Sindh High Court orders FBR to reinstate Shell Pakistan’s tax license

According to a news from a local daily, Federal Board of Revenue had suspended the income tax registration of Shell Pakistan for deliberately committing tax fraud to evade taxes. Meanwhile, FBR also imposed a default surcharge of Rs. 142.503 million while inflicting a penalty worth Rs. 73 million on the oil marketing company.

The FBR notice read as such, “It is noteworthy that the Registered Person continued the fraudulent practice till last Return filed for the month of March 2018, in order to safeguard the Government Revenue, this office immediately orders for suspension of Sales Tax Registration of M/s. Shell Pakistan Limited under Section 21(2) of Sales Tax Act, 1990 read with Rule 12 (a) (i) of the Sales Tax Rules 2006 read with SRO SSS (1)/2006 dated 05-06-2006.”

However, Shell Pakistan Spokesperson Mr. Habib Haider said that, “Shell Pakistan Limited (SPL) had received a notification from the FBR requiring the company to explain a tax discrepancy, SPL was allowed by the FBR to respond by 30 April 2018.”

He also mentioned that, “the company had earlier clarified that the relevant amount of tax had been paid in full therefore there was no shortfall in the payment of tax. However, FBR proceeded with the suspension of SPL’s GST license before the stipulated time given to the company to respond.”

He said that the “the suspension of registration was hence not justified, SPL therefore took the matter to the Honorable High Court of Sindh which has suspended the directive of FBR and ordered that the license be reinstated with immediate effect. SPL complies with all statutory requirements of the Country, and strives to conduct its business in accordance with the applicable laws of Pakistan. SPL will continue to work closely with the tax authorities to resolve this issue.”