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PAKISTAN’S FIRST INDEPTH NEwSPAPER ON CUSTOMS
ABC Certified vol 2 Issue No. 34
Karachi, Tue Sept 09 - Mon Sept 15, 2014
weekly
SIMPLIFYING RETURNS FILING
Simple tax returns filing system can help broaden the tax net and early refunds to exporters will increase volume of Pakistani exports, says Senator Haji Adeel | SEE PAGE 06 | REvIEwING OPERATIONS
FBR Chairman Tariq Bajwa visited RTOs and LTUs and asked the field formations officers to take proper steps to meet revenue targets of FY 2014-15 SEE PAGE 02 | COLLECTING CUSTOMS DUTY
Under the leadership of Collector Appraisement-East Najeebur Rehman Abbasi, the collectorate collected customs duty of Rs 5.24 billion in the month of August | SEE PAGE 03 | CARTOONS SPECIAL
| SEE PAGE 11 |
Regd. No, MC-1381
Price Rs. 50.00
Rs 33.03m tax scam case
Customs initiates investigation against Telenor KARACHI/ISLAMLABAD
SOHAIL RAB KHAN/M FAIZAN www.customstoday.com
fter high profile cases of tax evasion by country’s toptelecomcompanieslikeMobilinkand Q-Mobile,nowPakistanCustomshasdetected another such tax fraud by Telenor Pakistan and blocked its 9 consignments for mis-declaring the classificationofimportedequipmenttobeusedfor company’s 3G projects. It was disclosed after the examination of these consignmentsthatM/sTelenorPakistanattempted to clear different telecommunication equipment under same HS Code i.e. 8517-6990, depriving the national exchequer of Rs 33.03 million revenue. DirectorateGeneralofCustomsIntelligenceand Investigation-FBR has started investigations into alledged tax evasion by M/s Telenor Pakistan. Sources told Customs Today that Customs I&I, Islamabad has started reviewing goods declarations (GDs)ofthecompanyinthisregard.“CustomsIntelligence initiated investigation on request of the KarachiCustomsintothemis-declarationbytheac-
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cused company,”they added. Earlier, Customs Deputy Director Mudassar TirmiziconfirmedthattheDirectorateGeneralofCustomsI&IKarachi,afterthoroughlydetectingmis-declaration in 9 consignments of Telenor, forwarded the case to FBR Islamabad for further legal proceedings. He further informed that the authorities of FBR have asked the officers of the Directorate GeneralofCustomsIntelligence&Investigationfor scrutinising the import data of the company and send it to FBR Headquarters. Itispertinenttomentionherethatademandof Rs33.03milliondutyhadbeenraisedagainsttheTelenor Pakistan on import of telecommunication equipments including GU Base Stations, IPASO Link Radioequipment,Arialequipmentspol/directional antennas-mounting brackets, GSM equipments, Yuasapowerequipmentwithinstallationmaterial, outdoorrectifierandbatterycabinetsonsubmitting less customs duty. As the Directorate General of Intelligence & Investigation-FBR created a duty/taxes demand against M/s Telenor Pakistan to recover Rs 33.04 million, the company requested the Customs highups to release their 3G technology projects-related
Telenor terms allegations of tax evasion by customs as baseless
equipment and agreed to pay duty/taxes after re-assessment of the consignments by Customs. On the other hand, Atifa Asghar, Director Corporate Communications and Responsibility, Telenor Pakistan clarified to Customs Today, “Telenor Pakistan is a law abiding, responsible corporate entity and always meets its legal and ethical obligations. The allegation of tax evasion in this report is not correct and misconceived. It was a simple matter of different interpretation and confusion regarding the alteration in taxes and import duties on import of equipment as per the latest fiscal budget effective from 1 July 2014. The equipment was imported under specific HS Codes and was declared accordingly. The issue was sorted out amicably with the Customs authorities and differential payments have been made as per the new import regulations”. “It is important to note that Telenor Pakistan is one of the largest taxpayers in Pakistan and hascontributedRs147billioninvariousformsofdirect and indirect taxes. In addition Telenor PakistanhasalsowonHighTaxpayerAwardfromPakistan Customs several times,”she added.
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NATIONAL
SEPTEMBER 09 - SEPTEMBER 15, 2014
Customs serves recovery notices on 55 steal millers
SIALKOT: The Regional Tax Directorate in Gujranwala has issued tax recovery notices to 55 steal millers. The directorate has also collected Rs 500 million taxes in Gujranwala division despite the civil disobedience call given by the Pakistan Tehreek-e-Insaf Chairman Imran Khan. According to a senior official, the Federal Board of Revenue (FBR) has set another target of Rs 250 million for Gujranwala region till August 31, 2014. The directorate has also asked the RTO’s to submit their performance report on daily basis.
Attack on Karachi airport
TCS smuggling case
Importers without recourse to get back paid taxes SYED M ASLAM
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Customs court summons Hamdani, Shakirullah on 10th
he terrorists’attack on Karachi airport on the night of June 9 last, has not only resulted in the destruction of imported goods worth billions of rupees but have also left hundreds of importers without any recourse to get back over Rs69 million paid in head of customs duty and tax to the Sindh government for the goods they never received. Reliable sources told CustomsToday that the Karachi Customs Agents Association (KCCA) had been approached by about 194 of its members, seeking help to get back over Rs61.7 million paid in customs duty and over Rs7.8 million paid as tax to the Sindh Revenue Board (SRB) for the goods destroyed during the terrorists attack on the airport. Taking up the issue, the KCCA wrote to the Additional Collector Customs, Air Freight Unit Jinnah International Airport with complete details including name of each of the 194 clearing agents, name of importers, GD Nos., Payment Invoice Nos, Amount of duty paid, SRB Excise/Cess/Tax Invoice Nos and Amount of Cess paid to the SRB. The Customs, however, refused to refund the customs duty collected by the FBR and tax collected by the SBR, contending that there was no provision in Customs Act 1969 for reimbursement of duty paid on goods destroyed in an act of terror. The sources pointed out that the actual number of importers whose shipments were destroyed in the attack at JIAP may exceed the current figure of 194.
ISLAMABAD
KARACHI
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MUHAMMAD FAIZAN www.customstoday.com
epartment of Customs and Petroleum Director Audit Khalid Hussain has directed the audit of 21 collectorates and directorates of the Karachi Customs. Hussain has nominated Abid Javed Khan, Abdul Rashid Brohi and Muhammad Eisa Khan as audit officers through a letter no 231-DACP/PAC/DAC/verification/201414 (Vol-II) dated August 26 sent to the 21 collectorates and directorates referring to the Public Accounts Committee’s letter no1(156) accounts/PAC/2014 dated August 22, 2014 to FBR on the above cited subject. The letter also requested the heads of 21 collectorates and directorates to provide updated working papers to the office of director audit at the earliest. The three audit officers would be verifying the replies in respect of MFDAC reports for audit of FY2012-13 and FY2013-14. Sources said that it will not be possible for only three officers to thoroughly check the twoyear accounts of 21 collectorates and directorates. —CT Report
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nvestigations into the TCS smuggling case reveal that the address mentioned in the agreement between TCS and Smart Zone company was not physically existed. Shahidullah Jan, deputy director customs intelligence Rawalpindi Directorate who is investigating the
lawyers. Customs ofOicials have prepared an application to request the court for cancelation of aspiratory bail of the accused. After cancelation of the bail, customs ofOicials would be able to further investigate the case after taking them in their custody. It is also revealed that Shakirullah is owner of several other companies and he imports mobiles through one of these companies. After arrest, his all companies would be investigated. It is expected that heavy Oine would be imposed on TCS on the basis of ev-
idences collected against the company. Company’s new CEO’s presence in the court on September 10 is also mandatory. It was mentioned in the contract between TCS and Smart Zone company that the latter would provide all import related documents to the former but it was never done. After failing to submit any legal documents, Customs ofOicials are hopeful that both the companies would heavily be Oined and evaded taxes would be recovered and the seized goods would be auctioned.
