Daily on www.customstoday.com
Find us on
pAkiStAN’S fiRSt iNDeptH NewSpApeR oN CuStoMS
AbC Certified vol 2 issue No. 40
ColleCtiNg RS 416.96M Duty
The Enforcement CollectoratesSouth has collected revenue of Rs 416.96 million in terms of customs duty in first 15 days of October. | See pAge 04 |
weekly
karachi, tue october 21 - Mon october 27, 2014
Rs 560.36m, makes 26 seizures – COLLECTOR TAUSIF QURESHI –
Special attention is given to bolster the anti-smuggling performance of the collectorate FAISALABAD
RANA SHAHZAD
www.customstoday.com
C
ollector Customs of Model Customs Collectorate (MCC) Faisalabad Tausif Ahmad Qureshi has disclosed that his department has achieved the revenue target set by the federal government for the Pirst quarter July-September of current Piscal year 2014-15. In an exclusive interview with Customs Today, he said that in the Pirst quarter of current Piscal year, customs duty target set by the federal government was Rs 513.48 million. “We have achieved the target by collecting Rs 560.36 million. We have collected 9.13 percent extra revenue in Pirst quarter. We have achieved this milestone with an increase of 37.67 percent against
iSSuiNg guiDeliNeS
Appraisement-West Collector M Saleem issued administrative guidelines for ensuring precautions regarding inspection, examination and clearance of hazardous and radioactive materials. | See pAge 1o | SeiZiNg 30 tRuCkS
Customs Collectorate Preventive impounded 30 non-customs paid trucks with curtain cloth worth Rs 100 million from a warehouse.The raid is said to be the biggest ever confiscation in the Lahore’s history. | See pAge 03 |
Price Rs. 50.00
Faisalabad Customs collects
ReCoveRiNg RS 20.98
Appraisement-East recovered Rs 20.98 million while detecting 26 cases of tax evasion in which importers were involved on misdeclaration of value and PCT, misuse of SROs and classification. See pAge 02 |
Regd. No, MC-1381
My first priority is to collect the revenue because it is the backbone of our national economy
the same period of last year which was Rs 407.02 million. Tausif Ahmad Qureshi added that the sales tax target set by the federal government was Rs 1041.38 million. “We collected Rs 1057.56 million. We are 1.55 percent above against the current target in this domain. We have achieved the target with an increase of 14.55 percent against the same period of the last year which was Rs 923.25 million”. On joining as the Collector MCC, Faisalabad, he said special attention had been paid to bolster the anti-smuggling performance of the collectorate. Resultantly, there has been a marked improvement in the performance, he held. During the month of September 2014, 26 seizures of smuggled goods have been made as against 15 made out during the corresponding period of September 2013. Elaborating his performance, he said only three seizures of outdated vehicles and other goods of inferior quality were made earlier but the quality and size of improved performance during September 2014 can be measured from seizures of costly vehicles of recent models and worthwhile variety of goods like motor oil, tiles and plastic bags. “The level of focus on the anti-smuggling efforts can also be gauged form the fact that even during Eid Holidays on a tip off, a consignment of 75 cartons of prime quality smuggled cigarettes amounting to Rs 4 million was seized at Jhang road Faisalabad.” He said that this is the great achievement of MCC ofPicers. Tausif Ahmad Qureshi added that we are working hard to collect the revenue. “My Pirst priority is to collect the revenue because it is the backbone of our national economy,” said Qureshi while answering a question. He claimed this was record best performance of generating revenue at MCC, Faisalabad since he assumed ofPice. He said that we have two main ofPices where our Pield ofPicers are performing their duties one is headquarter of Customs Collecrtorate at Faisalabad Dry Port and the other is Anti-Smuggling OfPice located in Peoples Colony Faisalabad. Answering a question, he said the corrupt ofPicials are punished. To another question, Tausif Ahmad Qureshi said everybody whether he is our ofPicial or other like importers, exporters and agents, all are treated equal according to law.
02
www.customstoday.com
NATIONAL
OCTOBER 21 - OCTOBER 27, 2014
oil mills urge govt to withdraw tax on cottonseed cake
The Pakistan Oil Mills Association (POMA) pressed the government to take back newly imposed 5 percent tax on cottonseed cake. POMA Chairman Khalifa Riaz Ahmad along with Vice Chairman Ejaz Hussain Naqvi said this while addressing the association members. He said that new taxes would increase the production cost of oil, adding that it was not fair to slap more taxes on the oil mills. They warned the government that if their demands for the removal of the tax will not be addressed then they will shut down their oil Mills and that will not be beneficial for government.
PortQasimimproving qualityofassessment: CollectorSurriyaButt KARACHI
Appraisement-east recovers Rs20.98m in 26 tax evasion cases
SyeD MuHAMMAD ASlAM www.customstoday.com
KARACHI
M
‘property tax not to be revised’
www.customstoday.com
U
nder the dynamic leadership of Collector Najibur Rehman Abbasi, the Research and Development (R&D) Section of Model Customs Collectorate of Appraisement-East has recovered Rs 20.98 million in September while detecting 2 6 cases of tax evasion in which importers were involved on misdeclaration of value, non-application of correct valuation rulings, misdeclaration of PCT, misuse of SROs and classification. According to details, the R&D Section has recovered Rs 52,825 on misdeclaration of value on import of black film faced plywood; recovered an amount of Rs 402,883 on misdeclaration of value on import of blankets; and recovered Rs 924,208 on misdeclaration of value on import of miscellaneous goods. The R&D Section has succeeded in recovering Rs 106,387 on nonapplication of VR No. 661/14 on import of rotavators; recovered Rs 420,408 on misdeclaration of value on import of motorcycle spare parts; recovered Rs 1.78 million on non-application of VR No. 602/13 on import of brass valves; recovered Rs 266,953 on misdeclaration of PCT on import of motorcycle parts; recovered Rs 520,412 on misdeclaration of PCT on import of disposable razors; recovered Rs 244,112 on misdeclaration of value on import of empty PP woven; recovered Rs 284,755 on misdeclaration of value on import of photo-
— Exclusive Customs Today photo
odel Customs Collectorate (MCC) Port Muhammad Bin Qasim has geared up efforts to improve the quality of assessment and to monitor its impact on the revenue collection. Collector MCC-PQBM Surriya Butt will be chairing the first meeting in this regard on Friday to share the revenue collection efforts of each of assessment group and section during the first the first quarter of the current year ended September 30. It may be mentioned that an Office Order issued by Additional Collector Port Qasim Irfan Javed early last month had asked the Deputy and Assistant Collectors in-charge assessment groups to focus on the assessment-related aspects including determination of classification, application of correct valuation rulings and the admissibility of SROs and exemption claims. The Deputy and Assistant Collectors were asked to vigilantly monitor the assessment completed at Appraising Officer-level in their respective groups and all DCs and ACs in-charge were also directed to submit a statement highlighting revenue effort made in their respective group and section during September.The DCs and ACs in-charge were asked to provide the following details in the statement submitted by them: Serial No.; GD Number(s); duty/taxes as per declaration; duty/taxes as per assessment ; differential amount; percentage difference; amount recovered and remarks.
