KARACHI: The Post Clearance Audit has detected tax evasion of around Rs 200,000 by M/s Kinjhar International on import of outdoor LED flood light, projector lamp, LED street light through availing undue benefits of Fifth and Sixth Schedule.
The PCA, while auditing import data, found that importer M/s Kinjhar International imported declared to be “outdoor led flood light, projector lamp and outdoor led street light” through the Model Customs Collectorate Appraisement-West, and claimed the benefits of Fifth Schedule, Sixth Schedule.
Sources said that the exemptions are only available to SMD, LEDs with or without ballast with fittings and fixtures for promotion of the renewable energy technologies as per notification mentioned above. Whereas, clause 77 part-IV Second Schedule of Income Tax Ordinance, 2001 is more restrictive and allows exemption to items with dedicated use of renewable source of energy, which includes sources like solar and wind power only.
The examination staff in their examination report has not confirmed that the imported LED lights are for solar use. It appears from the examination report that the imported items are for general use as these are operative/works under the normal thermal / hydel power sources normally used in Pakistan.
The images scanned by the examination staff and examination report shows goods are operative at voltage as 85 – 265 volts, which is the standard voltage of 240 volts used in Pakistan produced by hydel/fuel based power.
It is an undeniable proof that the imported goods are not meant for to work / operate with the renewable energy sources like solar energy or wind energy. Further, it transpires that the imported goods operate on alternating current (AC) voltage rather than on direct current (DC) which is used and operate in the renewable energy technologies. Therefore, the concessions under the claimed notifications are not available to the subject imports.
Therefore, importer M/s Kinjhar International, Karachi, has been directed to pay the short-paid duties/taxes as earlier as possible.
