Mumbai: DRI busts racket involved in duty evasion of Rs 30 crore in luxury furniture import; 3 arrested
The agency raided multiple locations in Mumbai and arrested three persons on Monday and Tuesday under provisions of the Customs Act, 1962.
According to DRI, it received specific intelligence regarding the import racket.
Acting on the intelligence, DRI officials conducted extensive searches across multiple locations, including business premises, warehouses, offices of freight forwarders, customs brokers, and other associated entities.
'The investigation has exposed a complex, intertwined network used for massive undervaluation and misdeclaration of branded luxury furniture operating across multiple jurisdictions, involving the use of dummy importers (IEC holders), local intermediaries, overseas shell entities, and fabricated invoices and related documentation to systematically undervalue branded luxury furniture,' the DRI stated in a statement.
The anti-smuggling agency's investigation revealed that the beneficial owner, a well-known luxury furniture brand, was sourcing luxury furniture from reputed Italian and other European brands. However, invoicing was being done in the names of shell companies based in jurisdictions such as Dubai, while the goods were shipped directly from Europe to India.
In parallel, fabricated invoices were sent through a Singapore-based intermediary for falsely declaring the goods as unbranded furniture at significantly undervalued rates to Customs for clearance in the name of dummy importers, the DRI said.
Once cleared through Customs, the goods were transferred on paper to the intended beneficial owner via a local intermediary created for this purpose, while in reality the goods were directly sent to the beneficial owner or the customer at the direction of the beneficial owner of the whole scam, the central agency added.
Preliminary findings indicate a gross undervaluation of 70 to 90 per cent of the actual transaction value, resulting in estimated customs duty evasion of approximately Rs 30 crore.
The beneficial owner, the importer (IEC holder), and the intermediary have been found in complicity and close conspiracy with each other for executing the whole modus operandi to evade a huge amount of customs duty, the central agency probe has revealed.
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