SoHAil RAb kHAN
copy papers. The section has also recovered Rs 966,382 on misdeclaration of value on import of wooden panels; recovered Rs 135,092 on misdeclaration of value on import of decorative printed papers; recovered Rs 370,342 on misdeclaration of value on import of PVC wall paneling; recovered Rs 74,028 on misdeclaration of value on import of practical board flooring; recovered Rs 91,133 on misdeclaration of classification on import of isocynate; recovered Rs 202,748 on misdecla-
ration of value on import of PVC roll transparent. The R&D Section has also recovered Rs 239,291 on misdeclaration of value on import of miscellaneous goods; recovered Rs 4.08 million on misdeclaration of value on import of split air-conditioners; recovered Rs239585 on misdeclaration on import of flavouring powder; recovered Rs 327,058 on misdeclaration of value on import of miscellaneous goods. The R&D recovered Rs 247,973 on misdeclaration of value on im-
port of pharmaceutical raw material; recovered Rs 1.3 million on non-application of VR No. 614/14 on import of beauty soap; recovered Rs 375,797 on misuse of SRO551 (I)/2008 on import of PVC electric insulation tape; recovered Rs 4.2 million on misuse of PCT on import of shielded armoured cable; recovered Rs 2,981,514 on misdeclaration of description and PCT on import of fibre board and Rs 75,078 on misuse of SRO 659(I)/2007 on import of whey powder.
LAHORE www.customstoday.com
he demands of traders regarding the downward revision of property tax are not reasonable as the increase was made after 14 years, said an Excise and Taxation official. Talking to Customs Today, he said that the department increased the property tax after 14 years only up to 50 percent while it was expected to be raised up to 100-200 percent. He said that property owners were increasing rents of their buildings every year but did not want increase in taxes even after 14 years. He added that it was impossible to revise the decision regarding the 50 percent increase in property tax. On the other hand, a source said that the E&T Lahore Regions A, B and C collected almost Rs 3 billion during the first quarter of the current fiscal year. According to details, Region C has collected Rs 1.5 billion as motor vehicle tax which include registration, token tax and other taxes.
T
Falserefundclaimstofacepenalty:Memon KARACHI
CuStoMS toDAy RepoRt www.customstoday.com
T
he Model Customs Collectorate (MCC) of Exports, Collector Manzoor Hussain Memon, through a notice, has warned that false or misstated undertaking would not only result in the recovery of the duty drawback claim by exporters but also in the initiation of penal action against the claimant under Section 32(1) and (2) of the Customs Act, 1969. According to a public notice issued by his ofPice, all the claimants of duty drawback (rebate) with the customs would now have to submit an undertaking on the prescribed format, stating that they have not claimed any concessionary SRO in the exported goods. The undertaking will be submitted and scanned in the computerised system along with all other documents in stand-
— Exclusive Customs Today photo
MAHMooD iDReeS
Collector Manzoor Memon ing order No 01/2014/Exp-HQ dated August 18, 2014. The collector said that it has been observed that certain exporters had imported inputs under any Free
Trade Agreement (FTA) on concessionary SRO; like SRO 565/91)/2006 dated June 5, 2006; SRO 655(1)/2006 etc., but even then they claimed duty drawback on export of the goods which is legally not permissible. Moreover, duty drawback customs rebate is allowed on export of goods under section 21 of the Customs Act, 1969 at the rates speciPied through notiPications issued from time to time by the Federal Board of revenue (FBR). While notifying the rate of duty drawback, the percentage is worked out keeping in view the statutory customs duty payable on imports consumed in goods to be exported. To discourage a practice indulged in by certain exporters to get double monetary benePit, a claimant whose undertaking is found false or misstated at the time of sanction of rebate or at the time of post rebate audit would result in the recovery of the claim and also subject to penalty.
Collector Ranjha seizes smuggled tyres worth Rs10m he Adjudication Customs Collector has decided to confiscate smuggled tyres worth Rs 10 million in a seizure case. The Customs Intelligence and Investigation seized imported tyres of different brands on 30 May from a truck. The total number of seized imported tyres was 2,268. The owner was unable to provide any concrete evidence of import and its ownership in the case. After the owner’s failure to provide evidence the Customs Intelligence and Investigation provided conclusive evidence in this regard. After several hearings, Adjudication Customs Collector Saleem Ahmad Ranjha ordered confiscation of the imported tyres. The confiscated tyres will be presented for auction soon. —CT Report
T
www.customstoday.com
NATIONAL 03
OCTOBER 21 - OCTOBER 27, 2014
uk customs likely to miss 1,165 tax evaders prosecution
LONDON: The United Kingdom (UK) Revenue & Customs has failed to tackle tax evaders while perusing them in court trials and going to miss the target set for fiscal year 2014-15. The HM Revenue and Customs has failed in its target to chase criminal trials for tax evasion, which costs the UK £ 35 billion a year.
ISLAMABAD
MuHAMMAD fAiZAN www.customstoday.com
he Lahore High Court Rawalpindi bench on Tuesday rejected bail plea of TCS regional manager logistics Ghazanfar Gul and Smart Zone’s CEO Shakirullah in a smuggling case. Soon after the court rejected their bail pleas, Deputy Director Directorate General Intelligence and Investigation Shahid Jaan arrested them and presented in the court of the customs special judge. The court gave a two-day physical remand to the customs officials. According to details, both accused appeared in the court along with their lawyers and applied for bail. Shahid Jaan told the court that both were court absconders and were wanted by the customs officials in a smuggling case. The court rejected the petition submitted by the accused after hearing arguments from both sides. The customs officials arrested them from the court and later presented them before the customs special judge and sought a 12-day physical remand. The judge, however, gave a two-day physical remand. The customs officials have started interrogating the accused. The officials said they would again request the court to extend the remand. It is worth mentioning that Ghazanfar and Shakirullah had sought pre-arrest bail last month, but Special Judge Muhammad Ahmed Farooq rejected their plea. After which they fled from the court. Ghazanfar had sought protective bail, but it is not confirmed whether Shakirullah sought bail or not.