Bajwa laudsVirk for detectingTCS,Telenor cases ISLAMABAD
CUSTOMS TODAY REPORT www.customstoday.com
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BR Chairman Tariq Bajwa visited Directorate General of Customs Intelligence and Investigation. Director General I&I Lutfullah Virk briefed the chairman on the performance of the department during the chairman’s Oirst visit to directorate general after the appointment of Lutfullah as DG I&I. The FBR chairman lauded the efforts of DG I&I Lutfullah on his success in revealing TCS and Telenor tax scams. He also insisted on better per-
— Exclusive Customs Today photos
Only3auditorsto audit2yearsaccounts ofKarachiCustoms
case, has also conOirmed to Customs Today that there was no such ofOice in Peshawar. On the other hand, Customs Special Court has summoned Smart Zone owner Shakirullah, TCS former CEO Saqib Hamdani and Logistics Manager Gazanfar Gul on September 10. All three accused were getting extensions in case hearing from the court on the basis of their lawyers’ absence. However, now the court has clearly instructed them to ensure their presence in the court on September 10 even without their
formance to overcome the growing smuggling cases in Afghan Transit Trade and asked the ofOicers to act honestly to end the menace of smuggling from the country. The FBR chairman stayed shortly at Directorate General I&I. Meanwhile, FBR Chairman Tariq Bajwa has visited large taxpayer units (LTUs) to encourage the ofOicers to boost their revenue collection efforts amid the current political situation in the country. On the directive of Bajwa, Member Inland Revenue Operations Muhammad Ashraf Khan visited RTOs in Islamabad and Rawalpindi and met chief commissioners.
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NATIONAL 03
SEPTEMBER 09 - SEPTEMBER 15, 2014
FC seizes smuggled Iranian diesel in Balochistan
QUETTA: The Frontier Corps seized Iranian diesel during checking at Darakshan Checkpost. FC spokesman Khan Wasey informed that FC during the checking confiscated 15,000 litres smuggled Iranian diesel which was being transported to interior Balochistan.
FBR surpasses revenue target by Rs 3 billion ISLAMABAD
Appraisement-East collects Rs5.24b customs duty
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KARACHI
CUSTOMS TODAY REPORT www.customstoday.com
BR has surpassed the monthly revenue collection target of Rs 180 billion for August 2014 as it collected over Rs 183 billion during the month. FBR Official Spokesperson Shahid Hussain Asad confirmed to CustomsToday that the FBR has provisionally collected over Rs 183 billion during August 2014 against assigned monthly revenue collection target of Rs 180 billion with an increase of over Rs 3 billion. The data showed that the FBR collected Rs 53 billion income tax in August 2014 which is more than the collection of Rs 41 billion under same head last year.The FBR collected Rs 99 billion sales tax last month which is Rs 18 billion more than the last year collection of August. Moreover, the federal excise duty collected in August this year was Rs 11.5 billion; however, the FBR has collected Rs 10.9 billion during August 2013.The FBR collected Rs 23 billion customs duty in August 2014 while it had collected Rs 17 billion in August last year.The revenue collections of this year showed that business community totally refused the civil disobedience call by PTI Chairman Imran Khan.The FBR has achieved the revenue collection target despite slowdown in economic activities.
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— Exclusive Customs Today photo
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nder the supervision of Collector Najeebur Rehman Abbasi, the Model Customs Collectorate (MCC) of Appraisement-East has collected Rs 19.24 billion in August with an increase of Rs 5.78 billion as compared to the Rs 13.45 billion collected in July under the heads of customs duty, sales tax, withholding tax and federal excise duty. According to statistics, the MCC-Appraisement-East has collected Rs 5.24 billion customs duty in August against Rs 3.99 billion in July. The Collectorate has collected Rs 10.51 billion sales tax in August while it had collected Rs 6.83 billion in July 2014. The MCC Appraisement-East has collected the revenue of Rs 3.38 billion withholding tax in August while the Collectorate had collected Rs 2.54 billion in the same head in July. The Collectorate has collected an amount of Rs 101.81 million in share of federal excise duty (FED) in August with an increase of Rs 21.12 million, as the Collectorate had collected an amount of Rs 80.69 million in July. Meanwhile, the Research and Development (R&D) Section of the Model Customs Collectorate of Appraisement (East) has recovered Rs 24.46 million from 22 cases in August, 2014. According to details, the R&D Section has made the recovery of Rs 3,676,281 on the commodity (perfumery items) against the charge of mis-declaration of value and PCT. It has recovered an amount of Rs 25,000 on the commodity (electroplated metal jewelry Oitted) against the Orderin-Original penalty, Rs 2,845,211 recovered on the commodity (poly propylene polyethen) against recoverable amount in share of withholding tax. The R&D Section has recovered an amount of Rs 166,807 on the commodity (3 pieces bed cover) against mis-declaration of value and Rs 766,539 recovered
on the commodity (meth acrylamide) against misuse of SRO1125/2011. It has recovered an amount of Rs 39 866 on the commodity (sodium acid phosphate) against misuse of 6th Schedule of SNo 105 and recovered an amount of Rs 135,674 on commodity (aluminum wire) against excess weight revealed after examination. The R&D Section has also recovered an amount of Rs 37 744 on commodity (empty mesh bags) against mis-declaration of value and recovered an amount of Rs 427 966 on commodity (hair accessories) on mis-declaration of weight. It has recovered an amount of Rs 258 359 on commodity (ball bearing) against non-implementation of Valuation Ruling No 312/11 and recovered an amount of Rs99745 on commodity (Sino Oix red 301) against misdeclaration of value. The R&D section has also recovered an amount of Rs 609,671 on the commodity (Genetron R22) against misdeclaration of value and recovered an amount
R&D Section recovers Rs 24.46 million
of Rs 138,642 on commodity (ice-cream set ceramic) against non-applicable of 6th Schedule. It has recovered an amount of Rs 59 002 on miscellaneous goods against the recovery found in database and recovered an amount of Rs 2,231,923 on commodity (aluminum scrap) against mis-declaration of value as the consignment was cleared through green channel. The R&D Section has also recovered an amount of Rs 4,091,256 on commodity (ibuprofen pharmaceutical raw material and packing material) against misuse of SRO551/2008 and recovered an amount of Rs 102,310 on commodity (Oilm feed plywood) against mis-declaration of value. The R&D Section has recovered an amount of Rs,38,186 on commodity (miscellaneous goods) against additional duty recovered during re-assessment and recovered an amount of Rs 73,129 on commodity (compound Oilter) against mis-declaration of PCT.
