Tuff move 8212; Phoenix chief held in duty evasion case

MUMBAI, MARCH 1: The Directorate of Revenue Intelligence DRI has arrested a director of Phoenix International Limited, makers of Tuff b...

MUMBAI, MARCH 1: The Directorate of Revenue Intelligence DRI has arrested a director of Phoenix International Limited, makers of Tuff brand of shoes, in a case of duty evasion of Rs 64 lakh. The company allegedly acquired a forged bill of lading to use a Quantity Based Advance Licence QBAL beyond its date of expiry, thus evading customs duty in import of shoe uppers valued at Rs 87.24 lakh.

The director, Bhupendra Nagpal, and another accused, Sanjay Karandikar, were granted bail last week.

The DRI charged Nagpal and Karandikar, a manager of the steamer agent for the ship used in the import, of knowingly obtaining a manipulated document to misuse the Duty Entitlement Exemption Certificate scheme.

According to the remand application filed by the DRI, the company had acquired a QBAL on May 26, 1995 which was to expire on June 30, 1998. The advance licence allows duty-free imports for raw materials to be used in exports. The shipment however, arrived at the Nhava Sheva port on Sept 18, 1998. The accusedhad allegedly managed to acquire a certificate from the overseas shipping line that the goods were on board the vessel on June 30, 1998, the date on which the QBAL expired. That is how they answered Customs8217; queries about the shipment.

The DRI, however, on specific intelligence that the shipment had taken place from an Italian port after the date of expiry of the QBAL, raided the importer company8217;s offices in Mumbai and Noida UP. The officers found correspondence between Manoj Choudhary, assistant import manager of the company and Nagpal, indicating how the certificate from the foreign shipping line had been obtained.

An E-mail message from Sanjeev Malhotra, senior manager, imports Noida of the company to Manoj Choudhary also revealed the instruction to Choudhary to use the certificate only for customs purposes and not reveal it to the Indian shipping line.

Karandikar, the steamer agent8217;s man in Mumbai, when apprehended by the DRI, admitted the offence when he produced two copies of the bill oflading, the one marked original8217; showing shipment on June 30, 1998 and the copy8217; showing the date August 15, 1998.

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Nagpal admitted that he had ordered the foreign shipper to manipulate the bill of lading so as to make it possible for the company to use the QBAL. Karandikar, in fact, went so far as to produce documents to show the correspondence between the foreign shipper and himself containing the instruction to get the customs authorities to accept8217; the bill of lading with the date June 30, 1998, though the shipment was later, and his response to the same.