T
Biggest confiscation by Lahore Customs: 30 trucks of cloth worth Rs100m seized the total weight of the cloth was around 123 metric tonnes which involved taxes above Rs 55 million. the collectorate has also brought the seizure in the notice of federal board of Revenue Member Customs Nisar Ahmed LAHORE
M HAyAt
www.customstoday.com
T
he Model Customs Collectorate Preventive impounded 30 non-customs paid trucks with imported curtain cloth worth Rs 100 million from a warehouse. The raid is said to be the biggest ever conPiscation in the MCC Lahore’s history. According to details, the AntiSmuggling Organisation (ASO), led by Deputy Collector ShaPiqur Rehman and Superintendent Mumtaz Ajmal Mian, raided a truck loaded with foreign curtain, sofa and velvet cloth. The customs sources said that the truck driver was asked for customs clearance documents, but he failed to produce papers. In initial investigation, they added, the driver named a warehouse, Super Traders, in Garhi Shahu. The force conducted a successful operation and seized foreign cloth worth Rs 100 million from the warehouse, they added. The sources said that the total weight of the cloth was around 123 metric tonnes which involved taxes above Rs 55 million. The sources said that Ali Rehman, who used to smuggle cloth from Peshawar, was the owner of the seized cloth. However, Rehman claimed that he had the relevant documents. On the other hand, customs ofPicials said that the documents were
— Exclusive Customs Today photo
lHCrejectsbailplea oftCSofficialand SmartZoneCeo
fake which led to the conPiscation. The ofPicials told Customs Today that Rehman has been given two days to produce valid documents. They added that the cloth would be seized in state’s favour if Rehman failed to produce the documents. The collectorate has also brought the seizure in the notice of Federal Board of Revenue Member Customs Nisar Ahmed. Customs officials, including Khalid Butt, Safdar Bajwa, Irfan Mumtaz, Shahid Bhatti, Arif Meo, Mazhar Butt, Waheed Bhatti were also the part of the raiding team.
lHC issues stay order on luxury tax he Lahore High Court has issued injunction or stay order regarding the imposition of luxury tax on big houses. Lahore High Court Justice Shams Mahmood Mirza has restricted the government to collect the luxury tax on the houses which are above two canals area. On hearing the application filed by a local citizen Zain Shahzad, the court asked
T
the chief secretary and secretary excise to submit the answer. The applicant took stand in application that the Punjab government had also announced the collection of luxury tax last year but later government had to revise the decision after it was challenged in the court. It was requested in application that the Section 8 of Finance Act should be banned regarding the luxury tax.
04
www.customstoday.com
NATIONAL
OCTOBER 21 - OCTOBER 27, 2014
Non-customs paid Audi impounded
MULTAN: The Multan Customs Intelligence and Investigation has impounded American-origin Audi car worth Rs 9.5 million. The officials have seized the imported vehicle from Sher Shah Road in a raid on a tip-off. The car was seized due to non-paid customs and taxes. The owner of the car failed to provide documents. Customs Intelligence and Investigation Superintendent Siraj Malik impounded the car. Meanwhile, a first information report has also been registered and further proceedings are underway.
enforcement-South collects Rs 416.96 million customs duty until oct 15
FBR Board-in-Council approves $80,000 for human resource development he Board-in-Council meeting of the Federal Board of Revenue has approved allocation of $ 80,000 for the purpose of human resource development to enhance working capacity of the employees. The Department for International Development (DFID) of British Government is likely to provide an amount of $1.5 million to the World Bank to initiate numerous development projects with FBR. This amount will remain with the World Bank and the Bank will spend it as per its own discretion. Both DFID and WB want to assist FBR. A well-placed source at FBR Wednesday told this scribe that Board-n-Council of FBR held detailed discussions on activities related to all wings especially Operation Wing, IR Wing and Customs Wings. “An activity is to set up a special cell at Policy Wing for research and data analysis so that budget may be prepared on right accurate lines,” the source added, saying that another activity approved by the Board-nCouncil meeting was to bring those sectors in the tax net which were lying out of the net like capital gain from the Stock Exchange and real state. Similarly, the source said that more activities to improve audit system of sales tax as well as up-gradation of software of database were also minutely discussed and approved in the meeting. —CT Report
T
MCC Preventive collected Rs273.86m customs duty in the first 15 days of October, the MCC Hyderabad collected Rs 38.39 million and MCC Exports collected Rs 96.89 million LAHORE
CuStoMS toDAy RepoRt www.customstoday.com
KARACHI
CuStoMS toDAy RepoRt www.customstoday.com
he M/s Digicom (Pvt) Limited and M/s New Allied Electronics (Pvt) Limited, the authorized dealers of Q-Mobile (cellular company) have sought another adjournment from the Collectorate of Customs Adjudication-I in the hearing of tax evasion case of Rs772 million. The sources informed Customs Today that the Collectorate of Customs Adjudication-I has fixed the hearing date of the case in next week, although; the departmental representatives of the authorized dealers of Q-Mobile through a letter by courier have sought adjournment into the case till the end of this current month. It is pertinent to mention here that the Collectorate of Customs Adjudication-I had served showcause notices on M/s New Allied Electronic and M/s Digicom Private (Limited), the authorized dealers of Q-Mobile in the month of September, 2014 in the pretext of its involvement in tax evasion to the tune of Rs772million in terms of additional Sales Tax and Customs Duty. Later on, the Collectorate of Customs Adjudication-I fixed the hearing date of Sept 22 into the said case. It may be mentioned here that the Model Customs Collectorate-MCC of Multan had prepared a contravention report against the non-duty/taxes paid 2.4 million cellular phones of different models in the consignments involving Rs 772 million duty/taxes. Subsequently, the MCC-Multan had forwarded the case to the Collectorate of Customs Adjudication-I for further legal proceedings.
T
T
he Enforcement Collectorates-South has collected revenue of Rs 416.96 million in terms of customs duty in first 15 days of October. According to details, the Model Customs Collectorate (MCC) Preventive has collected Rs 273.86 million customs duty in the first 15 days of October, 2014 and the MCC Hyderabad has collected Rs 38.39 million, MCC Exports has collected Rs 96.89 million, the MCC Quetta collected Rs 7.82 million customs duty in same period, while the Gwadar Collectorate and Exports Port Muhammad Bin Qasim have not yet received any amount in terms of customs duty during the first 15 days of October. It is pertinent to mention here that the Federal Board of Revenue (FBR) has set the target of Rs 1459.90 million in the share of customs duty for the Enforcement
— Exclusive Customs Today photo
Q-Mobile seeks adjournment in Rs772 million tax evasion case
Chief Collector Nazim Saleem Collectorates-South for the month of October-2014. Sources informed Customs Today that the MCC Preventive have to collect Rs 1060.59 million by the end of October-2014 in share of customs duty and MCC Hyder-
abad Rs 379.39 million, MCC Exports Rs 398.03 million, MCC Port Muhammad Bin Qasim Rs 498.40 million, MCC Quetta Rs 79.87 million and MCC Gwadar to collect Rs 40.42 million customs duty by the end of October, 2014.
