Karachi Customs busts fraudulent import of artificial leather

ISLAMABAD: The Directorate of Customs Intelligence in Karachi has uncovered a scheme involving artificial leather worth Rs. 220 million.

According to information obtained by HUM News English, Director General Faiz Ahmed Chadhar of the Directorate of Customs Intelligence, Karachi received credible intelligence indicating that the Clearing Agency M/s Ayyaz Enterprises was engaged in importing artificial leather without paying required duties and taxes, using fictitious companies such as M/s Awami Textile, M/s Fraz Enterprises, and M/s Pak Asia. These companies purportedly existed solely on paper and were falsely claimed to be manufacturing goods for export, when in reality, the imported leather was being illegally sold domestically.

The investigation conducted by the Directorate revealed that M/s Awami Textile, M/s Fraz Enterprises, and M/s Pak Asia, supposedly located in various parts of the country, were non-existent entities used to evade substantial duties and taxes under the Export Facilitation Scheme introduced by the Government of Pakistan.

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M/s Ayyaz Enterprises imported artificial leather valued at Rs. 220 million under the names of these fictitious companies, evading duties and taxes totaling Rs. 110 million, and subsequently selling the goods on the local market.

In a significant development, a shipment of artificial leather worth Rs16 million, with applicable duties and taxes of Rs8.6 million, imported by M/s Ayyaz Enterprises under the guise of M/s Awami Textile, has been seized at KICT West Wharf, Karachi port. The Directorate of Customs Intelligence, Karachi has filed a First Information Report (FIR) against the clearing agent and the fake companies involved in the scam, and further investigations are under way.

The Directorate of Customs Intelligence, Karachi believes that uncovering and acting promptly on such misuse of the Export Facilitation scheme will deter unscrupulous individuals from exploiting it in the future.