Customs adopt smokescreen to bust beedi racket
Asuspect who obtained bail from Colombo’s Additional Magistrate after he was produced before him for allegedly making a false declaration to clear 12-tons of imported beedi leaves, has been remanded following an objection to the bail.
The reversal of the bail order came after the Customs’ Central Investigation Bureau officials made re presentations to Additional Magistrate Lochana A b e y w i c k rema t hat a Magistrate had no jurisdiction to release the suspect on bail.
The suspect, Noordeen Razali Ahamed, a businessman from Wattala, was taken in by Customs officials and produced before the Magistrate’s Court on Saturday, February 16 on a charge that he had made a false declaration to release a container that carried 12 tons of beedi leaves in December. He was granted bail.
According to the Customs officials, the suspects had produced documents which claimed that the consignment consisted of women’s garments.
However, when the case was taken up on February 18, the Magistrate admitted it was a mistake to release the suspect on bail and ordered that he be remanded till February 25.
The Customs officials pointed out that, in terms of the Customs Act, a Magistrate had no power to release a suspect, if the alleged fraud amounted to more than Rs.1 million. Only the High Court has the power to grant bail and that, too, under special circumstances such as medical reasons.
The Customs told court that the total value of the beedi leaves consignment was nearly Rs. 57 million and the suspect had committed a tax fraud of Rs. 43 million.
According to the Sri Lanka Customs’ National Imports Tariff Guide, an importer of tobacco leaves wrapper under HS code 1404.90.10 is subject to a tax of 30% of gross weight or Rs. 750 per kilogram if under valued. This includes 15 percent VAT (value added tax), 5 percent PAL (Port and Airport Development Levy), 25% cess and 2 percent NBT (Nation Building Tax).
Also, the importer has to hold a licence from the Sri Lanka Excise Department to import tobacco.
The scam was busted on December 3 last year on information received by the Customs Deputy Director G.B. Gnanaraj and he together with the Chief of the department’s Central Investigation Bureau, under the guidance of Director General P.S.M. Charles hatched out a plan to nab the suspects in secrecy as they had information that customs officials were involved.
Although the officials could have dealt with the matter within the Customs premises, they avoided such an approach because it would have given several loop holes for the suspect to slip through. For instance, if the suspect had been questioned within the Customs premises, he could have claimed it was a wrong consignment and reshipped it back to the country of origin or even abandoned it, claiming no ownership.
The Customs team had planned a controlled delivery plan, according to which the 40-foot container would be released but kept under surveillance.
The shipment was allowed to be cleared on December 3 last year. Around 7 p.m., the container carrying the goods was mounted onto a truck and it took off from the South Asia Gateway Terminal of the SLC.
Mr. Gnanaraj was assigned to follow the truck in a private vehicle. It travelled along the Negombo Road. At the Mabole junction in Wattala, the truck took a right turn to the Welikadamula Road and entered a huge warehouse. The doors of the warehouse were shut after the lorry entered it.
In the meantime, the Customs official sent a message to a stand- by team from the SLC Central Investigation Bureau, requesting them to join him. The Wattala Police were also contacted and urged to join in.
While he was waiting outside helplessly, the official had seen a man coming out of a side door. Seizing the opportunity, he had rushed through the door and ordered the workers there to open all the doors of the warehouse. As he was giving the orders, a team from the Wattala police joined him.
Inside, five workers were unloading the beedi leaves from the container, which the suspect had declared as Bangladesh-made garments in transshipment to Italy via the Bandaranaike International Airport.
On the orders of the Customs officials, the contents were put back into the container and it was sealed and sent to the Sri Lanka Customs’ container yard at Orugodawatte.
A pradeshiya saba member, his assistant and five warehouse workers were taken into custody. The workers were later released after an inquiry. But the pradeshiya saba member and his assistant were remanded after being produced in the Magistrate’s Court. Also remanded were the wharf clerks involved in the clearing of the consignment.
Two Customs officers who were suspected to be involved in the case were sent on compulsory leave, pending a disciplinary inquiry. After two weeks a broker was arrested and remanded.
The main suspect was summoned for a Customs inquiry, but he failed to turn up. He was eventually tracked down in Colombo and arrested on Friday, February 15.
In terms of the tobacco Tax Act No. 8 of 1999, persons transporting, supplying, selling or storing tobacco without paying tax, Customs duty or excise duty shall be fined Rs.1 million or imposed a jail term of upto five years. The court may also impose any other punishment, including confiscation of the consignment and forfeiture of the vehicles used in the offence.
The Director general of Customs, Ms. Charles said that investigations are ongoing by an efficient team of the Central Investigation Bureau of SLC. ‘ The perpetrators will be pun- ished in keeping with the law,’ she said.
The investigation is lead by Mr. Gnanaraj together with the Customs’ Deputy Superintendent Sampath Rajaguru, Assistant Superintendents K. Amarasinghe, Ranjan Ratnayake and Senali Lokubalasuriya.