Finance Act 2019: SBP to assist Customs against illegal fund transfers

ISLAMABAD: State Bank of Pakistan (SBP) will assist customs authorities in prevention of illegal inward or outward transfers of funds.

According to Finance Act, 2019 a new Section 32C has been inserted to Customs Act, 1969, which stated:

“32C. Mis-declaration of value for illegal transfer of funds into or out of Pakistan.- (1) Without prejudice to any action that may be taken under this Act or any other law, for the time being in force, if any person overstates the value of imported goods or understates the value of exported goods or vice versa, or using other means including short-shipment, over-shipment, with a view to illegally transferring funds into or out of Pakistan, such person shall be served with a notice to show cause within a period of two years from the date of detection of such mis-declaration as to why penal action shall not be initiated:

Provided that if goods have not been cleared from customs, such goods shall also be liable to be seized:

Provided further that a team consisting of Additional Collector, duly assisted by an expert in the relevant field and an officer of State Bank of Pakistan (SBP) as specified, shall submit a report in writing with evidence for the Chief Collector. The said report shall also be furnished to the SBP for action, if any, under the law regulated by SBP.

(2) Any proceedings under this section shall not be initiated without the explicit approval of the Board.”

The Finance Act, 2019 also mentioned penalty for such offence:

“Such person shall be liable to penalty not exceeding two hundred thousand rupees or three times the value of goods in respect of which such offence is committed whichever is greater; and such goods shall also be liable to confiscation; and upon conviction by a special judge he shall further be liable to imprisonment for a term not exceeding five years and to a fine which may extend upto one million rupees.”

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