The Department of Revenue Investigation on Wednesday arrested Sanjay Agrawal, proprietor of Global Leather Tanning Udhyog, on smuggling charges. He smuggled black pepper through Birgunj Customs. Agrawal was sent to jail after he failed to submit the bail amount worth Rs37.6 million.

Agrawal has been charged for producing fake declaration forms to illegally export black pepper. Along with Agrawal, the department also detained customs agent Dilip Shrivastav and Indian truck driver Dharmendra Kumar on similar charges. While the department slapped Shrivastav with a bail amount of Rs15 million, the truck driver was asked to submit bail worth Rs14.6 million.

Dhruba Pokharel, an investigation officer at the department, confirmed the arrest of the three accused for smuggling of black pepper. According to him, the department has started investigation on the basis of the customs declaration, invoice and seized agricultural product. 

On June 4, Parsa Police seized 12 tonnes of black pepper that was being transported in an Indian truck with registration number UP 78 BT 3804. Superintendent of Police Rewati Dhakal said they raided the truck based on the information that they received.

As per the customs declaration form that the accused submitted, Global Leather Tanning Udhyog was supposed to export leather to Merit Exim, a firm in Kanpur, India. According to a customs official, tanned leather is not subjected to undergo the physical scrutiny as it falls under the green channel category.

“Taking undue advantage of the provision, many traders are found to be involved in smuggling of the agricultural product,” the source said.

Birgunj Customs Chief Sewantak Pokharel said Agrawal had received certificate of origin issued by Birgunj Chamber of Commerce and licence to export leather from the commerce office.

The Parsa Police reported that Agrawal in the declaration form had stated to export 25 tonnes of ‘wet blue leather’ in two trucks.

According to the record at the department, a variation was also found in the quantity stated in the customs declaration form and invoice. The accused was discovered to  have rewriten the truck number on the declaration form to conduct the malpractice.

The smuggling of black pepper is on rise due to the difference in price of the product in domestic and Indian markets. Black pepper costs an average of Rs600 per kg in bordering market of Nepal while the product is sold at Rs1,000-2,000 in Indian market.

The price difference is due to the variation in customs duties charged on the agricultural good in two countries. Nepal charges 10 percent customs duty on import of black pepper. The rate stands at around 70 percent in India.

Traders import black pepper via Kolkata-Birgunj dry port. The product is then unloaded at warehouse located in vicinity of Birgunj before being reloaded to export in India.

In the first 10 months of the current fiscal year, police confiscated 18 tonnes of black pepper bound for illegal export in India.

According to Surya Sedhai, chief customs office at Birgunj dry port, Nepal imported 5,621 tonnes of black pepper worth Rs2.16 billion in this fiscal year.