The newly launched Post Clearance Audit (PCA) of importers at Karachi and Lahore has suffered a serious setback, when top customs officials have refused to work under PCA.
Sources told Business Recorder on Saturday that the Chief Collector of Customs (North) has expressed serious concern over the performance of PCA project director, who bypassed the FBR decisions for setting up a separate organisation.
The Chief Collector of Customs (North) has categorically informed the FBR that violation of rules and regulation have been committed by certain officials now running their own organisation in the disguise of PCA. Finance Act 2007 was also amended in the last budget to ensure that the project would be operated by the customs department and there was no need to set up a separate organisation. The project could not be run in the existing circumstances where a single person wanted to run a separate organisation in the presence of customs department.
Contrary to the board-in-council decisions, the project director has created a parallel PCA organisation which is not acceptable to the Chief Collector (North), sources said.
It is important to mention that the PCA is one of the key initiatives under reforms, for carrying out audit of imports and customs clearing agents under computerised system. It seemed that the PCA would not become operational even at the initial stage. The Chief Collector (North), a key post in customs department, heads a large number of Model Customs Collectorates (MCCs) including MCC, Peshawar; MCC Rawalpindi; MCC Lahore; MCC Multan; MCC Sambrial and MCC Faisalabad.
The refusal of Chief Collector North clearly indicates that the PCA could not be implemented in Punjab and NWFP due to serious reservations of respective customs authorities.
The Chief Collector (North) has informed the FBR that an order of the PCA project director revealed some unacceptable actions being taken by him. The orders revealed that the FBR has created a Directorate of Post Clearance Audit in Lahore and appointed a director of the central office. Moreover, this self-appointed director has assumed command of the working and operation of the field audit units both at Karachi as well as at Lahore. These are serious distortions being created by the PAC director which needs to be corrected immediately.
The Chief Collector (North) said that at initial stages of the development of PCA as a full-fledged organisation was proposed. This proposal was examined in detail by a committee constituted by the FBR Chairman comprising Member (Customs), Member (HRM) and Member (Admin.).
The committee decided that there was no need for setting up parallel country-wide independent organisation for Post Clearance Audit rather PCA being a part of customs operations should work under Member (Customs) within the Collectorates. In view of massive volume of anticipated PCA work in Karachi, it was agreed that the PCA work at Karachi would be handled by a collector supported by other staff.
In rest of the country PCA units were to be part of the reformed collectorates and would work under the collectors. This position was then approved by the board-in-council and thus stands fully reflected in the revised organogram of the customs department which was available on FBR website.
Following this decision, section 3(d) of the Customs Act was amended through Finance Act 2007, eliminating the PCA from the Directorate General of Valuation precisely for the reason that since the Post Clearance Audit function would be performed by the staff of the Collectorates, there was no need for identifying and having an enabling provision in the Act for the function of PCA. The structure and role of the central office of the PCA functions was thus subsequently described through FBR Customs General Order No 12 of 2007.
Since the development work to operationalise the PCA has been largely accomplished and PACCS is only operative at ports of Karachi, three audit teams comprising officers who had received training for PCA work should be constituted by Chief Collector (South). The teams should start working in Karachi where clearances of green channel through Pakistan Customs Computerised System (PACCS) being their target population.
About the location of PCA head office, the FBR had agreed that since the pilot is being launched at Karachi, the central office should also be located temporarily under Chief Collector (South) at Karachi and ultimately the central office would be located in Islamabad, once the PACCS rolls out countrywide.
Apparently, project director, on his own has set up a directorate of PCA in Lahore and obtained posting of even subordinate staff to this self-created organisation.
The FBR should immediately take notice of the self-serving mess being created by project director which needs clarification of key issues involved in creation of PCA.
Firstly, Board stands by its approved and reformed structure of the customs department whereby PCA is part of the Customs Collectorates. In Karachi this work is to be headed by a grade 20 officer given the volume of the work reporting to Chief Collector (South). In rest of the country, PCA is to be part of the Collectorates and so called directorate of PCA being created by its project director is a figment of his imagination.
Secondly, the PCA teams being constituted in the pilot phase would work at Karachi and report to Chief Collector (South) and not to project director. The role of Project Director is related to the developmental work and not operational work and board has no intention of making director as head of audit operations.
Thirdly, no operational work is to be undertaken at Lahore in the pilot phase and all three teams would focus on the clearances made through PACCS at Karachi. Fourthly, the Project Director has to do the developmental work of PCA and not work as director of central office, Chief Collector (North) added.
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