KARACHI: Rs40m fraud in motor vehicle tax collection detected

KARACHI, Oct 17: The Sindh excise and taxation department has unearthed a Rs40 million fraud in motor vehicle tax collection. An unspecified number of suspects, E&T staff of inspector rank, have been placed under suspension and a high-level inquiry into the fraud has been instituted.

The disclosure was made by provincial Minister for Excise and Taxation Mukesh Kumar Chawla at a press conference here on Saturday. He said that the fraud was detected in transactions involving four of the 11 branches of the National Bank of Pakistan authorised to collect the motor vehicle tax. The transactions, made through an MV tax committee, pertained to January and July (2009) accounts. He said the involvement of any bank employee in the racket was yet to be established.

The minister said that a high-level inquiry had been ordered on a directive of the chief minister, adding that the inquiry team comprised director-general Shoaib Siddiqi and director administration Qadeer Khan of the E&T department, two members of the chief minister’s inspection team and two State Bank officials.

He said that the chief minister had also ordered an audit of all the 11 MV tax collecting NBP branches accounts of the last five years. He said the inquiry team had been asked to submit its report within the next 15 days.

Giving details of the racket, Mr Chawla said that during the perusal of a quarterly collection report, it was found that the collection of motor vehicle tax was falling. Subsequently, an inquiry team was set up to ascertain the causes of the fall. The inquiry team submitted its report which was discussed at a meeting with the chief minister. The facts and figures contained in the report were brought to the chief minister’s knowledge.

Mr Chawla said that in the light of the inquiry team’s findings, a random check of motor vehicle tax deposits with four NBP branches was undertaken which led to the detection of the fraud, amounting to around Rs40 million. The bungling, he pointed out, pertained to only two months’ transactions, i.e. during January and July this year.

The minister said that a pilferage of Rs8.4 million was detected in the MV tax transactions made through the NBP’s M.A. Jinnah Road branch alone. Another pilferage amounting to Rs17.5 million was unearthed in similar transactions made through two other branches of the bank, he added.

“On Saturday morning, our team checked the MV tax collection account of the NBP’s Shaheed-i-Millat branch and detected a fraud of Rs3 million,” he said, adding that pilferage to the tune of Rs6.8 million was unearthed in the such transactions made through another branch of the bank.

Mr Chawla told newsmen that an audit of MV tax accounts at all the 11 authorised NBP branches would start on Monday and, initially, the record pertaining to the period July 2008-June 2009 would be checked.

Staff suspended

The minister said that the E&T staff concerned had been placed under suspension until the submission of the inquiry instituted for the purpose. He apprehended that the audit of the past accounts might also lead to similar disclosures.

In reply to a question, he said those placed under suspension were “inspectors” who manned the MT tax collection counters at the authorised bank branches.

In reply to another question, he said any involvement of the bank staff in the racket could be established only after the inquiry.—APP