KARACHI: Directorate of Intelligence and Investigation Inland Revenue (IR) Faisalabad has detected serious violations committed by government contractors of Punjab involved in getting taxable supplies without paying sales tax, as they are purchasing construction material from unregistered manufacturers.
On the directives of Director General Khawaja Tanveer, the agency has taken the initiative to check violations committed by the government contractors in Punjab. The detection of these cases would lead to substantial amount of recovery from the said contractors. The agency’s efforts would facilitate Punjab government in recovery of the sales tax from the said contractors. The credit goes to the regional directorate of the agency, which would help in expanding the scope of the inquiry against such government contractors.
Details revealed that the directorate has initiated an investigation/inquiry on the basis of definite information in the form of work orders issued by the District Office (Building and Roads) Faisalabad for development works in Faisalabad. The inquiry revealed that the government contractors are not purchasing Pre Cast construction material (tuff tiles, pavers, concrete columns etc) from authorized manufacturers specified in the work orders approved by the district officers (Buildings and Roads) Faisalabad. Instead of purchasing from authorized manufacturers specified in the work orders, the government contractors are purchasing construction material from unregistered manufacturers of concrete products. Recently, as per reports National Accountability Bureau (NAB) has already taken cognisance of the malpractices in the sector and has arrested EDO finance, Faisalabad for issuing fake completion certificates. This activity of government contractors has following financial implications.
Government contractors are getting taxable supplies without paying sales tax (input tax). The government contractors are purchasing sub-standard unapproved material from unregistered manufacturers and thus causing loss to the Punjab government as this substandard material would wear out soon. It is important to mention here that the directorate of intelligence IR is seriously focusing on government departments etc along with taxpayers allegedly involved in violations of tax laws, causing huge loss to the national exchequer.