The Directorate General of Intelligence and Investigation, Customs and Excise has started legal proceedings for the attachment of assets of Raja Zarat, chairman, the Bawan Shah Group of companies and also identified senior customs and sales tax officials, who were on duty in the collectorate, Karachi, during the period of multi-million GST/DTRE scam.
It is learnt on Thursday that the Intelligence director general has made significant progress on the case before handing it over to the National Accountability Bureau (NAB). The board has referred the case to the Bureau on November 8, 2006 for further investigation.
The directorate found that the bank accounts used for making supplies were opened through misuse of computerised identity card numbers (CNICs). Fake CNICs were also used to register the supplier units, while owners of some of the supplier units were being searched with the help of Nadra and record available with the banks.
Sources said some of the properties of the accused have been identified. The military estate officer, Karachi, and sub-registrar-1, Clifton, Karachi, have been requested not to allow sale/transfer of the identified properties without NOC from the directorate general/court.
Moreover, letters to district co-ordination officers (DCOs) concerned have also been issued for identification of other properties of the accused which would be attached through the competent court of law on finalisation of the judicial/quasi judicial proceedings in the cases.
About involvement of senior officials, the CBR has obtained a list of officers posted in sales tax and customs collectorates, Karachi, from the relevant offices. Though the staff concerned, who approved the export has already been nominated in the FIR, the records are being examined for possible involvement of senior officers in the tax fraud cases.
Sources said all officials nominated in the FIRs have been placed under suspension except one Appraising Officer Abdul Jabbar Khan, who has retired from the government service. It is pertinent to point out that all the customs officials have gone underground to avoid arrest. However, hectic efforts are being made to arrest all the absconding customs officials. Besides, the competent court of jurisdiction has also been requested for initiation of proclamation proceedings under section 87 and 88 CrPC.
About the latest position of investigation, sources said that investigation covering almost 50 percent fraudulent exports under DTRE has been completed so far. Documents relating to about 50 consignments confirming the fraud have also been obtained. The rest of the documents are being procured through various sources, which may take another two to three months.
The misuse of the DTRE scheme has been confirmed after search of two units, which were found almost empty with very little local fabrics and terry towels scattered around. One sewing machine was found installed in the Latest Fashion Stitching Factory and 12 old and used powerlooms with motors and four sewing machines were found in the Early Morning Textile Mills.
The period from July 2005 to February 2006 has been identified in which phony exports were allowed wherein almost 50 consignments amounting to Rs 44.72 million have been confirmed as mis-declared, and inadmissible sales tax refund. During the period from October 2002 to June 2005, in which the sales tax refunds amounting to Rs l.2 billion were sanctioned.
It has been time and again reiterated by the CBR that no conclusive figures have been arrived at so far and never any final figures were released by CBR or the investigating agency.
According to DG Intelligence, the Group has obtained sales tax refund of Rs 1.2 billion, during October 2002 to June 2005 (Tax periods) through its seven companies/sales tax registered persons. The break-up of the refund reveal that Bawan Shah Trading obtained Rs 293 million refund; Early Morning Textile, Rs 279 million; Latest Fashion Stitching, Rs 279 million; B.S. Enterprises, Rs 112 million; Business International, Rs 106 million; Alliance Leather, Rs 75 million and Bawan Shah Corporation obtained refund of Rs 75 million.
Out of Rs 1.2 billion, Rs 917 million has been obtained in 2004-2005, Hence, 75 percent of the total refund has been sanctioned in 2004-05.
Presently, investigation is focused on verification of shipping bills, identification and verification of major suppliers, analysis of banking transactions and correlating purchases, manufacturing facility availability and exported goods.
The DG Intelligence has also obtained original Saudi Customs documents of 51 containers, exported to Saudi Arabia by the said Group. Upon cross-checking with the relevant export documents filed before Pakistan Customs, 32 consignments have been identified as exports under DTRE, involving Rs 44.54 million which were also mis-declared.
Accordingly, fifth FIR has been lodged in the Court of Special Judge, Karachi. Relevant documents of remaining consignments are being collected from Collector of Customs (Exports), Karachi to ascertain further mis-declaration. The Commercial Consular, Jeddah, Saudi Arabia has been requested for verification/authentication of documents provided by the source.
As per details provided by Collectorate of Sales Tax, Collectorates of Customs (Exports)/(Appraisements) and Pral, the Bawan Shah Group of Companies has obtained Rs 2.060 billion on account of Sales Tax Refunds, Customs Rebate, DTRE Remission and exemption under SRO.410(I)/2001 during 2001 to March 2006.
The sales tax refund (all seven companies) Rs 1,219 million; customs rebate (all seven companies) Rs 604 million; DTRE Remission (the Early Morning Textiles Mills and the Latest Fashion Stitching Factory), Rs 156 million; exemption under SRO-410(I)/2001 (the Early Morning Textiles Mills and the Latest Fashion Stitching Factory) Rs 81 million. Therefore, total amount of refund/rebate was Rs 2,060 million.
The Directorate was of the view that almost all refund claims files of 2004-05 have been retrieved from Sales Tax Collectorate, whereas 90 percent shipping bills have been sent to export Collectorate for verification, verification of 480 shipping bills has already been received.
The directorate has identified major suppliers in 2004-05. There are 11 major suppliers, 10 based in Karachi and one in Lahore. The verification is in progress in which a pattern is emerging that these supplier units have been registered by misusing CNICs of persons who do not even know about the existence of these registered units, let alone making supplies of taxable goods to the Bawan Shah Group of Companies. In some cases, there is possibility of use of fake CNICs.
Audit of refund claims files of 2004-05 is under process. It is a long and tedious task in which inputs are being co-related with the closing stocks and exported goods, the directorate said.
On the basis of investigation carried out so far, an amount of Rs 328 million out of total refund of Rs 1,219 million has been identified with sufficient evidence that it has been claimed fraudulently.
The Dubai Customs has confirmed mis-declaration in 17 such containers exported by the Group to Dubai, whereas the Uganda Revenue Authority has sent Customs documents of one container, which is also found to be grossly mis-declared.
The incidence of duty remission on these 18 containers comes to Rs 16.989 million. The concerned customs authorities/commercial counsellor have been requested for supply of certified copies of complete customs documents, which are awaited.
Comments
Comments are closed.