ISLAMABAD, March 31: The chief tax collector of the country on Thursday took shield behind an executive order of the then finance minister Shaukat Aziz for not providing the relevant record pertaining to transactions of billions of rupees to the Auditor General of Pakistan (AGP) in breach of Article 169 and 170 of the Constitution and provisions of the Auditor General?s Ordinance 2001. ?The then finance minister was sent a reference and he gave the approval,? said Chairman Central Board of Revenue (CBR) Abdullah Yousaf while explaining the reasons for not giving the record of sales tax to the AGP during a meeting of the Public Accounts Committee (PAC).
The PAC took a lenient view of the continued attempts by the CBR since 2000 to frustrate the AGP to perform his constitutional duties after Mr Yousaf tendered an apology and assured future cooperation. Earlier, PAC member Chaudhry Nisar said, ?It (AGP) is a statutory body and nobody has the powers to determine its role. The then finance minister took a wrong decision.?
The PAC did not order an inquiry into the issue as the AGP had demanded. The PAC was informed that production of sales tax record for statutory audit was being denied for the last five years on one reason or another.
Apprising the committee of continued denial of sales tax record for audit by the CBR, the AGP, Mohammad Younas Khan, said, ?The AGP has to determine his course of authority. The executive authority cannot determine my role. If that?s the case, the AGP should go home.?
The AGP derives his authority from Articles 168, 169 and 170 of the Constitution and can requisition all records of the auditee departments/organisations to discharge its mandate as per section 14 of the Auditor General?s (functions, powers and terms and condition of service) Ordinance, 2001.
PAC Chairman Malik Allahyar said whenever the AGP required, the record should be produced. Another committee member Lt-Col (retired) Ghulam Rasool Sahi asked the chairman CBR, ?You have boldly confessed that record was not provided. It is a great embarrassment and serious concern. Would you take action against the concerned officials??
The audit brief presented before the committee said, ?Some time in 1999-2000, the CBR on their own submitted a note to the finance minister stating the position in their favour...On the basis of approval of this note, they issued their letter on September 5, 2000, directing their collectorates to make available to audit a record of sales tax with the exception of mere returns-cum-payment chalans and files of refunds.?
The AGP in its report to the PAC said the CBR during the tenure of previous chairmen Riaz Hussain Naqvi and Riaz Ahmed Malik in addition to the incumbent continued to deny the sales tax record for audit.
?From September 2000 to October 2004, 16 meetings were held between top managements of audit and tax. The defunct ad hoc PAC and the finance minister also took a serious note of it. Lastly, a meeting was held with the present CBA chairman on October 2, 2004. However, the situation has not improved,? said the audit brief.
The AGP report placed before the PAC said the matter was also brought before the ad hoc PAC during its meetings on November 10-11 with a number of reservations which said, ?If such reviews are rendered impossible by imposing restrictions, chances of leakage, misappropriation, evasion and collusion will increase and remain unchecked.?
Like the arguments given by the former chairman Riaz Hussain Naqvi before the ad hoc Public Accounts Committee in November 2000, Mr Yousaf took the same line before the PAC that the problem was of too many audit inspections of registered persons by internal and external agencies in a year which needed to be resolved.
At this, the AGP said the taxpayers were harassed by the internal auditors of the CBR and not the AGP?s department as he had only 28 officers in his staff. He said the CBR should change the name of its internal auditors to stop the negative aspersions cast on the role of the AGP.
When the audit objections were taken up individually, the CBR chairman sought time of six months to streamline the system and give a report to the PAC. He also assured the committee that full cooperation would be given to the AGP.
The PAC took a lenient view of the continued attempts by the CBR since 2000 to frustrate the AGP to perform his constitutional duties after Mr Yousaf tendered an apology and assured future cooperation. Earlier, PAC member Chaudhry Nisar said, ?It (AGP) is a statutory body and nobody has the powers to determine its role. The then finance minister took a wrong decision.?
The PAC did not order an inquiry into the issue as the AGP had demanded. The PAC was informed that production of sales tax record for statutory audit was being denied for the last five years on one reason or another.
Apprising the committee of continued denial of sales tax record for audit by the CBR, the AGP, Mohammad Younas Khan, said, ?The AGP has to determine his course of authority. The executive authority cannot determine my role. If that?s the case, the AGP should go home.?
The AGP derives his authority from Articles 168, 169 and 170 of the Constitution and can requisition all records of the auditee departments/organisations to discharge its mandate as per section 14 of the Auditor General?s (functions, powers and terms and condition of service) Ordinance, 2001.
PAC Chairman Malik Allahyar said whenever the AGP required, the record should be produced. Another committee member Lt-Col (retired) Ghulam Rasool Sahi asked the chairman CBR, ?You have boldly confessed that record was not provided. It is a great embarrassment and serious concern. Would you take action against the concerned officials??
The audit brief presented before the committee said, ?Some time in 1999-2000, the CBR on their own submitted a note to the finance minister stating the position in their favour...On the basis of approval of this note, they issued their letter on September 5, 2000, directing their collectorates to make available to audit a record of sales tax with the exception of mere returns-cum-payment chalans and files of refunds.?
The AGP in its report to the PAC said the CBR during the tenure of previous chairmen Riaz Hussain Naqvi and Riaz Ahmed Malik in addition to the incumbent continued to deny the sales tax record for audit.
?From September 2000 to October 2004, 16 meetings were held between top managements of audit and tax. The defunct ad hoc PAC and the finance minister also took a serious note of it. Lastly, a meeting was held with the present CBA chairman on October 2, 2004. However, the situation has not improved,? said the audit brief.
The AGP report placed before the PAC said the matter was also brought before the ad hoc PAC during its meetings on November 10-11 with a number of reservations which said, ?If such reviews are rendered impossible by imposing restrictions, chances of leakage, misappropriation, evasion and collusion will increase and remain unchecked.?
Like the arguments given by the former chairman Riaz Hussain Naqvi before the ad hoc Public Accounts Committee in November 2000, Mr Yousaf took the same line before the PAC that the problem was of too many audit inspections of registered persons by internal and external agencies in a year which needed to be resolved.
At this, the AGP said the taxpayers were harassed by the internal auditors of the CBR and not the AGP?s department as he had only 28 officers in his staff. He said the CBR should change the name of its internal auditors to stop the negative aspersions cast on the role of the AGP.
When the audit objections were taken up individually, the CBR chairman sought time of six months to streamline the system and give a report to the PAC. He also assured the committee that full cooperation would be given to the AGP.