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NATIONAL
SEPTEMBER 09 - SEPTEMBER 15, 2014
Increase in revenue linked to broadening tax base
KARACHI: The government wants to generate more revenue, but it avoids widening tax base that is said to barely cover 0.30 per cent of the population, said former Karachi Tax Bar Association (KTBA) president Anwar Kashif Mumtaz. He was addressing a seminar by the KTBA on “Finance Act 2014” and attended by tax practitioners and consultants in great number. He said that the government opted to introduce multiple categories with varied rates in the Act instead of broadening tax base.
Customs lodges FIR against agents, exporter for misusing‘E’form LAHORE
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www.customstoday.com he Investigation and Prosecution Cell of the Model Customs Collectorate Appraisement has lodged an FIR against five people for allegedly misusing‘E’form for foreign exchange at the Mughalpura Dry Port. Sources told CustomsToday that Jamaludin and Sons, through New See Line International Customs Clearing Agents, entered a consignment of 15,250 pieces of auto oil filters worth $12,192 in customs computer system for export to Ghana using fake‘E’form for the consignment. Customs has confirmed the bank account mention on the form of Meezan Bank branch, but the bank denied having an account of the said exporter. In the FIR the Customs authorities said that the accused deliberately violated Customs Act 1969 and Foreign Exchange Regulation Act 1947, inflicting heavy losses on the national exchequer. The consignment has been seized and the FIR has been lodged against customs clearing agent M Rashid, Najam Raza of freight.com, Nadeem andWasim of Shipping and Freight Forwarders, and Tasadaq Hussain of ShehnshahTraders in the alleged misuse of‘E’form. The customs adjudication deputy collector has imposed fines on the accused and instructed the customs authorities to start further investigations into the matter.
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Customs registers FIR on cheque bounce he Model Collecotorate of Customs (MCC) Appraisement Investigation and Prosecution (I&P) Cell has lodged an FIR against the Mashahni Enterprises after a cheque of Rs 12.6 million issued by the company bounced. As per details, the Mashahni Enterprises had allegedly cleared a consignment of 20,265 kilogramme consisting of drawing pen and markers worth Rs 3.1 million and paid Rs 1.7 million customs duty and tax at the Mughalpura Dry Port. However, the Customs Appraisement Valuation Group reassessed the imported goods and found its worth at Rs 25.9 million.The importer, later, moved the Islamabad High Court when customs asked additional duty of Rs 14.3 million. The court ordered the importer to issue post-dated cheque in the name of the Customs Department. Customs Inspector Farrukh Amin further stated in the FIR that importer’s cheque was bounced back due to insufficient funds in the bank account. The customs has registered a fraud and mis-declaration case against the importer. —CT Report
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vehicle amnesty scheme: FBR seeks reply from Collector wasif Memon KARACHI
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ederal Board of Revenue (FBR) Customs Tariff-III Secretary Syed Ali Zaman Gardezi has asked the Collector of Customs (Inquiry OfOicer) Dr Wasif Ali Memon to submit his written reply against the impugned chargesheet C 9 (2) /2014M.I in connection with the illegal import of 1 1 9 vehic l e s under t h e
amnesty scheme. As per details, the FBR has requested for attested photocopies of documents, including notiOications, SROs, instructions or guidelines issued by the board for the regularisation of smuggled vehicles and photocopies of 119 Oiles. In the letter, the authorities asked for documentary evidence for 119 vehicles claimed to be present in the
holding areas of Dubai, Sharjah, Afghanistan and auction houses in Japan during the currency of the scheme, as mentioned in the charge sheet, duly veriOied by the relevant authorities, ofOice order issued by the then collector dated March 22,2013, SOP issued by MCC Peshawar along with the board’s letter through which it was circulated, intelligence alerts issued by the Di-
3,000 members to cast vote for KCAA election round 3,000 members of the Karachi Customs Agents Association (KCAA) will cast their votes at auditorium on September 25 to elect a 20-member managing committee, including the president and the general secretary. As per details, the annual general elections of the KCAA for the term 201415 will be held on September 25. The voting will be held from 9am to 6am with a lunch break during which voters present in the polling area will be allowed to cast their votes. The nomination forms are available for the members from August 16, whose dues are cleared. In case a member wants to file a nomination for more than one post he has to submit a separate application form for each post. A security deposit of Rs 10,000 and Rs 5,000 has to be deposited by the candidates contesting the elections for the post of office bearer and post of member managing committee, respectively. The last date for filing the nomination forms is September 10 till 5pm.The meeting of the scrutiny committee will be held on September 13 while the last date for the withdrawal of nominations is September 20. The final list of the candidates will be displayed on September 22. The KCAA is the pioneer of formerly Karachi Customs Agents Group (KCAG) which was established in 1965 by a few prominent customs agents of that time who were experiencing difficulties in clearing and forwarding of the goods through customs and port authorities. On May 18, 2006, the Karachi Customs Agents Group was registered as a trade body under section 42 of the Companies Ordinance 1984 and now is known as Karachi Customs Agents Association. —CT Report
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rectorate General (I&I) dated March 29,2013 and April 1,2013 along with the dates of their receipt in the collectorate and the correspondence by the chief collector (South) on the issue with the board, instruction issued by the board regarding non-presentation of vehicles as mentioned at para (xi) (a) of the charge sheet and the date of its receipt in the collectorate, SOP, ofOice order indicating the undersigned’s responsibility for the acts and deeds of the subordinate staff a s mentioned in para (C) of t h e charge sheet, investigation report, if any, conducted on the issue by the FBR or any other agency and any other document deemed appropriate in connection with the subject. The board also asked the ofOicers for supplying the said documents sought for the verdict of the honorable Supreme Court of Pakistan, adding that on behalf of para (10) of the judgment reported as 1996 SCMR 201 is relied upon.
Amends made to valuation ruling of auto-parts KARACHI
SYED MUHAMMAD ASLAM www.customstoday.com
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he Customs Valuation has made a number of amendments to the Valuation Ruling No.661/2014 after a thorough examination and threadbare discussion with stakeholders. According to a letter No Misc/22/2009-VIIIA/7445 dated August 29, issued by Customs Director (Valuation) Abdul Rashid Sheikh, the Customs values of various replacement auto-parts were determined vide Valuation Ruling No.661/2014 dated March 3, 2014 and amendments dated April 4, 2014. The aggrieved stakeholders filed revision petition with the Customs Valuation Director General under Section 25D of the Customs Act, 1969. The DG vide Revision Order
No.54/2014 dated June 16, 2014 was pleased to order fresh determination of customs values as enumerated in the said order. Accordingly, after examination and holding meetings with stakeholders, the following amendments are made in regard to Valuation Ruling No.661/2014. The amendments include fresh determination of Customs values of water pump, oil pump, fuel pump, spark plug, automobile bulbs, oil filter, fuel filter, air filter, piston set, set; brake disc pads, brake disc rotors, brake drums and brake shoe; other brake parts; tie rod ends, ball joints, rack end, suspension arms; shock absorber; other steering and suspension parts; fender, bonnet/head, front grille, bumper, trunk lid (dikky), doors; other body parts; bushing, weather strips, rubber oil seals, other rubber parts.
