10/11/2026
🇵🇰 Senate Sub-Committee Calls In-Camera Meeting on November 16 to Review FBR's Investigation into Rs 1120 Billion FATA/PATA Tax Exemption Misuse, Seeks Complete Records and Recovery of Evaded Taxes
A meeting of the Sub-Committee of the Senate Standing Committee on Interior and Narcotics Control was held today at the Old PIPS Hall (PRC-Hall), Parliament lodges, under the chairmanship of Senator Saifullah Abro, to review progress on the investigation into the alleged misuse of the FATA/PATA tax exemption scheme, recovery of evaded taxes and identification of those involved in the illegal activities.
The meeting was attended by Senator Umer Farooq and senior officials from the relevant ministries and departments.
At the outset, the Chairman expressed serious displeasure over the absence of the Director General of the National Cyber Crime Investigation Agency (NCCIA), questioning the non-serious attitude of the concerned authorities, particularly when it had already been decided in the previous meeting that the DG would brief the Committee.
During the briefing, representatives of the Federal Board of Revenue (FBR) and the Federal Investigation Agency (FIA) presented their respective positions regarding the ongoing proceedings and investigation. The FBR officials maintained that the department had not received any formal notice from the court, whereas the FIA informed the Committee that its Legal Adviser had received the relevant court order. The Chairman and members expressed concern over the apparent lack of coordination and questioned why the FBR had remained unaware of the court proceedings for nearly two months.
The Committee was briefed on the reconciliation gap between Customs import data and consumption certificates for the period from 2018 to June 2026. It was informed that total imports amounted to Rs.1,120.662 billion, against which consumption certificates covered imports worth Rs.389.865 billion, leaving an apparent unreconciled difference of Rs.730.797 billion. The sector-wise analysis revealed apparent differences of Rs.148.248 billion in steel, Rs.146.955 billion in textile/fabric, Rs.100.884 billion in food, and Rs.76.487 billion in ghee and oil. The Committee emphasized the need for a comprehensive, transaction-wise reconciliation to ascertain the actual position and determine any potential tax liability or revenue loss.
Further, the FIA informed that 512 notices has been issued to various companies in connection with the ongoing investigation, out of which 19 companies joined the proceedings with partial records, while more than 100 notices were returned or remained undelivered. The matter is under examination before the competent court, and proceedings are investigative in nature, aimed at obtaining relevant documents and explanations. Possible corruption, abuse of authority, diversion and wrongful release of securities are being independently examined in accordance with the law.
The Chairman emphasized that the Committee had been pursuing the matter for a considerable period and that the authorities must demonstrate seriousness and take concrete action instead of prolonging the proceedings. He observed that the FBR should make effective use of the Committee's support and the investigative capacity of the FIA, particularly where tax authorities face difficulties in reaching certain companies and individuals.
The Chairman Committee was also briefed about the FBR's reluctance to share relevant records with the Parliamentary Committee, particularly when the department was prepared to provide information to the court and other authorities. Referring to Article 66 of the Constitution, Senator Saifullah Abro questioned the legal basis for withholding information from Parliament and asked the FBR to clarify the authorities to whom such records could legally be disclosed. The members stressed that parliamentary oversight must be respected and that the relevant legal provisions should not be used to delay accountability.
The Committee also examined the details of consumption certificates and payments released against them. It was observed that Out of the 223 companies, consumption certificates are expected to have been issued for 60 companies. The Chairman sought a comprehensive explanation of the certificates, the amounts released against them and the supporting documentation. He particularly highlighted 20 certificates involving approximately Rs.64 billion and directed the FBR to provide complete details, including the relevant records and justification for their issuance. The Chairman further referred to the Terms of Reference concerning approximately Rs.74 billion and questioned the release of payments without adequate verification and scrutiny.
Expressing serious concern over the financial implications, the Chairman observed that the alleged tax liability associated with the matter could be substantial and that the state must recover every rupee legally due. He referred to an estimated amount of Rs.1,120 billion and stressed that the FBR must ensure the proper assessment and recovery of applicable taxes.
The Chairman directed the FBR to examine the relevant Statement of Requirements (SOR) issued in 2021 and investigate whether the consumption certificates and subsequent releases had been processed in accordance with the applicable legal framework. He observed that the matter could have been addressed much earlier had timely action been taken. He further stressed that the investigation should not be confined to a few selected cases but must extend to all companies and individuals potentially involved in the misuse of the exemption scheme.
The Chairman also raised concerns regarding the large number of companies and petitioners involved in the proceedings. He questioned how numerous companies and individuals could adopt an identical position before the court and directed the FBR to examine the list of petitioners, verify their respective positions and issue notices wherever necessary. He emphasized that the FBR should proactively establish its legal position and pursue the matter instead of waiting for further directions.
