The Large Taxpayers Unit has requested the capital market regulator to take legal measures against Grameenphone for not keeping provision in its accounts against state's VAT claim of Tk 2,015 crore.

The move comes at a time when Grameenphone's stock has been on an upward trajectory and even hit an all-time high of Tk 500 on Tuesday.

The field office of the National Board of Revenue sent a letter to the Bangladesh Securities and Exchange Commission on November 14, citing eight VAT-related cases pending at different courts between the government and the largest mobile phone operator.

The cases include Tk 1,023 crore VAT claims by the NBR related to the issuance of SIMs. 

The LTU VAT earlier said the country's largest mobile operator had sold SIMs to new customers between July 2007 and December 2011 under the guise of issuing replacement SIMs to customers with the view to evading tax on SIMs.

The NBR's field office has also claimed VAT from other operators as unpaid tax on SIM issuance.

The operators, including Grameenphone, appealed to the High Court against LTU's claims after losing battle at the VAT Appellate Tribunal in June this year.  The LTU, in its letter, said the High Court earlier gave judgment in favour of the government following a writ petition filed by Grameenphone against the VAT claims on SIM replacement.

There is another case of VAT evasion of Tk 378.95 crore related to issuance of replaced SIMs between July 2012 and June 2015.

The LTU has issued primary demand citing that the Appellate Tribunal gave verdict in favour of the government.

The mobile phone operator also has a dispute of Tk 19 crore involving VAT on space and establishment rents. The NBR's field office got judgment in favour of the government from the Appellate Tribunal on VAT on this case as well. The LTU said Grameenphone appealed to the High Court challenging the Tribunal's verdict.

The mobile operator earlier filed a writ petition with the upper court and the apex court gave judgment in favour of the government. Grameenphone also has a Tk 452 crore VAT dispute for non-payment of Tk 348 crore SIM tax during August 2006 to March 2007 on time, according to the LTU.

Contacted, LTU VAT Commissioner Matiur Rahman said the mobile operator has not kept any provision in its accounts even though it owes Tk 2,015 crore to the government. “So we have asked the BSEC to take steps so that the company keeps provision.”

As per standard accounting principles, companies should keep provisioning in its accounts against arrears when there are cases at courts.

With the face value of Tk 10, Grameenphone shares closed at Tk 486.10 yesterday after opening at Tk 500 per share.

The operator recorded Tk 700 crore as profit for the third quarter to take the tally so far this year to Tk 2,146 crore. Grameenphone's highest profit was registered last year: Tk 2,250 crore.

Rahman said the LTU has also requested Bangladesh Bank a month ago to not allow Grameenphone to remit money to its parent company Telenor Group unless it keeps provisioning.

On the issue, Sayed Talat Kamal, head of external communications of Grameenphone, said, “We have not received any communication and can only comment after we have seen it and have had time to assess the allegations.”