Finance Committee Told to Stop Probe Into MG’s Alleged Tax Evasion

Federal Board of Revenue (FBR) Member Inland Revenue Operations (Customs), Tariq Huda, on Wednesday informed the National Assembly Standing Committee on Finance that the matter of alleged tax evasion by an automobile company should not be discussed at the committee level as it is subjudice before the High Court, and it may go up to the Supreme Court of Pakistan.

FBR Member Customs operations were responding to the queries of the committee members on agenda item number-7 to discuss the issue of tax evasion by Morris Garages (MG) Automobile Company on import of Complete Built Unit (CBU) if any and action taken by the FBR in this respect.

He said that the FBR has already started an audit to investigate the matter to ascertain the facts about the case.

He said that we encourage that new players should come into the automobile market. It is the legal right of any company to import and subsequently sell vehicles in the country. If any discrepancy is detected during the audit, the department frames the contravention report and submits it to the adjudication authorities. There are 4-5 legal forums available from the level of Commissioner Appeals to Appellate Tribunal and superior courts.

“The discussion in the committee might positively or negatively influence the legal forum. It is requested that the matter should not be discussed at the Finance Committee. Leave it to the judicial forms and trust us”, FBR Member Operations Customs added.

A committee member said that the investigation should also take into account that the vehicles are being sold to the customers and if any recovery is made at a later stage, whether the buyers are protected, or future liabilities would be recovered from the buyers.

Meanwhile, a brief submitted to the NA Committee on Finance by the Ministry of Industries and Production said, the Goods Declaration filed for the clearance of vehicles imported by any vehicle importer under the normal regime is processed and finalized by the customs field formation of FBR without the involvement of Industries and Production Division. Morris Garages (MG) JW Automobile Pakistan (Pvt.) Ltd. has imported new vehicles without availing the benefit provided in Automotive Development Policy (ADP) 2016-21.

It is further explained that the investment agreement between the Government of Pakistan and Morris Garages (MG) JW Automobile Pakistan (Pvt.) Ltd. has not yet been signed, enabling Morris Garages (MG) JW Automobile Pakistan (Pvt.) Ltd. to import Completely Built-up Units (CBU) or Completely Knocked Down (CKD) on the terms and conditions provided in AND 2016-21, Ministry of Industries and Production added.