A directive has been issued to seize the bank accounts held by Fu-Wang Food Limited, a company listed on the stock exchange. This directive was issued by the National Board of Revenue (NBR) to a private bank. It is reported that the order was issued by the Deputy Commissioner of Taxes in Dhaka Tax Zone-15.
For the past several years, Fu-Wang Food Limited has been in arrears, and despite multiple directives for payment, the company has not complied with government orders. In light of this situation, the authorities have decided to seize an equivalent amount of the company’s outstanding taxes.
From the fiscal year 2016-17 through 2021-22, Fu-Wang Food has not paid its due taxes. During this six-year period, the company’s outstanding tax liability has accumulated to Tk 4 crore 82 lakh 76 thousand 387. Among these arrears, Tk 74 lakh 43 thousand 184 was accumulated in 2016-17, Tk 11 lakh 64 thousand 402 in 2017-18, Tk 46 lakh 54 thousand 282 in 2018-19, Tk 65 lakh 71 thousand 820 in 2019-20, Tk 1 crore 71 lakh 47 thousand 93 in 2020-21 with interest, and Tk 1 crore 12 lakh 95 thousand 606 in 2021-22 with interest.
According to sources, the bank account operated by Fu-Wang Food has been asked to deposit the amount equal to the tax due to the tax office. On October 9, the Deputy Tax Commissioner of Region-15. Ruhul Amin gave this order. A letter regarding the instructions has been sent to the head of the Banani branch of the private bank.
The letter stipulates that as the taxpayer company, Fu-Wang Food Limited, has not yet settled the outstanding tax amount of BDT 4 crore 82 lakh 76 thousand 387 (Four Crore Eighty-Two lakhs seventy-six thousand three hundred eighty-seven taka only), the provisions of Section 221 of the Income Tax Act 2023 are being invoked that you are obligated to make immediate payment to the concerned party, or in the case where the amount is not currently payable, to make the payment only when you are rightfully entitled to that amount. If the amount payable to the party is less, you are directed to pay the community the specified sum. If you fail to make this payment, the amount payable, the right to it, or the excess amount, if any, should be settled directly with me.
In addition, it is further stated in the notice that this directive to seize funds is applicable to any financial disbursement made by the taxpayer company’s owners or any entity under their ownership. This shall be taken into account and the respective taxpayer shall be responsible for making payments equivalent to the amount of money mentioned on the receipt I receive after receiving the funds, in accordance with the relevant Income Tax Act of 2023. If, even after receiving this notice, you fail to make the due payments to the respective taxpayer, or if the amount paid by the defaulter to you is less than what should be, you will be held personally responsible for the tax due, and the difference amount shall be settled as per the Income Tax Act.
To shed more light on this matter, Mia Mamun, the director of Fu-Wang Food, explains that they faced significant tax and VAT issues left behind by the previous owner, amounting to 50 to 60 crore Taka. They expressed their inability to pay such a substantial amount to the National Board of Revenue (NBR). However, NBR has since withdrawn its claims. Regarding the outstanding tax, they plan to negotiate with the previous owner to resolve the matter as the previous owners are liable for the unpaid taxes. If they fail to fulfill their tax obligations, efforts will be made to reduce the burden on the company.
Notably, it is pertinent to mention that with the involvement of the alleged Japanese entity, Minori Bangladesh, in the ownership of two listed companies on the country’s stock exchange, Fu-Wang Foods and Emerald Oil Industries, there have been controversies surrounding the increase in the companies’ share prices. Primarily, allegations of price manipulation have been raised against Mia Mamun Syndicate, creating concerns within the market. Already, the NBR has issued a directive for tax recovery from Fu-Wang Foods. Additionally, Basic Bank Limited has announced the sale of all assets of Emerald Oil Industries.