The investors/importers of dump trucks at Karachi Export Processing Zone (KEPZ) have strongly contested the involvement of manufacturers' agents in clearance of dumpers from the EPZ giving the agents a clean chit to ascertain the year of manufacture, make/model type and value of the vehicle.
The directive was issued on the complaint of local assemblers that dump trucks cleared as six-wheelers were modified and re-registered after customs clearance as ten-wheelers.
The CBR recently issued instructions to collectors of customs that the importers should submit the original registration certificate or the receipt issued by the auctioneer, showing make, model, size, accessories and value.
Moreover, the chassis/engine series of the dump trucks imported and subsequently cleared so far from EPZ must be tabulated and forwarded to the local agents of original manufacturers providing complete type, model, year of manufacture, tonnage and value.
KEPZ construction machinery owners association said here on Sunday that investigations conducted by CBR, as well as Directorate General Investigation and Intelligence, were wrong.
Instead of facilitating the importers, the CBR issued a harsh directive to collectors banning clearance of dumpers from 13 units at EPZ and involved local assembler/manufacturers in clearance process.
They opined that local manufacturers, or their agents, would never supply the correct information to the custom authorities for assessment of value.
The involvement of the local assembler with the custom committee will create problems to the importers of dumpers trucks, which are being released by the customs strictly in accordance with the requirements of tariff/nomenclature.
The main complainants and competitors are only local assemblers and their involvement will be against the natural justice, whereas the importers engaged in rebuilding and reconditioning of dump trucks annually deposit billions of rupees as custom duty.
All dump trucks are being imported into the Tariff Area after payment of all due taxes in accordance with law and tariff requirements and imports regulations.
These investors are facing problems from Customs and intelligence agencies as customs clearance is being held up from time to time on the complaints of local manufacturer/assemblers.
Importers said that dumpers are being assessed under H.S.Code No 8704.1000 on the basis of findings of the Committees constituted by the tax authorities for this purpose when the question of assessment arose at different levels. The proper records of clearance are available with Customs House.
In the past, unnecessary disputes were raised with regard to the assessment of Dumpers and Show-Cause Notices were issued to different importers in 1994. The matter remained in adjudication and thereafter in Tribunal Karachi issued a judgement that the Dumpers are to be assessed under H.S.Code No 8704.1000 on the basis of criteria of Explanatory Notes in which different models of Dumpers were included.
The CBR did not agree with the judgement and filed an appeal before High Court, Sindh, which was dismissed.
Later, the customs department approached Supreme Court of Pakistan which held up the judgement of Tribunal Karachi.
Meanwhile, the committees were constituted by Custom Collectorate (Appraisement) and Export Collectorate to assess the dumpers.
The importers offered the Directorate of Intelligence and Investigation to associate in the examination conducted by the custom committee but they directly approached the Collector Export for examination/assessment of the same.
The Directorate has no mandate to examine and allow clearance of any imported goods under the law.
KEPZ construction machinery owners association pointed out that in spite of the above letter/clarification from Directorate of Intelligence and Investigations, the staff of the Directorate did not leave any chance to interfere in the matter.
The containers were checked by the staff of Directorate at the Ports, and remained under detention although no authority or even the Directorate of Intelligence and Investigations are not empowered to examine the goods which are meant for KEPZ.
The import into KEPZ in not restricted and not governed by the tariff and Import Policy requirements.
Recently, CBR Member Customs intervened in the matter and directed Export Collectorate to thoroughly investigate.
The matter was investigated by Export Collectorate which sent a report to CBR in which the allegations made by the custom authorities were found baseless.
The CBR and Directorate General Investigation and Intelligence conducted all these investigations on the allegations of local assembler/manufacturers.
The association said that this is an established fact that not a single case has been proved against any of the importers of dump trucks for any evasion of taxes and any violation of Import Trade Policy.
The importers objected that they are being charged very higher valuation in spite of the fact that some depreciation is available to the assemblers/ manufactures in KEPZ.
They are assessed on the basis of valuation made by the Appraisement Collectorate where the dumpers are imported in CBU condition.
All units operating in KEPZ also buy locally built dumper bodies against payment in foreign exchange from tariff area, the local labour is being used with the infrastructure facilities.
The government should direct the CBR not to create harassment to the importers of dump trucks.
The tax authorities were of the view that co-operation of local agents of the original manufacturer of imported dump trucks is essential to check evasion and incorrect description.
It is also necessary to examine the original record of first registration and auction in the country of origin to decide the dispute between investors/assemblers of EPZ and local agents of original manufacturers.
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