ISLAMABAD: Customs Adjudication Deputy Collector Dr Kaukab Farooq issued an Order-in-Original in a contravention case against M/s Six Global Traders and ordered that consignment of silk fabric be assessed on first available valuation ruling which was issued after its clearance. The court also imposed a condition that it should not be lower than the already assessed appraised value of the consignment.
It was reported that in pursuance of directions received through director general, to conduct post clearance audit of import of silk fabric to unearth the evasion of duties and taxes if any, the audit of soft data of imports of silk fabric (H.S. Code 50.07) for the year 2012 was done.
It was observed that M/s Six Global Traders had imported one consignment of 100 percent silk fabric from China and the same was declared as well as assessed at a far low value of $7/Kg. It was determined on the following grounds that the goods were grossly under invoiced:
The value of raw material (silk yarn) was determined at $30/kg by the Customs Valuation, Karachi vide Valuation Ruling No. 107, dated June 16, 2008. The perusal of import data of silk yarn during 2012 revealed that 85245 kg of silk yarn was imported and cleared as per customs value i.e. $30/kg fixed by the Customs Caluation.
However, contrary to this, finished product i.e. silk fabric in the same time period was also cleared at a far low value i.e. $7/Kg. It is evident that the value of silk fabric cannot be lower than the value of silk yarn.
Audit Observation No.30/2013 was issued to owner of the company to provide a written clarification along with supporting documents. Reminder issued vied C No. 621 returned undelivered. Neither any reply was received nor did any one appear on the given dates of hearing. Later, the contravention case was sent to the adjudication for further proceedings.
Meanwhile, the company deny the allegations levelled by PCA and said it is incorrect to say that the respondent firms imported any silk fabric and under invoiced the duty/taxes. The customs officials have correctly classified these goods without observing the texture of the fabric and without any test report.
The deputy collector stated in ONO, “The stance of the respondents holds grounds. The varying evidential data after the release of the consignments cannot be relied upon especially when the samples of the consignment are not available.
However, to bring uniformity it is ordered that the subject consignment be assessed on first available VR of silk fabric issued after the clearance of the subject consignment subject to the condition that it should not be lower than the already assessed / appraised value of the consignment.”
