Day: September 2, 2021

The Chairman of the Public Accounts Committee, Rana Tanveer Hussain, has said that many ministries are not conducting their regular departmental accounts committee meetings, including the Ministry of Commerce. It is grave financial misconduct by the ministries and those who are responsible for their financial matters.

He stated this while chairing the 67th meeting of the Parliament’s Public Accounts Committee in the Parliament House today where audit paras pertaining to the Ministry of Commerce were on the agenda.

The committee was informed that the Advisor to the Prime Minister on Commerce, Abdul Razzaq Dawood, had contracted the coronavirus and has quarantined himself. The Secretary of Commerce also could not attend the meeting for the same reason.

The Chairman of the committee said that there are certain forces that do not want its independent working. He said that there is a big issue in the Pakistan Post Office Department and the Habib Bank Limited Rs. 118 billion deal, but the Speaker’s office had sent a message to refrain from raising this issue.

He said that in the subcommittee of the Public Accounts Committee (PAC) chaired by MNA Noor Alam Khan, the Chairman of the National Accountability Bureau (NAB) was not attending the meeting.

Senator Sherry Rehman said while considering the audit objections of the President House, the officials did not answer any question. She said that no meeting of the PAC has been held on the expenses of the Presidency to date.

While considering the audit objections of the Ministry of Commerce, the audit report revealed that the delay in the construction of the State Life building in Islamabad had caused a loss of Rs. 820 million. The Additional Secretary of the Ministry of Commerce told the committee that the building plan had to be changed due to the refusal of the SNGPL to supply gas.

The PAC referred the matter to the departmental accounts committee to settle the issue and bring back the ministry’s recommendations. The committee was also informed that misappropriation of Rs. 12 million had been recorded in State Life Hyderabad. Ministry officials informed the committee that the case had been referred to the Federal Investigation Agency (FIA) and Rs. 7.4 million has been recovered.

Audit officials informed the committee that the Trading Corporation of Pakistan (TCP) has to collect Rs. 4 billion from the sugar mills. The Chairman of the TCP informed the committee that Haseeb Waqas Sugar Mill, Seri Sugar Mill, Tando Muhammad Khan Sugar Mill, and Tandlianwala Sugar Mill have to pay their dues. He said that these mills sell sugar in the market at cheap rates instead of selling it to the Utility Stores Corporation (USC). He added that the matter has been pursued by the NAB.

The Chairman of the committee referred this matter to the subcommittee of the PAC.

While talking to the media after the meeting, the Chairman of the PAC, Rana Tanveer Hussain, said that the Chairman of the NAB will have to account for the money as he is the Principal Accounting Officer of the NAB. He said that the Chairman of the NAB should not get an extension after his tenure ends.

Chairman Tanveer said that Transparency International questioned the transparency of the agreement between Habib Bank and Pakistan Post, and this matter should be investigated. The Speaker of the National Assembly had sent a message, warning not to raise the issue. He said that the agreement between HBL and the Pakistan Post Office Department (PPOD) should be thoroughly investigated, and told the media that the PAC has recovered Rs. 480 billion so far.

Source: Pro Pakistani

The Federal Board of Revenue (FBR) will take strict action against senior tax officials involved in the issuance of the exclusion/adjustment certificates to steel units for not charging sales tax on power consumption against cheques, which were not deposited in the national kitty.

Sources told Propakistani here on Thursday that the matter will be discussed in the Public Accounts Committee (PAC) meeting to be held at the Parliament House on Friday.

According to details, the FBR has initiated disciplinary proceedings against commissioners Inland Revenue, who issued exclusion/adjustment certificates to the steel units, but cheques were not deposited in the national kitty. Notices were served to the commissioners of Inland Revenue who violated the law and caused huge revenue loss, sources added.

The steel units are using electricity for steel and iron products and are required to pay sales tax as per rates specified in the Sales Tax Special Procedure Rules 2007 (steel sector).

However, the department had issued exclusion/adjustment certificates of sales tax in which it was mentioned that the taxpayers have paid sales tax through various cheques, but it has not deposited the cheques in the national exchequer for which the department has issued the exclusion/adjustment certificates.

