Rs 1.2 million tax evasion scam detected by customs

The Appraisement Collectorate of Customs has detected another case of misdeclaration of steel imports, causing a loss of around Rs 1.2 million to the national exchequer as customs duty and sales tax, sources here said.
According to the sources, the Appraisement Collectorate received a credible information from the Federal Board of Revenue (FBR) that, Sami Steel Mills, Gujranwala, was allegedly involved in fiscal fraud through gross misdeclaration of the value and concealment of their imported consignment of ferro chrome for the last three months.
However, a preliminary investigation was carried out, which revealed that nine consignments of ferro chrome had been cleared by the Sami Steel Mills from June 1, 2003 to February 28, 2007. Of these consignments, one was cleared from Sambrial Dry Port, while the remaining eight were cleared by the Appraisement Collectorate.
On further scrutiny of the import data, it revealed that out of these eight consignments, three were imported against the letter of credit (LC), while the opening of the LCs for the remaining five were not mentioned.
Besides, the import record, acquired from the importer's bank, Bank-Alfalah, confirmed that the importers had opened a total of nine LCs during the aforesaid period. During the scrutiny, the letters of credit (L/Cs) revealed that in the consignment against L/C No SLC/GRW/31827/2006 dated April 12, 2006 Index No 238, the chromium contents were misdeclared as being 40 percent to 45 percent. But the proforma invoice on the basis of the L/Cs showed the actual percentage as 74 percent.
Moreover, the proforma invoice and L/C confirmed the value of the consignment at 158,438 dollars (around Rs 9.5 million) against its declared value of 64,545 dollars (Rs 3.8 million).
The evasion of custom duty and sales tax worked out amounted to Rs 1.199 million- Custom Duty: Rs 289,0l7 and Sales Tax: Rs 910,403. However, investigations are under way to gather evidences for the crime committed and also to determine the role of the customs staff, who had processed the GDs after verification of all the related documents, ie L/C, performa invoice etc, as well as the role of the clearing agent, who produced the same before the customs authorities, who cleared the mis-declared consignment.
After the confirmation of Rs 1.99 million scam, the Appraisement Collectorate of Customs has got registered the first information report (FIR) against the Sami Steel.