Stakeholders filed revision petition with DG Customs valuation under Section 25D of Customs Act
The fresh Customs values (C&F) in US $ differs for same replacement auto-part depending on its origin of import and other specification, such as weight in the case of water pump, oil pump fuel pump, oil filter, fuel filter, air filter; Iridium or non-Iridium/carbon tipped spark plug. The Customs values is applicable per piece or for water pump, oil pump, fuel pump, spark plug, automotive bulbs, oil filter, fuel filter, air filter. It is based on per kilogram basis for the remaining auto parts including piston set, set; brake disc pads, brake disc rotors, brake drums and brake shoe; other brake parts; tie rod ends, ball joints, rack end, suspension arms; shock absorber; other steering and suspension parts; fender, bonnet/head, front grille, bumper, trunk lid (dikky), doors; other body parts; bushing, weather strips, rubber oil seals, other rubber parts.
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NATIONAL 05
SEPTEMBER 09 - SEPTEMBER 15, 2014
PITAD plans holding 15 seminars for businessmen
ISLAMABAD: The Pakistan Institute of Trade and Development (PITAD) in collaboration with chambers and other trade associations has planned about 15 seminars on “Trade & Economic Issues” for business community in 2015-16. The PITAD would also undertake a number of short and long training courses on “International Trade & Economy” and would establish “National & International” linkages to undertake quality research which would be translated into policy-making by the Ministry of Commerce.
Anti Smuggling Organisation seizes contrabands worth Rs 24m coated/ non-coated, standard cut circles involved in duty evasion of Rs 1.08 million which importer paid later. The anti-smuggling unit has also seized 24 bundles (2050 kilograms) of art silk cloth worth Rs 0.9 million involving Rs0.4 million duty. On August 27 customs team seized 700 bags (28,825 kilogram) of poppy seed, produced in Afghanistan and registered FIR against three criminals, including a godown owner J u naid, and
KARACHI
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Junaidasksofficersto launchrobusttax recoverycampaign MULTAN
CUSTOMS TODAY REPORT
— Exclusive Customs Today photo
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ustoms Intelligence Director Junaid Akram has urged the customs officers to perform their duties with dedication and strengthen the national economy by launching a robust tax recovery campaign and anti-smuggling operations. “All the officers will have to work hard to improve the revenue collection,” he said while visiting office of the customs intelligence in Multan. On the occasion, Additional Director Customs Intelligence Multan Nisar Ahmad apprised him of the performance and problems being confronted by the Multan office due to shortage of staff. He said that the shortage of staff had badly affected performance of the department, especially field operations against smugglers. There is acute shortage of operational staff particularly constables in Multan, he said. At which, the Director Customs Intelligence promised to resolved the problems at earliest. He also promised to seek permission from the FBR chairman for new recruitment on vacant posts to make effective operations against smugglers.
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he Anti-Smuggling Organisation (ASO) branch of the Directorate of Customs Intelligence and Investigation Karachi under leadership of Director Asif Margoob Siddiqui seized smuggled goods, including foreign diesel, oil tanker, CNG cylinders, high speed Iranian diesel, silk cloth, poppy seeds, shoes and sleepers worth Rs 24.2 million in which Rs 3.18 million duty involved, in raids during August. As per details, the antismuggling team has s e i z e d 18,000 liters of diesel in an oil tanker bearing registration number TUB-623 involved in Rs 0.55 million duty evasion on August 9 and arrested three culprits. The customs also seized 14 foreign CNG cylinders worth Rs 0.44 million on August 12 involved in Rs 0.1 million duty evasion. Moreover, customs has seized 6,000 liters high speed diesel with a
truck registration No JY-8054 involved in Rs 0.18 million duty evasion and lodged FIR against culprits. The Karachi customs has also detected a case of mis-declaration on August 25 in which the importer Haroon Steel House was taking undue beneOit of SRO-421(I)/2014 in clearance of stainless steel scrap, sheet
Mumt a z alias Lahori a n d S h a O i q Kakar. The worth of seized poppy seeds was estimated at Rs 8.6 million. The Customs seized 1,144 cartons of shoes and sleepers worth Rs1.42 million involving Rs 3.18 million duty and arrested four accused including Naushad Qazi of Cash Club Islamabad and clearing agent Muhammad Sajid.
Port Qasim revenue increases by Rs5.89b he Model Customs Collectorate of Port Muhammad Bin Qasim has collected revenue of Rs 25.6 billion in share of customs duty, sales tax, federal excise duty and income tax in August 2014. As per details, Collectorate of Port Muhammad Bin Qasim has increased its revenue collection by Rs 5.89 billion as revenue collection in July was Rs 19.74 billion. According to the statistics, the MCC Port Muhammad Bin Qasim has collected revenue of Rs 5.12 billion in share of customs duty in the month of August with an increase of Rs 1.1 billion as compare to the revenue collection of R s 3.93 billion in the month of July.The collectorate has collected Rs 16.97 billion sales tax in the month of August with an increase of Rs 3.8 billion as Rs 13.13 billion sales tax was collected in July.The Port Muhammad Bin Qasim has collected Rs 279 million federal excise duty in August with an increase of Rs 126 million as the collection of July was Rs 153 million. It has collected Rs 3.25 billion income tax with an increase of Rs 740 million as Rs 2.51b collected in July. It is important to mention here that the FBR has not yet set the revenue target for the fiscal year 2014-15 on monthly basis. The federal ministry of finance, however, has asked the FBR authorities to collect Rs 2810 billion during the FY 2014-15. —CT Report
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Rs 240 million tax fraud
Adjudication-1servesshow-causeon12fabricimporters KARACHI
CUSTOMS TODAY REPORT www.customstoday.com
he Customs Collectorate Adjudication-I served show-cause notices on 12 fabric importers allegedly involved in financial fraud in term of tax evasion amounting to Rs 240 million by taking undue advantage of SRO1125(I)/2011 on commercial import of fabric. The importers who have been served with show-cause notices include Al-MawadahTextile, AI Enterprises, Ahsan Enterprises, Al-Harmain Textile, GM Exports, Hira Exports, PioneerTextile, Anwar and sons, Nawaz Enterprises, Sara Corporation, BA Impex andWJK Enterprises. According to details, Al-Mawadah has been accused of tax evasion to the tune of more than Rs 18 million in term of additional sales tax and advance income tax; AI Enterprises was involved in tax evasion of Rs 18 million; Ahsan Enterprises was involved in tax evasion of Rs 45 million; AlHarmain was involved in tax evasion of Rs 7 million; GM Exports evaded tax amounting to Rs 59 million; Hira Exports was involved in tax evasion of Rs 102 million; PioneerTextile was
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amended vide SRO154(I)/2013, SRO504(I)/2013 involved in tax evasion of Rs 18 million; Anwar and sons evaded tax to the tune of more than R s6 and SRO898(I)/2013, sales tax is chargeable on import of fabric at concessionary rate if imported million; Nawaz Enterprises was involved in tax by registered manufacturers and commercial evasion of Rs 33 million; Sara Corporation was importers of different slab. As per above involved in tax evasion of about Rs 8 million; mentioned condition of said notifications, BA Impex evaded tax to the tune of registered manufacturers listed in the Rs 19 andWJK was involved in ActiveTaxpayers’List (ATL) pay tax evasion of Rs 5 million. sales tax at import stage It is to be noted that @3per cent on fabric all these case fall in imported for in-house the purview of MCCImporters took consumption and Appraisement undue advantage income tax @1per cent (West). According while commercial to the MCCof SRO1125(I)/2011 importers were Appraisement on commercial required to pay (West), certain additional sales tax unscrupulous import of fabric @2per cent over and commercial importers above the concessionary rate attempted to mis-use of 3per cent and income tax the concessionary rate of @3per cent. Furthermore, scrutiny of sales tax provided under SRO1125 relevant import data revealed that the importers (I)/2011 by obtaining sales tax registration from imported consignments containing different kind Inland-Revenue under the category of of fabrics, and filed GDs for home consumption, manufacturers despite having no manufacturing falsely claiming benefit of SalesTax vide facility of their own. It is to be noted that SRO1125(I)/2011 by declaring imported goods for according to condition (VII) of SRO1125(I)/2011,
in-house consumption in the capacity of manufacturer.The importers determined their liability of payment of duty/taxes by claiming undue benefit of SRO1125 (me) /2011 and sought clearance under Section 79(I). Therefore, the aforementioned importers committed an offence of mis-declaration in term of Section 32(1)(2), 32-A, 79(1)(b) and 80 of the Customs Act, 1969, Section 6,11 & 36 read with the Section 7A of the Sales Tax Act, 1990 and Chapter X of the Sales Tax Procedure Rules, 2007 vide SRO480(I)/2007 read with SRO1125(I)/2011,amended vide SRO154(I)/2013, SRO504(I)/2013, SRO898(I)/2013 and SRO 154(I)/2013 further read with Section 148 and 161(2) of the Income Tax ordinance, 2001 punishable under clauses (14) & 14(A) of the Section 156(I) of the Customs Act, 1969 read with the Section 33, 34 & 36 of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001.The Customs Collectorate Adjudication-I will take up the cases for hearings from Sept 16. It is to be recalled that CustomsToday had brought the issue of commercial importers mis-using using SRO1125 (I)/2011 to the fore.
