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Customs detect misdeclaration

September 18, 2012

KARACHI, Sept 17: The customs authorities have detected a case of misdeclaration wherein an industrial importer had been dodging tax officials by declaring alloy steel wire rod as non-alloy steel wire.

The duty on alloy steel rod is higher.

According to customs sources, the alloy steel wire rod falls under PCT heading 7227.9000. It has 20 per cent customs duty whereas non-alloy steel wire rod, classified under PCT heading 7213.9190, carries 10 per cent customs duty which is further reduced to five per cent under Free Trade Agreements (FTA).

The customs authorities after lab testing of the samples of the commodity reached a conclusion that the importer and his clearing agent had been mis-declaring for evading customs duty up to 15 per cent.

The lab test certificate verified that the imported commodity was carrying element of boron in the range of 0.0018 to 0.0023 per cent which attracts classification under heading 7227.900 on being alloyed wire rods, sources said.

The customs authorities accused that the importer being a manufacturer is well versed with the product and had been willfully mis-declaring imports to evade customs duty.

The officials further said that importer being a manufacturer of steel products requires specific grade of steel which was essential for manufacturing of their required commodity and for this purpose they had been importing “alloy steel” having specific grade SAE-1008B.

Consequently, the customs authorities believe that the importer violated provisions of section 79(1)(a) and section 32(1) and (2) of Customs Act, 1969, punishable under clause 45 and 14 of section 145(1) read with SRO499(1) of 2009 dated 13.06.2009.

Commenting on the case, a businessman suspected involvement of officials in such cases of gross violations of relevant laws.He said that billions of rupees are being annually evaded through mis-declaration and under-invoicing and this could not be done without the connivance of official authorities.“Such cases come to limelight when differences crop up between the officials and importers or when the FBR intervenes.