Hyderabad: Diesel smuggling racket busted, 4 held

The Directorate of Revenue Intelligence (DRI) on Friday arrested four persons after busting a diesel smuggling racket and seized fuel worth Rs. 1 crore.

According to a press release by Additional Director General, DRI, Vivek Chaturvedi, the four people were smuggling diesel into India via Kakinada in Andhra Pradesh and Chennai from Dubai by declaring it as a 'mineral spirit'.

"Dummy companies were opened in Dubai to purchase diesel and import the same to Chennai by creating false documents and invoices. The price difference was being adjusted by payments through hawala channels. It is found that in the past these operators have smuggled around 5366 MT (63 lakh litres approx.) of diesel valued at around Rs 17.7 crore, which comes to around 285 containers," the release added.

On the basis of inputs provided by Andhra Pradesh State Intelligence Department, a simultaneous search operation was carried out by the DRI officers of Hyderabad and Chennai with the active support of Andhra Pradesh State Intelligence at various places across Andhra Pradesh and Tamil Nadu since April 17.

"Searches conducted at two container freight stations in Chennai revealed that 14 containers, where the goods were declared as mineral spirit, were found to be actually carrying 263.78 MT (3 lakh litres approximate) of diesel," it said.

The operators had offices in Kakinada, storage yard at Maraimalai Nagar in Chennai and an office front at Guindy in Chennai to facilitate said smuggling and distribution.

"A relative of one of the operators from Kakinada was looking after the logistics, moving the diesel into the grey markets in Chennai, Kakinada, Ongole and parts of Telangana. Dummy companies were opened in Dubai to purchase diesel and import the same to Chennai by creating false documents and invoices. The price difference was being adjusted by payments through hawala channels," the release said.

It is found that in the past, these operators have smuggled around 5366 MT (63 lakh litres approx) of diesel valued at around 17.7 crore, which comes to around 285 containers, the DRI statement further said.

As the diesel has been smuggled into India in contravention of provisions of the Customs Act, 14 containers of diesel having a value of over Rs. 1 crore has been seized. Four people, including the mastermind and one hawala operator, have been arrested.

Diesel is a restricted commodity for import as per the foreign trade policy and allowed to be imported only by oil marketing companies which meet certain government norms.