Tax recovery: FTO orders probe against Lahore CTO officials over 'misconduct'

ISLAMABAD: The Federal Tax Ombudsman (FTO) has ordered an investigation against Corporate Tax Office, Lahore (CTO) tax employees allegedly involved in the recovery of taxes from government institutions without passing an order and communicating any enforceable tax demand to the taxpayer.

It is reliably learned that a taxpayer has approached the FTO through Waheed Shahzad Butt, advocate, against CTO tax employees CIR, Enforcement and Additional Commissioner for their joint move to recover non-existent tax demand from a government institution solely to meet the budgetary targets. When contacted, tax lawyer Butt told this correspondent that appropriate disciplinary and criminal proceedings may be initiated against the public office holders including the FBR officials responsible to cheat the FBR, taxpayers.

The tax officials are unduly harassing the taxpayers of the country under the garb of powers available with Inland Revenue Officers under the umbrella of IRS by issuing without lawful jurisdiction recovery notices, so much so without confronting any enforceable tax demand for Tax Year 2016, 2017, 2019, and 2020 to government institutions to rob/snatch bank guarantees through fake/fraud/bogus notices.

The petitioner accused that the tax employees must provide evidence of enforceable income tax demand against the complainant as at 27.04.2021 for up to tax year 2016 since inception, tax year 2017, 2019, and 2020.

In case of silence, criminal proceedings may be initiated against them.

The FTO notice states, The FTO has ordered to conduct an investigation of the said complaint. Now, therefore, you are required to submit reply to the allegations contained in the complaint.

Under Income Tax Law chargeable tax is determined under relevant provisions of law, demand is raised following normal procedure.

How taxpayer's Bank Guarantees lying with other Department can be released/encashed by tax department. Commissioner's specific comments may be obtained for transmission to this office.

While there was no tax recoverable/enforceable demand even for tax year 2018, how the Commissioner could issue the letter asking "to release bank guarantees from the date of inception to date" i.e., roping in amounts relatable to Tax Years 2016, 2017, 2019 and 2020.

The FTO further added, The allegation that Bilal Hassan, Additional Commissioner Enforcement's action to recover non-existent tax demand from Government Institution in compliance with the letter No CIR/Enf 3496 dated 27-04-2021, issued by his Commissioner tantamount to compliance of an illegal order. His comments may be obtained for transmission to this office.

Copyright Business Recorder, 2021