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Tag: Federal Tax Ombudsman

  • FTO directs probe into benami transactions by Millat Tractors

    FTO directs probe into benami transactions by Millat Tractors

    ISLAMABAD: Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) to launch probe into huge benami transactions made by M/s. Millat Tractors Limited (MTL).

    The FTO, in a case against Millat Tractors for making supplies on fake and flying invoices and obtaining refunds on such invoices, asked the FBR to direct Director General Anti-Benami Initiative to probe the incidence of Benami transactions in tractors manufacturing sector.

    According to the findings of the FTO, the evident from contents of the complaints, the bookings of tractors are made by commercial dealers who themselves are not the growers/farmers rather they are only carrying on the purchase and sales of tractors for profit/commission motive.

    READ MORE: FTO directs country-wide crackdown against smuggled vehicles

    “Tractors purchased in this manner are invoiced in the names of unrelated persons and mostly used for purposes other than agriculture i.e. industry, trolleying bricks & construction material, digging of land (housing societies), cleaning of garbage etc. so refund in such cases is inadmissible.

    “Thus most of the sales tax invoices are issued in the names of benami farmers/dummy growers. This scenario is perfect benami arrangement which has already been prohibited under Benami (Transactions) Prohibition Act, 2017.”

    According to the complaint the complainant highlighted that he had booked 1001 agriculture tractors from MTL on 21-06-2022, paying in advance full consideration amounting to Rs.1,252,851,600/-including 5 per cent sales tax (under serial number 25 of the 8th Schedule of the Sales Tax Act, 1990), through ninety-one (91) pay orders.

    However, MTL only delivered 47 tractors to the complainant in the month of June 2022 and failed to deliver the remaining 954 tractors even after expiry of 60 days.

    The complainant said MTL is involved in various bogus transactions like purchasing of fake invoices against which input tax is claimed by MTL, wherein, neither goods are physically exchanged nor payments are properly made from business accounts of genuine buyers in contravention of Section 73 of Sales Tax Act, 1990, resulting gigantic losses to national exchequer of billions of rupees with the connivance of FBR Officials. Thus the input tax claimed by MTL is also required to be probed by FBR through appropriate orders of Honourable FTO.

    READ MORE: FTO directs stop unlawful recovery from taxpayers’ bank accounts

    The FTO in its findings observed that following core issues need detailed deliberations:

    I. Sales Tax Invoicing under law vis-à-vis Pakistan’s Tractor Manufacturing Sector Invoicing is the cardinal concept in Pakistan’s Sales Tax regime. Section 2 (40) of Sales Tax Act, 1990 defines that “tax invoice “means a document required to be issued under section 23; and section 23 further elaborates

    “23. Tax Invoices.–

    (1) A registered person making a taxable supply shall issue a serially numbered tax invoice at the time of supply of goods containing the following particulars, in

    Urdu or English language,] namely: –

    (a) name, address and registration number of the supplier; [

    (b) name, address and registration number of the recipient

    (c) date of issue of invoice;”

    A. The above definition clearly denotes two parties in a sales taxable transaction: Supplier and the Recipient i.e. buyer and the seller or the payer and payee. Thus a valid tax invoice must incorporate the ordained particulars of both parties. However when the instant complaint is analyzed, admittedly payer remains Shahzad Riaz, the complainant but as per invoices issued by MTL, 47 unrelated persons have been shown as the payers who have neither made the booking of tractors through the authorized dealer, nor made any payment, nor maintain any business relationship with the payer and nor owned by the real payer/complainant Shahzad Riaz.

    “The case appears to be classic example wherein goods are delivered to one person and invoices are issued to the other/dummy/fictitious persons.”

    Authorized representatives of MTL confirmed that like all other local tractor manufacturers MTL also book sale of tractors through authorized dealers and invoices are issued as per details of buyers provided by the said dealers.

