KSRM now resorts to ADR system

Instead of paying the evaded value added tax (VAT) of Tk 231 crore for the last one and a half years, Chattogram-based Kabir Steel Re-Rolling Mills (KSRM) Ltd is now trying to cut through the litigation using the Alternative Dispute Resolution (ADR) mechanism.

The KSRM has been manufacturing and selling its products in the market while reportedly evading VAT worth crores.

On June 22 last year, acting on a tip-off, a team of Customs, Excise and VAT Commissionerate raided KSRM Steel Plant Ltd in the Ghoramara area of Bara Kumira under Sitakunda Upazila, seizing incriminating documents.

After reviewing the data on computers and reports of annual sales, purchases and chartered accountant firms, the authorities found evidence that KSRM dodged more than Tk 231 crore in VAT, and subsequently, prompting them to file a case against the company in July 2021.

Commenting on the matter, Additional Commissioner Mahmudul Hasan said, “The KSRM had applied to resolve the issue through the ADR system, and we are working on processing the relevant documents.” Responding to the KSRM’s application, Chattogram Customs, Excise and VAT Commissionerate Commissioner Syed Mushfequr Rahman named Additional Commissioner Mahmudul Hasan to represent the department, according to an order issued last week.

According to VAT officials, KSRM supplied 18.74 lakh tonnes of MS products to the market from July 2016 to May 2021, and was supposed to pay Tk 188.71 crore in VAT. The company, however, paid only Tk 103.42 crore in VAT, and thus owed Tk 85.29 crore to the exchequer.

Moreover, the KSRM could not produce any documents of VAT deduction at source against purchases from January 2017 to May 2021.

The company bought 19.97 lakh tonnes of raw materials over the period, and has yet to pay Tk 145.87 crore in VAT, resulting in a total of Tk 231.16 crore in VAT evasion, officials pointed out.