News Update

Cabinet okays 7th CPC recommendations on allowancesWater conservation campaign: Cabinet nod for India, Israel MoUAir India disinvestment receives Cabinet nodCabinet approves appointment of Vijay Keshav Gokhale as Economic Relations Secretary in Ministry of External AffairsGovt appoints Rajesh Shah as new NIFT chairman till 2019GST - Treatment of Salary SacrificesCX It does not appear to be purpose of Notf. irrespective of amount forked out by way of duty paid on cement & steel, appellant would be entitled to claim refund @ 6% of cost of construction: HCCX - Observation that period of limitation would commence from date, when, order was dictated in Court is erroneous in law: HCI-T - Additional disclosure of unaccounted income made with a view to end pending assessment, is no reason to conclude that initial disclosures made before Settlement Commission were false: HCGST on July 1 - A Historic Gain & a Loss!Govt issues Central Tax (Rate) + Integrated Tax (Rate) + Union Territory Tax (Rate) and Compensation Cess (Rate) NotificationsVarying Interest rates prescribed of 6, 9, 18, 24 per cent per annum under CGST Act, 2017Seeks to notify the number of HSN digits required on tax invoice based on turnover in preceding FY - less than Rs.1.5 cr, Nil digit, < 5 cr, 2 digits, > 5 cr., 4 digitsNotfn. no 6/2017-Central Tax amended retrospectively - one more verification mode addedCGST Rules for Valuation, Input Tax Credit, Refund, Returns, Assessment, Appeals, Advance Ruling, Transitional Provision, Anti-Profiteering etc. with forms NotifiedCertain sections of the CGST Act, 2017 to be brought into force w.e.f 01.07.2017Supplies by CSD to Unit Run Canteens and supplies by CSD / Unit Run Canteens to authorised customers - Exemption granted from IGSTInward Supplies received by CSD - refund of 50% of IGST paidNo refund allowed of unutilised input tax credit in respect of specified goodsReverse charge on certain specified supplies of goodsCertain sections of the IGST Act, 2017 to be brought into force w.e.f 01.07.2017CBDT Issues transfer orders for 35 Addl/JCITs of Income Tax grade officersHopeful of economic boom, SAIL gears up for GSTMPLADS fund to promote startups in IndiaCBDT issues transfer orders for 87 Pr CITs of Income Tax grade officersCBEC promotes 124 officers as DCs
 
Chennai Customs detects mega drawback fraud involving exports of Rs 200 Crore

By TIOL News Service

CHENNAI, Oct 14, 2005 : TO keep the exporting community happy the Government has hugely liberalised the exports benefits procedures. But it also offers huge opportunities to fraudsters to take the exchequer for a ride. And this is what has happened here in Chennai Air Cargo Customs. One exporter named K Gunasekhar from Coimbatore floated as many as 46 fake firms here in India and just one firm in Dubai for receiving the junk goods and made exports worth more than Rs 200 Crore in the past two years and claimed duty drawback benefits of Rs 19 Crore.

The scam was detected by the ACIU when it intercepted two consignments of 127 packages declared to contain leather shoe uppers for adults. These consignments were covered by 10 shipping bills - five filed by M/s R G Impex of Mumbai and rest by M/s Poppy Leather and Apparel from Coimbatore. The total value declared was Rs 1.8 Crore. On examination except for 16 packages all of them had only torn / used shoe uppers worth not a penny.

After seizing the consignments for misdeclaration a manhunt was launched to locate the mastermind. A detailed scrutiny revealed that 46 firms were floated by the alleged fraudster who had done exports worth Rs 200 Cr since 2003. And all the exports went to just one Dubai-based firm M/s Fild Line Trading LLC in which he was a partner. Obviously no payment was ever received in India for all these consignments.

Out of a total drawback benefits of Rs 19 Crore the Customs had blocked Rs 2.5 Crore and recovered Rs 6 lakh but the rest are gone. Nine persons were arrested in this connection. And finally the Customs managed to nab the mastermind who had been evading arrest.

Finally it was revealed that Gunasekhar in association with his borther-in-law Divakar and one Jayaraman used to procure goods from various places in Tamil Nadu and export them through various ports like Chennai, Coimbatore ICD and Tirupur ICD.


 RECENT DISCUSSION(S) POST YOUR COMMENTS
   
 
Sub: Kudos to ACIU Chennai

ACIU Chennai has done an excellent job in nabbing Drawback fraudster Gunasekar. This king of drawback frauds are becoming common. It SHOWS THAT THERE IS SERIOUS LACUNAE IN CUSTOMS EXAMINATION OF CARGOS UNDER DRAW BACK.IN 1970 Coimbatore is known for counterfeit notes. Now the fraudsters have switched over to bogus exports taking advantage of poor vigilance or lack of it in CUSTOMS. ALL ICDs should be closely monitored in view of this mega fraud. Connivance aslo can not be ignored. This 19 Crore fraud should serve as an eye opener to review the export incentives offered mindlessly.
Every one has to take the blame.
By,
M.RAM KUMAR,
BANGALORE.

Posted by ramkumar ramkumar