Enforcement operation uncovers 12,600kg of raw tobacco and manufacturing equipment allegedly linked to tax evasion.
ISLAMABAD: The Federal Board of Revenue (FBR) has sealed a clandestine cigarette manufacturing unit in Chakwal and seized raw tobacco, unstamped cigarettes, manufacturing materials and machinery, with the overall economic impact of the operation estimated at Rs211 million.
The operation was carried out by teams of the FBR’s Intelligence & Investigation Directorate, Islamabad, in coordination with the Inland Revenue Enforcement Network. Acting on credible information, the teams raided the premises of Hunter Tobacco SMC Pvt. Ltd., located near Dharabi on Kallar Kahar Road in District Chakwal.
According to the FBR, the premises were being used for the clandestine manufacture of cigarettes without the mandatory tax stamps required under the Track & Trace System. The manufacturing unit was also not integrated with the Track & Trace System, despite such integration being mandatory for tobacco manufacturers.
During the raid, enforcement officials seized approximately 12,600 kilograms of raw tobacco, which the FBR estimated could have been used to manufacture around 630,000 packets of cigarettes.
The seized material also included filter rods, cigarette paper, aluminium foil, packaging material and other inputs used in cigarette manufacturing. The confiscated goods were shifted to a government warehouse, while the premises were subsequently sealed.
The FBR estimated that the operation prevented approximately Rs90 million in potential tax evasion that could have resulted from the sale of cigarettes manufactured from the seized tobacco.
The total estimated economic impact of Rs211 million also includes duties and taxes allegedly evaded on stock found at the premises, along with the value of machinery and other materials seized or sealed during the operation.
The tax authority said the manufacture and sale of cigarettes without payment of applicable duties and taxes, as well as failure to comply with the Track & Trace System, constitute serious violations of tax laws.
The FBR said further legal action and criminal proceedings against those allegedly involved in the illegal activity would be initiated after completion of the ongoing investigation and in accordance with the law.
The Board reiterated its commitment to intensifying enforcement against illicit tobacco manufacturing and other forms of tax evasion. It said such measures are aimed at protecting government revenue, curbing unlawful manufacturing and ensuring a level playing field for compliant taxpayers and legitimate businesses.