Sources told Business Recorder on Friday that FBR has stopped the Directorate's officials, including senior intelligence officers, deputy/assistant directors and appraisers, from exercising powers under SRO 48(I)/2008.
Sources said that the decision has been taken in view of hue and cry made by the chambers and federation on the enhanced powers of DG intelligence. The board had substantially enhanced the powers of the directorate's officials through amendments in the SRO 471(I)/2007 to detect tax frauds.
Contrary to this, the businessmen were worried on the powers relating to arrest or search of taxpayers' premises and direct access to taxpayers' record. There were apprehensions that the low-grade officials of the directorate would misuse the powers.
Keeping in view the reservations of the chambers/federations, the board had stopped the directorate from using harsh provisions of the notification. The SRO 48(I)/2008 has not been rescinded, only its implementation has been temporarily stopped.
Sources said that sales tax general order (STGO) 3 of 2004 has made it mandatory for the staff of DG Intelligence to take specifically written authorisation by the FBR for carrying out audit of registered persons. In cases of sales tax evasion, the DG Intelligence will pass on the information to the concerned collector of sales tax, who will order for the audit.
In the presence of legal requirements under STGO 3 of 2004, staff of DG Intelligence has not been permitted to directly exercise powers of SRO 48(I)/2008. The implementation of the SRO.48(I)/2008 is subjected to the administrative instructions of the board. Without approval, staff of the agency has no provisions to exercise such powers.
Sources said that the powers of section 38A of the Sales Tax Act, 1990 was given to the agency's directors, who can seek data from regulatory authorities regarding issuance of licenses and authorisation to any company. The board has stopped them from exercising these powers.
The FBR had also empowered the directors, deputy directors/assistant directors and additional directors of DG intelligence to search the taxpayer's premises after obtaining warrant from the magistrate. The intelligence officials were also empowered to seek reply from taxpayers pertaining to any document being used for audit or investigation. These powers have been covered under SRO.48(I)/2008, whose implementation has been stopped. The board has also barred the agency to exercise powers for arresting a person under Section 37B of the Sales Tax Act.