INDIA BUSINESS WORLD - DECEMBER 1st - DECEMBER 15th
- 2007
DUAL PUNISHMENT FOR CUSTOM EVADERS
There could be a dual punishment for fraudulent evaders of custom duties among importers or exporters. The amended version of Prevention of Money Laundering Act, 2002, may include offences which have already been covered by the Customs Act, sources said.
That means, an offender of customs evasion could also be punished up to seven years of imprisonment for money laundering in addition to his prison term of three to seven years under Customs Act. The revised version of PMLA is almost ready, and awaits approval of Parliament.
A senior official of the ministry of finance said that several more offences would be included in the amended version of the Act, ensuring more punishment for those found guilty of money laundering. "In the proposed amendment to the Prevention of Money Laundering Act, we are including some offences which are at present covered by Customs Act and Unlawful Activities Prevention Act. Once, the PMLA is amended, the offenders will get dual punishment - first for the substantive offence under, say, Customs Act, and then a second punishment for money laundering under the new law. The idea is to bring in rigour to the existing sets of punishment," the official said.
In India, big-time customs evasion has been taking place in import of food grains, vegetable oil and alcohol to name a few. Experts, however, feel that most genuine importers or exporters don't indulge in custom evasion frauds. Says Ernst & Young's head of indirect tax in India, Vivek Mishra; "By and large, the business community in India don't indulge in such big customs evasion frauds for which cases are registered. Also, customs duties have been reduced considerably, and grey markets of many items are fast disappearing. Yet, there will be a few exceptions who should be punished."
Currently, a person committing the offence is punishable with rigorous imprisonment for three years, which may extend to seven years and shall also be liable to fine up to Rs 5,00,000.
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