LAHORE - Federal Board of Revenue has detected tax fraud of about Rs1 billion by Makka sugar mills owned by the former chairman of Pakistan Sugar Mills Association Punjab chapter.

It is to be noted that FBR, few weeks ago, had also unearthed a scam of Rs267 million tax fraud committed by Haseeb Waqas and Abdullah Sugar Mills.
The FBR’s Inland Revenue Intelligent Unit raided the offices and house of Makka sugar mills, Haq Bahu sugar mills and Abdullah Shah Ghazi Sugar Mills five directors including Riaz Qadeer But on arrest warrants issued by the Special Customs Court due to tax evasion of about Rs346 million on sale of sugar stock in 2009-10. The Makka group did not pay Rs700 million income tax during the same period.
The tax fraud was detected through FBR’s audit section, which found that the concerned mills had sold sugar stock through 17 bogus accounts in 2009-10 at the rates less the market prices, besides showing less stock to the FBR.
The intelligent Unit of the Inland Revenue of the FBR staff raided the both mills offices but could not arrest Mr. Riaz Qadeer Butt. However, FBR team has managed to arrest an employee namely Iftikhar from Bahawal Nagar. This employee was getting Rs14000 salary while Rs270 million transaction was made through his fake account. FBR officials claimed that several sugar dealers in different cities of the country have confirmed to receive sugar orders of thousands of tons through these bogus accounts.
Earlier, Large Taxpayer Unit Lahore of the FBR continued to conduct several raids to arrest the relatives of Prime Minister Nawaz Sharif and other directors in the case of federal excise duty evasion by Haseeb Waqas Sugar Mills and Abdullah Sugar Mills worth Rs267 million. However, none of the directors was arrested so far.
Official sources said that the Customs court has called the directors of both mills on a hearing conducted on Sept 28, 2015 but no one appeared before the court. The officials said that FBR now try to get non-bail able arrest warrants.
It is to be noted that the relatives of the prime minister damaged national exchequer with over Rs267 million loss mis-declaring the sugar sales price of only Rs4 and Rs12 per kg. The Large Taxpayer Unit Lahore of the FBR had registered two FIRs against Haseeb Waqas Sugar Mills, and Abdullah Sugar Mills which involved the FED evasion of Rs 113.61 million and Rs 154.14 million respectively. The mills management adopted the legal procedure in which they failed to get any relief.
It is to be noted that the Punjab government had also begun legal action against sugar mills not making payments to farmers. Around nine sugar mills have been taken into custody by DCOs on non-payment to the sugarcane growers so that after auctioning stock or mill, dues could be paid to the farmers. The defaulter mills included Chishtia Sugar Mills Sargodha, Abdullah Sugar Mills Okara, Abdullah-II Sugar Mills Sargodha, Haseeb Waqas Sugar Mills Nankana Sahib, Colony Sugar Mills Khanewal, Shakar Gunj–I Sugar Mills Jhang, Shakar Gunj–II Sugar Mills Jhang, Hussain Sugar Mills Faisalabad and Brother Sugar Mills Kasur.
When contacted, PSMA Punjab chairman Javed Kayani endorsed the action of the govt to crackdown against the tax evaders who so ever.
He said that PSMA is totally against those who are committing tax fraud, and suggest the govt to take strict action against every tax evaders in all sectors without any discrimination.
The govt should also bring agri as well as traders income into tax net, he recommended.
However, he stated that government attitude towards the industry is not fair regarding payment to growers.
The government’s major focus is just revenue collection instead of promoting industry which generates hundreds of thousands of jobs directly and indirectly. A single mill, on one side, pay around Rs 1 billion taxes and on the other side provide jobs to thousands of workers, bides engaging thousands of growers. The anti-industry policy of the government will cause total closure of the industry and overall loss of economy. Several sugar mills are being closed or sealed in central Punjab and government should take notice of it only in national interest, he added.