Gang of organised exporters active!: DGI&I traced 10 containers of lead ingots in India

Directorate General of Intelligence and Investigation Federal Board of Revenue has traced 10 containers of lead ingots in India, which were exported by a gang of organised exporters, under the cover of 'lead slag' to evade regulatory duty and other taxes, causing huge loss to the national kitty.
Sources told Business Recorder here on Monday that the customs authorities and the Regional DG Intelligence and Investigation Karachi have detected a unique case where not only all the documents have been recovered but the agency has also successfully traced the containers exported from Karachi. The agency has registered the FIRs against the organised gang of exporters and raids have been conducted to search and arrest the culprits involved in the mega scam.
This case is different from other scams unearthed by the agency as the containers, which left the Pakistani port, were traced by the agency. The directorate timely intercepted and resolved the case which was being complicated by the gang, diverting it towards export of highly misdeclared containers to Dubai, Sri Lanka and India to sell misdeclared goods at high price in the international market.
The detection of the case by the DG Intelligence and Investigation has prevented a major revenue loss and precautionary measures would avert such kinds of scams in future. If the phenomenon remained unchecked, it might have caused more loss to the domestic market, sources added.
Details of the case revealed that the lead is a basic raw material, which is consumed by the local manufacturers of batteries. As major raw material, it is being widely used in the locally manufactured batteries. Recently, the prices of lead went up in the international market and a gang of exporters made an attempt to earn huge profits from the international market by misdeclaring the goods at the cost of domestic industry. Ministry of Commerce had imposed some kind of regulatory duty on the export of lead to facilitate the local industry.
The rationale behind taking some measures was to ensure availability of lead for the local manufacturers. Secondly, it would also protect the local industry by checking unnecessary export of lead ingots, which would result in shortage of the basic raw material in the market.
According to sources, the modus operandi adopted by the organised gang revealed that they started declaring 'lead ingots' as 'lead slag' to evade the authorities by clearing the consignments under the Pakistan Customs Computerised System (PACCS). The PACCS clears the consignments of the 'lead slag' as it is a kind of wastage and has no use in the batteries. The bill of lading showed that the slag of lead would be exported through submission of false documents.
The consignments exported through the PACCS were highly misdeclared to commit organised tax fraud. The organised gang was showing export of 'lead slag' for smooth clearance of consignments destined for Dubai. Once the ship leaves Karachi Port, the exporters requested the shipping company to change printed names on the sealed containers.
It was argued by the gang that the 'lead ingots' has been inadvertently misprinted as 'lead slag' and shipping company should rectify the error by printing the actual product ie 'lead ingots' on the consignment. There were apprehensions that the misdeclaration could also be checked once the consignment would reach its destination at Dubai. During this process once the consignment has been declared as 'lead ingots', the same has been exported to Sri Lanka, India or any other country with accurate declarations to obtain maximum price due to higher prices prevailing in the international market.
In this way, the gang of exporters used the technique of "Switch BL" under which the BL was also changed after loading the containers on the sip. An interesting aspect of the case is that the directorate of Intelligence and Investigation has not only traced the containers but also recovered the export documents including letters written to the shipping company and other evidence proving their misdoing to cause huge loss to the national kitty.
It has been generally assumed that once the container has left the country, it is very difficult to trace the containers and documents used during the whole process. However, this specific case reflect that the DG Intelligence and Investigation has recovered all documents used in the scam including forged documents, initial documentation of the exporters, misdeclared documents, letters to the shipping lines and other documents used during the change of the description of the goods. Sources said that the case has been proved and containers have been traced at some Indian port. In such kinds of scams, the gangs usually disappears, but the agency is trying its level best to arrest the culprits involved in the mega scam of export of misdeclared consignments.