Customs authorities at Karachi have started liquidating around 45,000 pending cases of importers, who submitted various types of financial securities like indemnity bonds, post-dated cheques, corporate guarantees, undertakings, insurance/bank guarantees, pay orders, etc.
Sources told Business Recorder on Sunday the Central Board of Revenue (CBR) had issued instructions to the Collectorate of Appraisement, Karachi, to chalk out a strategy to liquidate nearly 45,000 pending cases where importers offered financial securities, bank guarantees, etc.
The business community had submitted these financial securities and guarantees against the provisional release of goods without payment of duties and taxes. In other cases, guarantees were demanded on non-production of installation or consumption certificates under various CBR notifications.
As a result of ongoing exercise, over 14,650 outstanding financial securities belonging to Karachi have been released or encashed settling the cases.
The sector-wise analysis at Karachi reveals that a major portion of the old cases relates to the financial guarantees submitted by the exploration and petroleum, textile and OEM sectors, captive power units, water and power projects, pharmaceuticals companies, public sector organisations like Wapda, Pakistan Railways, Sui gas companies, PAEC, etc.
To finalise these cases, the Karachi customs authorities have collected a complete record of such cases for settlement. The strategy encompasses tracing out of files of ages-old cases, sorting/enlistment of cases, SRO-wise as well as importer-wise tabulation, appraiser-wise distribution of cases, prioritisation of releasable/encashable cases, issuance of notices to importers and publication of advertisements for compiling requisite documents, retrieval and re-construction of missing files, creation of sector/importer-wise database of pending cases to expedite the liquidation process through establishment of close liaison with concerned importers, financial institutions, trade associations and bodies, chambers of commerce and industry and concerned collectorates of sales tax and federal excise.
Sources said the ages-old record of Bank Guarantee Cell of Collectorate Appraisement was scrutinised and 33,234 matured cases were traced out. These cases were duly sorted out and tabulated SRO-wise and importer-wise and distributed amongst appraisers holding them responsible for accurate processing and their subsequent expeditious release or encashment.
Priority for disposal was assigned to cases where the requisite legal formalities had been fulfilled. Simultaneously, in cases where requisite legal formalities were not fulfilled, requests were made to importers concerned for providing the required documents through individual notices as well as advertisements.
Moreover, the concerned trade bodies and associations were also requested to advise their members to get their pending securities released after fulfilling the requisite formalities. Meetings were also held by additional/deputy collectors concerned with major stakeholders like OEMs, E&P sector companies, Wapda etc.
Resultantly, 14,650 long-outstanding financial securities have either been released or encashed since March 2006, sources said.
Out of the remaining 31,000 cases, over 20,000 files have already been processed by the collectorate. The major issues identified in these cases are either non-production of installation or consumption certificates or condonation of delay involved therein, non-furnishing of re-export proof and awaited rulings of CBR/EDB and non-finalisation of provisional assessments by the collectorate.
Sources said the Karachi-based customs is trying its level best to dispose of all such cases, but it has been observed that the response of importers concerned is not encouraging.
To ensure liquidation of remaining old cases, the Collectorate Appraisement has formulated an action plan. To reach out the major stakeholders, detailed working papers showing case-wise reasons of pendency are being sent to the senior management of individual company/unit/organisation asking them to provide requisite documents within fortnight.
Simultaneously, a comprehensive schedule of meetings with major stakeholders at the level of assistant/deputy collector concerned has also been chalked out to ensure completion of liquidation process of majority of cases by the end of December 2006.
Sources said the concerned assistant/deputy collectors have been directed to finalise the pending cases of provisional assessments within a period of six weeks. Considering that enforcement of the demand in time barred cases will not stand the judicial scrutiny, the securities involved in such cases are being released with the direction to enquire into the reasons of their non-finalisation within prescribed time.
Furthermore, reasons of pendency of each case is also being fed into specially created database. So far, over 10,000 cases have been fed into the database. A 'Help Desk' has also been established in the collectorate to facilitate necessary co-ordination between the importers and the officers/officials concerned of the collectorate.
The regional officials have estimated that near 20,000 more old cases would be liquidated in the second quarter (October-December) 2006-07 in addition to the over 14,000 already liquidated cases.
Once this major backlog is cleared, the Collectorate, Appraisement would concentrate upon re-construction of missing files besides vigorously pursuing the sub-judice cases for ensuring that all old pending cases may be liquidated by the end of third quarter (January-March) 2006-07, sources added.
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