The Customs agents have strongly objected to a new clause on fiscal fraud proposed to be inserted in the Customs Act 1969, and said that it would make them responsible for frauds committed by others.
The clause 32-A entails fine up to three times of the value of goods or five-year imprisonment, extendable up to 10 years if a person files false or forged documents, declares in the bill of entry or bill of export the name of the exporter or importer, which is physically non-existent, alters mutilates, or surpasses any finding of the customs functionary or attempts abets or connives in any action relating to the offence.
Karachi Customs Agents Group (KCAG) President Sultan Mahmood, in a letter to the Chairman, Central Board of Revenue (CBR), pointed out that the said clause would make it impossible for the customs agents to work on behalf of the importer/exporter as now even filing of any wrong documents supplied and produced by the clients would amount to have violated the provision of Section 32-A irrespective of the fact that if the customs agent had any knowledge of its being true or otherwise.
He said that it had been provided in the proposed section that even if the importer or exporter was physically non-available on the given address, given on documents such as invoice, sales tax registration and letter of credit, the Customs agents could be held guilty of the offence committed under Section 32-A of the Customs Act 1969.
The KCAG pointed out that on numerous occasions, the customs agents received such documents from their clients in their offices and did not have means to check or verify the address given on documents, hence penalising the clearing agents on such wrong information could not be justified.
"Further it is pertinent to note that the CBR issues sales tax registration to the importers without which no bill of entry can be filed in the Customs House and if the address, provided on such document, is not correct, how the Customs agent is liable to any action under the law, rather it should be the officer of sales tax who issued such registration after due verification of address of the importer," he said.
The KCAG chief pointed out that the new section would make the existing Section 32 on the subject redundant under which the department was required to prove the element of Mensrea.
The Supreme and High Courts of Pakistan, he said, had repeatedly said that Section 32 could only be invoked when the action had been done with due knowledge or reason to believe that such declaration was false and untrue.
"In the new Section 32-A, there is no such requirement of Customs agents having knowledge or reason to believe," he said.
Sultan Mahmood appealed to the CBR Chairman to abolish the proposed amendment as it could be used as a tool by the department to blackmail the customs agents.