KARACHI: PCA South has busted another EFS scandal involving M/s Deenar Industries Pvt Ltd Lasbella Hub and M/s MD Industries Pvt Ltd Lasbella Hub in an audacious tax evasion scandal worth a staggering Rs 977 million. DG PCA Dr Zulfikar Ali Chaudhry, tasked Director PCA South, Sheeraz Ahmed, to investigate allegations of the misuse of the export facilitation regime by the fraudulent EFS user. Initiated in mid-December 2024, the investigation was initiated into the operations of M/s Deenar Industries Pvt Ltd Lasbella Hub, prompted by credible intelligence on the unit’s dubious activities.
Despite the lodging of the FIR in December 2024, M/s Deenar Industries Pvt Ltd persisted with its fraudulent activities; and in collusion with another EFS licensee, M/s MD Industries Pvt Ltd, made fraudulent exports of 47 containers of lead ingots in the month of January 2025. Previously, for last two years, the pace of exports was merely one-container-a-month, while after the lodging of FIR by PCA South, the pace of exports suddenly surged to 47-containers-a-month. This sudden surge of exports occurred despite the fact that M/s Deenar Industries Pvt Ltd didn’t have any manufacturing facility to produce “MDI” brand lead ingots. The lead ingots produced under the brand name of “MDI” were actually manufactured by M/s MD Industries but falsely exported under Deenar’s name.
Upon a thorough inspection by the PCA South team at M/s MD Industries Pvt Ltd, it was revealed that lead ingots bearing the “MDI” mark were being produced at their facilities, while M/s Deenar Industries lacked the manufacturing capabilities for these goods. The PCA audit team further exposed significant discrepancies at the M/s MD Industries premises, where a large quantity of EFS goods was found missing.
Of the 1560 MT lead ingots imported under EFS, only 111 MT was exported by M/s MD Industries Pvt Ltd while remaining quantity was found missing. Of the 2751 MT lead ingots imported for home consumption, only 307 MT was found available, while huge stocks were found missing. The missing EFS goods were valued at Rs 873 million, involving duty tax evasion of Rs 269 million. Additionally, the fraudulent exports made under M/s Deenar Industries’ name led to an additional duty tax evasion of Rs 230 million. Collectively, the value of the offended EFS goods was worked out at Rs 1.6 billion, with total duty tax evasion estimated at Rs 499 million.
M/s Deenar colluded with M/s MD Industries and both fraudulent entities caused loss of staggering Rs. 977 million to the national exchequer – Rs. 478 million evaded by Deenar Industries while Rs. 499 million evaded by MD Industries. The NTNs / STRNs of both associated companies were also found suspended on FBR’s Tax Payer List.
In response to these revelations, PCA South has booked M/s MD Industries Pvt Ltd in an FIR lodged on 03.02.2025. Two PCA teams have been constituted to investigate fraudulent exports and apprehend the involved parties and their collaborators. Authorities are intensifying efforts to bring those responsible for these financial discrepancies to justice, aiming to curtail misuse of EFS and safeguard the national economy from further harm.
This development serves as a stark reminder of the rigorous enforcement measures necessary to combat economic fraud and ensure compliance with financial regulations.
PCA South has also issued alerts to all export collectorates of Pakistan to beware of any fraudulent exports filed in the name of M/s Deenar Industries Pvt Ltd.