DRI unearths coal import scam

A major scam involving several energy companies and traders, including some in the state sector, has been unearthed involving alleged over-invoicing of imported coal including through a tax haven to siphon off money abroad and charge higher power tariffs, according to DRI sources.
The companies include some of the biggest names in the sector as also some state electricity boards and central power utilities which have have come under the scanner of the Directorate of Revenue Intelligence (DRI).
The agency has found that certain importers of Indonesian coal were artificially inflating its import value against the original price, the sources said.

The objective of over-valuation appears to be to siphon off money abroad and to avail higher power tariff compensation based on artificially inflated cost of the imported coal, they said.
Intelligence developed by the agency further indicated that while Indonesian coal was directly imported from ports there to importers in India, the import invoices were routed through one or more intermediaries based in Singapore, Dubai, Hong Kong, British Virgin Islands among others for the purpose of artificially inflating its value.
The investigation conducted by the agency found that the inflated invoices received in India were found to have been issued by intermediary invoicing agents who appear to be either subsidiary companies of Indian importers or their front companies.

DRI, according to sources, late last month issued a 'general alert' to customs establishments over it coming across alleged instances of certain importers of Indonesian coal were artificially inflating their import value of coal by about 50-100 per cent.
The alleged artificially higher prices of coal were then passed on to electricity consumers, they said.