Customs accused of issuing detection notices under the garb of tax evasion

LAHORE: The Customs department is issuing reassessment and recovery notices under the garb of detection of tax evasion while negating the period of limitation, said sources.

They said the department was deriving such interpretation of the relevant provisions of the law that was rendering other provisions as redundant.

According to these circles, the time limit for reopening of any matter or issuing show-cause notice has to be counted as five years from the relevant date and not from the detection date.

Sources said the appellate forums strike down notices issued beyond mandatory period available to the department, which presumes that the period of limitation can be enhanced in case of detection of any tax evasion.

Sources have further pointed out that the federal government also issues confusing directives from time to time, which let the Customs officials to misuse the provisions of law on the pretext of detection of tax evasion.

Accordingly, the importers prefer to challenge the validity of such notices before the higher courts instead of giving a proper reply to the department. The department, on the other hand, defends its action on the point that the importer should avail the remedy of filing an appeal under section 193 of the Customs Act.

In most of the cases, said sources, the department issues recovery notices on the pretext of under invoicing by the porters and ignores the period of limitation while doing so. They said it also suggests that the department officials fails to make appropriate assessment at the first instance and prefer to violate the provisions of law when any such complaint is pointed out by the relevant circles.

Copyright Business Recorder, 2023