    MTL’s stance that the dealer in question had obtained 47 CNICs from the complainant and submitted onwards to MTL is not only unsubstantiated it is against the legal provisions as well. When the payment through 91 pay orders made by the complainant is directly being received and credited to MTL’s A/Cs then there remains no ambiguity about the payer, especially when 47 tractors were delivered by MTL to the complainant. If for a while MTL’s argument that invoices are issued in the names of buyers whose CNICs are conveyed by the authorized dealers then the following issues may crop up;

    READ MORE: FTO investigates tax collection through electricity bills

    i. If the consideration is paid by one person and invoice is issued in the name of some other person and the real beneficiary remains the former; it tantamounts to a tailor made ” Benami Transaction”, cognizable under Benami (Transactions) Prohibition Act, 2017.

    ii. Such an arrangement would shield the true particulars of real payer/investor by portraying the made up particulars of an unrelated person whose CNIC has been misused to conceal the transactions made by the real payer. Investments made and profits earned by the beneficiaries thus remain concealed and untaxed.

    iii. Such an arrangement has neither any legal backing nor fits in the parameters of section 23 of ST Act, 1990.

    iv. MTL’s assertion that this practice is prevalent in the whole tractors manufacturing sector doesn’t carry weight if the practice in question is against the clear provisions of law and it only encourages benami transactions.

    v. The above referred scheme at the best conceals the true particulars of payers and at the worst aims at defrauding the national exchequer by camouflaging transactions made by commercial entities, persons in the garb of engineered purchases attributed to fake growers/farmers. On one hand it conceals commercial transactions made by non growers/farmers and on the others it paves the way for the filing, processing, sanctioning and issuance of bogus sales tax refunds by the tractor manufacturing companies.

    READ MORE: President Alvi rejects FBR plea in maladministration cases

    vi. MTL’s invoicing is plagued with serious flaws. Apart from the instant case in another under investigation case, (COMPLAINT NO.3858/SKT/IT/202, Dated: 29.08.2022 RO, Sialkot) the Complainant Abaid Ullah, P.O Ghondal Miani Awan, Tehsil & District Sialkot had booked a tractor on 03.06.2022 after making full and final consideration of Rs.1.953 million, inclusive of chargeable sales tax. When the Complainant approached MTL for delivery of tractor in July, 2022 the authorized dealer further demanded an amount of Rs.0.245 million quoting revised taxes on agricultural machinery w.e.f. 01.07.2022 and the Complainant had to deposit Rs.0.245 million. When the complaint was investigated by FTO Regional office Sialkot it was revealed that as the Sales Tax was waived for growers/farmers w.e.f. 1st July, 2022 therefore the sales invoice dated 22.07.2022 issued by the M/s. Millat Tractors Ltd. also reveals that no sales tax has been charged through said invoice and whole amount of Rs.2.198 million was accounted for price value of tractor. The questions which need to be explained by MTL are;

    — where has gone the sales tax charged at the time of booking; and why it was not declared & deposited by MTL while filing tax return for Tax period June, 2022;

    — how sales tax component was made part of the price finally charged;

    — why the authorized dealer has made alleged revised taxes as an excuse for additional charge when actually ST was waived in the cases of growers/farmers.

    The above referred case reveals another material fact that whenever any booking is made by a genuine grower/farmer through authorized dealers, the payment through banking instruments is made by the buyer/grower himself and invoice is issued in his own name. Such genuine instances are clearly distinguishable from the bulk of sales wherein payment is received from someone else and invoices are issued in the names of names lenders/benamidars.

    vii. Thus from the above discussions clearly indicate the “neglect, inattention, incompetence, inefficiency and ineptitude of tax authorities, who though claim to be conducting audits and monitoring of MTL yet thus far failed to unearth this patently illegal invoicing system, which is not only detrimental to the interest of revenue rather it it defeats the intent of legislation to facilitate small growers/farmers.

    II. Time of Supply

    Like tax invoices, time of supply is also an integral aspect of sales tax regime. Section 2 (44) of ST Act, 1990 duly defines “time of supply”, in relation to,–

    (a) a supply of goods, other than under hire purchase agreement, means the time at which the goods are delivered or made available to the recipient of the supply

    (b) a supply of goods under a hire purchase agreement, means the time at which the agreement is entered into; and

    (c) services, means the time at which the services are rendered or provided; Provided that in respect of sub clause ( a) ,(b) or (c), where any part payment is received, –

    (i) for the supply in a tax period, it shall be accounted for in the return for that tax period; and

    I. In the instant case though full price of 1001 tractors, inclusive of chargeable Sales Tax at that point of time was paid by the complainant in June, 2022, yet this transaction was not accounted for by MTL while filing the sales tax return for the month of June, 2022. When MTL was confronted on this account their AR’s 1st response was that time of supply is linked with delivery of goods and as booked tractors were not delivered therefore there was no need to declare the same in June 2022.

