The Directorate of Revenue Intelligence (DRI) in Mumbai has arrested two individuals for their alleged involvement in a syndicate that attempted to smuggle imported cosmetic products valued at Rs 7.35 crore through the Nhava Sheva port by misdeclaring them.
Arrests and Identities
The accused have been identified as Kailashnath Dubey (45), a resident of Bhandup, and Rajesh Madhukar Rao (50), a director of Evergrow Enterprises Pvt Ltd. According to the DRI, both played a crucial role in facilitating the import of restricted cosmetic products using front companies and fraudulently obtained Importer Exporter Codes (IECs).
How the Case Unfolded
The case came to light after DRI officers received specific intelligence that a container imported from China under two Bills of Lading was falsely declared as "Ammonium Bicarbonate (Industrial Use Only)." The container, bearing number TGHU6248814, was intercepted and examined on June 8. During inspection, officers allegedly found a large quantity of undeclared cosmetic products instead of the declared industrial chemical.
Investigators said the cosmetics had been imported in the names of Interlayer International Webtech Solution Pvt. Ltd. and Evergrow Enterprises Pvt. Ltd. without the mandatory licence from the Central Drugs Standard Control Organisation (CDSCO), rendering the imports prohibited or restricted under Indian law. A government-approved chartered engineer assessed the seized goods and valued them at Rs 7.35 crore. The consignment was subsequently seized under Section 110 of the Customs Act on the reasonable belief that it was liable for confiscation.
Confessions and Modus Operandi
During questioning, Rao allegedly admitted that he had provided his KYC documents to Dubey, who promised him payment for allowing a company to be formed in his name for import activities. He told investigators that Dubey handled company registration, obtained IECs and GST registrations, arranged office premises, and instructed him to share OTPs and sign company documents.
Dubey, in his statement, allegedly admitted that he worked as an intermediary for another person and procured KYC documents from individuals to facilitate the creation of companies, GST registrations and IECs. He stated that he received Rs 30,000 for arranging directors and coordinating documentation for the companies involved.
Syndicate Operations
The DRI alleged that Dubey and Rao knowingly aided a larger syndicate that used shell entities to import restricted goods into India. Investigators further claimed that Dubey instructed Rao to switch off his mobile phone after learning about the DRI probe, indicating an attempt to evade surveillance and potentially destroy evidence.
According to the agency, the syndicate was able to attempt the import of the restricted consignment by misusing company registrations, bank accounts and IECs obtained in the names of individuals who had little or no involvement in the actual import operations.
