DRI books Kanpur-based firm, arrests its director for illegal import of oils worth over Rs 110 cr

A case has been registered against a Kanpur-based firm by the DRI for importing edible oils worth over Rs 110 crore, violating the South Asia Free Trade Area (SAFTA) agreement and its promoter has been arrested, according to an official statement issued on Wednesday.

If edible oils are imported from other than SAFTA countries, it attracts basic customs duty of 54 per cent along with social welfare surcharge (SWS) of 10 per cent, apart from the applicable IGST.

However, if imported from SAFTA countries -- Bangladesh, Bhutan, Afghanistan, Maldives, Nepal, Pakistan and Sri Lanka, basic customs duty and SWS are exempted.

An intelligence was developed by the Directorate of Revenue Intelligence's Kolkata zonal unit to the effect that a syndicate of rogue importing firms are engaged in importing of edible oils -- refined palmolein, palm oil and soyabean oil -- by routing it through Bangladesh through different land customs stations (LCSs) of West Bengal, by misusing the SAFTA agreement with an intent to evade customs duty, the statement said.

"During the course of investigation, one of the major importing firms, namely, M/s Kanpur Edibles Pvt Ltd, of Kanpur has been found to have imported 17365.81 MTs of refined Palmolien, cumulatively valued at Rs 116.04 crore from Gojadanga LCS, Mahadipur LCS and Petrapol LCS of West Bengal," it said.

Seven consignments containing 771.935 MT of imported refined palmolien, cumulatively valued at Rs 4.55 crore have been seized, the DRI said in the statement.

The total duty evasion of consignments imported in the past is around Rs 45.62 crore, the statement said.

Investigation revealed that M/s Kanpur Edibles Pvt Ltd, had hatched a conspiracy to avail the benefit of exemption of duty under SAFTA rules which it was otherwise not eligible, it said.

"As such, Sunil Kumar Gupta, Director and main operator of M/s Kanpur Edibles Pvt Ltd, has been arrested on February 25, 2019, in Kanpur," the DRI said.