Customs I & I seizes hashish worth Rs800 million near Rohri Bypass KARACHI
CuStoMS toDAy RepoRt www.customstoday.com
T
he anti-smuggling staff of the Directorate of Customs Intelligence & Investigation – FBR, successfully foiled an attempt to smuggle a huge quantity of hashish (nine tonnes and 900 Kilogram) worth 800 millions near Rohri Bypass Sukkur and arrested three accused from the scene. This was disclosed by Director Customs Intelligence Asif Marghoob Siddiqui during a press conference along with Additional Director, Customs Intelligence, Karachi Nadeem Ahsan. Siddiqui informed the media that information was received in the Directorate of Intelligence & Investigation – FBR, Sukkur Range that a racket of drug paddlers was involved in transportation of narcotics by road from Mardan to Karachi. Acting the tip-off, a special
team comprising Najeebullah Jafri, Qaswar Shah and Mohsin Shah was constituted in order to check any such illegal movement of narcotics. The anti-smuggling patrolling staff of Customs Intelligence posted at Sukkur intercepted a trailer bearing registration No. Z-5085, carrying container No CAXU-959746-2 to Karachi. The driver was asked to produce relevant legal document in order to conPirm the bona-Pide status of the goods. The unsatisfactory and apparently evasive replies of the driver forced the anti-smuggling staff to detain the container and trailer for inquiry and investigation. The physical inspection of the container revealed that the fabrication of the container was different from other container of this capacity. The presence of wooden logs, an unusual export commodity reinforced the suspicion of Customs Intelligence staff. Subsequently, the same was, therefore, escorted to Sukkur Customs Intel-
ligence ofPice along with the three persons including truck drivers and cleaner present in the truck. An exhaustive search revealed that two portions had artfully been created inside the container by erecting a special iron wall. It was difPicult to identify the presence of specially created wall with cursory glance. On the spot search conPirmed that the wood logs covering three quarters space had been placed inside the container and rest of the one quarter space was used to clandestinely hide approximately 9 tonnes and 900 Kilograms of ‘hashish’ behind the artiPicially fabricated iron wall. The wall was demolished with the help of cutter and 495 bags containing hashish (brands Samar Qand / Bostan) was recovered. The initial probe has showed that the narcotics were booked by Haji Gul Mat Khan from Mardan KPK through M/s Seven stars & Co, a Goods transport Company to
Karachi. Speaking at the occasion, Siddiqui said that the seized narcotics were apparently to be smuggled abroad from Karachi, adding that the value of the seized narcotics is approximately Rs 800million in Pakistan and in European markets over billions of rupees. The Director Customs Intelligence further informed that the narcotics were seized and FIR against the accused has been lodged under the provision of CNS Act, 1997. He further stated detail investigation is underway to trap the other accomplices involved in this heinous trade. The Director Intelligence further claimed that this was one of the biggest narcotics seizures detected by any agency in the recent years. On the occasion, he also conveyed that Lutfullah Virk Director General, Intelligence & Investigation Islamabad, has lauded the seizure efforts of seizing team.
www.customstoday.com OCTOBER 21 - OCTOBER 27, 2014
ADVERTISEMENT 05
06
www.customstoday.com
SPECIALREPORT
OCTOBER 21 - OCTOBER 27, 2014
HistoryofDirectorateGeneral ofInternalAudit ● The Directorate General of Internal Audit was created as the Directorate of Inspection and Training prior to the Partition. ● Between 1966 and 1979, it was called the Directorate of Complaints and Investigation. Later it was bifurcated as the Directorate of Inspection and Directorate of Training in 1980. ● In 1984, it was revamped as Directorate General of Inspection and redesigned as Directorate General of Vigilance and Inspection in 1986. ● In 1990, it was re-named as Directorate General of Inspection and Training and revamped as Directorate General of Inspection, Internal Audit and Training in 1993. ● In 1996, the directorate was known as the Directorate General of Inspection and Internal Audit and Directorate General of Internal Audit in 2007. ● From 2009 until now, the directorate is known as the Directorate General of Internal Audit. ● The territorial jurisdiction of the Directorate of Internal Audit, Karachi is the Collectorate of Adjudication-I and II, Directorate of Customs Valuation, Directorate of Intelligence and Investigation-FBR, Directorate of Intelligence and InvestigationFBR Quetta, Directorate of Training and Research, Directorate of Post Clearance Audit, Directorate of Input Output Coefficient Organisation, Directorate of Transit Trade, Directorate of Transit Trade Quetta, Collectorate of Customs (Appeals) Karachi, MCC-Appraisement-West, MCC-Appraisement-East, MCC-Preventive, MCC-Port Muhammad Bin Qasim, MCC-Exports, MCC-Export Port Muhammad Bin Qasim, MCC Hyderabad, MCC Quetta and MCC Gwadar.
T
Revenue- and target-related issues would be resolved automatically if the internal Audit is taken seriously KARACHI
SoHAil RAb kHAN www.customstoday.com
he Pakistan Customs Directorate General of Internal Audit ofPicials are trying to make the directorate dynamic and innovative with the cooperation of the top management of Federal Board of Revenue (FBR), said Director General (DG) of the Directorate General of Internal Audit Rubina Wasti during an exclusive interview with Customs Today. The DG said the directorate has been established to conduct audit of Pield formations to ensure correct application of laws and allied regulations, keep deterrence and check possible leakages or losses of state revenue. The DG said that the slight attention of the top authorities of FBR could further improve the performance of the directorate. She said that lack of interest bars such organisations from producing fruitful results. On the other hand, these organisations were producing outstanding results in foreign countries due to proper attention to the affairs of internal audit. Rubina Wasti further urged the FBR authorities to revamp and reorganise the department for better results, adding that reward system should be introduced at the directorate level to encourage the subordinate staff. “If proper attention would be given to the affairs of the Internal Audit, then it would play a vital role in highlighting the revenue re-
coveries,” she added. To a question, the director general informed Customs Today that the directorate general has efPicient and competent staff, however, it has not yet been linked with Web Based One Customs system for clearance. To another question, Rubina said that the Directorate General of Internal Audit was currently working on the clearance/re-export of gold and checking the true implementation of SROs in clearance of the consignments. During the interview, she further disclosed that the Pield formation collectorates were not following the guidelines of the directorate general, adding that the audit teams in the collectorates were not competent, adding that they do not take the audit matters seriously. She said, “Revenue- and targetrelated issues would be resolved automatically if the Internal Audit is taken seriously.” Rubina also disclosed that the Directorate General of Internal Audit was currently working on the special assignments given by the FBR Headquarters pertaining to the audit of gold, steel and vehicles. To another question, the director general s a i d that the i n -
ternal audit had carried out the audit of Pield formation collectorates on quarterly, half-yearly and annual basis while the aim of the directorate was to save the national exchequer and interests of the FBR. To a question, Rubina Wasti said that the performance of the Directorate General of Internal Audit was quite satisfactory despite the meager resources, adding that the directorate general was facing shortage of staff and lack of resources. “I visit all directorates of Internal Audit from southern to northern regions at a monthly basis and also hold meetings with the ofPicers/staffers to get latest updates,” she added. Commenting on the transfers and postings, the director general said that they should be conducted on tenure basis with proper structure.
