Ongoing developments with seized containers of hides

Tanzania
Published:  13 January, 2014

The customs and excise department of the Tanzania Revenue Authority (TRA) remains uncertain over the fate of three containers of hides seized at the Dar es Salaam port two months ago.

Stakeholders in the leather sector now question why the TRA has failed to take action on those behind the consignment - even though they know them.

On November 20 the customs department announced they had seized three containers of under-declared raw hides that were about to be exported by the foreign trader. Reported to be SAK International Ltd from Pakistan.

The containers, which weighed some 80 tons of wet salted hides were then valued at $150,000, according to our sources, but the traders declared they were worth just $84,000.

But a local investigation reports that the customs regulator has since been skating around the issue, raising doubts among stakeholders who now believe the TRA is trying to cover-up those behind the illegal exportation of goods.

Two weeks ago, both the TRA and the Ministry of Livestock and Fisheries Development reached an agreement that the confiscated hides be donated to the prisons department. However, The Guardian on Sunday in Tanzania has learned that this has not been honoured.

As a result, some in Tanzania feel that the TRA is “not committed” to ending the hides saga. A senior official from the Ministry of Livestock and Fisheries Development expressed disappointment that TRA could not clearly state who was behind the consignment.

“The law is very clear, the exporter’s licence would be revoked once proved to be guilty.” he said, adding: “If the TRA cannot investigate the matter, let them give it to the police.”

In a phone interview with The Guardian on Sunday almost a month after the seizure, customs and excise deputy commissioner Patrick Kisaka agreed that the authority had failed to identify the owners of the seized containers and that the authority had plans to auction the goods.

He said the raw hides worth Sh163.5 million (about $1,000,000) were then being held at the customs warehouse awaiting public auction last month.

“We proved that the containers contained raw hides and since the owners have not come to claim them we will auction them to recover revenue,” he told a reporter.

According to the deputy commissioner, the authority had not been able to trace the owner for lack of clear information on their whereabouts.

But The Guardian on Sunday later learned that the owners of the confiscated consignment had wanted to buy the goods back through a private auction organised by the authority.

SAK International, the company under investigation for evading tax in the exportation saga, reportedly offered the highest bid at auction.

Investigations by the newspaper reveal that the Directors flew to Pakistan just days after the goods were detained by the customs officials. 

But on December 22 they sent one of their younger brothers back to Tanzania to coordinate the buying of goods. This was just a day after other stakeholders who applied to buy the goods through private auction were taken on site to view the raw materials at the Ubungo inland container deport.

During the site viewing, TRA official Manjale Masare who supervised the exercise publicly said that SAK International or its affiliates would not be allowed to participate in the auction - because the company was under investigation.

“SAK International and its partners are automatically disqualified in this process the investigation is still underway,” he said, adding that allowing them to do so would contravene ethics.

But The Guardian on Sunday later established that after coming back into the country, the SAK International official, through auction offered to buy the hides at Sh900 apiece, being the highest bidder.

The second bidder was Afro Leather, which offered Sh 650 apiece. So TRA agreed that the consignment would be sold to SAK International, a company they are still investigating.

“It is true SAK has won the auction with the highest offer, so it will be allowed to take the hides as soon as other processes are completed,” said an unnamed source within the TRA.

Meanwhile, more details indicate that the exporters has seven more containers of dry hides at its company yard in Temeke, ready to be exported as a soon as the current situation is resolved.

Source: Guardian on Sunday

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