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ISLAMABAD: The Federal Board of Revenue (FBR) Member Inland Revenue Operations (Customs), Tariq Huda Wednesday informed the National Assembly Standing Committee on Finance that the import of Iranian petroleum products is not banned under the Import Policy Order or Customs Act 1969.

The FBR Member Customs Operations was briefing the committee on the issue of misdeclaration of Iranian origin ships by changing Iranian origin shipments documents and cleared by customs authorities on the UAE/Oman, Iraq, and Turkey origin documents.

Tariq Huda said that the United States has imposed sanctions on Iran under which Iranian oil cannot be traded to avoid US sanctions.

The issue of Iranian origin oil needs to be seen within the context of the US sanctions imposed on Iran.

There are two different cases.

The first issue is related to the import of oil from a ship where it was alleged that the ship contain Iranian origin oil.

There was no issue of misdeclaration of quantity and quality.

However, the report of the Hydrocarbon Development Institute of Pakistan (HDIP) revealed that it does not have the Iranian oil.

The second issue was related to another oil vessel.

The samples of the oil were checked and it was reported that the oil seems to be of Iranian origin, but the report was not definite about it.

The contravention report has been made and forwarded to the adjudicating authorities.

However, there is no provision in the Customs Act or Import Policy Order to confiscate the Iranian petroleum products being imported into the country.

The issue is related to the US sanctions on Iran, but not the UN sanctions, the FBR Member Customs added.

However, the Customs Department is now following a standing operating procedure (SOP) of the Ministry of Petroleum for checking of the samples of the imported petroleum products.

However, there is no specific lab to determine the origin of oil of each country of the world.

The Committee members were surprised that if the import of Iranian oil is not banned under the Import Policy order or Customs Act 1969, then why the case has been framed by the Customs Department against one vehicle carrying Iranian origin oil.

The FBR Member stated that the import of oil and smuggling of petroleum products are two separate things.

The customs authorities have so far seized 1,500 petrol pumps selling smuggled oil.

The FBR Member Inland Revenue Operations (Customs) Tariq Huda informed the committee that the matter of alleged tax evasion by an automobile company should not be discussed at the committee level as it is sub judice before the High Court and it may go up to the Supreme Court of Pakistan.

The FBR Member Customs operations was responding to the queries of the committee members on the agenda item number-7 to discuss the issue of tax evasion by Morris Garages (MG) Automobile company on import of Complete Built Unit (CBU) if any and action taken by the FBR in this respect.

He said that the FBR has already started an audit to investigate the matter to ascertain the facts about the case. He said that we encourage that new players should come into the market.

It is the legal right of any company to import and subsequently sell vehicles in the country.

If any discrepancy is detected during the audit, the department frames the contravention report and submits it to the adjudication authorities.

There are 4-5 legal forums available from the level of Commissioner Appeals to Appellate Tribunal and superior courts.

"The discussion in the committee might positively or negatively influence the legal forums where cases are pending. It is requested that the matter should not be discussed at the finance committee. Leave it to the judicial forms and trust us," the FBR Member Operations Customs added.

The Chairman of the committee endorsed the viewpoint of the FBR Member for not discussing the matter before the committee.

A committee member said that the investigation should also take into account that the vehicles are being sold to the customers and if any recovery is made at a later stage, whether the buyers are protected or future liabilities would be recovered from the buyers.

Meanwhile, a brief submitted to the NA committee on Finance by the Ministry of Industries and Production said: the Goods Declaration filed for the clearance of vehicles imported by any vehicle importer under normal regime is processed and finalised by the customs field formation of the FBR without the involvement of Industries and Production Division.

The company has imported new vehicles without availing the benefit provided in Automotive Development Policy (ADP) 2016-21.

It is further explained that the investment agreement between the Government of Pakistan and the company has not yet been signed enabling the said company to import Completely Build-up Units (CBU) or Completely Knocked Down (CKD) on the terms and conditions provided in the ANP 2016-21, the Ministry of Industries and Production added.

Copyright Business Recorder, 2021