DRI busts diesel smuggling racket

Vijayawada: On the basis of inputs provided by the Andhra Pradesh Intelligence Bureau, the Hyderabad unit of the Directorate of Revenue Intelligence (DRI) arrested four persons, including the mastermind and one hawala operator, on the charges of smuggling diesel into India in the guise of mineral spirit and seized 14 containers of diesel worth over Rs 1 crore.

The DRI received information that diesel is being smuggled into India in the guise of mineral spirit by certain operators based at Kakinada and Chennai in huge quantities from Dubai on a regular basis through containers at Chennai port for illegal sale in Tamil Nadu, Andhra Pradesh and Telangana. Accordingly, simultaneous search operation was carried out by the officers of the Directorate of Revenue Intelligence (DRI), Hyderabad and Chennai with the active support of Andhra Pradesh State Intelligence at various places across Andhra Pradesh and Tamil Nadu from April 17.

Searches were conducted at two Container Freight Stations in Chennai revealed that 14 containers imported at Chennai Port in the name of M/s SAF Petroleum and M/s Aditya Marine landed at Sanco CFS, Chennai and Gateway CFS, Chennai, where the goods were declared as mineral spirit. These containers were found to be actually carrying 263.78 MT (three lakh litres) of diesel.

Simultaneous searches were conducted across Kakinada and Chennai covering 12 places belonging to operators or importers, clearing agents, transportation broker, supervisor, hawala operators. Diesel is a restricted commodity for import as per the Foreign Trade Policy and allowed to be imported only by oil marketing companies. To circumvent the restriction, the operators of diesel smuggling based at Kakinada hatched a plan and started smuggling diesel in the guise of mineral spirit. They not only imported it but also declared much lower value, around 40 per cent of the actual value, thereby evading customs duty.

The operators had offices in Kakinada, storage yard at Maraimalai Nagar, Chennai and an office front at Guindy, Chennai to facilitate smuggling and distribution. A relative of one of the operators from Kakinada was looking after the logistics, moving the diesel into the grey markets in Chennai, Kakinada, Ongole and parts of Telangana. Dummy companies were opened in Dubai to purchase diesel and import to Chennai by creating false documents and invoices. The price difference was being adjusted by payments through hawala channels. It is found that in the past these operators smuggled around 5,366 MT (63 lakh litres) of diesel worth 17.7 crore, which comes to around 285 containers.