed to establish a proactive stance in combating tax fraud, including the formation of task forces and stringent measures against involved tax employees. The case highlights the ongoing issues within the tax system and the critical necessity for reform to safeguard public revenue and enhance taxpayer confidence. |
| Court |
Federal Tax Ombudsman
|
| Entities Involved |
Federal Board of Revenue,
Directorate of Intelligence and Investigation,
Pakistan Revenue Automation Limited
|
| Judges |
DR. MUHAMMAD SHOAIB SUDDLE
|
| Lawyers |
Muhammad Munir Qureshi
|
| Petitioners |
WAHEED SHAHZAD BUTT
|
| Respondents |
SECRETARY, REVENUE DIVISION, ISLAMABAD
|
| Citations |
2014 SLD 894,
2014 PTD 1424,
(2014) 109 TAX 12
|
| Other Citations |
Not available
|
| Laws Involved |
Sales Tax Act, 1990,
Federal Tax Ombudsman Ordinance, 2000
|
| Sections |
7,
9
|