Massive tax evasion: Action against ‘Italian Kitchen’ dealer taken

Observer Report

Islamabad—The Directorate General of Intelligence and Investigation Inland Revenue (IR) has unearthed an alleged sales tax/income tax evasion by a registered taxpayer located at Clifton Karachi and engaged in import/supply and installation of Italian kitchens in Pakistan.
Sources said that the taxpayer has been registered as Association of Person (AOP) and running its outlet at Clifton, Karachi. During the visit of the registered person’s premises, it was observed that the worth of the sample installed Italian kitchens at the premises/showroom was about Rs 1.5 to Rs 5 million. Whereas, the registered person failed to declare any transaction in their income tax/sales tax returns, as well as re-cap deduction statement also reflected no business activity in the statement. In the light of facts and in order to determine the exact nature of work quantum of concealment/evasion of tax, action was taken against the registered person.
On credible information about suppression of receipts, the Directorate General, I&I-IR investigated the tax affairs of the taxpayer which is engaged in import and installation of Italian kitchens. Therefore, action u/s 38 of the Sales Tax Act, 1990 was invoked and the business premises of the taxpayer were raided. The record resumed in the case led to detect discrepancies between the sales declared and sales noticed from the record resumed.
In view of sales tax amounting to Rs 45,873,103 is recoverable from the taxpayer. When confronted with the undeclared receipts the taxpayer agreed and immediately deposited Rs 5,000,000. Accordingly, a contravention report has been sent to RTO-III, Karachi for necessary action and recovery of the remaining tax demand.
The team of expert officers, who detected the case included Said Ullah Khan, Director I & I-IR Karachi; Imran Qadeer, Deputy Director; Muhammad Arif, Deputy Director; Tahir Zafar, Assistant Director (Audit); Arshad Ahmed Khan, Assistant Director (Audit); Rashid Chundrigar, Assistant Director (Audit).

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