Customs Intelligence busts multi-million under-invoicing scam involving food company
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- Web Desk Shahzad Paracha
- Nov 26, 2023
ISLAMABAD: The Customs Intelligence has unearthed a major under-invoicing scam involving leading food company M/s Food Links International, which in the alleged connivance of a clearing agent, caused a millions revenue loss to the government exchequer by submitting counterfeit and forged invoices, declaring values 59% lower than actual.
Documents obtained by HUM News English indicate that the Directorate of Intelligence and Investigation Customs Karachi has filed a First Information Report (FIR) against the owner of M/s Food Links International and their clearing agent, M/s Danish International Karachi, on charges of under-invoicing related to the import of “vegetable oil and its products.”
Customs Intelligence claims that the importer, despite not being a manufacturer, sold the imported goods in the local market instead of consuming them for in-house purposes. This allegedly led to the inappropriate claim of an exemption for value-added sales tax, intended for importers-cum-manufacturers. The documents reveal that the importer significantly undervalued declared values of imported “vegetable oil and its products.”
The investigation indicates that M/s PT Smart Tbk Indonesia issued actual invoices in the importer’s name, M/s Food Links International Karachi. However, the importer, with the alleged collusion of the clearing agent, M/s Danish International Karachi, submitted fake and forged invoices during the import stage. These invoices depicted lower values than the actual ones issued by the notifying party MS Eximco Trading House LLC, Sharjah Dubai.
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The findings establish that the importer, in connivance with the clearing agent, submitted fake and forged invoices in the Weboc system, reflecting values 59.1% lower than the actual ones. This allowed the importer to evade Rs64.11 million in government duty and taxes.
The document also reveals that a Customs Collectorate team visited the alleged manufacturing premises of the importer, discovering that the site was a residential apartment for the past four years. The importer claimed inadmissible exemptions on additional sales tax, resulting in an evasion of Rs44.9 million on 79 Goods Declarations (GDs). Additionally, the importer allegedly evaded Rs7.7 million in regulatory duty on four consignments, which is typically admissible to registered manufacturers.
The document states that the importer also evaded duties and taxes worth Rs275 million in previously cleared under-invoiced consignments, which are currently under investigation. The Collectorate is reportedly recovering more fake invoices through the Pakistan embassy in Indonesia.