Slight attention of the top authorities of fbR could further improve the performance of the directorate
www.customstoday.com
OCTOBER 21 - OCTOBER 27, 2014
SPECIALREPORT 07
— Exclusive Customs Today photo
www.customstoday.com
08 EDITORIAL
OCTOBER 21 - OCTOBER 27, 2014
Founder & Chairman Zulfiqar Ali Editor Rahil yasin editor@customstoday.com.pk For advertising & subscription marketing@customstoday.com.pk +92-300-4009261 www.customstoday.com Phones: 042-35781643-4, Fax: 042-35781645 Address: 627, Siddiq Trade Centre, Gulberg, Lahore
eDitoRiAl
foreign investment in start-ups t least 405 new companies have been registered with the Security and Exchange Commission of Pakistan (SECP) since the last one month. The number of registered companies in the country has now reached 65,125. According to an SCEP notification, at least 91 percent firms are registered as private limited companies, six percent as a single member and three have been registered as public limited companies or associations. At least 65 companies have been registered in service sector, 51 in trading, 45 in information technology, 33 in tourism, 26 in construction, 12 in power generation, 11 in corporate agriculture farming and 10 each companies are registered in food, medicine and beverage fields. At least 12 companies have received investment from Australia, Canada, China, Denmark, Germany, the Netherlands, Singapore, Sweden,Turkey, UK and the United States.The foreign investment went to trading, corporate, information technology, power generation, chemical, and fuel and energy sectors. Most of the investment was made in Lahore where 132 companies had applied for registration. At least 113 companies were registered in Karachi, 109 in Islamabad, 23 in Peshawar, 13 in Multan, 10 in Faisalabad, three in Sukkur and two in Quetta. At least 71 applications were approved for increase in the amount of unpaid capital in September and a total of Rs 143.36 billion additional capital had been approved. Besides, 92 companies had applied for increase in the limit of paid up capital and a total of Rs 6.82 billion additional capital was approved for these companies. It is a good omen that the country has started receiving foreign investment after it had become an undeclared pariah state in the comity of nations.The country has suffered trillions of dollars losses since former dictator Pervez Musharraf jumped into the so-called war on terror.Thousands of people have been killed in bomb blasts and suicide attacks while economic activities also came to a grinding halt. Pakistan is still regarded as one of the most dangerous countries in the world. India, which remained unconcerned in the war against terrorism, took all the credit of Pakistan’s sacrifices and it is even pointing finger at Islamabad for insecurity in the region. However, the ice has now started melting and the democratically elected government has no choice but to convince the world community to invest in Pakistan and improve its economy. Otherwise, God forbade, a weak Pakistan will become such a monster that no other country will be able to control it and live in peace.
A
impact of imran, Qadri sit-ins on economy LAHORE
DR AftAb AfZAl
www.customstoday.com
A
ccording to a World Bank report on South Asia’s Economic Opportunity, Pakistan has roughly incurred short-term losses equivalent to 2.1 percent of the Gross Domestic Product due to sit-ins launched by Imran Khan, chief of the Pakistan Tehreek-eInsaf and Tahirul Qadri, chief of the Pakistan Awami Tehreek. However, the bank says that Pakistan achieved GDP growth of 4.1 percent during 2013-14 which is the highest in seven years of economic and political uncertainty in the country. According to the report, the government has achieved strong Piscal consolidation despite challenges and has contained Piscal dePicit and ensured economic re-
covery by after years of recession. The bank appreciates signiPicant inPlow of remittances sent by Pakistani expatriates which have strengthened the foreign exchange reserves and bolstered the national economy. The bank sees availability of energy as prerequisite for the services and manufacturing sectors which would also improve the conPidence of investors in the government policies. However, a frequent raise in electricity tariff, reduction in power subsidies and increase in load shedding has severely hampered the industrial growth. Pakistan is situated on major trade routes of the world which link it to South Asia, Central Asia, China and the Middle East. It can reap the benePits of its strategic location by extending cooperation to various countries in the region.The only thing the government has to do is to
the recent political chaos has severely damaged the confidence of the local businessmen and foreign investors
make peace with political opponents in the country, introduce economic reforms to attract local as well as foreign investment and try its best to curb terrorism. The recent border skirmishes with India are not in the interest of the two countries which are already Pighting on various fronts such poverty, unemployment and law and order. The proposed economic corridor will enable Chinato export its goods from Gwadar port, electricity agreements with Central Asian countries, and increase in the volume of trade with India can ensure prosperity in the region. The recent political chaos has severely damaged the conPidence of the local businessmen and foreign investors and it is the time for political stakeholders to shun their differences and join hands for the development of the country.
www.customstoday.com
NATIONAL 09
OCTOBER 21 - OCTOBER 27, 2014
Deputy Collector kokab decides 309 cases in one year
ISLAMABAD: Deputy Collector of Customs Adjudication Dr Kokab Farooq decided 309 cases during last one year from September 2013 to September 2014 which benefited millions of rupees to the national kitty. 372 cases were filed during last one year and show-cause notices were issued in all these cases. In this way, DCC on average decided one case per day in the year. There are only 35 pending cases left due to hectic efforts made by the DDC. The Customs authorities have lauded the performance of Kokab Farooq.
KCCI president too finds FBR’s software‘faulty’ KARACHI
wAQAR AHMeD ANSARi www.customstoday.com
ewly elected Karachi Chamber of Commerce and Industry President Iftikhar AhmedVohra said onWednesday traders were facing difficulties during e-filing of their tax returns. Talking exclusively to CustomsToday, he said complications had surfaced in the recently launched software IRIS, adding that several programmes were giving error messages and columns have also not been added. He said errors at a large scale have surfaced in the software.Taxpayers are facing difficulties in submitting tax returns and wealth statements. The PakistanTax Bar Association has written a six-page letter to FBR ChairmanTariq Bajwa in which the flaws have been pointed out.The FBR chairman has also been requested to rectify the errors to help taxpayers submit their tax returns. He said,“If the last date to submit tax returns is not being extended then the old form should be reactivated. He said law and order in Karachi was worrisome and an electronic showroom owner was killed in Landhi three days ago. He was receiving death threats. “We have condoled with the grieving family on behalf of the KCCI. When I went there charged people were protesting. We controlled the situation. Through Customs Today, I request to the Sindh inspector general to probe the matter.”He said traders were receiving death threats and were being forced to pay extortion money.“I appeal to both federal and provincial governments that crime cannot be curbed until you clamp down pre-paid SIMs. Now traders are asked to pay extortion money via easypaisa.” However, FBR IT Secretary Zainul Abdeen had told CustomsToday that there was no technical fault in IRIS.
