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NBR warns of punishment to errant PSI firms

UNB, Dhaka
The National Board of Revenue (NBR) appears serious to punish pre-shipment inspection (PSI) companies for their irregularities.
“NBR will go ahead case by case in detecting and punishing the PSI companies concerned if any irregularity is found,” NBR Chairman Muhammad Abdul Mazid said.
He said the NBR would go for instant actions against those PSI companies that will be found involved in irregulanties. "Irreg-ulanties by PSI companies are affecting industries of the country, we won't tolerate that.”
About the appointment of an audit firm for auditing PSI activities, he said, "We couldn't do that due to a case in the court. After the withdrawal of the case, we're very much interested to appoint an audit firm, but unfortunately we didn't find any capable firm."
On March 19, the government cancelled the certificate of M/S Cotecna Inspection SA, a pre-shipment inspection company, for serious irregularities.
The NBR said the certificate of Cotecna has been cancelled under the Pre-Shipment Inspection Rules 2002 for violation of law and rules by the company.
Cotecna was assigned to give Clean Reports of Findings (CRF) for Block B (China, Thailand, Korea (North and South), the Philippines and Cambodia) and Block D (Japan, Hong Kong, Vietnam, Taiwan, Australia, New Zealand, Solomon Island, Fiji, Kiribati, Venatu and Papua NewGuinea).
The NBR recently found Cotecna Inspection SA involved in serious irregularities in import inspections, particularly in Sports Utility Vehicles (SUVs) like Hummer seized from high-profile corruptsuspects.
It found that duty worth Tk 2.3 million was evaded on car imports alone due to the
inspection irregularities by the PSI company.
In one c^se, the NBR found wrong price certification in clean report of findings (CRF), as the company quoted USS 18,500 instead of $35,215 as original price of the Hummer 3.
Besides, Chittagong Customs has detected around 550 cases of irregularities in import of industrial raw materials, chemicals and industrial goods by Cotecna.
The report said Cotecna changed the harmonized coding system of import items to help importers evade customs duties.
Chittagong Customs detected 314 cases of undervaluation and price manipulation by the company in imports from China and 81 cases from the Philippines.
Sources said Cotecna issued clean reports of findings against 110 import consignments that showed less quantity, depriving the government ofaboutTk 14 crore.
The previous BNP-led 4-party alliance government appointed four PSI companies -- Cotecna Inspection SA, SGS (Bangladesh) Limited, Bureau Veritas BIVAC (Bangladesh) Limited and Intertek Testing Limited - in August 2005 for three years for certifying price, quality and quantity of imported goods.
Now BIVAC International SA, France has been assigned for giving CRF in Block B countries while SGS SOCIETE GENERALE DE SURVELLANCESA, Switzerland for Block D countries until August 31 this year.
Seeing the immense alleged irregularities by the PSI companies, NBR decided to appointment a PSI audit firm.
A tender was floated in this connection and only one audit firm, M/S National Marine Consultants Inc, out of three contenders submitted bids, remain alive in scrutiny by Proposal Evaluation Committee (PEC).