In a startling revelation, the United Arab Emirates (UAE) Customs Department has confirmed to the Directorate General of Customs Intelligence that containers having banned Indian-made cloths and high-end consumer goods such as cosmetics, auto parts, etc, were illegally cleared by Port Qasim Customs. Sources told Business Recorder here on Wednesday that the Customs Intelligence has received vital records from UAE Customs which establish beyond a smidgeon of doubt that a number of containers stuffed with banned Indian-made Greige/Grey cloth and high-end consumer goods (cosmetics, auto parts, etc) were unlawfully cleared by Port Qasim Customs, causing revenue loss of tens of millions of rupees.
This also clearly reflects violation of the ban imposed through the Import Policy Order on import of grey cloth from India. This is for the first time in the history of Pakistan Customs that Dubai Customs has shared such crucial and confidential information with Customs authorities of Pakistan due to the personal rapport of Director General Shaukat Ali with Dubai Customs. The situation would be further cleared after receiving remaining information of 115 containers cleared during last two years from Dubai Customs to determine exact revenue loss estimated to be around Rs 500 million.
It may be recalled that, in December 2016, Customs Intelligence, after overcoming the toughest resistance put in by the officers/officials of Port Qasim Customs Collectorate, had got hold of four containers, imported by M/s Khurram Steel Mills, Gujranwala, and unlawfully cleared by Port Qasim Customs vide Goods Declaration Nos. KPPI-HC-36077, 36082 and 36088 all dated 07.12.2016.
All the said four containers were cleared from Customs as containing iron & steel scrap and duty/taxes of just Rs 833,990 were charged. On examination by Customs Intelligence, it was discovered that three of the four containers had nothing but banned Indian origin grey fabric in them while the fourth container was found stuffed with miscellaneous goods (such as cosmetics, auto parts, CCTV cameras, caller ID telephones) to the hilt. Total value of the goods recovered from the four containers was assessed to be Rs 31.517 million with incidence of duty/taxes assessed at Rs 15.603 million, whereas the same had been cleared on payment of less than one million rupees (ie, just Rs 833,990) in duty/taxes. Yet another container, stated to be containing iron & steel scrap, was found by Customs Intelligence to, actually, contain miscellaneous goods such as hair preparations/shampoos, motor cycle parts, ladies purses, etc, valuing Rs 10.80 million on which duty/taxes to the tune of Rs 5.4 million were chargeable whereas only Rs 208,497 would have been charged, if Customs Intelligence had not intervened.
Detection of this blatant fraud was well appreciated by trade and industrial circles, particularly by All Pakistan Textile Mills Association (APTMA) in relation to seizure of the smuggled Indian cloth. However, the fraud that was uncovered in December, 2016 appears to be nothing more than the tip of the iceberg.
Customs record indicated that the said unit of Gujranwala had previously imported 195 containers, from different countries of the world and had cleared the same as containing iron & steel scrap on payment of Rs 200,000/- or thereabout as duty/taxes per container of forty feet (40''). Customs Intelligence decided to conduct overseas investigation in respect of 120 containers previously cleared by the Customs authorities of West Wharf and Port Qasim.
Dubai Customs authorities were accordingly approached with the request to provide export documents filed with Dubai Customs in relations to the 120 suspected containers referred to above. Customs Intelligence persisted with the matter and, finally, Dubai Customs has started the process by providing records relating to five containers as the first tranche.
Details and documents provided by Dubai Customs and communicated to Customs Intelligence by the Commercial Counsellor in Pakistan''s embassy in Dubai-UAE through letter No.12(1)2016-17-CS dated 20.06.2017 confirm that the goods actually imported from Dubai vide container Nos. TRLU7098560, SEGU5800535, CAIU8350943, AMFU8868929 and HLXU8228811 were polyester grey fabrics, polyester fabrics, polyester fabric textile piece goods and fan belts. However, Port Qasim Customs cleared all the five (05) containers as containing iron & steel scrap vide Goods Declaration Nos. KPPI-HC-31827 dated 19-11-2016, KPPI-HC-31838 dated 19-11-2016, KPPI-HC-31830 dated 19-11-2016 and KPPI-HC-30157 dated 12-11-2016. Total amount of duty/taxes charged on the goods imported through all the five containers referred to above was Rs 1.1 million whereas the record/documents provided by Dubai Customs categorically confirm that value of the goods imported through the impugned five containers was Rs 41.5 million and the actual amount of duty/taxes chargeable thereon was Rs 13.1 million. Thus, the government was defrauded of its legitimate revenue of Rs 12 million in relation to the clearance of the above-referred five unlawfully cleared containers. Customs Intelligence has now referred the matter of recovery of the defrauded amount of Rs 12 million to the adjudicating authority.
The facts and figures quoted above point to the extent and dimensions of the fraud committed at Port Qasim and West Wharf during the last two years or so. So far, information about just five containers has been retrieved from Dubai and the picture has already started looking quite bleak. Receipt of records/documents relating to the remaining 115 dubious containers is likely to take the stolen amount of government revenue in the vicinity of Rs 500 million, keeping in view the fact that in quite a few containers very expensive goods may have been unlawfully cleared. The most interesting part of the whole story is that FBR has not taken any action against the officers/officials posted at Port Qasim during the period of fraud, sources added.
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