DGI told to carry out audit to ascertain tax evasion amount

The main accused of the multi-million rupees GST scam, Raja Zaraat, was sent to jail on Tuesday by the Directorate General, Intelligence and Investigation, (Customs and Excise). He was sent to jail on judicial remand after completion of 14 days investigation by the directorate of intelligence.
Four different FIRs were registered against him when he was arrested two weeks back. Sources said that the Central Board of Revenue (CBR) has given permission to intelligence directorate for carrying out sales tax audit of Bawan Shah Group of Companies on their request. As the DG, Intelligence does not have audit expertise, there is ample chance that the audit is conducted by the sales tax auditors, as the independent chartered accountants may not be willing to take the case.
Sources stated that it is yet not clear how the sales tax auditors would conduct audit, as the entire audit team has been suspended last year on charges of corruption and blackmailing.
According to the directorate, the investigations are still underway to ascertain the exact amount of duties and taxes evaded under DTRE and normal exports by Bawan Shah Group of Companies. Up till new no final figure has been released by the investigating agency.
Following is a brief account of investigations held so far: An information was received by the Directorate General, Intelligence and Investigation (Customs & Excise) that Raja Muhammad Zaraat Khan, Chairman, Bawan Shah Group of Companies, Karachi along with his associates was actively involved in misuse of DTRE scheme. Examination of record scrutinised so far has revealed that two companies of Bawan Shah Group had been allowed to import 25 million meters of cloth without payment of duties and taxes to the tune of Rs 210 million. Of this quantity, 18.5 million metres cloth was imported by Bawan Shah Group availing exemption of duty and taxes amounting to Rs 115 million, the DG intelligence added.
A discrete vigilance was kept on various export consignments sent by different units of the said Group. As a result, three containers were detained. These were supposed to be carrying ladies suits made from cloth imported under DTRE but contained local made cloth of inferior quantity. Another container of the same exporter, bound for foreign destination was called back from the high seas. As per declaration, it was supposed to contain leather jackets worth Rs 49 million. On examination by the staff of directorate, the container was found to contain blended cotton fabrics of inferior quantity. On the basis of available information and facts and figures gathered from the seized containers, investigation is being carried out to confirm the total amount of duties and taxes evaded under DTRE and normal exports, agency added.