KARACHI: The Customs Post Clearance Audit, Karachi Directorate has detected taxes/duties evasion of Rs 1,284,744 through mis-declaration of classifications, it is learnt.
According to official sources, during scrutiny of import data of ‘Cellular Infrastructure Equipment For Telecom Sector’ correctly falling under PCT heading 8517.6990, chargeable to CD @ 15%, ST @ 17%, WHT @ 6%, it has been observed that certain Mobile Communication Companies have imported such equipment by mis-declaring the same under PCT Heading 8471.5000. Thus they have made a deliberate and willful attempt to evade duty/taxes by way of mis-declaration of classification of these items.
M/s. Telenor Pakistan (Pvt) Ltd imported ‘HP OEM CL360 GEN9 8-SFF CTO server’ for telecom sector by allegedly mis-declaring in the PCT heading 8471.5000. According to the Pakistan Customs Tariff (Vol-I), the description of goods given under the main heading 84.71 reads as follows:
“Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, not elsewhere specified or included.”
In order to classify the goods more specifically, under single dash heading 8471.5000, we need to look into the description of goods given under this heading which reads as follows:
“processing units other than those of sub-heading 8471.49 whether or not containing in the same housing one or two of the following types of unit: storage units, input units, output units.”
However, it is clear from the declaration made by the importers that the goods are Cellular Infrastructure Equipment for Telecom Sector which, in no way, fall under PCT heading 8471.5000 and are vividly and correctly classifiable under PCT heading 8517.6990. The specification of these importer goods when checked on-line reveal that the equipment is meant for use in GPRS/ UMTS solutions and supports a number of networking, routing, signaling and wireless sharing protocols/ interfaces. Other importers have also imported similar goods under PCT heading 8517.6990.
Thus, by way of mis-declaration of classification, M/s. Telenor Pakistan (Pvt) Ltd with the active connivance of their Clearing Agent M/s Ahbab Enterprises evaded/short paid Rs 1,284,744/.
Accordingly, an audit observation was issued to M/s Telenor Pakistan (Pvt) Ltd for explaining and clarifying as to on what basis they have avoided/evaded the leviable 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 to the Collector, Collectorate of Customs Adjudication-I, for initiating adjudication proceedings in the case.