The FBR is investigating that how much such kind of exclusion/adjustment certificates were issued to the steel units in Lahore and what was the actual revenue loss on this account.

The auditor designated by the Director-General (Audit) Lahore of the Auditor General of Pakistan had pointed out some glaring discrepancies in the collection of sales tax from Steel units falling under the jurisdiction of the Corporate Tax Office (CTO), Lahore, which needed stern action besides reconciliation by the concerned zone/CTO.

The details revealed that in CTO, Lahore, the Commissioners issued Exclusion certificates under Sub Rule 3(A) of Rule 58H of the Sales Tax Special Procedure Rules, 2007, to the registered persons so the LESCO did not charge sales tax per unit against advance payment (postdated cheques) but these cheques were not deposited in the government treasury and payments are not subsequently appearing in the sales tax collection/ledger of the registered persons.

The loss of revenue specified in the Audit Report 2019-20 is about Rs.900 million in only 40 cases for the period july-2016 to June 2019. There are more than 350 steel units which are registered in CTO, Lahore. The Member IR (Operation) FBR constitutes a fact finding committee to investigate this matter, quantify the actual loss of revenue and the responsibility of this alleged tax fraud be fixed to commence action internally and recommend the case to any external agency for criminal proceedings.

A fact-finding inquiry committee examined discrepancies in the collection of Sales tax from Steel units of Lahore. The chairman of the inquiry committee submitted its report, confirming the fraud of non-deposit of sales tax payment collected through cheques in 39 cases only.

The CTO Lahore has succeeded to recover the amount of Rs. 153.667 million till now. The first information reports (FIRs) have been registered against the registered persons in 17 cases and the amount of Rs. 505.074 million is still under-recovery. The pending recovery in the sub judice cases confirmed the viewpoint of the Audit of fraud.

The Fact-Finding inquiry Committee observed that loss of revenue in these cases is deliberate. Furthermore, the Fact-Finding inquiry Committee observed that the two exclusion certificates involving revenue Rs. 436.63 million have been issued to the un-registered persons and no cogent reasons were provided by the CTO for the issuance of this exclusion certificate to a non-existing entity. The issuance of exclusion certificates to unregistered persons was a serious lapse on part of the concerned Commissioner(s).

The fact-finding inquiry committee observed that this situation is alarming in the sense that if the same exercise is replicated on an overall basis in 350 Steel Sector cases, within the zone of CTO, Lahore, the quantum of irregularity in lieu of missing/dishonored cheques would be much higher.

The FBR has initiated disciplinary action against the commissioners who issued such exclusion certificates and investigation has been started in the remaining 310 cases in which exclusion certificates have been issued against post-dated cheques and the subject cheques were not deposited in the government treasury.

Source: Pro Pakistani

The Federal Board of Revenue (FBR) has directed its field formations to furnish details pertaining to the issuance of exemption certificates to greenfield industrial undertakings.

Sources told ProPakistani that the FBR has directed all Chief Commissioners Inland Revenue to furnish details with regard to the issuance of exemption certificates to greenfield industrial undertakings till September 6, 2021.

The board has asked the Large Taxpayer Office (LTO), Regional Taxpayer Offices (RTO), Corporate Tax Office (CTOs) and Medium Taxpayers’ Office (MTO) to send name as well as NTN details of taxpayers who have claimed exemptions in terms of clause 86(a) of the income tax ordinance.

The board also directed the field formations to share details about how many taxpayers claimed exemptions, how many exemptions were granted and what is the amount involved. It is pertinent to note that the FBR has introduced a “CHAPTER XVIIA’ in the income tax ordinance pertaining to greenfield industrial undertakings in September 2020.

The FBR has announced certain tax exemptions for those taxpayers who want to make new investments in Pakistan. The taxpayers can avail the benefits if they start a setup on land which has not been previously utilized for any commercial, industrial, and manufacturing activity. The FBR also allowed profits and gains on the income tax of a company from a greenfield industrial undertaking for a period of five years incorporated on and after July 2019.

In addition, the government had also given amnesty by not asking about the sources of income. The FBR had also given sales tax exemptions on importing machinery as well as furniture.