    But when enquired about non declaration 47 tractors in the return of June, 2022, which were admittedly delivered in the month of June, 2022, AR had no explanation to offer. Similarly though AR is of the view that time of supply is strictly linked with delivery of goods yet he couldn’t offer any plausible reason when the aforesaid proviso was referred which obligates

    “Provided that in respect of sub clause ( a) ,(b) or (c), where any part payment is received;

    (i) for the supply in a tax period, it shall be accounted for in the return for that tax period;.”

    According to AR this proviso is redundant in the face of main provisions of law but he failed to substantiate his assertion. His next argument was that the said proviso only covers cases where part payment is made: once again an over simplistic interpretation of law. If law is applicable on part payment, how would it ignore the incidence of full payment?

    II. Moreover the AR has failed to provide any explanation as to how and under which provision of law sales tax component of payment received by MTL can be retained by the supplier for an indefinite period and how sales tax paid by the buyer can be adjusted against price differential, if any by supplier on its own without disclosing this fact in the relevant sales tax return. Thus by non declaration of whole transaction and nonpayment of sales tax recovered against 1001 tractors from the payer/complainant MTL has contravened sales tax Act and LTO Lahore failed to take any suo moto cognizance of this glaring default.

    III. Departmental ineptitude can be judged from the fact that even when the department was informed (by sharing the complaint) that the respondent company has received advance payment amounting to Rs. 1,252,851,600/- including 5% sales tax from the complainant and was bound to declare this sales transaction in the tax period of June 2022, surprisingly, even after the receipt of this information the department failed to incorporate the definition of time of supply under section 2(44) of the Sales Tax Act, 1990 in the notice dated 16-08-2022, issued to MTL, specifically for the month of June 2022.

    Thus as per law the respondent company was bound to declare the sales against advance (received in full) for supply of tractors in the month of June 2022 but they failed to do so in violation of section 2(44) of the Sales Tax Act, 1990 read with section 3, 23, 26 and 73 of the Sales Tax Act, 19990. LTO Lahore failed to discharge its duties diligently in this regard.

    III. Payment of KIBOR plus 3%

    Regarding payment of KIBOR plus 3% for failure to deliver tractors within 60 days under SRO 837(I)/2020 dated 30-06-2020, it is evident that 1001 tractors were booked on 21.06.2022 against full payment including 5% sales tax though 91 pay order by the complainant and the respondent No. 1 was to deliver the same within 60-days of the booking but he only delivered 47 tractors to the complainant though authorized dealer of the respondent company. Revision of prices apart the violation of aforesaid SRO is evident.

    IV. Violations of SRO 363(I)/2012 dated 19th April 2012 and SRO 563(I)/2022 dated 29th April 2022

    These SROs are related to refund to agriculture tractors manufacturers and therefore, due diligence is required while issuing refund, but respondent No. 2 has also not been able to verify the genuineness/authenticity of supply chain under section 2(33A) of the Sales Tax Act, 1990 read with section 7, 8 and 73 of the Act, ibid.

    The FTO asked the FBR to direct Chief Commissioner Inland Revenue, LTO Lahore to conduct exhaustive review of the instant case so as to ensure that Section 2(4) and Section 23 of Sales Tax Act, 1990 and all relevant SROs governing tractor manufacturing sector are implemented.

  • FTO directs country-wide crackdown against smuggled vehicles

    FTO directs country-wide crackdown against smuggled vehicles

    ISLAMABAD: The Federal Tax Ombudsman (FTO) has directed tax authorities to launch country-wide crackdown against smuggled vehicles.

    (more…)
  • FTO directs stop unlawful recovery from taxpayers’ bank accounts

    FTO directs stop unlawful recovery from taxpayers’ bank accounts

    Federal Tax Ombudsman (FTO) has directed the tax authorities to stop unlawful recovery from bank accounts of taxpayers.

    The FTO issued the order dated September 30, 2022 in a complaint against non-issuance of refund amounting to Rs23.25 million for tax year 2016 along with compensation.

    READ MORE: FTO investigates tax collection through electricity bills

    According to the complainant, which is an Association of Person (AOP), filed return for tax year 2016. Later on, a tax office of the Federal Board of Revenue (FBR), amended the assessment order by making an addition of Rs1,754 million and rs164.21 million.

    Being aggrieved, the complainant filed appeal before the Commissioner (Appeals), Gujranwala who modified the order and annulled the addition of Rs164 million, with the directions that the unit office for further necessary verification and confirmed the addition of Rs1,754 million.

