KARACHI: A customs adjudication authority has ordered the outright confiscation of nearly 50 metric tons of cigarette paper and imposed penalties totaling 6 million rupees on an importer and its clearing agent for using a fictitious manufacturing address to illegally import restricted goods.
In an order issued Friday, the Collector of Customs Adjudication East in Karachi ruled that M/s Imperial Tobacco and M/s N.S. Enterprises—both registered under the same National Tax Number, 2822595—had fraudulently claimed to operate a manufacturing facility in Gilgit-Baltistan in order to import the cigarette paper.
The importer brought in 49,290 kilograms of cigarette paper, classified under PCT heading 4813.2000, valued at 26,548,728 rupees, through customs agent Perfect International under an in-bond customs declaration in late August. Cigarette paper is a restricted item under Pakistan’s Import Policy Order, 2022, and may only be imported by cigarette manufacturers registered with the Federal Board of Revenue and the government of Azad Jammu and Kashmir.
Authorities said they received credible information that the declared manufacturing premises at D.C. House Road in Diamer District did not exist. The Collectorate of Customs in Gilgit-Baltistan, citing a letter from the deputy commissioner of Diamer, confirmed in September that no such unit was located at the address.
A subsequent examination by the Large Taxpayers Office in Karachi found that the premises were not at the registered address and that a pre-suspension notice had been issued against the tax number over a questionable tax profile. The LTO suspended the registration on Oct 8.
Despite the findings, the importer had already ex-bonded 23.85 metric tons of the consignment through two customs declarations before authorities placed a third declaration on manual hold, according to the order.
The adjudicator, who presided over a hearing on Oct. 22 that the importer did not attend, determined that the importer and clearing agent had violated provisions of the Customs Act, 1969, and the Import and Export Control Act, 1950. The order also found that the importer wrongly availed an exemption of 436,602 rupees in additional sales tax, resulting in a shortfall of 445,334 rupees in total tax revenue.
The order directed the outright confiscation of all 49.29 metric tons of the goods, including 11.925 metric tons held in the bonded warehouse, and imposed personal penalties of 5 million rupees on the importer and 1 million rupees on the clearing agent.
The importer did not respond to the charges or appear for the hearing, according to the order.
