Many Indian companies procuring raw material from China have been instead delivered chemicals mixed with water, chalk powder and paper by their suppliers. To make matters worse, they are charged customs duty and IGST based on the actual invoice.
Most of the duped companies said they would take up the matter of fraud in international forums. They are also looking to approach Indian courts for some leeway on taxes.
In many cases, officials of importing companies said integrated goods and services tax (IGST) and customs duty applicable on the invoice amount is more than the actual cost of the fake or adulterated goods they received from China.
One company that had imported ‘re-melted lead ingots’ from China, instead, was delivered chalk power. But it was asked to cough up duties on the amount paid for importing ingots.
Many companies are taking the legal route to seek tax refunds.