    READ MORE: President Alvi rejects FBR plea in maladministration cases

    The tax office, recovered an amount of Rs23.25 million through attachment of bank accounts on the very next day without passing appeal effect order. Statedly, recovery was also made from bank accounts of some un-concerned persons.

    The complainant filed appeal before appellate tribunal Lahore, who order granted stay order with certain observations.

    The FTO in its findings revealed that the recovery of Rs23.25 million had been made from the complainant AOP and certain other unconcerned whereas no demand was in the field at the time of making such recovery. “This act of department tantamount to maladministration.”

    READ MORE: FTO directs customs to clear pending auctions

    It is also found that recovery from the bank accounts of unconcerned person is also an act which tantamount to maladministration.

    The FTO in its recommendations to the FBR to ensure that an internal fact finding is conducted to see as who had recovered the amounts from bank account without giving appeal effect and without having legally recoverable tax demand on record.

    READ MORE: KTBA passes resolution against FTO Asif Jah

    FBR has been asked to issue clear directions to all field formations: forestalling unlawful recovery in the absence of any legally recoverable tax demand; and recovery from the accounts of unconcerned persons/entities.

  • FTO investigates tax collection through electricity bills

    FTO investigates tax collection through electricity bills

    KARACHI: The Federal Tax Ombudsman (FTO) has launched investigation in a complaint received regarding sales tax collection through electricity bills.

    The FTO Friday issued notices to Secretary, Revenue Division, Chief Commissioner and Commissioner Inland Revenue Large Taxpayers Office (LTO) Karachi, in the complaint filed by Mrs. Fauzia Salman against illegal and unlawful collection of taxes through electricity bills by K-Electric Limited.

    READ MORE: Withdrawal of sales tax through electricity bills demanded

    The FTO has ordered to conduct an investigation into the complaint.

    The tax office has been directed to submit reply to the allegation contained in the complaint by August 09, 2022.

    Previously, the complainant sent a letter to K-Electric, the power supply utility in Karachi, and forwarded to the chairman of Federal Board of Revenue (FBR), Federal Ombudsman, and chambers of commerce, Fauzia pointed out that her company had received monthly electricity bill, which included: further tax at 3 per cent; extra tax/retail tax at 5 per cent; and newly introduced sales tax on retailers at Rs6,000 being an inactive taxpayer.

    She claimed that the sales tax collection had been made in the bill for the month of July 2022 as her company was a legal service provider.

    READ MORE: Tax through electricity connections on retailers, service providers

    Furthermore, as per the record of the Federal Board of Revenue (FBR) the law firm is an active taxpayer as per requirement under Income Tax Ordinance, 2001.

    In her letter, she explained that Section 3(1A) of the Sales Tax Act, 1990 relates to further tax (leviable where taxable supplies are made to a person who has not obtained registration number), Section 3(5) of the Act relates to Extra Tax (The government may imposed extra tax in addition to tax levied under sub section (1), (2) & (4) of Section 3) and Section 3(9) relates to sales tax on retailers, before and after the amendments made through Finance Act, 2022, under the Sales Tax Act, 1990 are applicable on the persons who is/are dealing in retail business of the taxable goods/supplies and required to be registered under the Act, 1990 but did not registered himself /themselves in FBR for the said purpose.

    READ MORE: FBR explains income tax on export of services

    “Indeed, we [the law firm] are not dealing in supply /retail of taxable goods and as such you have wrongly levied and charged further tax u/s 3(1A), extra tax u/s 3(5) or 3(9) and retail tax u/s 3(9) of the Sales Tax Act, 1990 through the Electric Bills,” according to the letter.

    The law firm is only engaged in rendering of legal services on the subject premises, according to the letter.

    Under the Sales Tax Act, 1990, neither the company is required to be registered with FBR nor various sales tax through electric bills i.e., Further Tax, Extra Tax and Retail Sales Tax are applicable on it, being a “Service Provider”.

    Fauzia said that the K-Electric imposed the sales tax on the monthly bill on the basis of assumption that the commercial connection holder was a retailer.

    READ MORE: FBR restores 100% depreciation deduction

    “You [the K-Electric] have imposed two taxes under the single provision of law i.e., Section i.e., 3(9) of the Act, 1990 relying on prior and post amendment made in Section 3(9) of the Sales Tax Act 1990 through Finance Act, 2022 which cannot be permitted under the law to charge the taxpayer twice, even if it is applicable,” she pointed out towards important provisions of the law.

