KARACHI: Post Clearance Audit (PCA) Karachi has detected gross misuse of Green Channel facility by certain importers causing significant revenue loss to the national exchequer, and clearing banned goods.
On the directives of Director PCA Karachi Yousafani, Additional Director Sheeraz Ahmed initiated a scrutiny of the imports of certain importers and detected gross misuse of Green Channel facility.
Entity based audit of M/s Husain Enterprises was initiated on the basis of risk profiling determined through desk audit in which misuse of green channel was detected and, initially, Rs2.86 million was found evaded due to under-invoicing and non-application of Valuation Ruling (VR) in 03 GDs.
During visit of the business premises, M/s Husain Enterprises was found to be “non-existent” at given addresses. Four addresses were appearing on the NTN/STRN registration certificate.
On one address in Karachi, two other businesses under the name of M/s Noman Printing Press (Pvt.) Ltd and M/s. Al Tawakal Garnents were found operative since years which informed that they have no relation with M/s. Hussain Enterprises.
On another residential address in North Karachi, a lady was residing who confirmed that she had no relation with M/s Hussain Enterprises or its proprietor (same address was also found registered in the name of another fictitious entity M/s Jawa Industries.
This flat address was the only address appearing on the NTN/STRN certificate and the Tenancy Agreement as per WeBOC User ID record. On third address in North Karachi Town, the resident tenant Mr. Sheikh Kashif Saeed informed that he had no relation with M/s. Hussain Enterprises or its proprietor who had fraudulently registered their residential address on the NTN Certificate.
In case of fourth address located in Lahore, PCA Lahore carried out physical verification and confirmed that said office pertained to M/s AMK Trading Centre and was closed since long.
It is established that M/s Husain Enterprises acquired NTN/STRN and WeBoc User ID registrations on the basis of “concocted, false and forged” documents by claiming business operations at unrelated addresses as the land-lords/owners of said addresses have confirmed that they have no relation with M/s Hussain Enterprises who has fraudulently misused their addresses.
After ascertaining that M/s Hussain Enterprises was a non-existing entity, fraudulently 04 registered on the basis of false/forged documents at unrelated addresses, and misusing manufacturing status, the clearance Collectorates of Appraisement West and East were informed to block the consignment lying at the port to avoid further commission of fiscal fraud by misuse of WeBOC User ID, manufacturing status and green channel in terms of Section 192 of the Customs Act, 1969.
In view of above, it becomes evident that M/s Hussain Enterprises, is knowingly and intentionally, involved in fiscal fraud that resulted in duty/tax evasions due to under-invoicing, non-application of VR, misclassification and was also found involved in illicit financial flows to Dubai, financing imports through illegitimate means without any legal source of finances thus involving use of proceeds of crime/black money and trade based money laundering.
M/s Husain Enterprises made fictitious imports through misuse of NTN/STRN and WeBOC User ID through false/forged documents, thereby misused the status of manufacturer by claiming operations at fake/irrelevant addresses to illegally claim exemption/concessionary rate of taxes. Moreover, M/s Hussain Enterprises misused green channel and evaded duty/taxes through non-application of Valuation Ruling.
Sources said certain smugglers rent the IDs of importers/traders having Green Channel status at high rates.
These detected cases are only one percent of the mis-declaration and under-invoicing going on through green channel. These banned items will now be cleared through green channel under mis-declaration.