Karachi fire in 1989: PAC tells FBR to recover over Rs 50 million taxes in a week

The sub-committee of Public Accounts Committee (PAC) on Tuesday directed Federal Board of Revenue (FBR) to recover Rs 50,229,045 taxes, forming a fact-finding team on the fire incident of bonded goods at Karachi in 1989 within a week. The sub-committee, which met here with its convener Yasmeen Rehman in the chair, discussed the audit report of revenue receipts (indirect taxes) 1989-90.
The committee expressed concern over the non-compliance of PAC directives and directed FBR to fix responsibility on this laxity. According to audit paras, a large consignment of non-duty paid over stored goods were burnt in a public bonded warehouse run by the Collectorate of Customs Karachi (Appraisement) in a fire incident on September 9, 1989.
The audit report pointed out that despite expiry of one year neither any survey was conducted nor government taxes of Rs 67,229,045 were paid by the bonder or insurance company as the over storage of goods was the one of the cause of this fire and resultant loss. The FBR in a departmental reply to the committee said that an amount of Rs 17,000,000 has been recovered on December 2008, while M/s Sterling Insurance Company was declared defaulter.
The company went into litigation on the recovery action of the balance government dues, it added. The committee directed the FBR to recover the remaining amount of Rs 50,229,045 within a week, besides fixing responsibility on the officials for not pursuing the case and the insurance company for its negligence in paying the due public money.
The audit was taken aback that despite clear cut directives by the then PAC in 1990, the concerned FBR officials did bother to take any action against those responsible for this laxity, but no response was given to the audit pertaining to the action when pointed out. The sub-committee also referred the case to the implementation and monitoring committee of the PAC and refused to settle the para, directing FBR to expedite the matter for recovery of the balance amount of Rs 50,229,045 from the concerned insurer or bonded warehouses.