Tk5,000cr revenue stuck in Ctg customs cases

The Chattogram Customs Bond Commissionerate halted the licence of Halda Enterprise and locked its business identification number in 2013 on charges of bond facility manipulation.

According to the bond commissionerate, Halda Enterprise — a garment accessories importer — illegally moved elsewhere the imported raw materials that had been brought under the bond facilities and meant for bonded warehouse storing. The importer thus evaded paying Tk1.92 crore in customs duty.   

Subsequently, the business entity filed a writ with the High Court challenging the tax claim. The writ is still pending in court even though eight years have passed, with the realisation of around Tk2 crore revenue caught in a legal quagmire.         

Halda is just one example among many, since more than Tk4,792.14 crore is stuck in 9,283 cases filed by the Chattogram Customs House, Chattogram Customs, Excise & VAT Commissionerate and Chattogram Customs Bond Commissionerate.

The cases are awaiting disposal with the revenue officers, appellate tribunal, High Court and Appellate Division. Trials in some of the cases have been ongoing for 15 to 25 years, while new customs disputes are added to the total number of lawsuits every year.  

Top revenue officials have said businesses that resort to tax fraud often go to courts to delay the payments. The attitude results in long legal battles, with the cases mounting every year.     

M Fakhrul Alam, chairman of Chattogram Customs House, said the national revenue board has proposed that the attorney general's office establish separate courts to settle customs disputes promptly.

"If the proposal gets the go-ahead, we will be able to cut into the case backlogs. The customs dedicated courts will be holding the hearings of multiple cases at a time," Fakhrul Alam said.       

Mahbubul Alam, president of the Chattogram Chamber of Commerce and Industry, said businessmen also suffer due to the prolonged legal battles over customs disputes.

He said since the cases are not settled, businessmen have their money for advance tax getting stuck.

"Therefore, the cases should be disposed of promptly. This will benefit both the government and the business community," he commented.

Prof Md Salim Uddin, Chattogram University accounting teacher and also Islami Bank executive committee chairman, said:   

"Many companies have their imported items released with bank guarantees. Earlier, there were irregularities in such cases as some businessmen showed the guarantees as fixed deposit receipts that would add interest if they could delay the customs payments."

The university teacher said prolonged legal battles over customs dues mostly benefit the businesses.           

Akbar Hossain, commissioner of Chattogram Customs Excise and VAT Commissionerate, said a businessman can go up to the Appellate Division if he is not convinced by the decision of the VAT Commissionerate. And trials at the Vat Appellate Tribunal, then the High Court and ultimately at the Appellate Division prolong the disposal of cases.  

Latifur Rahman Azim, first vice-president of the Bangladesh Garments Accessories & Packaging Manufacturers & Exporters Association, said the Chattogram bond commissionerate does not have an alternative dispute resolution (ADR) arrangement, though other customs offices have such ADR facilities.

"As a result, a businessman has no other option but to go to court if he is not convinced by the bond commissionerate customs claims," he added.  

Contacted by The Business Standard, Halda Enterprise Managing Director Md Sarowar Alamgir said that the company is awaiting the HC verdict on the dispute.