The tractor maker, Millat Tractors Limited (PSX: MTL), informed the Pakistan Stock Exchange on Monday that the story regarding its Rs. 5.4 billion penalties for sales tax audit discrepancy has been misreported.
This relates to a recent article in the English-language daily in the area about the Federal Board of Revenue (FBR) fining the company Rs. 5.4 billion for errors found in a sales tax audit. The stock filing added, “The said news is misreported as FBR has not imposed any such fine until the publication of this information.”MTL confirmed that, in accordance with its own interpretation, FBR has sent the company a show cause notice for sales tax-related issues.
According to the company, “the majority of the matter(s) taken up in the show cause notice have already been decided by the President of Pakistan, the FTO, and the Lahore High Court, and are liable to be dropped in light of their decisions.”The brief also stated that other cases go against the company’s factual stance and are probably going to be won.
MTL has issued this declaration in spite of prior rumors that, following a thorough investigation of the business, FBR had discovered sales tax irregularities totaling Rs. 13.286 billion. The Federal Board of Revenue (FBR) was instructed by the President to reopen an investigation against MTL in November 2023 for an alleged inadmissible sales tax refund of more than Rs. 12 billion for the tax year 2018–2022.
The President had approved the FTO’s order to begin recovery proceedings against the aforementioned corporation and rejected the FBR and MTL’s representations.In his judgment, the President noted that any intervention in the situation would likely jeopardize the independence of the appropriate body, as the FBR had already started audit proceedings against the MTL for Tax Years 2018–2022, which are still underway. As a result, the President decided to forgo any involvement.