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PROFILE
— Exclusive Customs Today photo
Currently Haji Muhammad Adeel is Chairperson Senate Standing Committee on Foreign Affairs as well as an active member of Senate Standing Committees on Defence , Rules of Procedures and Privileges; Finance, Revenue, Economic Affairs, Statistics and Privatization, Senate House Committee and Senate Finance Committee. He also holds office of Parliamentary Leader of his party in Senate of Pakistan, SeniorVice President, Awami National Party (ANP) Pakistan, Chairman ANP Election Commission, Coordinator ANP Lawyers, Member ANP Central & Provincial Executive Committees, Member, National Executive Committee, Pakistan-India People’s Forum for Peace and Democracy and Member of National Steering Committee INSA (Imagine a New South Asia). Previously he had been on the positions of ANP Acting President, Member of Provincial Assembly in 1990, 1993, and 1997, NWFP Minister Finance in Provincial Cabinet in 1993, Deputy Speaker NWFP Assembly in 1997-1999, Deputy Parliamentary Leader of ANP in Provincial Assembly, Chairman Frontier Ghee Manufacturers Group, Member Managing Committee All Pakistan Ghee Manufacturers Association, Executive Member of Zonal Committee, Federation of Chamber of Commerce and Industry, Pakistan, Executive Member, Sarhad Chamber of Commerce and Industry and numerous others.
www.customstoday.com SEPTEMBER 09 - SEPTEMBER 15, 2014
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SPECIALREPORT 07
SEPTEMBER 09 - SEPTEMBER 15, 2014
M
ISLAMABAD
M ARSHAD
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ember Senate Standing Committee on Finance and Revenue Haji Muhammad Adeel has said that simple tax returns filing system can help in broadening the tax net. Federal Board of Revenue must also make the payment of refunds to exporters at the earliest to encourage the exporters to increase volume of Pakistani exports and earn foreign reserves. In an exclusive interview with Customs Today, Haji Adeel said that more than three million potential taxpayers were identified during the tenure of previous government and now it is
reparable loss on national economy and damaged Pakistani image in the comity of nations. “Foreign dignitaries and heads of states including Maldives and Sri Lanka were not able to pay visit to Pakistan due to the political unrest and instability in the country and it earned bad repute for Pakistan across the globe,” he added. “Now, visit of Chinese President is scheduled and none is sure either he will be able to come to Pakistan or not, because no early ending of the political turmoil is being seen on the horizon,” he observed. Alleging the hypocrisy on part of his political rival, he said that members of the provincial assembly had also drawn their August salaries after
said that prevailing turmoil had also cast adverse impacts on the revenue collection because tax collecting agency’s officials were not able to execute their professional duties honourably, freely and with freedom of mind. He proposed easy process of filing of tax returns for retailers in national language instead of English saying, the existing system and mechanism was not tangible for common retailers and they were forced to hire services of technically literate people to meet the purpose which was an extra burden on them. “Once I came to FBR for submission of a claim for refund, I had to pay Rs 25,000 for filing of the specified form, then I sought guidance from the
The government may take assistance from Immigration, NADRA, traveling agents and others to countercheck capacity of identified people on account of number of their foreign trips and luxurious life style responsibility of the incumbent gov- deduction and payment of income tax ernment to bring them in the tax net and their utility bills but their party to increase volume of revenue collec- chairman had given call of civil distion. obedience. He elaborated that the government He said that very act of containermay take assistance from Immigra- ization of Islamabad-Peshawar Motion, NADRA, traveling agents and torway (M-I) and Grand Trunk others to countercheck capacity of Road (G.T. Road) by the provinidentified people on account cial government of Khyber of number of their foreign Pukhtunkhwa had blocked movetrips and luxurious life ment and transportation of style. cargo from Peshawar to Haji Adeel said other cities of the that the prevailcountry. ing political We l c o m i n g e situation government’s k a m d oul arisen out decision of FBR sh ent of of long ex t e n d i n g m y a p the marches last date o t refunds s at the and sit-ins for filing r had inof tax reexporte to flicted irturns, he arliest
e ge them encoura se a to incre of exports volume foreign n and ear s e v reser
officer, instead of getting my refund claim accepted, I had to face a number of cases against me,” he said while describing his personal experience. “Now I am left with no other option except withdrawing my refund claim or hire several advocates to contest my cases in the court,’ he added. “Virtually, sit-ins and long marches have disconnected economically Khyber Pukhtunkhwa and twin cities; Islamabad and Rawalpindi, causing shortage of edibles due to blocked transportation of vegetables and other items,” he said. Similarly, he said that the prevailing uncertainty had also devalued rupee against the dollar which had added billions of rupees in total volume of foreign loans and overburdened every citizen.
