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Rs225m tax evasion of textile fabric: MCC Appraisement-West yet to take legal action

Rs225m tax evasion of textile fabric: MCC Appraisement-West yet to take legal action

KARACHI: Model Customs Collectorate of Appraisement-West has not yet taken any legal action against the importers of woven textile fabric, who were found involved in massive tax evasion through mis-declaration in their fabric consignments.

Earlier, Directorate of Intelligence and Investigation-Customs, Karachi has lodged First Information Reports (FIRs) against seven importers, who were involved in importing blended viscose rayon in the garb of blended cotton.

Last month, MCC Appraisement-West had put on hold around 200 consignments of woven textile fabric and sent those for laboratory tests in order to determine the actual description of the imported fabric.

Later, the lab report of nearly 100 consignments revealed massive mis-declaration in the imported consignments and stated that the blended viscose rayon of higher value had been imported in the garb of blended cotton which involved massive tax evasion of Rs 225,165,356 so far.

Subsequently, Directorate of Intelligence and Investigation-Customs, Karachi after joint examination with MCC Appraisement-West lodged FIRs against seven importers.

In the FIRs, the directorate stated that the importers were allegedly involved in clearance of fabric imported from China by mis-declaration in description HS Code and value thereof and claiming undue benefit of SRO 1125(I)/2011 and through Pak-China FTA under SRO 659(I)/2007 aiming to evade levy able duties and taxes.

It was further stated that the importers were involved in violation of Section 19, 32(1) & (2), 32(A), 79(1) of the Customs Act, 1969 punishable Section 156(1), (10A) (14) and 14A of the Customs Act, 1969, read with Sections 3, 6, 33, 34 of the Sales Tax Act, 1990 and Section 148(1) of the Income Tax Ordinance, 2001.

The importers who were allegedly involved and booked in FIRs included M/s Samad Enterprises involved in tax evasion of Rs 5,270,676; M/s M A Enterprises involved in tax evasion of Rs 23,352,680; M/s A K Fashion Apparel involved in tax evasion of Rs 6,997,284; M/s Country Care Trader involved in tax evasion of Rs 136,408,253; M/s Klassic Industries involved in tax evasion of Rs 2,468,023; M/s First Lock Enterprises involved in tax evasion of Rs 94,05,808; and M/s NK Enterprises involved in tax evasion of Rs 41,262,632.

The total tax evasion and loss to national exchequer reached Rs 225,165,356 from those seven importers alone.

When contacted, one of the senior officers in MCC Appraisement-West while commenting on the mis-declaration issue in importation of fabric textile said that lodging FIRs against the importers involved in mis-declaration is a policy matter and Chief Collector of Appraisement-South is the authority to decide whether the FIRs against those importers would be lodged or not.