Fraudulence: Old machinery at front, high-duty parts hidden behind container
Importer attempts to evade customs duties worth crores by displaying old machinery at the front. Collected image.
There is a textile machine placed at the front of the container. Quite old. Judging by its worn-out condition, it doesn't even seem reusable. Moving a little further back, you find sacks full of screws, three-wheeler vehicle parts, and automobile components. It becomes clear that the importer used such tactics to evade customs scrutiny!
The goods placed inside the rear part of the container attract much higher duties. The machinery declared upfront carries much lower import duty. In reality, the items brought in under the name of machinery are actually scrap destined for junkyards. Two importers brought these goods in 10 containers using this tactic. Besides evading duties, this scheme was meant to clear the containers from Chattogram port through false declarations and collusion with customs. However, the vigilant Customs Intelligence (AIR) team caught them on August 10.
The importers committed two types of irregularities in the shipment: one is duty evasion, and the second is money laundering. It was later learned that the duty rate for textile machinery was 26 percent, while the goods hidden at the back had duty rates ranging from 60 to 90 percent. The two importing firms are Rimi Sarkar Doa Textile and SN Textile from Narsingdi. The shipments were from different importers, but the arrangement of goods inside the containers used the same trick. The clearing and forwarding (C&F) responsibility for the shipments rested with Enatul Hasan C&F Limited of Chattogram. Thus, the importers, together with the C&F agent, executed this duty evasion scheme.
Tarek Mahmud, head of the Chattogram Customs Intelligence team, said, "The tactic of placing old textile machinery in front while bringing high-duty goods behind did not escape the customs eye. After physical inspection, the process of imposing fines is now underway. According to the law, a penalty ranging from the amount of evaded duty to double that amount will be applicable."
When contacted, Kamrul Haque, owner of the agent firm Enatul Hasan C&F Limited, said, "I don't know what is inside the container; the importer knows." Later, when asked about the same trick being used in both shipments, he said that some screws could be brought along with machinery. When countered that machinery scrap and screws differ in size, he hung up the phone.
According to customs documents, the two shipments brought 10 containers of goods from China. Based on confidential information, customs first blocked the shipments online. Later, in the presence of port, customs, and intelligence officials, the containers were opened and every item was subjected to 100 percent physical inspection.
M/s Rimi Sarkar Doa Textile from Bhatpara area of Madhabdi Upazila in Narsingdi declared to Chattogram Customs that it was importing 1,32,000 kg of second-hand power looms. The declared value was USD 91,200 (approximately Tk 1.14 crore at Tk 125 per USD). During physical inspection, 1,07,000 kg of loom machinery was found. Behind the declaration, the importer brought 35,310 kg of undeclared wood screws.
In another shipment, M/S SN Textile similarly declared the import of 1,32,000 kg of second-hand loom machinery. The declared value of this shipment was $79,600 (approximately Tk 1 crore ). During physical inspection, alongside the loom machinery, the authorities found 21,550 kg of flange nuts and bolts, 6,496 kg of shock connectors, 3,360 kg of shock absorber pipes, 2,650 kg of gears, 2,560 kg of rims, 2,106 kg of differentials, and 480 kg of mudguards – totaling 9,860 kg of undeclared automobile parts and three-wheeler vehicle components. All of these were outside the declared items.
The two importers declared the total value of both shipments at Tk 2 crore, and the customs duty declared was only Tk 8 lakh. In reality, even the machinery itself would not be worth that amount. As a result, the full Tk 2 crore could potentially be laundered. These machinery parts have no usability in factories. The scrap machines were placed at the front of the containers solely to evade duties on high-duty screws, automobile parts, and three-wheeler components.
Customs said that for wood screws and flange nuts and bolts, the total duty-tax is 60 percent, and for three-wheeler and automobile parts, it ranges from 55 to nearly 90 percent. It was precisely this huge duty gap that the importers exploited – bringing in high-duty goods under the cover of low-duty textile machinery to evade crores of Taka in revenue.
Customs officials said that the actions of the importers and the C&F agent constitute a clear violation of Section 33 of the Customs Act, 2023, which is a punishable offense under Table 9 of Section 171(1) of the same Act. The process of filing cases and imposing strict penalties, including customs valuation of the seized goods at their commercial value, is underway. The shipments have been sealed and are being kept at the NCT and CCT yards of the port.