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08 EDITORIAL
SEPTEMBER 09 - SEPTEMBER 15, 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
Economy in the dock
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hrough their contradictory statements, the government ministers have been repeatedly warning the nation about billions of rupees losses to the national exchequer since Imran Khan, chief of the Pakistan Tehreek-e-Insaf, and Dr Tahirul Qadri, chief of the Pakistan Awami Tehreek started their marches and sitins in the twin cities of Islamabad and Rawalpindi. Khurram Dastgir, the federal commerce minister, puts the figures of losses at Rs 8 billion while Finance Minister Ishaq Dar claims that the national economy has lost Rs 12 billion due to protest marches. However, the Federal Bureau of Revenue claims that the tax collection ratio has been improved in the recent weeks. According to a Customs Today report, the FBR has collected Rs 1 billion more than the revenue it had collected during the same period last year. The economic figures presented by the federal ministers and the government officials are absolutely in contrast with the state of economy. As Imran puts during his speeches to the participants of the sit-ins, he is in Islamabad with peaceful protesters, and questions how the sit-in affects the national economy. It has become a habit in the government circles to mislead the people by putting wrong figures. The ministers are issuing irresponsible statements about the state of the economy without giving any hearing to the voices of reasons. The figures issued by the FBR blatantly contradict the government’s claims of colossal losses as the board has collected more revenue in the current situation. Regarding the exports from the country, the exports activities are going on in full swing in Karachi and the goods, which were supposed to be exported from Islamabad, are being sent by the Karachi route. The commercial and trade activities are going well across the country and there is no panic in the business circles. However, the stock exchange is under pressure after reports appeared in the media that Khan and Qadri’s supporters have started marching towards the Prime Minister’s House, and it shed at least 291 points in the early session. According to other reports, at least three people have been killed and hundreds of others have been injured in clashes with the police. The government may have sincerity to resolve the current political crisis amicably, but one thing is clear that it has gravely mishandled the Model Town incident as well as the current political chaos in Islamabad. A bad workman fights with his tools and this can be 100 percent applicable on the Nawaz government in Islamabad and Shahbaz government in Punjab. It seems the two are adamant that instead of making new mistakes they will repeat the past mistakes.
In the hope of future LAHORE
DR AFTAB AFZAL
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he foreign missions situated in the Red Zone have been closed down for Oive days owing to volatile situation in the area while no party seems to be in a mood to accommodate the other in the current political spectrum. In this scenario one wonders where Pakistan will stand in 2050 predicted by Jim O'Neill, a British economist, that the country has the potential to become 18th largest economy in the world. In his book The Growth Map,O'Neill believes that there are prominent chances for Pakistan to
become part of the Next 11 (N-11) group of nations which includes Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, Turkey, South Korea, and Vietnam. In his view Pakistan has the potential to become the 18th largest economy of the world by 2050, leaving behind many growing and strong economies. The renowned economist has earlier coined the term BRIC – Brazil, Russia, India and China as large economies and another term MINT -- covering Mexico, Indonesia, Nigeria and Turkey. He also predicts that Pakistan’s GDP will be almost equal to the size of the current German economy -- $3.33 trillion by 2050.At the moment, Pakistan is at
44th with a GDP of $225.14 billion in the list of the world economies. The problem in Pakistan has never beenat the policy-making stage, but the implementation level as is evident by the third Oiveyear plan when Pakistan had recorded double digit growth in every sector of the economy in early 60s. South Korea, which was reeling under utter poverty at the time, sent a delegation of experts to research the causes of the growth in the Pakistani economy. Still at this juncture the economic indicators suggest that Pakistan is a potentially rich country, but the question is why more than 35 percent of its population lives below the poverty line.It must be a point
to ponder for the country’s politicians who do not tired of making tall claims to make Pakistan an Asian tiger. The rulers of the country never tried to explore or understand the real causes which hinder the path of progress and prosperity of this nation. The current chaos in Islamabad is nothing, but a test for the selfcentered political leaders to resolve political issue through political means. It is a time for the politicians across the board to prove their mettle and end the political impasse as soon as possible. At least they should have faculty to respect the country’s values and the national pride in the current situation.
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NATIONAL 09
SEPTEMBER 09 - SEPTEMBER 15, 2014
Swiss banks hit by huge deposit outflow in tax crackdown
ZURICH: Swiss banks have suffered from a massive outflow of funds since 2008 due to the international crackdown on tax evasion. According to a survey by auditors PricewaterhouseCoopers attributed much of the outflow -- totalling almost 350 billion Swiss francs (290 billion euros, $380 billion) -- to customers paying fines for undeclared assets held in Swiss accounts. The report said that foreign clients withdrew about 100 billion Swiss francs to pay fines abroad, and 250 billion Swiss francs were transferred to other countries.
PICT assures FPCCI of tackling congestion at terminal KARACHI
CUSTOMS TODAY REPORT
Grounding at PICT
80pc containers getting examined on same day: ADC Tahir
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KARACHI akistan International Container Terminal (PICT) Chief Executive Officer Zafar Iqbal Awan has assured the FPCCI delegation of taking all necessary measures to ease congestion at the terminal. The delegation, comprising FPCCI Standing Committee on Customs members and led by its Chairman Saqib Fayyaz Magoon, called on the PICT CEO here. Later, Mr Magoon informed that the FPCCI delegation held a meeting with PICT officials and apprised them of the problems being faced by the traders due to slow pace of work and congestion at the terminal. He said that the PICT CEO had assured to improve efficiency of the terminal’s operation. He cited a similarly meeting with the officials of Karachi International Container Terminal (KICT) in the past on the issue, saying that this meeting had resulted in improving operations at KICT terminal. On the occasion, FPCCI Standing Committee on Customs Co-chairman Shabbir Mansha stressed that the PICT should give priority to bulk cargo or cargo containing industrial raw material to minimise problem being faced by the industries. Standing Committee Vice Chairman Khurram Ijaz regretted the sending of high percentage of marking goods to laboratory. He termed it main reasons for the delay in clearance of GDs and demanded its reduction accordingly. He stressed the need for a simplified procedure for refund of demurrage by PICT.
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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
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s Customs Today raised the issue of delay in grounding at PICT, Pakistan Customs took prompt action to facilitate the importers and customs agents. ADC-PICT Muhammad Tahir said despite the fact that the Pakistan International Container Terminal (PICT) was facing space shortage, Pakistan Customs is examining 150 to 180 containers daily at PICT, adding that the examination of the containers is also being conducted at the sea-shore of the terminal. This was revealed by Additional Collector (ADC)-PICT Muhammad Tahir while talking to Customs Today exclusively at his office. Muhammad Tahir said the import are on the rise as around 5055 ships have arrived at the port in the month of August. However; the prevailing situation of the country has once again put a negative impact on the imports of the country. Commenting on the examination procedure at PICT, ADC Muhammad Tahir said Customs’ officials were also conducting the examination of the containers in the stacking yard of the terminal, adding that the Goods Declaration
ADC Muhammad Tahir
Deputy Collector Rizwan Bashir
Pakistan Customs has asked the terminal operator to ensure timely grounding of containers for examination (GDs) related to exports, raw material, value-added goods and machinery are also being filed on regular basis. “We are ensuring to examine
the containers within 5 days “freetime” given to the consignee, adding that the process can only be made more effective with the cooperation of the importers, if
they start providing “packing list” in the container”, he added. He further revealed that more than 2600 GDs within a week have been filed and cleared by the authorities concerned of Pakistan Customs. Responding to a query, Muhammad Tahir claimed that 80 per cent containers have been examined on same day after grounding at PICT, adding that the examining staff of MCC-Appraisement (East) is aimed at clearing consignments within 5 days free-time without any hassle. To another query, ADC MCC-Appraisement (East), PICT said that the Pakistan Customs have already taken up the matter with the high authorities of terminal operator in order to improve working scenario for facilitating the trade. “In this regard, the Pakistan Customs has urged the terminal operator to work efficiently and ensure timely arranging and grounding the containers for examination”, he added. Answering to a query, Additional Collector-PICT Muhammad Tahir confirmed that the MCC-Appraisement (East) has completed the examination of the containers accumulated during holidays and Deputy Collector Rizwan Bashir and his team with all-out efforts took the pendency to ‘zero’. He further said the pendency of every week stands at ‘zero’ before starting the new week.
