KARACHI: The Post-Clearance Audit (PCA) South Directorate has conducted a comprehensive sectoral audit targeting the implementation of Statutory Regulatory Order (SRO) 492, which allows importers to claim exemptions on duties and taxes on the condition that the imported goods will be processed and then exported within 18 months. The audit has unveiled substantial discrepancies in practice.
The examination, carried out by PCA South, highlighted that numerous importers, who have been filing Goods Declarations (GDs) since the year 2014, failed to meet the export condition outlined in SRO 492, within the compulsory 18-month timeframe. These findings suggest a systematic fraud over the years that permitted the misuse of this exemption.
Investigation into the customs records unearthed the substantial extent of this evasion. It was found that approximately 1,268 importers took advantage of this exemption offered under SRO 492. This fraudulent claim of exemptions has resulted in an estimated evasion of duty and taxes amounting to a staggering Rs 27.5 billion.
This evasion is not concentrated in a single region but is spread across various jurisdictions. Of the total 1,268 importers, 764 importers are located within the jurisdiction of PCA South, another 645 are overseen by PCA Central, and the remaining 164 fall under the scope of PCA Central. The geographical spread of these fraudulent importers indicates a widespread misuse of this import-export regulation framework.
PCA South has referred cases to respective PCA formations. Reliable sources have indicated that legal cases are being instituted against these fraudulent importers for misappropriating the benefits under SRO 492. The mechanisms in place to recover the evaded amounts include encashment of the security instruments that were initially deposited by the importers to the respective clearance collectorates at the time of filing their import GDs. PCA team, under the supervision of DG PCA Chaudary Zulfiqar Ali and Director PCA South, Sheeraz Ahmed, is poised to take decisive action to curb such fraudulent activities and retrieve the lost state revenues.
This massive detection by PCA South sends out a stern warning to all importers to adhere strictly to the stipulated regulations or face the rigors of the law. It also underscores the need for continuous monitoring mechanisms and timely audits to ensure compliance with customs procedures and safeguard Pakistan’s economic interests.