KARACHI: Deciding a contravention case against Shahid International and 51 others importers of Pistachio from Iran, Collector Adjudication I, Karachi Sanaullah Abro has held that charge of evasion of duty and taxes on account of non-application of Valuation Ruling 1031/2017 dated 2-2-2017 for assessment of customs value of Pistachio imported through Collectorate of Customs (Appraisement) Quetta were not established against the importers.
According to details Directorate of Customs Intelligence & Investigations, gor credible information that some importers in connivance with clearing agents are involved in huge mis-declaration in value and weight of Pistachio with shell imported from Iran and causing collosal loss to the government exchequer in terms of duty and taxes.
The I&I during scrutiny of record from 30-12-2017 till 06-01-2020 a sizeable number of consignments cleared at a rate of USD 1.32 per Kg as against USD 2.97 per Kg after 15 per cent discount given on the basis of freight from Iran as determined vide Valuation Ruling 1031/2017 issued by the Directorate General of Customs Valuation, Karachi and also got undue/abnormal favor in weight in terms of “tare” of cartoons/bag.
It was alleged in the contravention report that importers in league with staff of Customs Appraisement, Quetta has not considered the VR 1031/2017 in letter & spirit. The valuation was instead based on assessment/valuation by “LVC” or Local Valuation Committee dated 03-12-2016.
The importers were served with Show Cause Notices and contravention reports were transferred by FBR from Collector of Customs Adjudication Quetta to Collector of Adjudication, Karachi.
The importers took the plea that Collector of Customs, Quetta is empowered to issue a VR exercising powers at par with Directorate of Valuation. It was further maintained that the VR 1031/2017 was four year old and thus determination of new VR was necessary before any contravention is made.
The importers also relied on recent judgments of Balochistan High Court.
The Collector Adjudication I Sanaullah Abro after hearing the Authorized Representatives from both sides held that VR 1031/2017 was not applicable for the assessment of the item imported through the jurisdiction of Collectorate of Customs Appraisement, Quetta, hence the alleged charges of evasion of duty and taxes are not established.
The Collector Adjudication, however allowed the contravention to the extent of “tare” holding that percentage of ‘tare weight’ availed by the importers on consignments of Pistachio upto 12 per cent and upto 36 per cern is clearly excessive and abnormal. Therefore the charge on account of excess abnormal tare weight availed om the clearance of consignments of Pistachio as levelled in the show cause notices under section 32(1) & (2) of the Customs Act 1969 is established.
The collector however ordered re-determination and recovery as such against the importers availing more than 2 per cent tare weight on bags and more than 7 per cent on cartoon.