KARACHI: Collector Customs Adjudication Chaudry Mohammad Jawaid has penalized M/s Orient Electronics Pvt Ltd and M/s Rahmani Traders for misusing concessionary SROs to evade government’s legitimate revenue.

 According to details, Directorate General of Customs I&I had issued an alert that various importers imported huge quantity of LED lights claiming exemption available to renewable technologies under PCT 9405.1090 by misusing the SRO 575(I)/2006 and S.NO.24 of Fifth Schedule.

The past clearance data of M/s Orient Electronics was scrutinized and it was found they imported various kinds of LED lights without fitting and fixtures as required for renewable technologies but availed concessions. Therefore, M/s. Orient Electronics was required to pay Custom Duty at statutory rate i.e., 20percent & 25 percent.

The importer in collusion with their clearing agent M/s. Rahmani Traders cleared 03 three consignments of LED Light without fitting & fixtures through Model Customs Collectorate of Appraisement (East) and were liable to pay Customs Duty 20 percent & 25 percent.

They in collusion with their clearing agent deliberately misused exemption of duty and taxes under S.No.24 of Fifth Schedule to the Customs Act, 1969, Sixth Schedule to the Sales Tax Act, 1990 and clause 77, Part-IV, Second Schedule to Income Tax Ordinance, 2001 attracting zero percent Customs Duty/taxes and thus evaded huge amount of customs duty and other taxes.

Accordingly, the Directorate General of Intelligence and Investigation-FBR (Customs Enforcement), Karachi issued a notice to the importer and clearing agent to supply the relevant information/ import documents. M/s Orient Electronics (Pvt), Ltd submitted reply along with copies relevant GDs, invoices & Packing lists but failed to supply approval of AEDB, Islamabad to qualify for claiming/availing exemptions.

After detailed deliberations and hearing both sides, Collector Adjudication found the charges established that M/s Orient Electronics (Pvt) Limited in collusion with their clearing agent M/s Rahmani Traders managed to clear LED Light consignments without fitting/fixtures and deliberately evaded the amount of duty and taxes to the tune of Rs 21.512 million  through misusing the concessionary regime.

Collector Chaudry Mohammad Jawaid ordered payment of the evaded amount of duty/taxes and imposed a penalty of Rs3.0 million on M/s Orient Electronics and a penalty of Rs0.5 million was imposed on clearing agent M/s Rahmani Traders.