    The relevant amendment made through Finance Act, 2022 in Section 3(9) of the Act, 1990 is reproduced here as under:-

    Section 3(9),–

    (i) for the words “five per cent where the monthly bill amount does not exceed rupees twenty thousand and at the rate of seven and half percent where the monthly bill amount exceeds the aforesaid amount”, the words “rupees three thousand per month where the monthly bill amount does not exceed rupees thirty thousand, rupees five thousand per month where the monthly bill amount exceeds rupees thirty thousand but does not exceed rupees fifty thousand and rupees ten thousand per month where the monthly bill amount exceeds rupees fifty thousand” shall be substituted;

    READ MORE: FBR notifies graduated tax rates on disposal of securities

    (ii) after sub-section (9), the following provisos shall be inserted, namely:–

    Provided that the above rates of tax shall be increased by one hundred percent if the name of the person is not appearing in the Active Taxpayers List issued by the Board under section 181A of the Income Tax Ordinance, 2001 on the date of issuance of monthly electricity bill:

    Provided further that the Board may through a general order prescribe any persons or class of person who shall pay upto rupees two hundred thousand per month through their monthly electricity bill.

    Despite having number of employees who are engaged in monitoring of meter or recording of energy consumption from meter installed on the subject premises, the utility provider has blatantly charged such taxes without verification of status whether the consumers is/are liable to be charged for such taxes or not.

    It came to our knowledge from number of electricity consumers that the K Electric Limited has charged such taxes from all Commercial Consumers irrespective of their business status and FBR’s active taxpayer’s profile and treated all of them as “In-active Retailer of taxable goods” which cannot be justified or allowed under the Act, 1990.

    Such an act of M/s K Electric Limited comes within the meaning of mal-administration as defined under Section 3 of the Federal Tax Ombudsman Ordinance, 2000.

  • FTO directs customs to clear pending auctions

    FTO directs customs to clear pending auctions

    ISLAMABAD: The Federal Tax Ombudsman (FTO) has ordered the customs authorities to dispose of 8,522 pending auctions of goods and vehicles within two months.

    In pursuance of an own motion investigation, the FTO also directed the Member Customs to personally monitor the compliance of above directions and initiate disciplinary proceedings against the Collectors/Directors who fail to comply with the above directions.

    READ MORE: KTBA passes resolution against FTO Asif Jah

    Reportedly, the own motion investigations were initiated by the Federal Tax Ombudsman on the reports regarding large quantity of confiscated or otherwise uncleared goods and vehicles laying un-disposed at Customs formations all over the country, involving stuck up revenue of billions of rupees.

    The Customs Laws, Rules, Customs General Orders (CGOs) and instructions provide for expeditious disposal and auctions of such goods and vehicles, however, the Customs authorities are not disposing these goods and vehicles having tampered and non-tampered chassis numbers as required under the law.

    READ MORE: FPCCI suggests FTO should deal with adjudication cases

    The data pertaining to the un-disposed lots ripe for auction was collected for the analysis purposes by FTO which revealed that a total of 8522 lots are un-disposed and still pending in auction.

    The reason intimated by FBR, was that satisfactory bids have not been received against the reserve price fixed for these lots.

    So much so that at certain Customs Collectorates, the goods/vehicles have been offered for auction upto 40 times but still not disposed of. In addition to this alarming pendency in case of auctionable lots, other non-auctionable goods and cut & weld/tempered vehicles are also not being disposed of.

    READ MORE: FTO directs setting up quality Customs labs

    The above has resulted into non realization of huge government revenue and piling up of un-disposed goods ripe for auction at various Customs Warehouses across the country. FTO has directed the FBR to do away with the huge pendency of auctionable goods/vehicles within 60 days.

    Furthermore, Member Customs (Operations) is to personally monitor the above activity and disciplinary action to be initiated under E&D rules 2020 against the Collectors/Directors who fails to comply this direction.

    FTO also ordered Customs field offices to ensure that Collectors/Directors get the reserve price of the lots revised after every three consecutive auctions, if found undisposed and incorporation of provision to this effect under the Rule 58(2A) of the Customs Rules.

    READ MORE: FTO reconstitutes advisory committee

    FTO also ordered Chief (F&C) Customs to circulate the lists of tempered/ cut & weld vehicles to all other departments on monthly basis for allotment under the Customs procedures along with the inclusion of registered Philanthropic Organizations of good standing, for allocation of these vehicles in pursuance of their philanthropic activities.

