Law: Sales Tax Rules, 2006

Section: 11

Law: Federal Tax Ombudsman Ordinance, 2000

Section: 2(3),9(1),10

Sales Tax Rules, 2006- -R. 11-Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), Ss. 10, 9(1) & 2(3)-Jurisdiction, functions and powers of the Federal Tax Ombudsman-Own motion complaint- Maladministration-Bogus sales tax refunds -Own motion complaint against maladministration committed by Department and its officials in issuing bogus sales tax refund-Federal Tax Ombudsman observed that except backlisting the registered person, Department failed to initiate any proceedings to verify genuineness of input tax or locate the registered person, which was tantamount to maladministration- Federal Tax Ombudsman recommended to the Department to direct concerned commissioner to conduct timely investigative audit to identify the officials involved in registration of fake registered person and initiate criminal and disciplinary action against the same-Complaint was disposed of, accordingly. FINDINGS/RECOMMENDATIONS MUSHTAQ AHMAD SUKHERA, FEDERAL TAX OMBUDSMAN:---.--- This is an own motion investigation initiated while exercising powers conferred under Section 9(1) of the Federal Tax Ombudsman Ordinance, 2000 to investigate irregularities committed by the FBR field formations in processing and sanctioning of bogus sales tax refunds during the period 2011-14 identified by Directorate General I&I 1R of FBR. The Red Alerts in such case were issued to the field formations concerned but neither any action was initiated against the fake claimants and their connivers in the Deptt, who were involved in bogus registration, processing and sanctioning of fraudulent refund and issuance of refund cheques, nor was any action proposed against the related officers/officials of bank branches concerned and PRAL management. 2. In the case of Messrs Saif Enterprises STRN 1700402015712, Registered Person (RP) got registered with business activity as other personal service activities N.E.C the investigation conducted by I&I-IR, Karachi revealed that the RP had filed refund claim for the tax period March 2013 of Rs.0.899 million and claimed input from Messrs Al- Mezan Iron and Steel having STRN 1700085745914 which in turn claimed input from Messrs Shaikh Traders…

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