KARACHI: Directorate of Post Clearance Audit (PCA) South has detected tax evasion of Rs859.98 million against M/s Hussain Enterprises.
Sources said that Director Khalil Yousufani received credible information regarding misuse of green channel facility. He immediately constituted a team under the supervision of Additional Director Sheeraz Ahmad. Deputy Director Saima Butt and Appraising officers then unearthed a non-existent fraudulent importer M/s Hussain Enterprises that was flagrantly misusing green channel while dealing in imports of white spirit, chemicals, fabric, plastic film and artificial leather.
The importer was taking exemption benefits by misusing manufacturing status at import stage and indulged into mis-declarations through non-application of VR and mis-classification involving Rs. 111.75 million. Income tax record revealed that the proprietor of the unit was declared to be a salaried person having financial worth of merely Rs50,000/- for the tax year 2021, while WeBOC data reflected huge imports worth 682.67 million without legitimate sources of income, thus involving use of proceeds of crime (black money) to finance imports. Flow of import remittances also reflected that Rs. 65.56 million had been illegally transferred to one Dubai-based company against imports effected from various Chinese exporters.
It was the first case invoking the provisions of Sections 26B and 187 of the Customs Act 1969 which require use of legitimate sources of income to finance imports and lawful use of authority or permit or license (including manufacturing status) at import stage. The importer had mentioned four address on its STRN certificate and all were found to be fake/non-existent. The audit revealed import loopholes in the system which need to be plugged to control revenue leakage and promote tax compliance.
