Tax chief misled PAC - Hakeem

By Bandula Sirimanna

Legal experts and parliamentarians have expressed divergent views over a Parliamentary Public Accounts Committee (PAC) decision to ask the Finance Ministry to probe the Tax chief over alleged involvement in the VAT fraud amounting to Rs 3.57 billion.

While some members of the PAC said the committee had taken a decision to send a letter requesting that Tax Commissioner-General A.A. Wijepala should be probed by the ministry, Committee chairperson and Minister Rauf Hakeem however says no such decision was taken.

But PAC members said Hakeem was delaying in sending the letter because he wanted to consult the President, an issue that drew legal experts to comment that this was an erosion of the power of the legislature. PAC sources said two weeks back that Hakeem had been entrusted with the task of sending this letter to Finance Secretary but when it was not done subsequently, the issue was taken up at a PAC meeting last Wednesday.

Dayasiri Jayasekara, UNP MP and PAC committee member, told The Sunday Times FT the PAC chairman has informed them that he wanted to consult the president and the cabinet on this matter and he was also awaiting the verbatim reports of the committee proceedings from the Hansard Department before finalizing the interim report, exposing corruption and fraud in four revenue departments.

He said that they took the decision to send a letter to the Treasury after conducting inquiries for one and half years, and therefore they should take firm action on this matter. Jayasekara said that there was no need to consult the president as the PAC is an independent committee of the legislature.

Wasantha Samarasinghe, another member and a JVP MP, said he raised this problem in parliament where he said non compliance of the PAC decision (to send the letter) was a serious issue as its main function is to ensure public money is applied for the purpose prescribed by Parliament. The issue has triggered a plethora of comments on parliamentary tradition and the need for a Finance Minister to be present and accountable to parliament.

Dr Rohan Edirisinha, an international law expert and Director of the Centre for Policy Alternatives told The Sunday Times FT, the PAC is a parliamentary body and the legislature has the independence to ensure the due exercise of finances and maintain high standards of public morality in such matters.

As to modalities of functioning and the general environment, he said the approach of the Committee is "more judicial than political," he said. Edirisinha said he was of the view that there is no need to consult the president on this matter (committee decisions). Asked for his views, Wijedasa Rajapakse, MP and COPE chairman said if there was substantial evidence of corrupt practices against any public official, the PAC could make a directive to relevant authorities to take necessary action.

However Priyani Wijesekera, Secretary General of Parliament, said if the PAC has sent such a letter, it would be deviating from the normal practice of allowing Ministry Secretaries who are the chief accounting officers to take appropriate action against officers. She says if such a letter has been sent it would create a precedent in parliamentary committees in making request to take action against officials.

John Amaratunge, UNP MP and a former COPE chairman, when contacted by The Sunday Times FT said the PAC has powers to make a written request from the Secretary of the Ministry to take necessary action against any officer. But he said that there is also nothing wrong in consulting the president on this particular issue of VAT scam as he is the minister in charge of finance. In Parliament on Wednesday, Hakeem said he needed more time to release the committee’s interim report as he was awaiting Hansard reports of the committee’s proceedings regarding inquiries into the VAT scam.

He told Parliament that the Inland Revenue chief who was the chief accounting officer has misled the PAC and he should not sit in his official position when the investigation into the VAT scam is being made as he could influence it.

Other PAC sources said the findings of the committee were alarming as the Inland Revenue Department has failed to conduct an internal inquiry into the actions of the officials responsible for the VAT Fraud. These sources said that officials of the Inland Revenue Department were lethargic in responding to directives by the ministries, and the PAC has found instances of non-compliance with directives of the committee in regard to this ‘massive fraud’.