Customs penalizes importer, agents for availing inadmissible concessions

KARACHI: Collector Customs Adjudication Chaudry Mohammad Javaid has penalized M/s BSN Medical pvt Ltd and several clearing agents for inflicting loss on exchequer through claiming inadmissible benefit of concessionary SRO.

Directorate of Post Clearance Audit (PCA) during scrutiny of clearance of calcium sulphate [Pharmaceutical Grade) observed that M/s. BSN Medical Private Limited imported various consignments of Calcium Sulphate, Pharmaceutical Grade cleared from different Collectorates by mis-declaring the goods under PCT heading 2520.1010 attracting Customs Duty 10%. whereas the goods are correctly classifiable under PCT heading 2520.2000 chargeable to Customs Duty 15%. Thus evaded a sum of Rs13.464 million.

Directorate of Post Clearance Audit has Audit Observations to pay the short paid amount of duty and taxes. The importers however failed to come up with any tangible evidence and explanation.

The importer submitted that Calcium Sulphate Natural is raw materials being used to manufacture a product GYPSONA which is registered by Ministry of Health. Moreover, Pharmaceutical companies have the privilege entire sales tax exemption and duty exemption in excess of 10% through different SRO.

Calcium Sulphate“ was included in SRO 1147(l)/89 without mentioning its verity (Precipitated or Natural). The Precipitated Calcium Sulphate falls under chapter 28 whereas the Natural Calcium Sulphate falls in chapter 25.

Replacing of the above SRO with new SRO 552(I)/2000, the Board in principle was of the view that only those raw materials which attract customs duty  10% or less may be deleted from the new SRO. Therefore calcium sulphate was deleted from the new SRO.

Collector Adjudication after detailed deliberations of the case found the charges established and ordered the importer M/s BSN Medical to pay evaded amount of duty/taxes of Rs13.464 million and imposed a penalty of Rs3.0 million.

Clearing Agents M/s H.I International, M/s Okay Logistics, M/s Foreign Trade Associates were also imposed penalty of Rs0.5 million each for active connivance with the importer.

Source: CustomNews