Source: Pro Pakistani

The federal Minister for Planning, Development, and Special Initiatives, Asad Umar, chaired a progress review meeting on the South Balochistan Development Plan.

The Secretary Planning, Hameed Yaqoob Sheikh, the focal person for the South Balochistan Development Package (SBDP), and senior officials attended the meeting.

In line with the Prime Minister of Pakistan’s vision for the development of unprivileged and less developed areas in Pakistan, concerted efforts have led to the successful completion of Phase-I of the SBDP, culminating in the listing of the approved projects in the PSDP 2021-22 and the allocation of funds.

In order to ensure the implementation of the approved projects at an accelerated pace, the Minister for Planning, Asad Umar, reviewed the progress of Phase-II of the SBDP, and was satisfied with the progress of the SBDP projects.

While reviewing the progress of the new projects to be funded through the Federal PSDP, he observed that 90 percent of the projects have been approved and included in Federal PSDP 2021-22 for Rs. 234.315 billion, out of which Rs. 25.721 billion has been allocated in the CFY. Likewise, for various approved and ongoing PSDP projects amounting to Rs. 274.689 billion, the allocation for the CFY amounted to Rs. 29.160 billion.

While reviewing the status of PC-I/IIs and the corresponding financials, the minister observed that Balochistan’s current portfolio in the Federal PSDP has a thin spreading of funds, and desired for a priority list of projects to be prepared so that fast-moving and strategic projects may be adequately funded for timely completion.

He also reviewed the progress of the priority SBDP projects, and was informed that the National Highway Authority (NHA) has begun the procurement for three projects — the construction of the Hoshab–Awaran–Khuzdar Section of the M-8 (Awaran–Naal 168 km) for Rs. 32 billion; the Hoshab-Awaran Section of the M-8 (146 km) for Rs. 38 billion; and the Rehabilitation & Upgradation of the Awaran—Jhaljao Road (54.8 km) at Rs. 6.9 billion.

It was highlighted that seven road sector projects amounting to Rs. 24.39 billion and seven water dam projects amounting to Rs. 48.68 billion have been approved/included in the PSDP 2021-22, and their award process is being expedited.

In order to address the shortage of water, especially at Gwadar, funds have been approved for the connection of the Shadi-Kaur dam with the Gwadar pipeline. Additionally, the Central Development Working Party (CDWP) has accorded the approval for the installation of a 1.2 MGD desalination plant at Gwadar Port through a Chinese grant.

Minister Umar called for the completion of the desalination plant within six to nine months to ease the population of Gwadar.

While reviewing the progress of 15 projects that are to be funded through the Non-PSDP model for Rs. 20.376 billion, the minister observed that 78 percent of the projects have been approved while the projects amounting to approximately Rs. 10.188 billion are in various stages of implementation in the CFY.

In order to improve Digital Connectivity in Gwadar, Chaghi, Noukeshi, and Kech, the USF has awarded contracts for districts for Rs. 3200 million; the completion of which is planned to be by 24 July 2022.

The minister was further informed that the contract for High-Speed Broadband Connectivity along the M-8 and the National Highways is likely to be awarded by the third quarter of 2021.

The minister also reviewed the progress of the projects that are to be funded through the Public-Private Partnership model. He commented that the private sector is the real driver of growth for countries across the globe, and even today, the Sialkot-Kharian motorway has been inaugurated by the Prime Minister through such a model.

He was informed that the supply of LPG to the population of South Balochistan is a priority project whereby the Petroleum Division has prepared a draft summary for the Cabinet Committee on Energy (CCoE) for consideration, and has circulated the same for the feedback of all the stakeholders.

The house was further informed that the Alternative Energy Development Board (AEDB) is working on the Off-grid Electrification of South Balochistan’s districts, and a consultant has also been procured.

The Fishermen Empowerment Programme has also been inaugurated by Prime Minister Imran Khan as part of the Kamyab Jawan Program. An MOU has been signed between four banks (Punjab, NBP, Al Falah, and Habib), whereby they will provide loans to eligible applicants.

Source: Pro Pakistani