Computer industry: three leading vendors sent to judicial custody for 15 days

Special Judge Customs and Excise Islamabad Friday sent three leading vendors of computer industry to jail on 15 days judicial remand for their alleged involvement in massive sales tax evasion over and above Rs 1 billion. It is learnt that the directorate of intelligence IR Islamabad presented the accused before the customs judge for their remand.
The accused vendors tried their level best to get bail, but the court endorsed the viewpoint of Directorate General of Intelligence and Investigation Inland Revenue (IR) Islamabad. Computer vendors were also ready to submit undertaking for making payment. After hearing of both the sides, the court sent accused Saleem Zaveri, Shiekh Yaqoob and Atiq ur Rehman of Advance Business System to jail on 15 days judicial remand.
Sources conformed to this scribe that further arrest of computer vendors of Karachi and Lahore is expected in cases where they are directly involved in the scam. It is a major breakthrough of Directorate General of Intelligence and Investigation IR which successfully detected this high-profile case in computer industry.
According to sources, the case has been identified by the agency and arrests were made after completion of all legal formalities required under the law. The international case has been framed after collecting solid evidence which is presentable in any court of law. During the whole exercise, legal process has been duly followed.
Directorate of intelligence IR successfully completed investigation of a global scam of computer industry and its logical conclusion lead to detection of massive amount of evaded taxes and preventive measures would save revenue to the tune of billions per annum. The global investigation of the case would also bar other computer vendors from adopting the same techniques used to evade sales tax by creating dummy companies in Dubai. The detection of the scam would also improve contribution of sales tax from this sector by diverting smuggled imports to documented channels. The agency had deputed a team of experienced officers who were working day and night to analyse and verify data from various sources to unearth the modus operandi adopted by the tax evaders. The directorate has expanded the scope of investigation which would also be instrumental in improving sales tax collection of the FBR.
As a result of agency's efforts, the legal imports of computer and related equipment has shown enormous increase of Rs 5 billion (value) with increase of around Rs 1 billion in payment of duties and taxes in one year through improvement in legalised computer imports into the country. This international case of tax evasion has given a clear message to the entire computer industry to legalise their imports or face similar kind of criminal proceedings, in cases of tax evasion. The agency has also focused on analysis of data from Dubai and other sources to verify the authenticity of the level of tax evasion committed by the company.
The agency investigated company's offices in Dubai and analysed the trail of payments made from Pakistan to Dubai. The agency found that the computer products were massively under-invoiced in Dubai and then shipped to Pakistan, where the sales tax liability is understated. Interestingly, all products were not imported through legal channel and these were smuggled into Pakistan to evade sales tax. Moreover, the undocumented payment model enabled accused to cause loss to the national exchequer by declaring imports at lower rates. The company was involved in making payments to the computer manufacturers from Dubai via banking channel. However, most of payments from Pakistan to Dubai are sent through non-banking channels.