KARACHI: The Pakistan Customs adjudication has forwarded the Q-Mobile tax evasion case to the Model Customs Collectorate (MCC) Preventive, Karachi for seeking legal and technical reference from the Federal Board of Revenue (FBR).
The adjudication department, during the hearing, has completely redundant the view point of MCC-Multan, because as per law, the Multan Collectorate did not authorise to establish the case, as the consignments were not cleared by that Collectorate.
The adjudication authorities were of the view that the MCC-Multan should forward the case to the Post Clearance Audit (PCA) or MCC-Preventive Karachi, as the consignments having around 2.4 million smart phones were cleared from MCC-Preventive.
It is pertinent to mention here that the MCC-Multan was constituted a tax evasion case involving duty/taxes Rs 772million approximately on import of smart phones.
Subsequently, the adjudication department after completing its hearing into tax evasion case linked with M/s Q-Mobile, Telecommunication Company and its authorized dealers M/s New Allied Electronics and M/s Digicom Private Limited has decided to forward the case to the authorities concerned of MCC-Preventive for seeking legal opinion from FBR Headquarters.
It may be mentioned here that the tax evasion case against the M/s Q-Mobile was surfaced in the month of August-2014 in which the MCC-Multan in its contravention report stated that the cellular company i.e. M/s Q-Mobile was involved in tax evasion of Rs772million in import of around 2.4million cellular phones of different characteristics.
The total six hearings were conducted into the said case which were held on September 22, October 13, October 27, November 13, December 6 and 11 respectively in the office of the Collectorate of Customs Adjudication-I.
The MCC-Multan in its contravention report against M/s Q-Mobile on August 26 stated that the accused importers were involved in the tax evasion tune to Rs772million in terms of evading additional Sales Tax and Customs Duty by violating the SRO460 (I)/2013 in importing of around 2.4million cellular phones of different models and description.
The departmental representative of Q-Mobile Afzal Ahmed Bhatti appeared before the Collector of Customs Collectorate of Adjudication-I in all hearings of the case, while the Additional Collector of MCC-Multan Ghulam Mustafa and Superintendent ASO-Multan Tanveer Malik presented to contest the case on behalf of MCC-Multan.
In the hearings, the departmental representatives of MCC-Multan were of the view that the cellular company i.e. Q-Mobile was paying sales tax @ Rs250 against the import of each smart phone while the other cellular companies including Samsung Blackberry and Nokia had been paid sales tax @Rs500 on import of such smart phones which were identical to the mobile phones imported by Q mobile.
The departmental representatives of MCC-Multan were also stated that when the screen size of smart phone has been increased to 5 inches from 4.2 inches, the Q mobile stopped paying sales tax @ Rs. 500.
On the other hand, the departmental representative of Q-Mobile in all hearings challenged the jurisdiction of MCC Multan by stating that the mobiles phones were cleared from MCC-Preventive-Karachi and Multan Customs could not seize those mobile phones.
The departmental representative of Q-Mobile also came up with the objection that the Customs’ authorities have nothing to do with the collection of sales tax, as this issue is to be handled by Inland Revenue Services (IRS)-FBR.