  • KTBA passes resolution against FTO Asif Jah

    KTBA passes resolution against FTO Asif Jah

    KARACHI: The Karachi Tax Bar Association (KTBA) on Tuesday passed a resolution against the statement of Federal Tax Ombudsman (FTO) Dr. Asif Mahmood Jah.

    Following is the text of the resolution:

    Karachi Tax Bar Association (KTBA) expresses its deep disapproval and condemnation for recent jibes by the Federal Tax Ombudsman Pakistan (FTO), Dr. Asif Mahmood Jah. The statement made by the FTO lately televised on electronic media / uploaded on social media is offensive towards the taxpayers and manifests his nepotism and biased approach in the discharge of his official duties.  The arbitrary and belligerent statement by the FTO is not only contrary to his oath prescribed in Schedule via Section 3(2) of Federal Tax Ombudsman Ordinance, 2000 read with Section 8 of Federal Ombudsmen Institutional Reforms Act, 2013 but also makes him guilty of misconduct that renders him incapable of holding public office anymore.

    The entire tax fraternity is in a fix over the rude and offensive remarks of Dr. Asif Mahmood Jah and demands his immediate resignation from the office of FTO.  Nonetheless, by way of this resolution, we ask the Hon’ble President of Pakistan to remove him from his office in the exercise of his powers vested U/s. 6(2) of FTO Ordinance, 2000 else a reference against him may be sent to Supreme Judicial Council under the recourse of Section 5 of FTO Institutional Reforms Act, 2013 immediately.

    We believe the statement has eroded the already depleting confidence of the taxpayers and the tax consultants in the office of Federal Tax Ombudsman which had bluntly been submissive towards the Department and have shied away for not (i) allowing a stay of recovery/injunctions to the complainants: Section 10 and 11; (ii) avoiding defiance proceeding against tax collectors: Section 12; and (iii) punish tax collectors for contempt: Section 16 and 12 ibid for obvious reasons.

    On a final note, the KTBA urges the Federal Law Ministry that rules may be prescribed to desist induction of the retired FBR officials in the official of Federal Tax Ombudsman for the sake of transparency and propriety.

    FTO directs setting up quality Customs labs
  • FPCCI suggests FTO should deal with adjudication cases

    FPCCI suggests FTO should deal with adjudication cases

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has suggested that the cases of tax adjudication should be handled by the Federal Tax Ombudsman (FTO).

    The suggestion has been made to make adjudication more fair, neutral, transparent, and competent resolution.

    According to a statement issued on Wednesday, the FPCCI President Mian Nasser Hyatt Maggo presented the suggestion while speaking on the occasion of Dr. Asif Mahmood Jah, FTO Pakistan, visit to FPCCI Head Office in Karachi.

    He said that FPCCI appreciates FTO’s recent notice and report on the misuse of powers by the officials of the Federal Board of Revenue (FBR) in issuing fake notices and accessing the bank accounts of the taxpayers unnecessarily.

    Maggo apprised the audience that it has been FPCCI’s longstanding demand to have a well-reputed, fearless, competent, and senior officer appointed as FTO Pakistan.

    Highlighting the major issues with income tax cases, FPCCI President said that discrimination, delay, injustice, non-transparency and non-payment of refunds are plaguing the taxation system of the country and that is the reason FPCCI recommends sweeping reforms in the system.

    Hanif Lakhany, Vice President FPCCI, said that the business community is, for the first time, feeling secure and protected against the tax and customs officials’ harassment and highhandedness; due to the fair redressal by the office of FTO. He also thanked the government for having the right man for the right job.

    Nasir Khan, Vice President FPCCI, expressed his satisfaction over the performance of the office of FTO; but, maintained that the tax and customs authorities use time-delay and procrastinating tactics to avoid swift redressal of the issues of business, industry and trade community. In order to resolve these grievances, FTO should be given the authority to reprimand and punish corrupt officers.

    FTO Dr. Asif Mahmood Jah apprised the audiences on the mandate and the performance of the Federal Tax Ombudsman.

    He said that 90% of the complaints by the business community go in their favor on average. The complainants have the option of appealing to FTO or of even filing a representation with the constitutional office of the President of the Islamic Republic of Pakistan.

    Dr. Asif Mahmood Jah added that FTO can not directly reprimand the tax and customs officials; but, he can make his observations on misuse of powers, maladministration, anomalies, harassment and corruption; and, those are taken seriously.

