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CJP, Chairman NAB notice of green channel: customs audit — a fraud within a fraud

CJP, Chairman NAB notice of green channel: customs audit — a fraud within a fraud

KARACHI: Customs Today covered the green channel scam since past many years. The Chief Justice of Pakistan Mian Saqib Nisar took notice of the scam and the court associate sent a letter to the Chairman NAB for necessary action.
A customs high official was denying his role in the mega scam saying that it is the issue of software automation so he is not involved in the scam. But later CT team found that he is also director at Pakistan Revenue Automation (Pvt) Limited called PRAL which develops and controls the green channel related software and system. It was also found that another high official is the mastermind behind the green channel design and system due to his role in the committee of Risk Management System (RMS). This committee designed the green channel policies under the instructions of this top official and now too the committee is managed by officials who are working under him.
Sources said mobiles, electronics, liquor, cigarettes, betel nuts, explosive chemicals, etc continues to pour into country through green channel‬ but finally ‪FBR admitted that millions of containers have been cleared in Green Channel without any examination. In fact, not even scanning of these containers is done by customs.‬
Sources said when the CJP took notice and the then FBR Chairman Tariq Pasha was asked to submit a reply on green channel issue, he asked the three accused in the case ‬to submit details. Although, it is not allowed anywhere in the world that the accused are made investigators of the case but this happened here due to the powerful mafia of green channel. But DG customs candidly admitted that the green channel is ‘mercilessly misused’ and involvement of Customs officers cannot be ruled out. Whereas, on the other hand, customs high official, under a scheme to manipulate the entire investigations, asked the very high official to conduct an audit who is already an accused in the case. This audit was itself a fraud merely to save the corrupt culprits.
Sources said, in the audit, the accused customs high official made his juniors compare the valuation rulings, PCT codes with the goods cleared in green channel. But the comparison was done with the declarations made of those goods in green channel and not of the actual goods present in the container. The entire scam of green channel is that the goods declared are totally different from goods present in the container. Like QMobile had mobiles in the container and they declared LED lights. They in fact even admitted this when they were caught. The problem was not of PCT code or valuation of LED.
Sources said, in the audit, the customs staff under instructions of customs high officials instead of checking what the real goods were inside the millions of containers, they just checked, like in this case, if PCT and value of LED lights were applied on these goods and gave a clean chit to such clearances! Whereas the goods were mobiles and PCT and value of LED lights were applied and zero duties were applied instead of the high duty of mobile. Similarly, they checked PCT code and value of Iron scrap whether applied but the goods were cigarettes or betel nuts or liquor. After this audit of PCT code and values they gave clean chit to even such hazardous materials like chemicals or contraband items like liquor, etc. in the garb of the fraudulent audit.
After such audit, the customs high officials involved in the scam want to give a clean chit to themselves. Based on this fraudulent audit, some of the customs officials want to mislead and misguide the Honourable Chief Justice of Pakistan and also the Chairman NAB under whose notice already this case of green channel mega scam is pending.
The actual audit should be to find out what exactly was there in the more than 10 Million containers released without proper scanning and examination. Customs staff should start tracing the declared goods backwards and also forward. To check backwards, they should check with the respective exporters and exporting countries whether they have exported the same goods that were declared in green channel at import stage in Pakistan? If goods exported were mobiles and the same imported in green channel at Pakistan was LED lights then it would be clear that fraud has taken place. But in backward checking there are some hurdles that customs department will have to overcome:
1. Exporters side with the importers rather than FBR and hence they may not co-operate with FBR authorities.
2. Many exporting countries’ customs authorities do not examine the goods properly because they do not have risk of losing revenue. Mostly exports enjoy tax free regime.
3. The information provided by exporting countries are mostly not admissible as evidence in Pakistan. Hence, legal action and recovery would become difficult.
Hence, the above mentioned backward method will be effective only 10% if customs department puts its efforts appropriately in this direction. Even 10% effectiveness is worth doing as the amounts involved in the green channel scandal is really huge.
But the second method which is the forward method, will be very effective. Customs should trace the goods released under green channel in a forward manner as to where have the goods gone. Like around 750 containers of LED lights cleared in green channel to be checked where they have gone in Pakistan in the supply chain from importer to whole seller to retailer. The goods brought by green channel are in Pakistan only and not re-exported hence we can track those goods easily on paper firstly and then physically at the end location. If the importer says he cleared 750 containers of LED lights then he must have documents to show sale of the same to the wholesaler or retailer. The wholesalers and retailers can be asked to confirm whether they have bought these LED lights or they have bought Mobiles. Those thousands of iron scrap containers imported in green channel should be tracked as to where and how they have been used in Pakistan. Where those thousands of containers are actually cigarettes, liquor, electronics, dangerous chemicals then how will the green channel smuggler be able to prove his sales of scrap? This second method of forward tracking is very effective and also incriminating evidence can be collected against those who are clearing contraband goods under green channel.
This ways by tracking the goods backward and forward then proper audit of green channel clearances is possible and not by artificially comparing the PCT code and valuations with the goods declared.
Also, since there are millions of containers to be audited hence first a priority list of audit should be made. In this list those goods should be included that have been imported in green channel through switch B/L. Secondly, those goods should be included that have zero or up to 5% duty tariff. Those who are clearing contraband items or high value items in green channel without screening or examination are declaring them in very low or zero tariff. Also, scrap consignments should be on priority list of audit.
Genuine importers once again appealed to the CJP and the Chairman NAB to take notice of the second fraud of audit within the mega scam of green channel. A fraud to cover up their previous frauds with the nation!!