KARACHI: The Post Clearance Audit (PCA) has detected evasion of duty/taxes amounting to Rs 386,729 on import of aerosol spray paints by M/s Warre Wala and Company, it is learnt.
The case was detected by Assistant Director Sajid Ali Baloch while scrutinising import data of spray paint.
Sources said that M/s Warre Wala imported ten consignments of aerosol spray paints under PCT Heading 3208.9090 paying custom duty at 12.5 percent after claiming benefit of SRO 659(I)/2007 dated June 03, 2007. However, the subject goods are correctly classifiable under PCT 3208.2090 attracting 20 percent customs duty, 17 percent sales tax, three percent additional sales tax and 6 percent income tax.
Therefore, the importer, violated the provisions of Section 32 (1) (2) and (3A) of the Customs Act, 1969, Section 3, 6 and 7 read with Section 34 of the Sales Tax Act, 1990 and Section 148 of Income Tax Ordinance, 2001 punishable under clauses (1), and 14 of Section 156(1) of the Customs Act, 1969, Section 33(5) of the Sales Tax Act, 1990 and Section 148 and 182 of Income Tax Ordinance 2001 and Section 7A of the Sales Tax Act read with chapter X of the Sales Tax Special procedure Rules, 2007 and under relevant provisions of Income Tax Ordinance, 2001. Thus, by way of mis-declaration of classification, M/s Warre Wala evaded/short paid Rs 386,729.
Accordingly, an audit observation was issued to M/s Warre Wala for explaining and clarifying as to on what basis the company have avoided/ evaded the leviable duty and taxes. The importer, however, failed to come up with any tangible evidence and explanation and was also unable to refute the charges leveled by the Department. The contravention report has been forwarded for initiation of adjudication proceedings in the case.
