The Social Islami Bank Limited (SIBL) has given back-to-back LC facilities worth Tk 16,630 crore to two companies in Gazipur without required bonded warehouses licenses, official sources said.
In case of duty benefited back to back LCs, there is an obligation to export goods, but no goods were exported by the concerned companies. Bangladesh Bank’s inspection team did not also find any stock of imported raw materials or products made from raw materials after searching the factories of the companies.
The central bank has written to the customs intelligence department as well as the bank to take necessary action against those involved in the scam. The two companies are Sharpe Knitting & Dyeing Industries Ltd. and the Blithe Fashion Ltd., both located in Gazipur. Of the two companies, the first one is the client of SIBL Banani branch and the other is the client of Mirpur branch.
According to BB regulations, no bank can lend more than 25 percent of their capital, combined funded and non-funded, to any company or group. In this case, this rule was also ignored. The BB inspection team also found the two companies closed in the given location, which made the recovery of the fund uncertain.
According to the National Board of Revenue, in case of 100 percent export-oriented enterprises, the license period is 2 years and it has to be renewed every two years. And there is a provision to keep the product in the warehouse for 24 months after manufacturing and in case of special products more time if required.
But after the license was issued in April 2003 to the Sharpe Knitting and Dyeing Industries, it has not been renewed till now. Moreover, such enterprises are not covered by the duty free benefits under the bond in any logic. But the SIBL issued LC worth large amount of money against the company with duty free facility.
According to BB’s inspection report, Banani branch of SIBL has issued LC in favor of Sharpe Knitting and Dyeing Industries Limited located in Tongi Pagar area (holding no. 123) under Gazipur City for import under duty concession facility without any consideration of the rules.
From 2015 to 2021, 889 back-to-back LCs were opened in the name of the company, the total amount of which is about Tk16,563 crore. In case of back-to-back LCs with duty concession facility, there is an obligation to export goods, but no goods have been exported from the company as well. Even stock of imported raw materials or manufactured goods in the client’s factory could not be found. The factory has been closed for about 3 months.
Meanwhile, similar irregularities were found in case of Blithe Fashion Ltd located in Govindbari of Bara Bhavanipur in Gazipur. Even though there is no bonded warehouse license, from September 21, 2015 to September 12, 2018, goods of worth $67,40,416 with 123 back to back master LCs LCs opened at the Mirpur branch of SIBL under duty concession facilities.
Against this, the required export worth $8,42,663 did not take place. At the same time, 350 back to back LCs were issued in favor of that client. The amount of which is $55,7689. The the company has not exported products worth about $63,50 353 as required under the LCs.
Contacted, Abul Kalam Azad, BB executive director and spokesperson, told The News Times that BB is working on the issues, refusing to give further details.