N
wRite to uS youR gRievANCeS: Through CuStoMS toDAy platform Help DeSk, now you have chance to DiReCtly write your problems to top govt. functionaries. If you have any grievances, queries, questions or suggestions, you can write in this section as it provides easiest access to you to approach Customs and Revenue authorities. wHo can write in this section? Importers & Exporters, Customs Agents, Chambers of Commerce, Trade Associations and Customs Officers to wHoM you can write? Honourable PM, Minister/Secretary for Finance & Revenue, Minister/Secretary for Ports and Shipping, FBR Chairman, Member Customs and Chairperson Senate/National Assembly Standing Committee on Finance & Revenue. Send your letters at: newsdesk@customstoday.com.pk
finance Division mulls inquiry against pRAl for inefficiency ISLAMABAD
MuHAMMAD ARSHAD www.customstoday.com
T
he Finance Division contemplates on initiating fact finding inquiry into inefficiency of Pakistan Revenue Automation (Pvt.) Limited (PRAL) in producing desired results. “The very option of appointment of new Chief Executive Officers of the company is also an option under consideration of the authorities concerned,” said a well placed source at Federal Board of Revenue. The PRAL was established in 1994 as a small IT setup has diversity of solutions for its customers and has expertise in software development, business process re-engineering/improvement, technical advisory and consulting services, managing large data centres, data entry services, designing and executing wide area networks, operational and technical management services. This wide spectrum of services offered by PRAL facilitates valued customers looking for ‘one-stop shop’ solutions from conceptualization to post-implementation operations. The source further confided that most probably the fact finding inquiry would cover the acts and decision made by the sitting Chief Executive regarding im-
provement of the efficiency and that since its incorporation in performance of the company. June 1994, PRAL has been in“Soon after taking additional volved in the development of charge, besides FBR Member In- wide array of tax and revenue reformation Technology, as the CEO lated solutions pertaining to InPRAL, the sitting CEO fired come Tax, Wealth Tax, General dozens of employees on numerSales Tax, Federal Excise, Cusous reasons which hamtoms, Capital Value Tax, Provinpered improvement in cial Cess, Property Tax etc. efficiency and perSome of the key applications formance of the developed and impleinstitutions,” mented during the source these years. observed. Moreover, “At the PRAL is deltime of ega ted the very option of appointwith servment, ices of appointment of new t h e feasibilChief executive officers Memity studber IT i e s / of the company is also w a s technian option under considcal Adviered the s o r y , consideration of fbR b e s t N e e d choice A n a lys i s / authorities and selecRequiretion for bement Specifiing OfPicer Docations / Remain and having quests for know how about the Proposals, Software issue, however, decisions Development and Customizaand acts taken by her marooned tion, Portal Design and Developthe performance of the organisa- ment, Large Database Managetion,” the source further added. ment, Administration and Such a state of affairs, the source Integration, WAN / LAN Adminsaid that had raised concerns istration, Specialized Training among the authorities concerned, Programs, Technical and Finanwho were now contemplating on cial Evaluation of bids as per two options; either to withdraw World Bank Standards, Data Encharge from her at Pirst or to initi- try of Voluminous Nature, Prepaate fact Pinding inquiry. ration of computer installation It is pertinent to mention here sites, Maintenance of hardware
(PCs, printers, peripherals etc.), Operational support i.e., running computer installations on BuildOwn-Operate-Transfer (BOOT) basis or any combination of this basis and Research and Development, i.e., evaluating new information technologies, monitoring latest trends and disseminating technical information etc. Currently, PRAL is running projects including, e-FBR portal, e-Customs Systems, Trade Export Promotion and Industry Program.(TEPI) (Customs wide area networking), tax management system, Motorway Automated Toll Collection Project (National Highway Authority) , Biodiversity of Pakistan: Databases & Global Networking (BGN) Project (Pakistan Museum Natural History), UIP (Urban Immovable Property Tax & Survey) (Excise and Taxation Department, Govt. of NWFP), Consultancy Services for NTTFC, UNCTAD, Institutional Support for Trade Regime (Ministry of Commerce & Crown Agents), Human Resource Management System (Federal Board of Revenue and its allied Organizations) and Taxpayers Audit Monitoring System (Federal Board of Revenue). Moreover, PRAL has been involved in Tax Registration System, Integrated Tax Management System, Self-service Tax Portal, eCustoms System, Revenue Accounting System, Provincial Cess Collection System and Urban Immovable Property Revenue Management System.
early issuance of it exemption Certificates To,
FBR Chairman, Tariq Bajwa, Govt of Pakistan, Islamabad Dear Sir,
LCCI has received a number of complaints that the FBR was not issuing certiPicates despite the fact that tax has been collected in advance. Unfortunately, not a single certiPicate has so far been issued under Section 148 which is sheer injustice. Non-issuance of Income Tax Exemption CertiPicate is causing hardships for the businesses. Normally the certiPicate is issued for six months but now it is being issued for three months that is creating multiple problems for the businesses. Federal Board of Revenue is not issuing certiPicate to the companies who applied in mid September. The delay in issuance of Income Tax Exemption CertiPicate is encouraging the menace of smuggling that would destroy the national econ-
omy and would also open up the Ploodgates of corruption. All the leading economies were giving incentives to expedite economic activities in their respective countries but in Pakistan the people who are sitting at the helm of affairs were doing the otherwise at this point in time when almost all the businesses were facing a number of internal and external pressures. The private sector was ready to supplement all government efforts aimed at revival of economic activities in the country if they are provided breathing space but in the presence of such anti business tactics, it would be very difPicult for the private sector to continue with their businesses. Federal Finance Minister should take stock of the whole situation and issue directions to the FBR authorities to issue Income Tax Exemption CertiPicates under section 148 of the Income Tax Ordinance of 2001 on imports. With Profound Regards, Ijaz A. Mumtaz, LCCI President, Lahore
www.customstoday.com
10 NATIONAL
OCTOBER 21 - OCTOBER 27, 2014
ANf arrests drug traffickers with 280kg hashish in special operation
MULTAN: Anti-Narcotics Force has thwarted the attempt of drug traffickers and seized 280 kg hashish in a special operation. Multan Anti Narcotics Force on a tip-off conducted special operation with its team near Khanewal Road Multan and arrested two persons with 280 kilograms of hashish loaded in a Corolla vehicle. The hashish sample was sent to the laboratory for chemical examination and to check its quality. The total worth of hashish will be evaluated after the reports.
CollectorSaleemissuesguidelines forinspectionofhazardousmaterial
AuditofFTACell,DTRE, vehiclesamnesty schemesinitiated KARACHI
CuStoMS toDAy RepoRt www.customstoday.com
Appraisement-West Licencing Authority has given October 31 deadline to customs agents to renew their licences KARACHI
SoHAil RAb kHAN www.customstoday.com
— Exclusive Customs Today photo
M
odel Customs Collectorate of Appraisement-West Collector Muhammad Saleem has issued administrative guidelines for ensuring precautions regarding inspection, examination and clearance of hazardous and radioactive materials. According to details, the Appraisement-West has issued the guidelines for examination and clearance of radioactive materials, chemical warfare, biological hazards, toxins, irritants, corrosives, electric hazards, combustibles, Plammables, environmental hazards, explosives and low-power laser material. The collectorate asked the ofPicials concerned to follow procedure as per relevant clauses of Import Policy Order (IPO) and Pakistan Customs Tariff in case of symbols identiPied during examination. Meanwhile, Collectorate of Customs Appraisement-West Licencing Authority has given October 31 deadline to customs agents to renew their licences. According to sources, the collectorate has issued a circular in which the customs agents have been told that their licences
would expire on 31 October so they should submit their papers to get their licences renewed. It is worth mentioning that the collectorate has issued a circular but under Rule 99 of the Custom Act 1969 it is mandatory that the customs agents go through sixday training before getting licences. However, the customs authorities have made no announcement in this regard. The customs department had launched three
training sessions a few months ago. Sources said so far no such programme has been started. They said issuing licences via illegal means would give rise to corruption. A delegation of customs agents told Customs Today that they were waiting for the training announcement. They urged the collectorate to announce the training session as soon as possible. Meanwhile, the Appraising In-
telligence Branch (AIB) of the Model Customs Collectorate-MCC of Appraisement (West) has sent recommendations to the authorities concerned of the Collectorate for conducting 100 per cent examination of the stainless steel consignments having declaration of 200 series. The sources conPirmed Customs Today that the AIB on the directives of Collector-MCC Appraisement (West) Muhammad Saleem has scrutinized the post clearance data of the importers who were involved in the clearance of stainless steel through green channel and any other ways. The sources revealed that the AIB during scrutinization of the importers’ data found that several importers were involved in tax evasion worth millions of rupees in terms of duty/taxes by clearing stainless steel of 300Series in the garb of stainless steel of 200Series. The sources revealed that both of the stainless steels i.e. (200Series and 300Series) had different PCT Headings and huge difference in custom duty and other taxes. “By taking those mis-declarations in clearance of stainless steels into consideration, the AIB has sent recommendations for conducting 100 percent examination of each consignment of the stainless steel in order to keep vigilant eye on tax evaders,” they added.
