In a nutshell, the complainant files income tax returns declaring only salary-related income as a Deputy Secretary in the Ministry of Law and Justice.
In violation of the law, the Federal Board of Revenue (FBR) took action against a salaried person whose tax profile contained 23,800 fictitious entries for import declarations and withholding transactions.
The Federal Tax Ombudsman (FTO) has taken serious note of the situation and has instructed the Member (Information Technology) to fully investigate it. He has also mandated that the Directorate of General Intelligence and Investigation Inland Revenue conduct an IT audit of all fictitious transactions in order to determine the extent of revenue leakage and assign blame to the appropriate parties.
In a nutshell, the complainant files income tax returns declaring only salary-related income as a Deputy Secretary in the Ministry of Law and Justice.
According to reports, he found thousands of unknown entries in his tax profile. In fear, he contacted the Commissioner-IR, RTO Islamabad, but no response was received.
He had complained to the FTO about tampering with his tax profile, and his complaint was dismissed with the recommendation that he update his tax profile.The recommendation does not appear to have been followed, even after almost five years have passed.
According to an examination of the record provided by the complainant, there are roughly 23,800 fictitious entries in the complainant’s name, including import declarations and withholding transactions made in accordance with various provisions of the Ordinance. These were most likely caused by the test NTN 1234567-9 being assigned to the complainant.
Anyone could enter this test number and get away with it if they didn’t have an NTN or didn’t want to reveal their NTN. This situation is a blatant example of the systemic inefficiency and neglect of FBR and PRAL employees, which needs to be addressed.
In addition, the FTO has ordered the FBR Member-IR (Operations) to give instructions to all field formations on how to take legal action against withholding agents who have improperly used the complainant’s identity to recover underpaid taxes. These agents were found through a refereed investigative IT audit.
“The GM PRAL’s explanation for failing to address the situation, which was raised by this office and earlier by concerned IR field formation, and for failing to report compliance in 45 days,” the FTO continued.
According to the FTO order, “In light of the foregoing analysis, the neglect, inattention, incompetence, and ineptitude of the officers of FBR, particularly PRAL, is obvious and amounts to maladministration in accordance with Section 2(3)(ii) of the FTC Ordinance.”