Habib Metropolitan Bank Officials Sued Over Alleged Embezzlement [Updated]

Update: The FBR has withdrawn the complaint against the said account however the case is still in court. A notification, in this regard, has also been issued. The said notification is given below:


The Federal Board of Revenue (FBR) has filed a complaint before the Special Judge for the prosecution of Habib Metropolitan Bank officials for aiding in tax evasion.

Sources said that the Large Taxpayer Office (LTO) Islamabad has filed a complaint before Special Judge Customs, Taxation and Anti-smuggling Rawalpindi/Islamabad for the prosecution of Habib Metropolitan Bank officials.

FBR, in its complaint, claimed that the five accused persons, including Manager Operations, were holding money on behalf of the taxpayer company-in-default, M/s Tahir Builders (Private) Limited.

Income tax demand of Rs. 267.9 million was outstanding and recoverable against the taxpayer on account of default u/s 122(5A) of the Income Tax Ordinance, 2001 for the Tax year 2016.

The recovery notice u/s 140 read with rule 69 of Income Tax Rules, 2022, was served to Manager Operations Habib Metropolitan Bank, on 6 June 2022, for the recovery of tax dues of the taxpayer.

However,  the bank officials did not debit block the bank account of taxpayer maintained at their branch with malafide and criminal intention even after receiving the notice u/s 140 of the Income Tax Ordinance 2001 and enabled the taxpayer to remove and transfer the funds available in its account to dodge the tax authorities and to avoid recovery of tax dues dishonestly and fraudulently.

This allowed the taxpayer to transfer an amount of Rs. 20.05 million from its account on the same day, i.e., 6 June 2022. Thus, a huge loss to the national exchequer has been caused by the bank officials by their willful non-compliance with notice u/s 140 of the ITO-2001.

FBR stated that the said bank officials, in connivance with the taxpayer, also obstructed the officials of the FBR from carrying out their statutory duty and are liable to be prosecuted u/s 191 and 196 of the Income Tax Ordinance 2001.

The other two accused persons President Habib Metropolitan Bank Limited, and Chief Compliance Officer were in full knowledge of the fact and willfully and knowingly aided and abetted the accused officials in committing the offenses and as such are liable to be prosecuted u/s 196 and 199 of the Income Tax Ordinance 2001 for aiding and abetting the commissioning of the aforesaid offense.

In the foregoing circumstances, it is, therefore, respectfully prayed that accused persons mentioned above be summoned through notice/arrest warrant and their trial be commenced u/s 203 read with sections 191, 196, and 199 of the Income Tax Ordinance 2001.

Sources from within FBR informed ProPakistani that recovering tax dues from the defaulting taxpayers is a tedious and painstaking task and is initiated only after exhausting various appellate forums.

Banks hold money on behalf of the taxpayers, they act as the gatekeepers of the entire financial system. Once the department is in the position to effect a recovery of defaulted tax, the banks have a role to play under the fiscal laws in making that recovery successful.

Their timely compliance to the letter and spirit of tax laws is essential for the entire enforcement drive of FBR but when these gatekeepers are corrupt or compromised, the opportunity to recover tax dues slips away and may not come again for years due to prolonged litigations and stays liberally granted by our judicial system, without looking much into the facts of each case.

If this kind of behavior by the banks is accepted, then there simply won’t be any recoveries made, adding that the department then has to make an example out of the corrupt and negligent bankers, who have caused loss to the national exchequer.

It is necessary for establishing the writ of FBR, and therefore, we have planned to go all out against such bankers so that this is not repeated by any bank. There is no room for any leniency, definitely not for this kind of blatant non-compliance to the tax laws, sources added.



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