he Directorate General of Internal Audit-Pakistan Customs has initiated the audit of FTA and PTA, DTRE Scheme and Vehicle Amnesty Scheme, it was learnt here on Tuesday. The impeccable sources in DG Internal Audit informed Customs Today that the Federal Board of Revenue (FBR), Islamabad has given special assignment to the Directorate General of Internal Audit to initiate audit of FTA and PTA Cell, DTRE Scheme and Vehicle clearance under amnesty scheme on immediate basis. The sources further revealed this scribe that the authorities concerned of the Directorate General of Internal Audit have asked the data of last three months from the authorities concerned of FTA and PTA Cell and Export Collectorate in connection with the DTRE scheme. They further said that the Directorate General of Internal Audit has also asked the one-year record of the clearance of vehicles under amnesty scheme from the field formation Collectorates. To a query, the sources disclosed that the FBR has handed over the task to the Directorate General of Internal Audit in order to check the anomalies being reported under the issuance of FTA and PTA certificates, DTRE certificates and clearance of vehicles under amnesty scheme.“The Directorate General of Internal Audit has started to gather the information for its further proceedings in order to initiate annual audit of those related fields,” they added.
T
MULTAN
iMRAN Ali kHAN
www.customstoday.com ultan Dry Port is the one of the best ports of the country which provides best services on time to importers and exporters, said Deputy Collector Customs Multan Dry Port Muhammad Ali Malik. In an exclusive interview with Customs Today onWednesday, he said,“The Port provides prompt clearance of containers service as almost 95 percent consignment are cleared the same day while the remaining five percent consignments are delayed due to exporters own negligence or clearing agents present their documents not on time,” he held. He said that the Port provides the service of onsite clearance of Industrial raw material.The Port is providing end to end clearance of consignment by filing online goods declaration. “WeBoc is a digital system to overcome
M
any error filed in goods declaration and it provides assistance in our job but business community still feels there is still a room for improvement in this digital system,” Malik said, adding that the Port will attract more the exporters and importers if the government establishes a bounded cargo train services for the importers and exporters of this region. “The South Punjab has a lot of business potential if government establishes a bounded railway service for the importers and exporters. The service will improve the imports and exports activities of the Port. Bounded Railway service will expand the business volume by establishing a container terminal in the port.” He said that the Port touches the boundaries of three provinces Sindh , Balochistan and Khyber Pakhtunkhwa -which increases its attraction due to geographical significance. The port has its importance due to the existence of many pesticides factories, textile
— Exclusive Customs Today photo
better services hallmark of Multan port: DC Ali Malik
industry, feed mills cooking oil firms and huge petroleum oil refinery in this region. He affirmed that Multan Dry Port would be one of the dry ports of the Pakistan with some specific facilities but it is very unfortunate that
people still prefer clearance from other ports due to some misleading information about us that clearance from Multan Dry port is slow and adopt complicated procedure. The Port is also touching one international border of India through Raajhistan. He said that Multan Dry Port signed an agreement with Pakistan Railways for bounded train service in 2010 but due to unknown reason it has not been established yet. He said that the South Punjab Region has a lot of potential for business activity if government give some attention to this dry port by providing locomotives train cargo service and the government should declare all this all 34 kanal area for bounded Multan Dry Port. He said that suppose if the business community is paying 140,000 per container charges from Karachi to Multan for the clearance of their consignment through road then they can save almost Rs 80,000 to Rs 90,000from the bounded train cargo service.
He said that mutual cooperation for further enhancement of services at the Port requires better coordination among the clearing agent, dry port authorities and dry port trust. The Port revenue is increasing constantly due to our enhanced services to our clients and better management performance,” Malik said. “Due to their better performance and administration, the Multan Dry Port has generated Customs duty of Rs1752.811 million, Rs 5508.713 million and Federal Excise duty of Rs 32.207 million and income tax of Rs 87.698 million up to the September from July of this fiscal year 2014-15. The petroleum levy generated by the Multan Dry Port Custom is Rs 2969.357 million up to the September of this fiscal year 201415,” Malik added. He said that our staff also upgrades their knowledge through capacity building training programmes of mid career course to improve their performance during their job and to enhance their abilities.
www.customstoday.com
CARTOONSSPECIAL 11
OCTOBER 21 - OCTOBER 27, 2014
Collector Adjudication Ranjha to hear land Cruisers case today
MULTAN: Collector Customs Adjudication Saleem Ahmad Ranjha will hear the case of two imported Land Cruisers worth Rs 15 million today. The registration numbers of both vehicles are Y–720 and B-111 respectively. Both the Land Cruisers are of same model of 2001 and seized due to nonpayment of customs duty. The worth of one seized Prado Jeep is worth 7.5 million rupees each. The owners of both seized vehicles were remanded again from the Appellate Tribunal.
Complexities appear in weboC KARACHI
CuStoMS toDAy RepoRt www.customstoday.com
C
omplexities have surfaced in Web-Based One Customs (WeBOC) system of the Customs Department. Customs agents said the system was still faulty after a passage of more than one year. They said they stand in queues for four to Pive hours and when their turn comes they are told that goods declaration was not working. Sources said commercial importers were evading customs duty and taxes worth millions of rupees under the guise of self clearance. They said the Customs Department issues licences for customs clearance. They also said these licences were being issued to only multinational companies. After the WeBOC, ordinary importers are issued "ID password" after getting bribes. A WeBOC ofPicial, seeking anonymity, said the system prior to WeBOC was linked with Bahrain and Kuwait and the department was facing difPiculty in
paying its bills. “WeBOC is our own system. There are lots of complexities
and we are trying hard to remove them and efforts are being made to make it a success. The former
system was more importer and customs agent friendly, but they will soon show their satisfaction
fbR orders special audit of 3,475 ‘tax evader’ industrial units
SIALKOT
ZAfAR MAlik
www.customstoday.com
T
he Federal Board of Revenue (FBR) has ordered special audit of as many as 3,475 industrial units located in Sialkot, Narowal and Gujrat districts for allegedly evading taxes and concealing facts. The FBR has formulated 11 special
teams which have started the pre-audit process in this regard. According to FBR ofPicials, there were 86 corporate class and 3,389 non-corporate class industrial units, which would be audited soon. The FBR has issued orders to the senior ofPicials of Regional Tax Directorate Sialkot to ensure early audit of the 3,475 industrial units, besides the re-scrutiny of the tax return submis-
sions Piled by the owners, exporters and importers of the industrial units. The ofPicials have also been directed to impose special Pines on those who concealed their actual taxes or did not mention assets in their tax return submissions as well. The FBR ofPicials added that 2,901 industrial units fell in the income tax category and 574 in the sales tax category.
in WeBOC. There is no reality in issuing WeBOC password after getting bribes.''
