It was back in February 2021, more than a year ago, that Javed Afridi’s Morrison Garages (MG) Motors found themselves in the headlines in an under-invoicing scam. Now, the Public Accounts Committee (PAC) has ordered a reopening of the tax evasion case against the company.
Under question are Rs 8 billion worth of custom duty which MG has allegedly evaded through the practice of under-invoicing. While it is a common occurrence in Pakistan’s imports sector, it is rare in major industries that have regulations like automobiles.
The accusation against MG is that they failed to reveal a joint venture agreement between them and a company in China that provides them with their vehicles – even though under the law they are supposed to. Sources have told Profit that MG had used government contacts, corrupt officials in the customs department as well as members of former Prime Minister Imran Khan’s staff to get the matter hushed up. However now, after the arrival of the Sharif administration, the inquiry is being opened up again.
Profit spoke with MG’s chief in Pakistan, Javed Afridi, over the allegations. Afridi told Profit that the company was being misrepresented and that no under invoicing had taken place. As of now, under the instruction of PAC, the FBR has formed a four member investigation committee to conduct a probe. The committee will take a detailed look at the comparable prices of Completely Built Units and Completely Knocked Down units of MG cars and determine the fair value that should have been established by the custom authorities. Further, the committee is also directed to investigate the role of FBR’s field operations in the matter. The content in this publication is expensive to produce. But unlike other journalistic outfits, business publications have to cover the very organizations that directly give them advertisements. Hence, this large source of revenue, which is the lifeblood of other media houses, is severely compromised on account of Profit’s no-compromise policy when it comes to our reporting. No wonder, Profit has lost multiple ad deals, worth tens of millions of rupees, due to stories that held big businesses to account. Hence, for our work to continue unfettered, it must be supported by discerning readers who know the value of quality business journalism, not just for the economy but for the society as a whole.To read the full article, subscribe and support independent business journalism in Pakistan
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