Non duty-paid cigarettes: Crackdown on stockists, distributors to be launched

Directorate General of Intelligence and Investigation, Inland Revenue (IR) has decided to launch crackdown against stockists, distributors and dealers of non-duty paid smuggled cigarettes in settled areas of Punjab. Sources told Business Recorder here on Wednesday that the directorate has shifted the focus of exercise against counterfeit and smuggled cigarettes from KPK/tribal areas to the settled areas of Punjab and areas in its vicinity.
It is a major policy shift of the agency to fully focus on settled areas for conducting raids on godowns along with strict enforcement through checking on roads. In KP the surveillance would continue but more focus would be on settled areas of Punjab. When FBR Chairman Ansar Javed was Director General Intelligence and Investigation, IR, he established the Anti-illicit Tobacco/Cigarette Cell. Within one year, the Cell has exclusively worked on controlling smuggling of non-duty paid and counterfeit cigarettes. So far, the directorate has seized 36 million sticks of non-duty paid smuggled/counterfeit cigarettes in first ten months of 2012-13 against 10 million sticks in 2011-12.
The directorate of intelligence FBR has also categorically directed the Regional Tax Office (RTO) Peshawar that the non-duty paid cigarettes are being smuggled into the tariff areas despite presence of the monitoring teams of the said RTO on roads/highways. The directorate has warned the RTO that if any such cigarettes manufactured in Mardan or Swabi was seized in settled areas, criminal proceedings would be initiated against the monitoring teams of the RTO as well as manufactures of the cigarettes. Meanwhile, directorate of intelligence IR Faisalabad has conducted a successful operation against the non-duty paid cigarettes.
Details revealed that in pursuance of a credible information and surveillance of suspected distributors/ wholesalers/stockiest of cigarettes, the authorised Team under rule 62 of the Federal Excise Rules, 2005 of regional directorate under the supervision of Shafique Anwar Khan, Audit Officer, I&I-IR visited the Godown of a Cigarette Stockiest located at Aminabad, Samanabad and Faisalabad. At the time of the visit, Muhammad Mansoor Ashraf claiming to be the owner of the goods was present at site. During physical stock taking, 323 cartons cigarettes of different brands were found stored at the mentioned address.
The Authorised Team sought Sales Tax Invoices in respect of these taxable and dutiable goods from the owner but he failed to provide the same. In the absence of any evidence of tax payment like Tax Invoices, the authorised team seized these cigarettes under section 26 of the Federal Excise Act, 2005 read with rule 62 of the Federal Excise Rules, 2005 on their place and directed the owner to provide tax invoices or evidence of deposit of due duty and taxes by May 16, 2013.
On the spot inquiry, it revealed that the brands including Hillbrow, Victory, Fedora, Range and Marvi are manufactured by M/s Hilltop Tobacco, Azad Jammu Kashmir and tentative revenue including duty/taxes of the seized goods as worked out was Rs 2,862,672 approximately.
Directorate of intelligence IR Peshawar has also carried out an operation and seized non-duty paid smuggled cigarettes. According to details, credible information was received that some persons are hiding non duty paid/counterfeit cigarettes at a godown in Chamkani area, G T Road Peshawar with the intent of causing revenue loss. Accordingly a mobile team of agency under supervision of Altaf Hussain Inspector I & I (IR) Peshawar raided the said godown with the co-ordination of local police and seized 26 packrites of non-duty paid cigarettes accordingly.
The value of seized goods for purpose of duties & taxes is Rs 1,017,000 FED is payable at Rs 661,050 and sales tax at Rs 268,488 out of total seizure six packrites of Hi-Lite cigarettes, 15 packrites of Marlboro and five packrites of Gold Flake were seized.