Top corporates in a spot over export data glitch

The Directorate General of Commercial Intelligence and Statistics (DGCIS) has found that, besides small exporters, top firms including Ford India, LG Electronics, Cipla, Larsen & Toubro and Ranbaxy have been reporting incorrect export data codes.

The DGCIS has prepared a sample list of companies which undertook exports in 2004-05 in categories spanning plastic and linoleum products, metals, machinery and instruments and cotton yarn, fabrics and made-ups. The lists has been forwarded to export promotion councils to sensitise them about the problem of misreporting.

Maruti Udyog and Ranbaxy said they had not received any communication from the government in this regard, while Cipla, Ford India and LG Electronics did not comment on the issue.

The Federation of Indian Export Organisation and the Apparel Export Promotion Council said they planned to organise programmes to sensitise customs house agents (CHAs) and companies in all metros.

An export promotion council official said while the DGCIS data showed discrepancies, there were no complaints raised by the revenue department which used the similar data to issue drawback.

The official said the large extent of misreporting or wrong data by top companies proved the extent of the problem.

"The misreporting is not intentional. Most companies get their shipping bills prepared by CHAs. It is these CHAs who have to be properly trained to fill the correct codes," a senior ministry official told Business Standard.

Earlier this year, the commerce and industry ministry had discovered that export data captured from shipping bills by DGCIS during 2004-05 had an error of 36 per cent on account of wrong entry of goods classification codes and 41 per cent error on account of wrong entry of quantity.

As per the samples compiled by DGCIS, Cipla was found to have wrongly entered 79 per cent of its total entries of 11,041 in case of exports of machinery and instruments and plastic and linoleum products.

Similarly in the case of Ranbaxy, the percentage of Indian Trade Classification Harmonised System (ITCHS) codes changed was 69 per cent of its 5,938 entries for exports of plastic and linoleum products and manufacture of metals.

The percentage of ITCHS changes in the case of Larsen & Toubro was 28 per cent of the total entries of 3,142, pertaining to plastic and linoleum products, manufacture of metals and cotton yarn, fabrics and made-ups.

Percentage of ITCHS changed in case of Maruti Udyog was 21 per cent of its total entries of 2,220, while it was 28 per cent in case of LG Electronics's total entries of 1,694.

Other companies which find a mention in the DGCIS sample include Biocon, Zee Telefilms, Dabur Pharma, Crompton Greaves, Sun Pharmaceuticals, Dr Reddy's, Ikea Trading (India).

Officials said DGCIS was also conducting workshops with export promotion councils to ensure that correct entry codes were filled by individual companies.

"The commerce secretary will conduct a review meeting with all the export councils next year to examine the extent to which the councils have rectified the problem," an official said adding that harsh action would then be considered against exporters who continue to file wrong entries.

 (With inputs from the Corporate Bureau)

IN THE HOT SEAT

• The DGCIS has made a sample list of companies which undertook exports in 2004-05 in over a dozen categories of goods
  
  
• Top firms including Ford India, LG Electronics, Cipla, L&T and Ranbaxy have not been entering correct export data codes
  
  
• These samples have been forwarded to various export promotion councils to sensitise them about the problem of misreporting