    Another limitation of the FTO is that we can not take up cases that have been already taken up by any court of law and are subjudice. Explaining the other functions of the institution of FTO, Dr. Jah said that inspections, own-motion actions and research are also mandated.

    Dr. Asif Mahmood Jah also stated that he wants to expedite the turnaround time for the resolution of complaints from 60 days to 60 hours. He also agreed to FPCCI’s demand of setting up help desks at FPCCI offices in Karachi, Lahore and Islamabad.

    Direct tea import from Tanzania to reduce prices: FPCCI
  • FTO directs setting up quality Customs labs

    FTO directs setting up quality Customs labs

    ISLAMABAD: Federal Tax Ombudsman (FTO) has directed the tax authorities to expedite setting up Customs laboratories at collectorates.

    In its recommendations, the FTO office directed the Federal Board of Revenue (FBR) to expedite the task of setting up of customs laboratories in the remaining customs collectorates and upgradation of existing customs labs as per international best practices.

    The FBR has also been advised to assign administrative control to Member (Customs) to save the lab officials from local pressures.

    The FTO made this recommendations in an own motion investigation initiative to investigate systemic maladministration of the Customs Administration for failing to establish customs laboratories in the Customs Collectorates as per World Customs Organization (WCO) guidelines, besides failure to upgrade the existing customs lab functioning at MCC Karachi, Lahore and Faisalabad.

    Absence of quality laboratory facilities not only compromise collection of legitimate due government revenue but also put at risk import/export controls, environmental protection, control of dangerous goods.

    The FBR responded to the FTO notice that the existing Customs lab at Karachi had been upgraded and more than 95 per cent of items, such as textile fabrics, yarn, chemicals, dyes, petroleum hydrocarbons, pharmaceutical materials and metals etc. are conducted there. “Few samples were, however, forwarded to other labs, like HEJ Research Institute of Chemistry and PCSIR…”

    Crux of the investigation is that necessary actions have been initiated by the FBR, after initiation of the investigation, through constituting a committee on June 16, 2021, to examine the proposals for setting up modern Customs labs in the remaining Customs Collectorates as well as upgrading the existing labs as per the best international practices.

    FTO reconstitutes advisory committee
  • FTO reconstitutes advisory committee

    FTO reconstitutes advisory committee

    ISLAMABAD: Federal Tax Ombudsman (FTO) has reconstituted the advisory committee (South) for the year 2021.

    The Federal Tax Ombudsman is pleased to reconstitute the Advisory Committee (South) for the year 2021, as follows:-

    1. Dr. Asif Mahmood Jah, Federal Tax Ombudsman : Chairman

    2. The President Federation of Pakistan Chamber of Commerce & Industry, Federation House, Main Clifton, Block-5, Abdullah Shah Ghazi Road, Karachi : Member

    3. The President, Karachi Chamber of Commerce and Industry, Aiwan-E-Tijarat Road, Off: Shahrah-e-Liaquat, P.O.Box No. 4138 Karachi : Member

    4. The President Women Chamber of Commerce & Industry, Karachi South #4, Plot # 1-C, Lane # 2sehar Commercial Area Phase-VII, D.H.A. Karachi : Member

    5. The Chief Executive, Karachi Women Chamber of Commerce & Industry, District East Plot #391, Block # 3, 6th Floor office # 604, Al Reef Tower, Salamgir Road Karachi

    6. The President, The American Business Council of Pakitan 155-C 4th Floor Almurtaza Commercial Lane – 2 DHA Phase 8-A Karachi : Member

    7. The President, Overseas Investors Chamber of Commerce & Industry Chamber of Commerce Building, Talpur Road Karachi : Member

    8. Chairman, Air Cargo Agents Association Of Pakistan, suite No. 305, 3rd Floor, Fortune Centre, 45-A, Block 6, P.E.C.H.S., Sharah-e-Faisal, Karachi : Member

    9. Chairman, All Pakistan Fruit & Vegetables Exporters, Importers & Merchants Association House No. 175, C.P. Berar Society block 7/8 Karachi : Member

    10. Chairman Customs Agents Association Room No. 7/8, Bombay Plaza Mezzanine Floor, Bohri Road Opp. New Custom House, Karachi : Member

    11. Chairman All Pakistan Shipping Association Room No. 712, 7th Floor, Business Centre, Mumtaz Hassan Road Karachi : Member

