Pakistan is facing the menace of illicit trade and unlawful manufacture of cigarettes, a problem estimated to be causing an annual revenue loss of nearly Rs. 250 to 300 billion to the national exchequer.
Recognizing the gravity of this challenge and its far-reaching economic implications, the Prime Minister of Pakistan has issued clear directions to decisively curb the illicit cigarette trade and ensure strict enforcement of tax laws.
In compliance with these directions of the Prime Minister of Pakistan, the Federal Board of Revenue (FBR) formulated a comprehensive and multi-layered enforcement plan aimed at eliminating non-duty-paid cigarette production, strengthening monitoring mechanisms, and disrupting illegal supply chains. This national effort received broad support from all stakeholders, most notably the Pakistan Army, which has extended full cooperation to reinforce enforcement operations.As part of the coordinated strategy, approximately 120 Pakistan Rangers personnel have been deployed at Green Leaf Threshing (GLT) units across the country to assist in monitoring and securing the premises against illicit manufacturing activities.
Simultaneously, FBR has also posted more than 200 dedicated monitors under Section 40B of the Sales Tax Act, 1990, and Section 45 of the Federal Excise Act, 2005, to oversee production, ensure lawful removal of goods, and verify tax compliance at manufacturing facilities.
Following the directions of the Prime Minister and in strict compliance with FBR’s enforcement plan, the Directorate of Intelligence and Investigation-IR Peshawar, after obtaining warrant from area Magistrate, conducted a successful raid on an undeclared godown in the area of Jabbar Police Station District Mardan KP on 03.11.2025. During the search a total of 200 cartons of non-duty paid/non-TTS cigarettes with brand names, Business Class, Red and Crown were recovered. The mentioned cigarettes are registered brands of M/S.Indus Tobacco Company (Pvt) Ltd. Accordingly the Directorate of I&I-IR Peshawar forwarded a Contravention Report on 21.11.2025 to Regional Tax Office Peshawar. Acting upon the contravention report, and after completing the codal formalities and necessary approvals, the manufacturing machinery of M/s Indus Tobacco Company was sealed under Rule 28A(6) of the Federal Excise Rules, 2005 by the officers of RTO Peshawar on 29.11.2025. The operation was executed by DC(IR) Arsalan Ali under the supervision of the Chief Commissioner, RTO Peshawar. Further proceedings under sections 21, 22, 19(3), 19(10), and 27 of the Federal Excise Act, 2005 are underway.
During and after the search proceedings, the Officers and officials of I&I-IR Peshawar faced stiff resistance from armed personnel including the Director/owner of the Company. Despite immense pressure armed resistance, both I&I-IR and the Chief Commissioner-IR RTO Peshawar and his enforcement team successfully carried out the action without succumbing to any influence, demonstrating FBR’s unwavering commitment to upholding the rule of law and protecting the national revenue. Mr. Bilal khan, One of the directors of the company who also resisted the lawful proceedings with fire arms, is related to prominent political family of district Mardan whose many members had remained members of the provincial assembly of Khyber Pakhtunkhwa.
Earlier, a similar action was taken against another prominent manufacturer, M/S.Souvenir Tobacco Company on 29.11.2025 which was found involved in manufacturing and removal of non-duty paid/non-TTS cigarettes. Machinery of the said company was also sealed.
