President Alvi Backs Action Against Corrupt Taxmen



President Arif Alvi has upheld a decision of the Federal Tax Ombudsman (FTO) who had recommended action against corrupt taxmen who failed to bust a syndicate involved in smuggling and sale of non-duty-paid vehicles in Pakistan.

FTO Mushtaq Ahmad Sukhera had taken a suo motu notice in February last year on reports of influx of smuggled vehicles into Pakistan. The FTO busted a syndicate who would first smuggle a vehicle and then the Customs department would recover it and subsequently sell the same vehicle to smugglers through an auction.

The FTO had recommended the Revenue Division secretary to take action against the corrupt FBR officers who were accused of either negligence or being part of the syndicate. However, instead of taking action, the FBR filed a representation against the FTO’s decision with the president of Pakistan.

“The president has been pleased to reject the instant representation of the collector Customs MCC Quetta and uphold the impugned recommendations of the FTO,” according to the decision of the president of Pakistan.

Collector Customs, Model Customs Collectorate (MCC) Quetta had filed representations with the president against the FTO orders about investigation of widespread reports of presence of showrooms dealing in non-duty-paid vehicles on the main road of Quetta and further transportation of such vehicles to other parts of the country.

A syndicate of smugglers and corrupt FBR officers was working in Quetta, according to Sukhera. The syndicate smuggled 960 non-duty-paid vehicles into Pakistan. It first declared these vehicles recovered from unknown people and then eventually bought in auction.

These vehicles were above 2,700cc engine capacity, the FTO said while briefing its advisory committee last week about the presence of the syndicate. On the FTO recommendation, the government has already declared the connivance of state functionaries in corrupt practices as criminal activity by amending tax laws through the Finance Bill 2019.

The FTO recommended the FBR to direct the chief collector (enforcement) Quetta to examine the seizure reports of non-duty-paid vehicles and take disciplinary action against the officers and officials who failed to exercise their powers against the smuggling of vehicles and provided protection to the offenders.

It further recommended the FBR to ensure that all seizures in future were made in line with the legal requirements, including criminal prosecution against the persons and owners of showrooms from whom non-duty-paid vehicles were recovered.

“The recommendations thus made, in particular, about the formation of a task force and action to be taken against those who were responsible can hardly be disputed,” according to the decision of the President Secretariat.

All those state and statutory functionaries charged with the duty to act in accordance with the law fail to do so are liable to be proceeded against by the competent authority in accordance with the law, it added. “Tax/revenue collection functionaries of the state should take necessary steps to implement such recommendations wholeheartedly to improve their functioning and augment revenue collection,” said the President Secretariat.

According to the FTO findings, the reports submitted by the department indicate that the department takes benefit of smuggling of vehicles to achieve the revenue target, therefore, no action is taken against the smugglers and individuals involved in the business of non-duty-paid vehicles, fearing that the action may adversely affect the inflow of smuggled vehicles, making it difficult for the department to achieve its revenue target.

The entire Pak-Afghan border and about 450 kilometres of Pak-Iran border fall within the jurisdiction of Quetta MCC.

The FTO recommended the FBR to direct the chief collector (enforcement) Quetta to form a task force for action against the smuggling of non-duty-paid vehicles by regularly conducting raids on showrooms and to ensure that all seizures in the future were made in compliance with the legal requirements.

The submissions made by the department as well as by the directorate, police and FC reflected that smuggling of non-duty-paid vehicles and its business not only in Balochistan but all over the country was an undisputed fact, according to the FTO. The actions taken by the department seemed to be having no effect, it added.

At this juncture, it is observed that in all cases the accused are stated to be unknown so much so the recoveries made from showrooms are also shown to have been made from unknown individuals.

“Since the department has remained dormant, therefore, it does indicate that the Customs officials collusively did not want to take legal action against the smugglers and owners of showrooms for their ulterior motives,” according to the FTO. Thus, failure in exercise of powers for corrupt motives, inefficiency, inattention and neglect in the discharge of duties were evident, it added.

In response, the Quetta Customs Department maintained that due to lack of weapons, their utility/performance in anti-smuggling-related activities was generally hampered as the smugglers were better equipped with latest automatic and semi-automatic weapons.

The Customs said it had issued standard operating procedures for sale and purchase of vehicles and notices were also issued to the owners of showrooms informing them not to indulge in the illegal business. Also, from fiscal year 2013-14 to March 2018, the Customs seized 2,134 vehicles having value of Rs1.9 billion.

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