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| Thursday, 17 July 2003 |
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by Manjula Fernando One of the country's leading coconut products exporting companies has been caught up in the Customs net for defrauding and evading millions of rupees to be paid to the Coconut Development Fund as cess since 1992. The owner is alleged to be pressurising the investigating offices in a bid to cover up the probe. According to authoritative Customs sources the company which had been in this business since 1992 had saved millions of rupees on false declarations and wrong classifications on their export products in order to pay less cess or pay not at all. The Colombo based company with clients worldwide has classified their canned coconut cream (milk) which is liable for a 45 cent cess according to the special gazette notification concerned, on a different 'HS code' to avoid paying the required dues. Customs sources said: "This company ships about 170,000 kilos of canned coconut cream a month. The loss to the coconut sector is massive. Moreover, citing their false classification several of the companies in the same business have been avoiding cess on this product." According to the Coconut Development Act a cess should be charged with effect from February 1, 1994 in respect of every coconut product and only the fibre products were exempted at one time, sources said. Furthermore, the same company is now being investigated for fraudulent declaration on one of their value added products called 'creamed coconut' which is produced by grinding desiccated coconut in to a paste. "They should have paid Rs.2 per kilo as cess. Instead what they have done is classify this as 'cream coconut' (milk) and pay 45 cents per kilo, the rate for coconut milk." Customs investigations have revealed that the company had exported over one billion worth of cream coconut since 1996, according to the documentation the investigation officials have been able to uncover. The case is now in the inquiry stage and one of the former senior managers of the company and a former senior official of the Coconut Development Authority are giving evidence. |
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