Hyderabad businessman arrested in Rs 100 cr luxury car import scam

Hyderabad: Amid raids by the Enforcement Directorate and the Directorate of Revenue Intelligence (DRI), a Hyderabad businessman was arrested earlier this month in an alleged Rs 25 crore luxury car fraud.

The accused was identified as Basharat Ahmed Khan, the owner of the Hyderabad-based Car Lounge showroom in Gachibowli, reported News Meter. Based on intelligence, the DRI found that luxury cars were imported to India at 50 percent of their original price through deliberate under-invoicing and misdeclaration at Indian ports.

Khan has been accused of importing eight such luxury vehicles, resulting in a customs duty evasion of over Rs 7 crore, reported PTI.

Khan was arrested by the DRI from Ahmedabad and remanded to judicial custody by a magistrate’s court there. According to local reports, the accused is a native of Hyderabad’s Vijaynagar colony.

He began selling high-end cars. These cars are put on display at the showroom. Many vehicles were sold to VIPs and cars were lent to be ‘used’ by politicians, cutting across all parties. Basharath held a good rapport with a few parliamentarians.

Customers paid in cash

Khan and his business partner, Dr Ahmed, have a partnership in the firm. These high-end cars were also stationed at the farmhouse. Customers paid the amount in cash to avoid taxes. The fraud began when cars sourced from the US and Japan were shipped to Dubai and Sri Lanka for altering the left hand drive to a right-hand drive.

After these alterations, the cars were imported into India using falsified documents that significantly undervalued the vehicles, thereby evading substantial customs duties.

The investigation revealed that over 30 luxury vehicles, including premium models such as the Hummer EV, Rolls-Royce, Cadillac Escalade, Lexus, Toyota Land Cruiser and Lincoln Navigator, were brought into the country using this modus operandi.

The importers involved in the scam are based across major cities, including Hyderabad, Mumbai, Pune, Ahmedabad, Bengaluru and Delhi. The estimated duty evasion exceeds Rs 25 crore.

Three companies linked to Khan, CLFIVE Automotives Private Limited, BAK Carlounge Services Private Limited, and BAK Car Lounge Private Limited, are also under scrutiny.

(The copy had earlier mentioned the accused was arrested in Surat, and Rs 100 crore fraud was claimed. However, the information was found to be incorrect. The error is regretted.)