ISLAMABAD: Federal Board of Revenue (FBR) ordered the Corporate Regional Tax Office (CRTO) Lahore to take immediate corrective action under Section 122 (5) of the Income Tax Ordinance,2001 against M/s Habib Construction Services Private Limited (NTN 3237053) for concealment of income and causing loss of Rs855.30 million to public exchequer
According to details, M/s Habib Construction Services who falls under the jurisdiction of CRTO Lahore derived income from contractual receipts being a contractor. Taxpayer executed several projects during the last six years as predicted by the taxpayer itself on its website.
FBR observed that taxpayer did not declare its actual contractual receipts in its income tax returns with respect to its completed projects. Resultantly, non-declaration of actual contractual receipts caused public exchequer to revenue loss of Rs855.30 million.
It is also important to mention here that Section 111 of the Income Tax Ordinance, 2001 provides for taxation of concealed income which is not offered for tax. According to the provision where a person is the owner of any moveable or valuable article or has made any investment or credited any amount in the books of accounts, the amount shall be chargeable to tax if not adequately explained by the taxpayer.
FBR also directed that if the position of concealment of income established then recovery be made from the contractor along with recovery of default surcharge and imposition of penalties and responsibility may be fixed against the persons found at fault for not initiating legal proceedings for concealment of income.