Mend their ways! To,
Finance Minister, Ishaq Dar, Govt of Pakistan, Islamabad I have received a number of complaints that the FBR is using negative tactics to collect revenues. The LCCI members have complained that FBR was creating problems to the industrial sector without giving any kind of notices what so ever and has held clearance of the goods at the Karachi Customs Port. All the leading economies are giving incentives to expedite economic activities in their respective countries but in Pakistan the people who are sitting at the helm of affairs are doing the otherwise at this point in time when almost all the businesses are facing a number of internal and external pressures. It is very unfortunate that despite clear direction of the Federal Finance Minister Ishaq Dar and Chief Minister Punjab Mian Shahbaz
Sharif, the bureaucracy is creating troubles for the businessmen who are backbone of the economy. The manufacturing sector is already passing through very critical times due to unavailability of needed electricity & gas and in dire need of handholding by the government to run their businesses. The private sector is 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 antibusiness tactics, it would be very difOicult for the private sector to continue with their businesses. I would urge Federal Finance Minister Ishaq Dar to please take stock of the whole situation and stop the FBR ofOicials from coercion. Best Regards
Mian Tariq Misbah, SVP LCCI, Lahore
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10 NATIONAL
SEPTEMBER 09 - SEPTEMBER 15, 2014
wildlife trafficking: Customs tribunal slashes fine on accused
KARACHI: The Customs appellate tribunal reduced 75 percent of the fine imposed on five wildlife smugglers charged with illegally sending out 67 consignments of banned species of rose-ringed parakeet between April 2008 and January 2010. Similarly, the tribunal also slashed 60 percent of the fine imposed on three clearing agents for aiding and abetting the wildlife traffickers in smuggling of the birds.
Improving examination and clearance
Multan Dry Port generates duty collection of Rs704m
Multan Customs collects Rs 14.92b: Collector Sarfraz MULTAN
IMRAN ALI KHAN
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ultan Customs Collectorate has collected Rs 14.92 billion in August for FY 2014-15. The Anti-Smuggling Organisation has registered 15 cases in August 2014 which includes seven cases of vehicles and eight cases of contraband items, collecting Rs 7.26 million duty on the seized items. The Multan Customs also uncovered alleged tax evasion by Q-Mobile smart phones company worth Rs 771.8 million in August. In July customs has collected Rs 13.15 million and ASO has registered 16 cases in that month, however, seizure cases were 15 in August. Multan Customs Collectorate Sarfraz Warraich, while talking to Customs Today, said: “We are trying to improve examination and clearance process which will also help us collect more revenue and end duty evasion cases”. Moreover, Superintendent Anti-Smuggling Organisation Tanvir Malik said that Anti-Smuggling Organisation has also trying to foil any bid to smuggle contrabands through Multan Port. Meanwhile, the Multan Customs Intelligence and Investigation has captured two trucks of imported cloth and plastic grains in separate raids. According to reports, the customs ofOicials
intercepted a truck near Dera Ghazi Khan and seized huge quantity of Iranian-origin plastic grains being transported to Lahore. Customs Intelligence and Investigation Additional Director Nisar Ahmad constituted spe-
he Multan Dry Port (MDP) generated Rs873.300 million in the head of Customs duty during the month of August of current fiscal year 2014-15.The revenue collected in the month of August increased to Rs704 million against Rs169 million collected in the month of July of the current fiscal year. The monthly collection of SalesTax on import in August of the current fiscal year stood at Rs2,110.301 million which included regulatory duty, warehouse surcharges, miscellaneous goods, and 0.25 percent export development surcharge and export duty. The MDP’s collection of SalesTax on import witnessed an increase of 40 percent in the month of August against the collection of July of the current fiscal year which was Rs1,630.793 million. Likewise, the MDP collected import value amounting to Rs11,805.722 million which included anti-dumping duty, petroleum levy and advance income tax during the month of August of the current fiscal year.Talking exclusively to Customs Today MDP Collector Muhammad Ali Malik claimed that the revenue collection of the dry port had been on the rise constantly. He attributed this trend to the provision of multiple facilities being extended to the business community at port. MDP is providing multiple incentives to importers and exporters which in turn has not only improved confidence of the businessmen but has also resulted in boosting revenue. —CT Report
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cial teams to foil the smuggling attempts. Springing into action against the smugglers, Inspector Sheikh Arshad, Inspector Naseem Cheema along with constable ZulOiqar captured a truck and seized the plastic grains. Another team intercepted a truck and recovered huge quantity of smuggled cloth. According to the Customs I&I additional direction, the captured cloth and grains worth more than Rs 15 million. Meanwhile, Multan Appraisement Principal Appraiser Mahmood Ahmad Khan has said that the Multan Dry Port authorities have cleared the major consignments of the coal power plant in August to help government end energy crisis. He said that Kot Addu Power Plant Company (KAPCO) is an independent power plant company, which generates electric power and going to install new coal power plants in the Southern Punjab region very soon. “The KAPCO has imported a set of complete coal Oiring system with standard accessories from China in July at the Multan Dry Port through Auto Track Clearing and Forwarding Agency,” he added. He said that the customs appraisement department cleared nine such consignments in August which were imported from Shanghai. These imported power plants will be installed near Kot Addu and Muzaffargarh and will help reducing electricity shortfall in the country, he said. The gross weight of the consignment was observed 177.11 million tonne and the declared assets value was $0.44 million with Rs 4.7 million duty.
Delay in FTO Sialkot camp office draws STBA ire SIALKOT
ZAFAR MALIK
www.customstoday.com ialkotTax Bar Association (STBA) President Shahid Mehmood has regretted the delay in the establishment of FederalTax Ombudsman (FTO) camp office at the export-oriented city despite a lapse of four months and demanded early setting up of the office. Talking to CustomsToday, Mehmood informed that the STBA had long been struggling for the FTO camp office in Sialkot, adding that they had taken up their demand with the FTO during his visit to Sialkot in April 2014. “Finally all our hectic efforts bore fruit as the Federal Tax Ombudsman Secretariat, Islamabad accepted our demand and issued directives vide a letter on June 18, 2014 for the establishment of FTO camp office,” he said. Mehmood said that the directives declared that“all complaints pertaining to custom, sales tax, federal excise duty and income tax etc. of Sialkot region shall be heard at the Sialkot camp office with immediate effect and Advisor (Incharge) Lahore was advised to arrange venue for hearing.” The STBA chief revealed that the core issue the STBA had been grappling with was the extension in bar room, adding that the tax bar was consisted of about 60 members whereas the existing space in the bar room was too little to cater to the needs of the members.“Many a times they have discussed the issue with the officials
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concerned and have sought some extra space linked to the bar room for the desired extension,” he informed, adding that unfortunately neither the FBR nor the other officers concerned did nothing to address the issue.
