FBR Provisionally Attaches Alleged Benami Properties



The Federal Board of Revenue (FBR) on Friday provisionally attached hundreds of millions of rupees’ worth of alleged benami properties on suspicion that the real owners are political persons who have kept the assets in the names of other people.

The Benami Transactions Prohibition Zone-I Islamabad has provisionally attached 3,141 kanals of land located in six jurisdictions of Rawalpindi Division, according to 12 different provisional attachment orders that the FBR issued on Friday.

These properties are in the names of 12 persons, three of them being close relatives. But the FBR suspects that the real owner is one Tausif Ahmad. The Benamidar are Tahir Rauf, M Sadiq, M Anas, Ijaz Ahmad, Abdul Shakoor, Faisal Ahmad, Waqas Nasim Akram, Ahmad Yar, Sana Hussain Gilani, Syed Fayaz Gilani and Sikandar Husain Gilani, according to provisional attachment orders.

The provisional attachment order shall take immediate effect and will be valid for either 90 days or the issuance of an order of continuation of provisional attachment, whichever is earlier, according to the order.

Benami properties are the ones which the real owners have retained in other people’s names either to hide their source of income or evade taxes.

The worth of the provisionally attached properties is hundreds of millions of rupees and officials of the FBR’s Anti Benami Initiative suspect beneficial owners and benamidars have close ties with political leaders. They stressed, however, that it had to be established that the properties were owned by the political persons.

Parliament had approved the Benami Transactions (Prohibition) Act in 2017 but it has become effective only this year after the Pakistan Tehreek-e-Insaf (PTI) government cleared its rules. The law authorizes the government to confiscate Benami property and courts can award rigorous imprisonment of up to seven years and impose fines amounting to 25% of the fair market value on both the Benamidar and the beneficial owner of the properties.

The provisional attachment is the first step in the long journey of establishing that the property belongs to someone else. Both the FBR and accused persons have the right to present their cases before the Adjudicating Authority, the Federal Appellate Tribunal, the high court, and finally before a special court.

This is the FBR’s second major enforcement action in Rawalpindi in its ongoing drive against Benami properties. Earlier, on July 2, the FBR had provisionally attached six properties allegedly owned by Pakistan Muslim League-Nawaz (PML-N) Senator Chaudhry Tanveer Ahmad Khan.

However, the government has had to extend the provisional attachment periods of properties allegedly owned by bigwigs of the PML-N and the Pakistan Peoples Party (PPP) after its investigators failed to make headway in filing references against accused persons within the statutory deadlines.

Section 22(3) of the Benami law states that “the initiating officer can provisionally attach the property for three months from the date the show-cause notice is issued”. The law authorizes the FBR to further extend the provisional attachment period until the Adjudicating Authority decides the case.

Benami zones are currently facing shortages of both human and financial resources. The FBR had sought a Rs250 million budget from the Ministry of Finance to strengthen the zones but no money has been allocated so far.

The zones are funded by FBR resources. This has greatly undermined their effectiveness and impaired their ability to come up to the expectations of the political leadership.

In order to unearth Benami properties, the federal cabinet on Tuesday approved the issuance of the Benami Transaction (Prohibition) (Amendment) Ordinance 2019 aimed at expanding the definition of a ‘whistle-blower’. In addition to a person, the cabinet approved the inclusion of an entity or agency in the definition for the purpose of the Benami Law.

Information obtained during investigations by the National Accountability Bureau (NAB) and the Federal Investigation Agency (FIA) can now be used as legal information for the purpose of tracing and identifying real owners of Benami properties.

The PTI government has vowed to expand the net of income tax return filers to bring more people in it and to crack down on those evading taxes and creating assets through illegal means. The government has claimed having information on 2.7 million potential taxpayers.  But no major breakthrough has so far been achieved.

Currently, there are 2.6 million income tax filers although the total number of taxpayers in Pakistan is more than 53 million, 26% of the country’s population.

Prime Minister Imran Khan met Friday with FBR Chairman Shabbar Zaidi and National Database and Registration Authority (NADRA) Chairman Mubeen Usman to review progress on bringing 2.7 million people into the tax net. In the past, the FBR has questioned the utility of NADRA’s 2.7 million data due to missing important information.

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