Dealer Arrested For Rs. 25 Crore Import Duty Evasion: 30 Luxury Cars Including Rolls Royce, Toyota Land Cruiser Seized
A lot of luxury used car dealers sell cars like Rolls-Royces, Bentleys, and others, and as we all know, these cars attract a lot of customs duties. However, in order to sell these vehicles for lower prices, some dealers get involved in tax frauds and evade customs duties. They do it by misrepresenting such luxury cars. Recently, a dealer from Hyderabad by the name of Basharat Ahmed Khan was arrested for evading customs duties of Rs 25 crores on over 30 luxury cars. These cars included Rolls-Royce, Hummer EV, Lexus, Toyota Land Cruiser, and others.
Hyderabad dealer arrested for customs duty evasion
The owner of the Hyderabad, Telangana-based dealership SK Car Lounge, Basharath Ahmed Khan, was recently arrested by the Directorate of Revenue Intelligence (DRI). SK Car Lounge is located in Gachibowli, opposite the Cyberabad Police Commissioner’s office. As per reports, Basharath Ahmed Khan was arrested in Ahmedabad. The staff at his dealership were not aware of his arrest and were told that he was in Dubai.
It has been reported by the authorities that three other companies which are linked with Basharath Ahmed Khan are also under investigation by DRI. These companies are: CLFIVE Automotives Private Limited, BAK Carlounge Services Private Limited, and BAK Car Lounge Private Limited.
How were the customs duties evaded?
According to the reports, Khan used to import cars from the United States of America and Japan. However, they were then rerouted through Dubai and Sri Lanka. This was done to hide the origins of these cars and avoid coming under the radar of the authorities. After this, these vehicles were then converted from left-hand drive to right-hand drive to suit Indian regulations.
Following this, with the help of forged documents, these vehicles were declared to have lower values than their original ones. This sometimes made the vehicles half of their original cost, which helped in evading customs duties. Over 30 luxury cars, including the Hummer EV, Rolls-Royce, Lexus, Cadillac Escalade, Lexus, Toyota Land Cruiser, and Lincoln Navigator, along with others, were imported and have been seized by authorities.
In total, the Directorate of Revenue Intelligence has estimated that Rs 7 crore of duties have been evaded from the above-mentioned 8 vehicles. Meanwhile, in total, over Rs 25 crore in duties have not been paid by Basharat Ahmed Khan. Reportedly, he has connections in Mumbai, Pune, Bengaluru, Ahmedabad, and Delhi. Currently, the investigation is ongoing, and more assets will be seized in the future.
Gautam Singhania also evaded customs duties
Back in January of last year, it was reported that the Raymond Group had to pay penalties of Rs 238 crore. The Directorate of Revenue Intelligence accused Singhania of undervaluing and evading customs duties on 142 vehicles, including 138 vintage cars and four R&D vehicles between 2018 and 2021.
As per the investigation done by DRI, Singhania was identified as the beneficiary and owner of these vintage cars. All of these cars were procured from prestigious auction houses globally, such as Sotheby’s, Barrett-Jackson, and Bonhams.
The investigation revealed that Singhania’s firm allegedly used intermediaries registered in UAE, Hong Kong, and the US to undervalue the cars and evade customs duties totaling Rs 2,297.2 crore. When DRI suspected an evasion of duties, they raided JK House, the Singhania residence. According to reports, the actual prices of the imported cars were revealed in emails and chats.