Senate committee questions FBR over Rs 1,120 bn imports, demands records within two days

ISLAMABAD, Nov 02 (APP): A Senate Sub-Committee on Interior and Anti-Narcotics has expressed serious concern over the alleged misuse of the FATA/PATA tax exemption scheme, delays in recovering billions of rupees in outstanding taxes and the failure of several companies to provide required records.

Convenor Senator Saifullah Abro directed the Federal Board of Revenue (FBR), Federal Investigation Agency (FIA) and other relevant institutions to submit complete documents, determine potential revenue losses and establish responsibility for any violations of the law.

The meeting was held at Parliament House under the convener-ship of Senator Saifullah Abro. It reviewed the issuance of consumption certificates for imported goods, alleged tax evasion, non-payment of dues, investigations and the performance of relevant departments.

Senator Umar Farooq and officials from the Interior Ministry, FBR, FIA, police and other departments attended the meeting and briefed the Committee.

During the briefing, officials informed the Committee that imported goods worth approximately Rs1,120 billion under the FATA/PATA tax exemption scheme were under scrutiny. Consumption certificates and related records had been identified for goods worth around Rs389 billion, while further details were required regarding the remaining imports, their utilisation and outstanding tax liabilities.

The Committee was also informed that 223 consumption certificates had been issued to 108 companies. It questioned why complete information about imports, factory production, utilisation of goods and tax payments was unavailable for all companies.

Senator Abro questioned the performance of the FBR, stating that Pakistan was seeking loans from international financial institutions while billions of rupees in alleged tax dues remained unrecovered. He said negligence and delays in collecting taxes were unacceptable.

He declared that public money would be recovered at all costs, adding that national resources belonged to the people and no compromise would be made in protecting them. If investigations established tax evasion or financial irregularities, those responsible must be identified, legal action initiated and outstanding amounts deposited into the national exchequer.

The Convenor directed officials to prepare a separate case file containing import records, customs documents, consumption certificates, tax payments, bank statements and other relevant information. He also sought clarification about the legal basis and supporting documents concerning approximately Rs85 billion and the requirements fulfilled before the release of imported goods.

Officials explained that companies were required to deposit an amount or pay order equivalent to the value of imported goods with customs authorities before their release to factories, subject to prescribed conditions.

Under SRO 2021, documents required for consumption certificates included electricity and gas bills, buyers’ bank statements, business records and employee details.

Senator Abro questioned why these requirements had not been properly verified. He directed officials to present consumption certificates and records of 20 major companies identified during the previous meeting. He also sought correspondence with companies whose certificates had been questioned and explanations for cases where no objections had been raised.

He held the concerned officers and inspectors responsible for examining company documents before issuing certificates and directed that any negligence at any level be identified. All required records were ordered to be submitted within two days.

FBR representative Taqi informed the Committee that suspected cases of fraud or tax non-payment could be selected for audit. He said the department was examining relevant cases and would submit audit findings to determine recoverable amounts.

However, Senator Abro rejected the explanation that audits were underway, demanding details of companies that had submitted records, cases examined and practical steps taken to recover taxes.

Officials further informed the Committee that notices had been issued to 512 companies. Some had submitted complete records, while others had provided partial information. Letters sent to 58 companies had been returned or refused. Meanwhile, 35 writ petitions had been filed before the Peshawar High Court, and 174 beneficiary companies had approached the court seeking relief against FBR inquiries or proceedings.

The Convenor directed officials to compile company names, ownership details, business activities, notice records and details of pending cases. He also instructed the institutions to defend their positions before courts through documentary evidence and use their legal powers where companies failed to provide records.

Regarding the FIA investigation, the Committee was informed that an inquiry was underway into imports, consumption certificates, company activities and outstanding taxes. Senator Abro said FIA Director General Dr Usman Anwar and other officials had been invited to help advance the investigation.

He directed the FIA and FBR to share information and coordinate their investigations. If violations or financial irregularities were established, the responsible individuals and companies must face legal action. Outstanding taxes and penalties must be recovered, while criminal cases should be registered where required.

The Committee also discussed potential revenue losses and tax liabilities estimated at Rs400–500 billion. Senator Abro directed that the amount be determined through verification of records and legal scrutiny.

He said the FBR must fulfil its responsibilities and that public offices and governments were temporary, while the duty to protect national resources was permanent.

The Convenor also directed a review of the FBR’s overall performance and reconsideration of nominations for the Sitara-i-Imtiaz. He said national honours should reflect merit, transparency and measurable contributions. Officers who helped recover taxes and prevent irregularities should be recognised, while negligence and delays should also be examined.

The Committee discussed companies involved in importing edible oil, ghee, steel, food items, polymers and tea. Officials were directed to examine their ownership, management, business activities and possible links, without drawing conclusions in the absence of evidence.

The meeting also reviewed around 20 import entries worth approximately Rs65 billion during the preceding six months, involving 20 Goods Declarations (GDs) and 19 factories. The relevant authorities were directed to examine import documents, factory records, utilisation of goods and the legal validity of consumption certificates.

Senator Abro directed officials to prepare a comprehensive report by November 9, covering the business activities and import records of five key companies. The report would help the Committee review the matter before the Peshawar High Court proceedings scheduled for November 12, 2026.

He instructed the relevant institutions to coordinate with their legal teams, prepare documentary evidence and submit complete responses before the court.

The Convenor directed officials to provide consumption certificates, import records, notices, court petitions, potential tax liabilities and correspondence involving relevant officers without delay. He reiterated that the required documents must be submitted within two days and that all investigations and recovery efforts must be completed in accordance with the law.