Massive KEPZ Fraud Uncovered: Rs. 825 Million Smuggling and Tax Evasion Exposed
Karachi: The Export Collectorate at Port Muhammad Bin Qasim (PMBQ) has unearthed a massive fraud and smuggling operation valued at Rs. 825 million. This is the result of an audit and investigation conducted by the Collectorate into the trading company M/s. Sardar Enterprises operating in the EPZA, Karachi.
The operation was spearheaded by Collector Sadia Sheeraz with Additional Collector Zuhra Naqvi and Deputy Collector Amin Haider Shah. Through the investigation, they discovered blatant violations of EPZ exemption rules pertaining. to the year 2023-24 for M/s. Sardar Enterprises, which were being exploited to avoid both duty and taxes.
Two suspicious consignments connected with the company were intercepted by Deputy Collector Amin Haider Shah. The first consignment, declared to contain “faulty LCD laptops, panels, and accessories,” was found to include unauthorized used tablets and new keyboards. These goods were valued at Rs. 10.6 million, with evaded duties and taxes of Rs. 3.6 million.
The second shipment was misdeclared as “Raw Cotton,” when it was concealing 14,000 kg of Cellulose Acetate Tow, a high duty attractable item. The value of the goods worked out to Rs. 22 million and the amount of duty/taxes evaded to Rs. 821 million.
The total value of the illicit goods from both consignments was Rs. 32.5 million, while the total evaded duties and taxes stood at Rs. 825 million. This case depicts serious misuse of the EPZ exemption regime, which violates the Customs Act, 1969, and EPZA Rules.
As the case has unveiled such discoveries, an FIR is filed, and processes for arresting the fraudsters and their collaborators are currently going on. Collectorate. has sent a letter urging stricter supervision inside the EPZA and recommended license cancellation of M/s. Sardar Enterprises on account of frequent breaches.
Such cases will remain as a threat to all enterprises within the EPZA and create an imperative that rigid regulations should be implemented so as to prevent more frauds and smuggling.
