KARACHI: The team formed by Collector MCC Appraisement West to examine and assess motorcycle parts consignments at MCC Hyderabad has submitted its report underlining mis-declaration of weight and classification.

The lacunae in the procedure of processing transshipment (TP) consignments is inflicting a heavy loss to the national exchequer; the collectorate where the TPs are filed do not have the authority to examine the goods, hence the importers widely commit mis-declaration and even the goods are pilfered enroute to the dry ports.

The team comprising Usman Tariq Assistant Collector, Shahid Dasti Appraiser, Abdul Aziz appraiser and Arif Ahmed Examiner, formed by MCC Collector Appraisement West to examine and assess motorcycle parts consignments at MCC Hyderabad has found large scale mis-declaration of classification and weight.

According to the report submitted by the team, beside the difference of weight, certain discrepancies in the decalred HS code have also been observed. The importers mis-declared the item casing crank case left/right under PCT heading 7616.9910 which is chargeable to Customs Duty at 10 percent. However, it is correctly classifiable under PCT heading 8409.910 attracting customs duty at 35 percent and 5 percent additional customs duty in terms of SRO 693(i)/2006.

Mis-declaration in Karachi on import of auto parts and other goods was almost eliminated and so many contraventions were made against the importers. Hence, the unscrupulous elements opted to dry ports.

MCC Appraisement East came quite hard on cheaters and made several contraventions against importers particularly motorcycle parts importers.

MCC Appraisement East also found that a group of officers was continuously engaged in supporting and facilitating tax evasion and corrupt practices in the Collectorate in an organized manner. Appraisement West and MCC Port Qasim also discouraged mis-declaration.

It is that the collectorate where the TP is filed, the same collectorate has no authority to examine the goods. The importers declare PCT of their choice attracting lowest tariff and grossly mis-declare the weight of consignment. Since several dry ports do not even have the weighbridge, the declared weight is accepted and the consignments are cleared.

Moreover, the goods are pilfered enroute to the dry ports and scrap or any other thing is filed in the consignment to match the weight. The practice is causing a huge loss to the national exchequer.

An official said that the Collectorates where the TP’s are being filed, should have the authority to physically examine the consignments so that mis-declaration of classification and weight could be avoided.

Sources said that the MCC Appraisement West team had concrete evidence against the motorcycle parts importers pertaining to corrupt and fraudulent practices, however the collectorate is confused whether they should pursue the case and seek authority to examine the past record of these imports.

Sources said that Collectorate was waiting for FBR directives as to who would pursue the case, as the FIR was lodged by DG I&I.

It may be recalled that DG I&I Lutfullah Virk, in a letter to Chairman FBR, informed that motorcycle assemblers pilfered a huge quantity of motorcycle parts/kits during the transit of TP consignments from Karachi to Hyderabad.

In one case, one container was intercepted after clearance and the same was re-examined and weighment was also carried out. Weight of 16.6 MT was recorded at Hyderabad against the ascertained weight of 27.9 MT recorded at Karachi indicating a difference of 11.3 MT i.e. 68 percent.

Virk had informed that there was evasion of revenue to the tune of Rs489 million during the last two years by the above mentioned manufacturers. Moreover, the DG I&I had also conducted a detailed analysis of imports carried out by various other motorcycle manufacturers throughout Pakistan.

In the case of fraudulent duty/tax evasion by motorcycle assemblers, the Directorate General of Intelligence & Investigation was stayed to pursue the investigations by the Sindh high Court. However, Lutfullah Virk, DG I&I has asked MCC Appraisement West to pursue the case.

As many as 9 more consignments of these importers are still at KICT. However TP for these consignments have not been filed as yet. As soon as the TP is filed, these will be 100 percent examined in Karachi.

Intelligence sources said that the issue was subjudice and High Court has suspended DG I&I FIR in this regard, “but we have all the evidence which we would present before the court regarding all the past history of the scam,” sources said.