He urged the Federal Board of Revenue (FBR) chairman to consider the matter on sympathetic grounds so that the longstanding issued could be resolved in a better manner.“Look the FBR chairman hold the key to get
the STBA extension issue resolved either through provision of extra space adjacent to the existing bar room or its relocation to in any other part of the RTO Sialkot,” he pointed out. Shahid Mehmood complained that there was no independent/permanent Commissioner Appeal in the Sialkot RTO having more than 12 million taxpayers, adding that all appeal/cases pertaining to Sialkot RTO used to be marked to Commissioner Inland-Revenue (Appeal) Gujranwala who heard these cases at camp office in Sialkot. However, after his posting, the seat fell vacant and charge was additionally assigned to CIR (A) Lahore, he added.The STBA president said that the CIR (A) Lahore had been reluctant to hear cases pertaining to this region at Sialkot or even at Gujranwala, adding that all such cases of the Sialkot RTO had been heard at Lahore which caused great problems for the bar members. Mehmood said that finally they approached the FBR Member IR, urging him to restore the permanent seat of CIR (A) for Sialkot Zone.“We also urged the Member IR to advise the Commissioner IR (Appeal) Gujranwala to arrange a camp office at RTO Sialkot to hear all such cases until the permanent post is created,” he claimed. The STBA president boasted that now with the grace of Almighty Allah, and the bar efforts, the seat of Commissioner Inland-Revenue (Appeal) had been restored in Zone Sialkot. He also expressed the hope that the new Commissioner (Appeal) would be appointed soon to facilitate taxpayers.
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CARTOONSSPECIAL 11
SEPTEMBER 09 - SEPTEMBER 15, 2014
Customs seizes 45 sewing machines worth Rs 10m
LAHORE: A team of Multan Customs anti-smuggling squad seized 45 smuggled Japanese sewing machines in a raid on a bus near Chenab Bridge on Muzaffargarh Road. According to the customs sources, the value of the seized machines is Rs 10 million.
Multi-billion tax scam
Shaheen Air seeks documents from customs KARACHI
CUSTOMS TODAY REPORT www.customstoday.com
he Shaheen Air International (Private) Limited has sought relevant documents from the customs authorities in a multi-billion tax evasion case against it. According to details, the MCC-Preventive has constituted a case against Shaheen Air for allegedly evading tax of Rs 4.145 billion. It is alleged that the airline imported 47 aircrafts under different lease agreements and dismantled, removed or scrapped 12 of them. The Collectorate of Customs Adjudication-I has forwarded the query letter of the airline to the Collectorate of MCC-Preventive for further departmental procedure. It is pertinent to mention here that the Collectorate of Customs Adjudication-I on the contravention report sent by MCC-Preventive had issued show-cause notices to Ehsan Ali Sehbai, the chairman of the Shaheen Air, CEO Kashif Khalid Sehbai, Syed Yousaf, chief/director procurement & logistics, and others. In view of the facts and circumstances, the Customs
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authorities reached at the point that the accused persons namely Ehsan Ali Sehbai, Chairman Shaheen Air International, Syed Yousaf (Chief/Director Procurement & Logistics), Faisal Rafiq, DMD (Airlines Operations), S M
Anwar, Director Legal Services M/s Shaheen Air International, Abriaz Ali Khan, Assistant Legal Advisor, M/s Shaheen International, Altaf and Basharat, scrap dealers thus committed an offence under Section 2(s),
32(2) & 79 of the Customs Act, 1969 punishable under clauses 8,14 &47 of Section 156(1)ibid read with the Sales Tax Act, 1990, Income Tax Ordinance, 2001 and Prevention of smuggling Act, 1977.
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12
SEPTEMBER 09 - SEPTEMBER 15, 2014
Dubai Customs receives Internal Auditors Certification
DUBAI: Dubai Customs has received the International Standard for Service Excellence (TISSE2012) Internal Auditors Certification from the International Customer Service Institute (ICSI) on improving its standard of inspection, examination and custom care. As per details, Dubai Customs received TISSE2012 which will enable them to become certified auditors, capable of conducting internal assessment of their clients in addition to improving performance and efficiency.
NATO GOODS PILFERAGE
Collector Mujtaba imposes Rs 50 million penalty on M/s Water Link KARACHI
SOHAIL RAB KHAN www.customstoday.com
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hmed Mujtaba Memon, the Collector of Customs Adjudication-I, has issued Order-inOriginal (ONO) against Water Link Pakistan (Private) Limited. The ONO was also against Water Link Pakistan Managing Director Ghulam Mustafa, manager, assistant manager (operations) Karachi Port Trust, broker of New Ittehad Shanwari, supervisor of Water Link, owner of conOiscated vehicle, drivers, Ehsanuddin and Company (Private) Limited, Fayyaz Hussain of carrier Tracon Services (Private) Limited. In the verdict, the collector was of the view that the charges leveled against the Water Link and its administrations in the show-cause notices stand established, as no claim of the impugned goods has been made by any authority which shows that all goods from two containers and partial goods from one container have undisputedly been pilfered. The fact that the vehicles were in an unauthorised place without permission as prescribed in rules/law and after an extended delay with a
door open and goods missing clearly shows that there has been “en-route pilferage of transit goods” as deOined in Section 2(s) of the Customs Act, 1969. The collector, in its judgment, also ordered for conOiscating of the seized goods along with the containers and vehicles that they were laid on under clause 8 and 63 of Section,
156(1) and the Section 157 of the Customs Act, 1969. In the judgment, the collector of customs adjudication stated “I impose a penalty of Rs 50 million under clause 8, 14, 63 and 64 of the Section 156(1) of the Customs Act, 1969 on M/s Water Link Pakistan Private Limited, who are responsible for paying
duty and taxes due on the pilfered goods in terms of rule 484 of Customs Rules 2001 read with the Section 32(2) of the Customs Act, 1969”. Moreover, the collector customs adjudication-I in the ONO has also imposed penalty of Rs 0.5 million on Water Link Managing Director Ghulam Mustafa and Rs 0.1 million on each
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
including Water Links Manager Rizwan Yousaf, Assistant Manager KPT Muhammad Rizwan Ishaq, ofOice boy Muhammad RaOiq, broker of New Ittehad Shanwari Idrees Khan, Supervisor Water Links Qaiser Ali, Satrah Khan, owner of the vehicle No TLQ857; Muhammad Iqbal, driver of vehicle No TLC-514; Gull Nawab owner of vehicle No TLQ-857, Atif Iqbal driver of the Vehicle and Fayyaz Hussain, owner of vehicle No TLC-514. It is important to mention that the MCC Preventive on midnight of December 6 raided at the Water Link Yard and found that one door of a container No LMSU-1400780, Seal No PCCSS-3456188 loaded on trailer No TLQ-857 was half open and few people were busy inside the container. Two persons namely Rizwan Yousaf and Qaiser Ali were immediately held by the ofOicials of MCC Preventive. Later on, the MCC Preventive in its seizure report No ASO/147/2013Hqrs stated that the Water Link Pakistan Private Limited, who is an authorized bonded carrier for Afghan Transit has illegally engaged in breaking/open the NATO containers, which were being exported from Afghanistan to USA through Port Qasim without touching the seal and by removing rivets from one of doors of the container, taking out the goods and re-riveting the containers.