Concept of whistle blower violated
Zubair Qureshi Islamabad
President Dr Arif Alvi has directed the Federal Board of Revenue (FBR) to submit a report to the Federal Tax Ombudsman (FTO) and explain how the identity of a whistle-blower, who had reported large scale tax-evasion/fraud by a private limited company, was leaked to his employer and consequently he had to face threats by the tax-evading company.
The president further directed the FBR to explain why it could not fully utilize the information provided by the whistle-blower to recover the maximum Sales Tax amount from the company that caused loss to the national exchequer.
The president gave these remarks while rejecting a representation filed by FBR against the order of FTO directing FBR to revisit its relevant Assessment Order, provide an opportunity for hearing to the whistle-blower, and fully utilize the information provided by him for the recovery of the evaded Sales Tax.
The president expressed displeasure that the FBR did not take full advantage of the information about the various alleged financial irregularities by the company. Moreover, even the identity of the whistle-blower was disclosed.
“This is abhorrent to the whistle-blower concept and legislation. Instead of taking advantage, the FBR has been very lax in its attitude”, the president noted.
He further directed that a report must also be submitted to FTO within 60 days as to why this happened. As per details, Muhammad Ilyas (the complainant) was serving as an Accountant in M/s Northern Toolings (PVT) Ltd and reported to FBR that the company was indulging in various financial irregularities by maintaining bank accounts in the names of its employees, using fake and flying invoices for adjustments of Input Sales Tax, concealing warehouses with undeclared stock, less tax payment, and under-invoicing at import stage using similar names and style of another company, thus, resulting in huge loss to the national exchequer. The employee reported large-scale tax evasion/fraud to FBR, after which he was registered as a whistle-blower.
The FBR initiated proceedings against the company and recovered Rs15.251 million, however, the amount recovered was too short due to not properly utilizing all annexure provided by the complainant.
