A million-rupees Federal excise duty and sales tax evasion has been detected by the Directorate of Intelligence and Investigation of Federal Board of Revenue (FBR), Karachi.
Sources in the directorate told Business Recorder here on Tuesday following a credible information from Lahore regional office that one Fortune Commercial Company, having its offices at Kashif Centre, Sharea Faisal, Karachi, had allegedly evaded Federal excise duty, which was 50 per cent of the total value of imported chemicals-flavours and essence for use in aerated beverages.
Elaborating, the sources said that the Karachi was informed that the accused company was importing huge quantity of essence, the main ingredient in manufacturing beverages.
They said that the company did not pay Federal excise duty on its import, which was a taxable product and evaded Rs 1.022 million, including duties and taxes. They said the importer had the intentions to earn more profit by showing inadmissible adjustment of the HS code as 2106.9010 and 3302.1010 instead of 3302.9000 and 3302.9090 in terms of section 3(1)(b) and 3(2) of the Federal Excise act, 2005, besides causing a huge loss to the national exchequer.
However, the accused company was to provide details of purchase of concentrates and flavours during the period July 2003 to March 2007 to the Additional Director, Intelligence and Investigation, CBR, Lahore, but the company provided details of import and sales of essence from April 2004 to May 2007, said the sources.
Not satisfied by the details provided by the company, the Lahore office referred the case to Directorate of Intelligence and Investigation of Federal Board of Revenue (FBR), Karachi, for further investigations.
However, the Karachi directorate detected evasion of duties and taxes, recoverable from the company under the Customs Act, 1969, Federal Excise Act, 2005 and the Sales Tax Act, 1990 along with additional duty and default surcharge under the Federal Excise Act, 2005 and the Sales Tax Act, 1990, besides penal action under the Customs Act, 1969, the Federal Excise Act, 2005 and the Sales Tax Act, 1990. The directorate, after completing its investigations, submitted the contravention report along with the relevant documents to the authorities for adjudication.