Examination alert issued on assessment of Zinc Sulphate; evaded amount recovered from M/s Greenage International

KARACHI: Model Customs Collectorate of Appraisement (East) has issued an examination alert on assessment of Zinc Sulphate over claiming zero – rating on non-feed grade.
The alert is issued by Muhammad Qasim Khokhar, Deputy Collector-II on advise of Collector Appraisement after detection of a case.
The customs officials have been informed that Zinc Sulphate is used in feed as well as in fertilizer. Whereas SRO 1007(I)/2005 is available only to feed grade. “But some unscrupulous elements are claiming benefits of exemption by declaring non-feed grade Zinc Sulphate as feed grade.
The alert advised that all such consignments should be sent for examination to get confirmed as feed grade to prevent tax evasion.
The alert stated that contravention of such items should be initiated after deleting benefit of the said SRO, if feed grade is not confirmed.
The alert has been issued on the bases of a contravention detected by Qasim Khokhar where the customs recovered the evaded amount.
In the instant case importer M/s Greenage International deliberately mis-declared the classification of goods by declaring fertilizer grade as feed grade in order to avoid government revenue of Rs 2.2 million against offending value goods of Rs 10.7 million by mis-using SRO, the contravention report said.
Examination report said that good are not of feed grade and thus SRO 1007 is not chargeable however, it is mentioned in the invoice that it found fertilizer grade thus do not merit for award of exemption of sales tax.
The contravention report said that the importer electronically filed GD and declared to contain Zinc Sulphate Monohydrate granule 34 percent MIN feed grade on which it claimed customs duty at zero percent and zero rating under sales tax under SRO1007 (I)/2005.
During scrutiny, commercial invoice and packaging list had been found from inside the container in which an invoice of 56 percent higher value was found which is direct evidence of mis-declaration.
The report said, “The importer determined his liability of payment of applicable duties and taxes and sought clearance under section 79(I) of the Customs Act, 1969 and declared his total invoice value at $52920 ($0.49/kg).”
The importer did not contest the leveled charges within specified date or no one appears for hearing then it is presumed that importer had nothing to submit in his defence therefore; the case will be decided exparte on the basis of available records.

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