    12. Chairman, Pak Readymade Garments Manufacturers & Exporters Association 3rd Floor, Plot # 57-C 24th Commercial Street Phase II (Ext), D.H.A. Karachi : Member

    13. The Chairman, Pakistan Bedwear Exporters Association 245-1V, Block 6, P.E.C.H.S. Karachi : Member

    14. The Chairman, Pakistan Leather Garments Manufacturers & Exporters Association, St # 20, Central Avenue, Sector, 7/A Korangi Industrial Area, Karachi : Member

    15. The President, Karachi Tax Bar Association, Strachan Road, Saddar Karachi : Member

    16. The President, Sukkur Chamber of Commerce & Industry 1st Floor, Sukkur Chamber House, Bunder Road Sukkur : Member

    17. President Hyderabad Chamber of Small Traders and Small Industry Naz & Bilal, Shopping Mall 41/499/1, Mezzanine Floor, Saddar Hyderabad : Member

    18. The President, Pak-Iran Joint Chamber of Commerce and Industry Jk Plaza, Plot No. 06 Zonki Ram Road, Tamir-e-Nau Masjid Quetta : Member

    19. The President, Chaman Chamber of Commerce & Industry Commerce House, Trunch Road, Chaman : Member

    20. The President, Gwadar Chamber of Commerce & Industry GCCI, Civic Center airport Road Gwadar : Member

    21. Chairman Pakistan Carpet Manufacturers & Exporters Association 23-D, Block # 6, P.E.C.H.S. Shahrah-E-Faisal Karachi : Member

    22. Chairman, Pakistan Chemicals & Dyes Merchants’ Association PCDMA House, Rambharti Street, Jodia Bazar Karachi : Member

    23. Chairman, Pakistan Waste Products Association, 7/12-A, Rimpa Plaza, M.A. Jinnah Road Karachi : Member

    24. Mr. Adnan Mufti, Chartered Accountant, Moore Sheikha Mufti, C-253, PECHS, Block-6, Karachi : Member

    25. Mr. Muhammad Ali, Sr. Reporter, Business Recorder, R-1367/15, Federal B. Area, Karachi : Member

    26. Mr. Asif Haroon, FCA, State Life Building No. 1-C, I.I, Chundrigar, City Railway Colony, Karachi : Member

    27. Mr. Shahnawaz Akhtar, Sr. Staff Correspondent, Bol News, Bol Headquarter, Bol Road, Karachi : Member

    28. Mr. Ashraf Khan, Sr. Correspondent, 24 News, DHA Phase 2 Ext, Karachi : Member

    29. Mr. Asif Inam, Chairman South Zone APTMA House, 44-A, Street No. 01, Molvi Tamizauddin Khan Road, Lalazar, Karachi : Member

    30. Chief (IR-Policy) – IR, FBR (HQ), Islamabad : Member

    31. Chief (ST-Operations) IR, FBR (HQ), Islamabad : Member

    32.  Chief (Tariff) –Customs, FBR (HQ), Islamabad : Member

    33. Mr. Shahid Ahmad, Advisor (Customs), FTO Secretariat, R.O. Karachi : Member

    34. Mr. Manzoor Hussain Memon, Advisor (Customs), FTO Secretariat, R.O. Karachi : Member

    35. Mr. Badruddin Ahmad Qureshi, Advisor, FTO Secretariat, R.O. Karachi : Member

    36. Justice (R) Muhammad Nadir Khan, Advisor Incharge, FTO Secretariat, R.O. Quetta : Member

    37. Mr. Manzoor Hussain Kureshi, Advisor Incharge, FTO Secretariat, Secretary Committee R.O. Karachi

    The Chairman of the Advisory Committee may co-opt any person for assistance of the Committee as per need.

    Due to budgetary constraints, the FTO Secretariat will not be able to bear the expenses relating to participation of the Members in the Advisory Committee Meetings.

    FTO’s prompt action helps release of stuck up tractors
  • FTO’s prompt action helps release of stuck up tractors

    FTO’s prompt action helps release of stuck up tractors

    The Federal Tax Ombudsman (FTO) has taken swift action in response to a complaint against customs authorities, addressing unnecessary delays in the clearance of a consignment. The complainant, a regular importer of Agricultural Tractors, reported that the customs authorities had unjustifiably halted the clearance of a shipment of tractors destined for use by farmers in the country.

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