The Hindu Business Line : Base import price for poppy seed fixed at $5,398/tonne

Forcing action
Poppy seeds were sold at $1,500 a tonne when its price in Turkey, a major producer, was $3,900-5,200 a tonne.
The consignments are under-invoiced and imported in the garb of having originated in a SAARC nation.

G.K. Nair

Kochi, Dec 6 The Centre has fixed a tariff value of $5,398 a tonne for poppy seeds in an effort to check its illegal imports. The tariff value is the base price on which the Customs Department calculates the import duty.

A notification to this effect was issued by the Finance Ministry on December 3, vide Notification No116/2007-Cus.,(N.T).

Complaints

The move to fix the tariff value follows complaints of under-invoicing of spices consignments, especially poppy seeds and cloves, by some traders. These consignments had allegedly come through Kochi and Tuticorin ports. According to trading sources, many cases are reportedly pending at Nhava Seva, Bombay and Tuticorin ports. Besides, it is understood that they are importing citric acid of Chinese origin as a product of Pakistan, which is a net importer of the commodity.

Sale price

During the last seven months, a few importers in the country have allegedly released 5,000 to 6,000 tonne of poppy seeds at $1,500 a tonne when its price in Turkey, a major producer in the world, was between $3,900 and $5,200 a tonne. The current price is said to be $5,200 a tonne. “It is a clear example of under-invoicing,” said the Secretary of Neemuch Jeera Khus-Khus Maithi Growers Association in his letter to the Chairman, Central Board of Excise and Customs on November 28. “These big poppy seeds importers are doing business and are the same people who are importing cloves, arecanuts in mis-declared origin and have also visited jail under COFEPOSA,” he alleged.

Certain spices, which are grown elsewhere in the world, are illegally imported into the country as a produce of the South Asian Association for Regional Cooperation (SAARC) countries to avail of the benefits under preferential trade agreement (SAFTA). These are also being under invoiced.

“It is going on unabated and hence warrants stringent action as has been taken in the case of cloves and poppy seeds,” trading sources told Business Line.

Clove import

A Bangalore-based firm which imported cloves from Pakistan as a produce of that country lost its appeal against the Cochin Customs, which seized two consignments imported in 2004.

The CESTAT South Zone Bench, Bangalore recently dismissed the appeal filed by the company through its final order on June 5, 2007 saying: “We do not find any merit in this appeal. We uphold the impugned order and dismiss the appeal”.

The judgement of the CESTAT will enable the Cochin Customs to levy duty plus 500 per cent penalty and 500 per cent fine. It could also charge the importers under COFEPOSA for illegal and hawala transaction, industry sources said.

The growers as well as the genuine traders have urged the Centre to fix tariff value for spices such as cloves, ginger, pepper and other spices imported into the country so as to arrest illegal imports and misusing of SAFTA.

During April –October 2007, imports of ginger shot up to 11,000 tonnes from 8,168 tonnes in the corresponding period last fiscal. The unit value has been shown as Rs 3.50 a kg as against 13.79 a kg last year.

Besides, they said, import of spices should be allowed only through 2 – 3 major ports in the country as it would enable the authorities to monitor illegal imports and arrest the violation/misuse of the SAFTA.

Initiating action

Meanwhile, Spices Board sources told Business Line that the Board, which had promptly initiated action in the case of illegal imports of cloves as the produce of Pakistan, would initiate action if imports of spices misusing the SAFTA were brought to its notice. They said the Board had been requesting the Centre to restrict imports of spices through selected ports besides insisting on to keep the import duty on pepper at 70 per cent.