KARACHI: Collector Customs Adjudication Asif Marghoob Siddiqui has penalized certain cartel of toy importers for concealing the actual description of the goods to take an attempt for getting the goods assessed on suppressed values for evading government’s legitimate revenue.
One order-in-original (ONOs) has been served on M/s Xing Enterprises imposing a penalty of Rs1.0 million along with recovery of evaded government revenue of Rs21.78 million. One order-in-original (ONOs) has been served on M/s Boss Enterprises imposing a penalty of Rs0.0 million along with recovery of evaded government revenue of Rs35.757 million. One order-in-original (ONOs) has been served on M/s Lucky Traders imposing a penalty of Rs0.3 million along with recovery of evaded government revenue of Rs5.59 million.
It was known that all these companies are flying companies with no fixed address and employees and these companies were formed only for this dirty business. One Imran alias Molvi runs the entire business. Sources said a very senior Customs officer is said to be partner of this toy importer cartel.
It may be mentioned here that Adjudication orders were earlier passed against these toy importers by MCC Appraisement East and MCC Appraisement West. Moreover, Principal Appraiser Babar Kabeer, Appraising Officers Sher Khan, Dawood Vohra and Asfandyar of MCC Port Qasim are suspended for faulty assessment of the consignments of the said toy cartel. However, no action was taken against the examination staff or any action was taken against the WeBOC ID issuing authorities.
Even after the suspension of these officials, the entire Customs hierarchy made all efforts to favor the unscrupulous toy importers. Shipping companies and terminal operators were forced to waive delay and detention charges against the toy importers despite the fact they were penalized by Customs Adjudication for misdoing.
As per modus operandi of the companies involved in mis-declaration of imported goods, children toys (i.e. ride on toy cars/tricycles in SKD condition etc) have regularly imported against payment of 5% import duty while actual duty is 35%.
Goods have been declared as “parts” under the Pakistan Custom Tariff PCT heading 9503.0040 (parts of toys) attracting Custom Duty of 5% by removing the wheels from the complete unit to deceive Customs. However, actual PCT IS9503.0010 custom duty stands at 20 percent while Regulatory Duty (RD) is 15 per cent.
The customs contravention report revealed that the importer tried to evade the legitimate customs duty and RD in addition to higher rate of valuation ruling by mis-declaring the description of incomplete toys as spares for plastic toys.
It has been proved that the importer deliberately concealed the actual description of the goods in an attempt to get the goods assessed on suppressed value to evade legitimate amount of taxes and accordingly goods have been seized under penal provision of Pakistan Customs Act; however the option was given for release if importer pays the deferential amount of duties with penalties amounting to millions of rupees.
Dozens of shipments to Karachi East were also seized due to customs vigilance and monitoring, over the ground of mis-declaration and dozens of contravention reports served and Custom Adjudication imposed huge penalties to the tune of millions of rupees.
However, the cartel, unleashed a defamation campaign through a website (owned & managed by the same importers as per available documents) against Additional Collector Yaseen Murtaza who had detected the revenue evasion of toy importers. The importers also began pressurizing other officers/officials including Additional Collector Yaseen Murtaza, Deputy Collector Athar Naveed, Principal Appraisers Shahid Rizvi, Khalid Umar, Dost Mohammad, Appraising Officer Rana Insaram Rabbani, Superintendent Abdul Razzak Junejo and others.
The cartel, after conviction moved to Customs Tribunal against the ONO (Orders in Original) issued by Custom Adjudication but the same provisionally released the shipments from Sindh High Court after payment of additional duties/tax and penalties, to avoid escalated terminal storage and container rent vide CP 5499/2018, 5500/2018, 5501/ 2018, 5502/2018, 5503/ 2018,5504/ 2018, 5505/ 2018 6281/2018, 6998/2018,6999/2018.
Surprisingly despite the fact that all the shipments were detained due to mis-declaration by the Customs Adjudication, the importers obtained delay detection certificates from the customs officials by pressurizing them, later revoked/withdrawn by the competent authority vide letter No.MMC/Misc/270/2018 R&D East, of September 11, 2018. An inquiry was initiated by the Chief Collector Customs Appraisement on issuance of illegal issuance of the certificates to two companies for waiving demurrage and detention charges and an inquiry initiated by the Custom Officials for issuance of delay and detention certificates to importers guilty of mis-declaration and evasion of government revenue.