FBR seeks to implement IT based trace mechanism on sugar godowns


ISLAMABAD (Eshfak Mughal):– While grilling the sugar mafia, the government was suggested to strengthen to inspection regime, enhancing the penalties for late sugar crushing and cartelization. The FBR also suggested to implement the IT based track and trace system on brokers and sugar godowns.
A sugar report was submitted in the cabinet meeting which was held under the chairmanship of Prime Minister Imran Khan here on Tuesday. The meeting allowed to open the report for further discussion to formulate suitable law in this regard.
The report suggested that the government should enhance financial penalties for late sugar crushing by the sugar mills to Rs 5 million fines and 12 month imprisonment to make sure timely sugar crushing could be started. Last month, the sugar prices were gone by sky rocketing speed due to end of the sugar season.
The report also highlighted the possible cartelization in the sugar sector and said that the association of sugar mills owner is generally frontrunners of cartel. “Section 38 of competition Act 2010 may be amended suitably, adding a maximum penalty of Rs 75 million for violations by the associations. The penalty may by enhance as a certain percentage of the combined turnover of the member undertakings”, the report suggest.
The report suggested the government to impose sales tax on actual sales prices on sugar. In this regard, the Federal Board of Revenue should issue SRO. Currently the government is charging sales tax on ex-mill rate.
“The Competition Appellate Tribunal needs to the revised and made fully functional with regular members. This will end delays in decisions under the competition law”, suggested in the report.
The report also suggested to SECP to amend the law for allowing audit of cost accounts of the company. It also said that administrative ministries should have power to request to SECP for cost audit for required commodities.
To deal with possible satta in sugar, “The inspection regime should be strengthened to ensure that no sugar remains inlifted after the expiry of the forward contract”. The report also said that the FBR should implement IT based track and trace system. There should be mandatory registration of brokers, sugar dealers, wholesalers with NTN and STRN linked to their bank accounts with mandatory registration of godown and automated online inventory management system. The Board also should develop a digital dashboard of stocks of sugar.
The report also says the provincial governments should strict implementation to ensure that no hoarding is possible. The State Bank should issue advisory to commercial banks to inspect their pledged sugar stocks and to verify their presence with the collaborations with FBR and Cane commissioners. Joined inspection teams should be formed of concerns banks, SBP, FBR and provincial governments to verify the pledged stock after every three months, the report further said. The matter may be referred to Federal Investigation Agency in case of any misappropriation, the report said.