Referring to reports of individuals possessing substantial assets, large convoys of vehicles and unexplained sources of income, Chairman Committee Saifullah Abro urged the FBR to investigate possible financial irregularities and money laundering. He questioned how individuals with no apparent declared means of income could maintain such expensive lifestyles. The members stressed that the investigation must also examine the financial trails and possible involvement of influential individuals and networks.
The Committee further discussed the alleged movement and importation of tobacco-related material through the FATA/PATA exemption regime and its subsequent use by companies operating outside the exempted areas. The Chairman observed that the issue involved a substantial loss to the national exchequer and required coordinated action by the FIA, FBR, Customs and other relevant enforcement agencies. He directed the concerned authorities to provide complete import records from January 2018 onwards, particularly details of consignments, their movement, destinations and the companies involved.
The Chairman also sought details of companies involved in importing material without payment of applicable taxes and directed the relevant Customs authorities to furnish records of imports through Khyber Pakhtunkhwa and FATA, particularly for the period after June 2026. He emphasized the need to examine the tracking and movement of containers and to identify any misuse of the exemption mechanism through companies established in other parts of the country. The Committee was informed that a significant number of companies had already been referred to the FIA for investigation, while further cases remained under examination.
The Chairman stressed that the investigation must be pursued without fear or favour, observing that the money involved belonged to the people of Pakistan. He urged the FBR officials to demonstrate professional integrity, take ownership of their responsibilities and ensure that no individual or company was allowed to escape accountability. He also emphasized that, wherever law-and-order constraints prevented officials from accessing certain factories, the assistance of law enforcement agencies should be sought to facilitate the investigation and verification process.
The Chairman Committee directed that the next meeting of the Sub-Committee, scheduled for November 16, 2026, be held in-camera to examine sensitive financial and investigative records. The FBR was directed to bring complete details of all consumption certificates issued from November 2025 onwards, along with the corresponding payments, pay orders, supporting documents and verification records. The concerned authorities were also directed to provide the complete details of the remaining companies under investigation without further delay.
Furthermore, the Khyber Pakhtunkhwa Customs authorities were given four to five working days to furnish the required import and movement records, taking into account the different routes and customs regimes through which consignments had been processed. The Chairman directed that all relevant information be compiled and presented before the Committee in the next in-camera meeting.
The Chairman concluded that the Committee was extending its support to facilitate the concerned departments in identifying the culprits, recovering public money and strengthening the accountability mechanism. He emphasized that the matter could no longer be allowed to linger and that tangible progress, rather than repeated assurances, was required from all relevant authorities.
The Federal Investigation Agency (FIA), through its Anti-Corruption Circle, briefed the Sub-Committee on a coordinated multi-city operation conducted in connection with the high-profile Silver Swapping and Heist Case, involving alleged corruption, smuggling and the suspected involvement. They informed that during the course of the investigation, it was revealed that the accused had allegedly adopted a systematic modus operandi involving the fabrication of fake container seals, counterfeiting, substitution of genuine silver with lead bars and concealment of the stolen consignment. The investigation established that approximately 400 kilograms of silver had been swapped, out of which 214 kilograms had so far been recovered, while the case involved an estimated financial loss of PKR 4 million. Legal proceedings had been initiated against the accused, who were facing proceedings before the competent courts. The FIA informed the Committee that the investigation was continuing through digital and financial forensics, asset tracing and other investigative measures to identify all individuals involved, recover the remaining stolen silver and bring the perpetrators to justice.
Subsequently, the DG Safe City explained that the theft had been carried out in a highly sophisticated and carefully planned manner. When the consignment reached Lahore, it was discovered that the original silver had been replaced with lead bars. He explained that one vehicle had initially been prepared for the operation. However, as it exited the airport, another identical vehicle approached from behind and carried out the swapping operation. The vehicle carrying the consignment was subsequently taken away. The entire sequence of events was detected through the Safe City surveillance system. Further investigation revealed that replica boxes had been prepared specifically for the operation, and the individual responsible for manufacturing and supplying these boxes was apprehended after four weeks.
The DG Safe City also questioned the allegations of their involvement, stating that had they been involved in the operation, they would not have detected and exposed the swapping activity themselves.
The Chairman of the Sub-Committee highly appreciated the FIA's efforts and commended its professional approach, effective coordination and significant progress in the investigation. He particularly lauded the recovery of 214 kilograms of silver and acknowledged the Agency's commitment to pursuing the case through sustained investigative efforts. He emphasized that such proactive measures were essential to ensuring accountability, recovering the remaining stolen consignment and bringing all those involved to justice.
The Chairman remarked that the incident deserved to be made into a film. He suggested that, if Sindh had a dedicated film-making wing, or a similar facility existed in Balochistan, a film should be produced highlighting the entire incident, particularly how the theft was planned and executed and how it was subsequently detected through the Safe City surveillance system.
Government of Pakistan Federal Investigation Agency - FIA FBR Regional Office Islamabad
