The Supreme Court has sought replies from the Union government and as many as 61 iron ore pellet producers-cum-exporters on a PIL seeking a probe on duty evasion in exporting iron ore pellets to China from 2015 onwards.
The apex court has allowed the petitioner – advocate ML Sharma of Coalgate fame – to appear and argue in person, while seeking responses from the Centre and the exporting companies.
Underlining the fact that only state-owned pellet manufacturer KIOCL was authorised to export pellets, the petitioner argued that in violation of existing laws exporters have used the HS Code 26011210 instead of 26011100 in a bid to evade the 30% export duty on iron ore above Fe58%.
HS Code 26011210 is a duty-free code prescribed for KIOCL, while HS Code 26011100 applied to all other exports that attracted export duty, according to the PIL.
Alleging that the government did not issue show cause notices to exporters, the petitioner urged the court to direct the government to “recover INR 7, 08,000 crores penalties, jointly and severally, from the exporters” – an estimate of total export duty evasion since 2015.
In this context it deserves mention that although several pleas have been issued by different associations in the past urging the government to impose a duty on pellet exports – many of which were forwarded to the government by the DGFT – no such duty has been effected till date.
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