MULTAN: Collector Customs Adjudication Multan issued an Order –In –Original against tax evasion of Rs 38.89 million against Ahmad Industries on the import of high carbon steel wire rod.
Ahmad Industries (Pvt) Limited imported a consignment of 141.392 metric tons of high carbon steel wire rod. Ahmad Industry (Pvt) Limited claimed its import under PCT Heading 7213.9190 at the rate of 10 percent customs duty.
Customs presented arguments in the Collector Customs Adjudication by leveling charges against Importer Ahmad Industry that Alloy steel wire rod in customs tariff is classified and exists under PCT Heading 7227 .9000 in which customs duty of @ 20% is payable, Regulatory duty payable @15 % but the Ahmad Industries Khanewal and the clearing agent declared a false declaration of description and claimed a wrong PCT heading attracting lower rate of customs duty to evade customs duty and other chargeable taxes.
While the importer Ahmad Industries claimed exemptions of customs duty under SRO 659(i)/2007 at the applicable rate of 5 percent in counter of charges in the Customs Adjudication. The importer argued in the Customs Adjudication that customs duty and regulatory duty of 15 percent was paid during the import of high carbon steel wire rod wire.
It is observed during the hearing of case that PCT heading 7213.9190 as claimed by the Ahmad Industries relates to “bars and rods” “hot rolled “in irregularity wound coils of iron and non-alloy circular of steel cross section measuring less than 14 centimeters in diameter during the clearance of import consignment. Whereas PCT Heading 7227.9000 as alleged by the Customs department relates to “bars and rods” “hot rolled “in irregularity wound coils of other alloy steel.
The ingredients of the steel were also elaborated in the Customs Adjudication and examination of tag attached with the import goods, the chemical composition of the ratio of boron has been found as 0.0008 percent. The ratio of boron found during chemical examination 0.0020 percent.The chemical analyses held by the Multan Customs through University of Engineering and Technology for the verification of imported ingredients was found above the specified value of Boron.
Ahmad Industries have not rebutted from the allegation surfaced by the Model of Customs Collctorate Multan that in their goods the element of Boron specified were not included thus it also concluded that goods imported by the Ahmad Industries are Alloy Steel High Carbon wire rod instead of High Carbon Steel Wire rod as claimed by the importer. The valuation advice referred paid by the importer is not applicable as the goods involved in this case alloy steel High Carbon wire rod whereas the valuation obtained by importer during clearance of consignment contains Iron or Alloy Steel Wire rod low and High Carbon.
In the light of above presented facts from Model of Customs Collectorate Multan against the importer Ahmad Industries stand established. Meanwhile the importer and clearing agent has committed an offense under sub section (1) and (2) of section 32 of the customs act 1969 along with sales tax act 1990 and section 148,161(2) of the income tax ordinance 2001. It is punishable under clause 1 and 14 of the section 156 of the customs act 1969, section 33 and 34 of the sales tax act 1990 for the recovery of evaded tax amount Rs 33.49 million. So Collector Raja Tahir Majeed directed Ahmad Industries to pay leviable duty and taxes amounting to Rs.33.49 million in the contravention case no 01/2015.Collector have also applied the same direction in the identical case no 02/2015 due to its same nature against Ahmad Industries of worth Rs 5.4 million in the import of another goods. Collector Adjudication have also imposed fine redemption of 35% on the differential value of imported goods under clause SRO no.499 (I)/2009 .
