FBR unearths Rs134.45m tax evasion; industrialist held

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ISLAMABAD: The Directorate of Intelligence & Investigation (Inland Revenue), Faisalabad, unearthed Rs134.453 million sales tax evasion and arrested an industrialist on Friday.
According to details, the directorate arrested Syed Muhammad Azhar, owner of M/s Fazal Awais Textiles, Faisalabad for his alleged involvement in tax fraud by way of issuing fake and flying invoices to a non-existing unit M/s Arrow International.

The directorate unearthed a big sales tax evasion scam of issuing and adjusting fake and flying invoices involving tax fraud of millions of rupees. Accordingly, tax fraud proceedings against the sales tax fraudsters have been initiated and the First Information Report (FIR) has been lodged against M/s Arrow International, its buyers, suppliers and other beneficiaries under section 37A of the Sales Tax Act, 1990.

The investigation revealed that M/s Arrow International is a non-existent and dummy unit, which had been registered by the fraudsters for the purpose of issuance/adjusting fake/flying invoices and to facilitate buyers and suppliers to avoid payment of due sales tax, including further tax.

Moreover, 65 registered persons also declared fictitious purchases to avoid the payment of due tax. These 65 registered persons have evaded further tax amounting to Rs134.453 million.

Given the facts, tax fraud case under section 37A read with section 2(37) of the Sales Tax Act 1990 has been registered against the firm M/s Arrow International, its buyers and suppliers and other beneficiaries involved in defrauding national exchequer from tax revenue of Rs134.453 million.

Earlier, the Federal Board of Revenue (FBR) chairman had issued directions to all the FBR field offices to expedite operation against tax evasion and play an active role to stop the menace of fake and flying invoices.

The FBR Headquarters had further explained that all the people who are found involved in fake and flying invoices and causing tax evasion would be dealt with strictly in accordance with the law. The organisation had said that it would also take prompt action against its own employee if the employee was found involved in any crime.

It had categorically stated that it encourages people to come forward and reveal the identity of those who are involved in causing tax evasion through fake and flying invoices, and FBR would grant rewards to such whistle blowers under its reward rules, while keeping the names of the whistle blowers secret.

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