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Litigants’ CNICs misused in tax fraud case

Litigants’ CNICs misused in tax fraud case


Intelligence and Investigation Inland Revenue of the Federal Board of Revenue (FBR), Faisalabad, has busted a gang which has been using the computerised national identity cards (CNICs) of the litigants for registration of dummy units and claiming sales tax refund on fake invoices.

A majority of the litigants comprise of farmers and labourers having no knowledge of the misuse of their CNICs the gang had got from tax consultants.

The gang has inflicted a colossal loss on the national kitty by claiming sales tax refund against fake invoices. The fraudsters have connections with the mills of Faisalabad, Karachi, Lahore and Multan that used to purchase fake invoices to adjust their taxes or get refund from the FBR.

Sources said the two cases of tax refund claims through fake invoices were registered against some textile and packages units in February 2013, including those from Faisalabad, Sheikhupura, Sargodha, Karachi, Gujranwala, Sheikhupura, Swabi and Lahore.

The sources said the officers had detected the fraud through preliminary investigation and they were not aware of the persons who were behind it and how they had managed to register the dummy units. They said the FBR had worked on both the cases scientifically and succeeded in arresting two persons, identified as Sheikh Jameel and Babar Shahid, a couple of days ago. They are on judicial remand till Sunday.

Requesting anonymity, an official of the FBR said that during investigation, Jameel had revealed that he had obtained the services of four to five sales tax consultants for registration of the dummy units. He said the consultants had obtained CNICs of the litigants from the local courts and registered the units in their names though it was not known yet that how the tax consultants or Jameel had managed to get CNICs the local courts. He said the people whose CNICs had been used had also been summoned for the investigation and it had been proved that they were mostly poor farmers and labourers, having no links with the gang.

Another accused Javed, who was arrested in January, had revealed the name of Jameel, however, he had no knowledge of his (Jameel’s) modus operandi, the official added. He said Javed dealt in local invoices of Faisalabad and Jameel was dealing with the units of Lahore, Karachi, Faisalabad and Multan.

Babar Shahid had registered a unit on the instructions of Jameel who, with the help of legal consultants, had managed registration of units in the services category which did not require visit of the FBR. Jameel has been working as manufacturer, he added.

The official said that more than 20 fake units had been detected and soon the FBR would summon the people who had obtained tax refund against fake invoices.

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