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Mumbai: DRI busts 32 crore gold import racket

The Directorate of Revenue Intelligence (DRI) busted a gold import racket and allegedly seized a consignment of 100kg of gold potassium cyanide (GPC) worth 32 crores at the Air Cargo Complex in Mumbai
By Manish K Pathak, Mumbai
PUBLISHED ON JUL 12, 2021 12:26 AM IST

The Directorate of Revenue Intelligence (DRI) busted a gold import racket and allegedly seized a consignment of 100kg of gold potassium cyanide (GPC) worth 32 crores at the Air Cargo Complex in Mumbai. The agency arrested two persons on Saturday who were allegedly involved in the racket of exporting the material. Both were produced in court and remanded in judicial custody till July 21.

The agency claims that they suspected that the buyers are spread across big cities in India. GPC is also known as potassium dicyanoaurate and its primary application is in the electrolytic gold plating of metals. The seized consignment was being exported to Dubai by a Mumbai-based firm, the DRI mentioned in the press release.

The people who are part of the racket claimed that the GPCs they tried to export was made of duty-free imported gold for post-value re-export. The GPC attempted to be exported, was falsely declared to be the resultant products made from the duty-free import of gold that the Mumbai based firm was permitted to bring in as input against an Advance Authorisation (AA) license.

The DIR mentioned in the release that, “the Mumbai based exporter never manufactured any products out of the duty-free for export from gold which was permitted to import by his company. Instead, it diverted the imported duty-free gold to the domestic market at a profit, by melting and recasting it. This effectively led to the violation of the ‘actual user condition” imposed under the AA Scheme.

After selling the gold in the open market, the Mumbai-based exporter procured GPC from a connected firm based at Gandhinagar, Gujarat, and inaccurately claiming it to be a resultant product made of the imported gold brought in duty-free under the AA, mentioned in the press release.

The official suspected after finding the Gandhinagar company is engaged in a solar energy solution that has nothing to do with gold. The Gandhinagar firm imported GPC last week from Indonesia by claiming a 0% tariff concession benefit available under the ASEAN India Free Trade Agreement (AIFTA).

The documents and other evidence collected indicated that the GPC exported to Dubai was relocated to Indonesia and returned to Mumbai through the Gandhinagar office. The same produced entered and exited the country regularly. As per the investigation, the estimated duty evasion is 338 crores. The arrested accused were controlling and operating illicit schemes. The DIR did not disclose their names as the investigation is going on, said the DRI officer.

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