Duty Dodging at CTG Port: Tricks not so secret
In the wake of the coronavirus outbreak, four expatriates returned from Saudi Arabia by air on November 29 last year.
Under their names, 2,500kg of various used goods were brought in as unaccompanied baggage through the Chattogram Port.
A clearing and forwarding (C&F) agent then released the goods showing only 1,200kg from the port in four separate consignments on December 2, thus evading tax for the undeclared 1,300kg.
This is one of the instances where dishonest importers and C&F agents, with the help of some senior customs officials, concealed more than half the weight of goods in consignments imported as unaccompanied baggage in the name of expatriates to evade customs duties.
According to the Passenger (non-tourist) baggage (import) rules-2016, when returning expatriates bring goods themselves, it is called baggage; if an expatriate is not able to bring it themselves, it is referred to as unaccompanied baggage or U-baggage at the port.
Expatriates get duty-free benefits for 26 self-use goods such as personal mobiles, laptops, and printers. They can also bring in other goods worth up to $5,000 at a low duty once a year.
Various commercial importers and C&F agents are abusing this policy by using the names of expatriates, customs sources said, and also reducing the weight of goods shown in the release documents of unaccompanied baggage and getting away with paying less tax.
U-BAGGAGE FRAUD
The Daily Star collected documents of 80 consignments -- all under U-baggage rules -- where 53,000kg of goods were shown in the master BL (bill of lading) but only 25,000kg in the house BL (release documents).
These consignments were released from the port between October and November last year by three C&F agents -- Nahar Trading Company Limited, Spread Link, and Amin Brothers.
On these 80 consignments alone, the government lost more than Tk 5 crore in revenue.
According to the documents, Joint Commissioner of Customs Mohammad Mahbub Hasan issued clearance for the release of these consignments.
A C&F agent proprietor, on condition of anonymity, said a long-time joint commissioner in charge of supervising the inspection and release of U-baggage at the port jetty for the last 20 years, was suddenly replaced.
Towards the end of October 2019, the charge of this branch was suddenly given to Joint Commissioner Mahbub, who was already at the helm of several sections in the Customs House, he said.
"Since then, the U-baggage fraud has started."
After taking over the branch, Mahbub demanded Tk 35,000 as "speed money" for every consignment in addition to the bribe for concealing the actual weight of goods in the release documents, said the C&F agent proprietor.
"We informed senior customs officials but no remedy has been found till now," he added.
"Rather, the rate of bribery [per consignment] has been increased from Tk 1 lakh to Tk 1.5 lakh after the complaints. As a result, some corrupt C&F agents are taking advantage and hiding the actual weight [of goods] to evade duty.
"We don't know why the customs authorities did not take action against those officials and C&F agents, even after getting proof of the allegations. Those involved are still working in the U-baggage section without any official action taken against them."
Sheikh Salahuddin, an importer, said in an official complaint sent to the Customs House on December 15 last year: "In the last one year, 2,500 consignments were released from the port under U-baggage rules hiding actual information in the release documents.
"Joint Commissioner Mahbub Hasan has taken Tk 1.5 lakh per consignment to hide the actual invoices and the bribe was transacted through his office assistant Md Daud."
To help verify the allegation, the importer also provided a total of 250 bill of lading numbers with his complaint.
The Daily Star managed to collect documents on four consignments from those against the 250 bill of lading numbers in the official complaint; irregularities were found in three of them.
Although a total of 5,300kg of goods were shown in the three master bills of lading -- SACQ0129844, SACQ0129627, SACQ0129613 -- only 2,500kg of goods were shown in the release documents.
So, more than 2,800kg of goods in these three consignments were released by the C&F agent Spread Link without any customs duty being paid.
The consignments came from Saudi Arabia and the documents showed old refrigerators, charger lights, fans, blankets, and washing machines as their contents.
Regarding these allegations, Customs Commissioner Fakhrul told The Daily Star recently, "Surveillance has been stepped up on existing consignments which are awaiting release from the port yard following the allegations and we found forgeries in all these."
"However," he said, "it can't be said without investigating that the same forgery happened in consignments previously released from the port."
He added, "We have set up two inquiry committees to look into whether there were any similar irregularities in those consignments. After the investigation, we will take action against them."
Contacted in mid-December, Joint Commissioner Mahbub Hasan said there was no scope for customs duty on goods to be given lower than that specified in the documents. "I have no idea how it happened," he added.
He also denied the allegation of bribery.
WHAT EXPATS, C&F AGENTS SAY
Abu Tayab, one of the four expatriates under whose names the consignments were shipped to Bangladesh, had lost his job because of the pandemic and was broke towards the end of 2020.
In these circumstances, through a friend named Shafi Ullah, he was offered a ticket by officials of a Jeddah-based courier agency who said they would be shipping goods in his name and asked for his passport to do this. He accepted the deal.
While he took the free ticket home, he has no idea what unaccompanied baggage was and what its rules entailed.
Abu Tayab said Shafi himself cut a similar deal but he was also shipping some of his own items in addition to the courier's goods, and they flew to Bangladesh together.
Shafi Ullah could not be contacted but his brother Himel told this correspondent that Shafi never brought any goods though Chattogram Port and he returned to Saudi Arabia at the end of December.
The consignment under Abu Tayab's name was released by C&F agent Nahar Trading Company Limited from the port.
Asked about the allegation of commercial goods in his consignments being released under expatriates' names, Ahsanullah Talukder Rintu, proprietor of the C&F agent, said, "Some importers may use passports of expatriates to bring in commercial goods.
"In this case, we have nothing to do. We deliver the goods to those to whom the courier agent abroad asks us to do."
Rintu, however, denied allegations of irregularities in the customs documents and bribing customs officials.
"If such irregularities occur, shipping agents and freight forwarding agents must be involved. Such irregularities are not possible without the involvement of officials of the other two C&F agents," he said.
Proprietor of the C&F agent Amin Brothers, Mohammad Fazlu, told The Daily Star, "It is true that for every consignment of U-baggage, a bribe has to be paid in the name of speed money."
However, he claimed that before releasing the goods, customs officials had checked all the consignments and they had no scope to release products by showing a lower weight in the documents.
When this correspondent further asked him about the alleged irregularities, he said he would explain later but did not answer despite repeated phone calls afterwards.
This correspondent attempted to contact the proprietor of Spread Link, Md Amirul, and an office assistant of the Customs House, Md Daud, but they did not respond to repeated calls.
FAULTS IN THE SYSTEM
To release imported goods from the port, a letter of credit (LC), paperwork of the imported goods and other documents including details of the exporter are required.
However, these documents are not required in the case of U-baggage, as these goods are mainly for expatriates' use.
Customs sources said it is not possible to identify the irregularities by looking at the documents due to expatriates submitting the house BL and bill of entry separately when they take delivery of the goods.
Using this opportunity, C&F agents are releasing additional goods with the help of the customs officials concerned.
Customs sources said such irregularities can be detected if the authorities make it mandatory to specify the expatriates' names and the quantity of goods when they submit both the IGM (Import General Manifest) and the Bill of Entry in the Customs server.