The revenue authority has filed a case against the local sales partner of social media giant Facebook on allegation of noncompliance with the value-added tax law.

The VAT Audit, Intelligence & Investigation Directorate (VATAIID) under the National Board of Revenue filed the case after finding that digital ad agency Httpool Bangladesh was not operating from the address it had used while obtaining VAT registration, according to a press release.

Httpool Bangladesh got its VAT registration using an address at Karwan Bazar in the capital in May this year, said the VAT directorate, adding that it did not find "existence" or "activities" of the firm during investigation.

"As per rules, VAT offices should be informed in case of any change in the office address of a company. But no notice was given in this regard," said VATAIID Director General Moinul Khan in an email.

The address mentioned in the VAT registration is now used as the chamber of some lawyers, Khan said over phone.

VAT detectives disclosed the findings after an investigation launched on the basis of a complaint.

Httpool announced its appointment as Facebook's local sales partner in June this year, making it easy for local companies and self-employed people to advertise their products and services on the vastly popular social media platform.

Though Bangladeshi companies are increasingly turning to Facebook, YouTube and Google to reach out to their target customers online, buying ad space on these digital platforms was a convoluted and opaque exercise until recently.

The VATAIID found that Httpool had collected ad revenues worth Tk 6.22 crore from 31 firms through 198 acknowledgement receipts and deducted Tk 93.32 lakh as VAT against the advertisements.

The field office of the NBR said Httpool did not submit VAT returns even though it got registration three months ago.

Rules bind submission of VAT returns on a monthly basis, Khan said in the press statement, adding that the VAT deducted from the clients was not deposited to the state coffer as the Facebook agent did not furnish returns every month.

"We have lodged the case under the VAT law for non-filing of VAT returns and nonexistence of the company's office in the given address," he said, adding that further investigation is ongoing. 

The case has now been forwarded to the VAT Commissionerate of Dhaka South.

The Daily Star contacted Benchmark PR, the public relations partner of Facebook in Bangladesh, but no comment came at the time of going to print.