KARACHI: Pakistan Customs’s Post Clearance Audit, Karachi Directorate has detected massive tax evasion, short payment of taxes and duties to the tune of Rs 17 million by M/s BMW Electronics for misusing Fifth and Sixth Schedule benefits. And, an audit observation under Section 26 and 32 of the Customs Act, 1969 has been issued.
The sources told Customs Today that PCA Karachi Directorate, while scrutinizing import data, found that M/s BMW Electronics had imported LED lights with fitting and fixture, ceiling and panel light, tube light, LED strip light, light emitting diode etc through MCC Appraisement West and East and claimed benefits of Fifth Schedule and Sixth Schedule.
While, 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, 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, according to sources.
“The examination staff in their examination staff has not confirmed that the imported LED lights and batteries are for solar use. It appears from the examination report that the imported items are for general use as as these are operative, works under the normal thermal, hydel power sources normally used in Pakistan”, sources added.
Therefore, the importer M/s BMW Electronics is advised to pay the short-paid taxes/duties of Rs 17 million at the earliest.
