February 02, 2015 – Sohail Sarfraz –
The Federal Board of Revenue (FBR) has launched recovery proceedings against those fertilizer dealers and distributors who have failed to deduct 4 percent withholding tax on payments received under section 153 of the Income Tax Ordinance, 2001. Sources told us here on Saturday that the FBR has issued instructions to all Chief Commissioners of Large Taxpayer Units and Regional Tax Offices (RTOs) on the non-deduction of withholding tax u/s 153(1)(a) of the Income Tax Ordinance 2001 by fertilisers dealers and distributors.
According to the FBR, the RTO, Faisalabad while monitoring the withholding tax u/s 153 discovered that a fertilizer company has received the payment from various fertilizer Dealers/Distributors in the first two quarters of the current financial year. Tax on these payments was supposed to be deducted u/s 153(1)(a) @ 4%. In addition to this inquiry, it has been observed that the fertilizer company has no exemption for the first two quarters of the tax year 2015. In that case the withholding agents “The Dealers and the Distributors” were supposed to deduct the tax u/s 153(1)(a) which they did not. As a result of these concerted efforts, Rs36 million has been recovered u/s 161/205 and the remaining amount is in the pipeline.
In the light of above facts, the FBR has directed the field formations that to obtain information of Fertilizer Dealers and Distributors doing business in the territorial jurisdiction of respective LTU/RTO for the recovery of the lost amount in a similar manner along-with the default surcharge, FBR added.