Customs I&I officials too old to chase smugglers: Nisar Ahmed
M
ost of Customs Intelligence and Investigation ofPicials are too old to chase the smugglers, Customs Intelligence and Investigation Additional Director Nisar Ahmad told Customs Today. The Multan Customs Intelligence and Investigation has generated Rs 36.75 million in October. The ofPicials registered only 13 seizure cases in September. Four cases were registered in the adjourning areas of Multan Range OfPice; another four in Dera Ghazi Khan and Pive cases were registered in Sadiqabad region. Six non-customs paid vehicles were seized in September. One, two and three vehicles were seized from Multan, Dera Ghazi Khan and Sadiqabad respectively. The vehicles included Toyota Crown Athlete, Toyota Vitz, Jimny Jeep, Honda Civic and Mazda truck. The total worth of seized vehicles was almost Rs 15 million. The intelligence and investigation ofPicials seized a huge quantity of Iran-origin plastic granules (plastic dana), different sizes and brands of India-origin tyres and Iran-origin diesel. The value of seized 1,500 plastic granule bags was almost Rs 9 million. The total weight of the bags was more than 36 tonnes. Customs Intelligence and Investigation Additional Director Nisar Ahmad said, “Our local manufacturers complained about the smuggling of plastic granules so we are trying to curb the smuggling. Smuggling of plastic has become a pain in the neck of our industry and damaged our local market production.” —CT Report
www.customstoday.com
12
OCTOBER 21 - OCTOBER 27, 2014
Misbah 'too poor' to pay taxes
LAHORE: Two seized accounts of Pakistan cricket team captain Misbahul Haq does not have enough money to deduct taxes he owes to the FBR, Customs Today learnt. Sources said the FBR froze the bank accounts of Misbah to deduct the unpaid taxes, but surprisingly one of the accounts has zero balance and the other carries a few thousand rupees. On Tuesday, the FBR had frozen the accounts of Misbah and test cricketer Azhar Ali for tax evasion. According to the FBR, Misbah and Azhar have not paid taxes worth Rs 3.9 million and Rs 1.5 million respectively.
Misusing SRO: Customs unearths tax evasion of Rs775 million importers are involved in misusing the SRo1125/2011 in import of fabric /yarn, causing colossal loss of revenue to the national exchequer
KARACHI
CuStoMS toDAy RepoRt www.customstoday.com
T
he Directorate General of Customs Intelligence and Investigation (I&I) Karachi has exposed the several cases of massive tax evasion in terms of duty/taxes mounting Rs 775 million approximately misusing SRO 125/2011. The FBR sources informed Customs Today that the Directorate of Customs I&I Karachi on the special instructions from the Directorate General of Customs Intelligence and Investigation Islamabad has scrutinized the data of several importers and found that the importers were involved in massive evasion of duty/taxes of Rs 775 million approximately under the heads of custom
duty, sales tax and withholding tax through misusing of SRO 1125/2011. Sources further disclosed that the various importers were engaged in import of fabric/yarn by availing undue advantage of the S RO 1 1 2 5 / 2 0 1 1 and involved in evading legitimate taxes. “The Directorate of Customs I&I Karachi on the credible information received by the Directorate General of Customs I&I, Islamabad has initiated the crack-
down against the corrupt elements and found that the importers having no manufacturing unit and status were involved in misusing the SRO1125/2011 in import of fabric /yarn, causing colossal loss of revenue to the national exchequer,” they added. Moreover, the authorities of the Directorate has started legal action against importers and made contravention and seizer reports against importers who were involved in tax evasion worth million of rupees.
inland Revenue wing of fbR has also testified the cases and non-existence of manufacturing units
Sources also conPirmed that the cases have been sent to the Adjudicating authorities for further legal proceedings, adding that such import consignments were cleared from MCC Appraisement-East, West and Port Muhammad Bin Qasim. Furthermore, Director Customs Intelligence and Investigation Karachi, Asif Margoob Siddiqui has conPirmed that huge amount of tax evasion has been involved in such cases and said that the Inland Revenue Wing of FBR has also testiPied the cases and non-existence of manufacturing units. It is important to mentioned here that the Directorate of Customs I&I Karachi had also detected the tax evasion cases of Rs 576 million in violation of SRO 1125/2011 during April-May, 2014; and 53 such containers were also seized at Karachi Port wherein duty/taxes amounting to Rs 225 million was involved on account of mis-declaration of value by misusing SRO 1125/2011.
MSpiDA unhappy with valuation ruling of motorcycle parts KARACHI
CuStoMS toDAy RepoRt www.customstoday.com
A
ll Pakistan Motorcycle Spare Parts Importers and Dealers Association (MSPIDA) has expressed dissatisfaction over the assessment of customs values of motorcycle spare parts vide Valuation Ruling No.685/2014 dated September 15, 2014. Talking to Customs Today, MSPIDA Senior Vice Chairman Khurram Riaz said that motorcycles were considered as transport of the poor but it is being treated as a luxury by the taxation authorities. Motorcycle spare parts draws
are bracketed with car spare parts for assessment of customs values despite the fact that motorcycle and car users belong to two entirely different segments of the society - the middle and the low middle classes and the rich respectively, Khurram said. Not only imports of motorcycle spare parts are treated as luxury items, a fact obvious from its being subject to 35 percent customs duty despite the reduction of maximum customs duty in Budget 2014-15 to 25 percent but the import of motorcycle spare parts are also being assessed at higher values by each day, Khurram lamented. Motorcycle spare parts import is subject to a high customs duty of 25
Motorcycle spare parts import is subject to a high customs duty of 25 percent
percent, an additional duty of 15 percent, 17 percent sales tax and 5 percent income tax the cumulative incidence of which add up to 85 percent. This is extremely unjust to the poor who are the primary users of motorcycles, he added. Khurram said that he has written letter to the director valuation to add a number of items not included in the valuation ruling 685/2014 as well as to rectify a number of errors in valuation ruling 265/2014. For instance, the weight of the item listed at S.NO 30 of the Ruling – gear main and counter shaft – is not correctly ascertained for the purpose of Pixing value. This is so because converting kg
to per piece pushes up the customs value of the item from $0.12 per piece to $0.34 per piece. This got to be rectiPied, he added. Similarly, prior to VR 685/2014, the value of the said item was determined at $1.59 per kg, that is 13 pieces per kg which with the recent change would create another problem because each and every gear has different number of teeth, weight and size and such prices would vary to complicate smooth clearance, Khurram continued. “We have made suggestion to director valuation that the previous value of $1.59 per kg be maintained or customs value of $0.12 per piece be inserted for the sake of justice.”
Published by M. F. Riaz, Off. 91, 3rd Flr, Gul Plaza, M.A. Rd., Karachi, for Customs Today and Printed at Dhoom Printing Press Masheer Mahal Building, Off: I. I. Chundrigar Road, Karachi