Veracity of sales declarations: DGI&I IR probing bank accounts of some businesspersons

Directorate General Intelligence and Investigation Inland Revenue (IR) Federal Board of Revenue is carrying out an investigation into the bank accounts of certain businesspersons to determine whether their sales have been correctly declared in their income tax returns or not.
Sources told Business Recorder here on Saturday that the DG (I&I) IR is probing major credits and withdrawals from the bank accounts of some persons falling within the category of 'business individuals' to detect concealment of income and under-reporting of taxes using declared bank accounts information. The DG (I&I) IR is securitising the detailed bank statements of concerned persons to check their actual banking transactions. In these cases, there are debt and credit transactions involving huge amounts from the business bank accounts. The agency wanted to check whether the declared version of account details mentioned in their annual income tax returns match with the details available with banks.
The DG (I&I) IR is also examining their detailed bank account statements to verify the information declared in the sales tax or income tax returns, sources added. When contacted, a tax expert said that such kind of investigation would be valuable in cases where sales have been declared less than the credit entry in the bank statements. However, it would be a useless exercise where the sales declared are more than the credit entries in the bank statements. Therefore, the DG intelligence should only focus on those cases where the bank credit entries do not commensurate with the sales declared in the income tax returns or sales tax returns, tax expert added.
Recently, the DG (I&I) IR has informed the RTO Faisalabad that the agency has gathered valuable bank accounts information in respect of 2 individuals falling in the territorial jurisdiction of RTO Faisalabad. RTO Faisalabad may check the CNICs (available with the banks and given in the account opening forms) of each compliance and his tax status.
In case of existing taxpayer, RTO Faisalabad may also check whether their declared account details mentioned in their annual returns, reconcile with the details obtained from the bank, DG intelligence maintained. In the case of non-existing taxpayer, the RTO should initiate broadening the tax base (BTB) proceedings against the said two accountholders.
Detailed bank account statements along with account opening forms of the complainees may be requisitioned from the relevant Banks. Major credit/ withdrawal and transfer entries needs focused probe; such an action may lead to some concealed/undeclared bank account as well, the agency directed the RTO. Findings of the tax inquiry in the instant case may please be shared with this directorate, directive of the agency to the said RTO added.