New Delhi [India], July 22 (ANI): The Directorate of Revenue Intelligence (DRI) has busted a sophisticated, well-orchestrated customs fraud in imports of premium luxury furniture, said a statement from the Ministry of Finance on Tuesday.

Acting on specific intelligence, DRI officials conducted searches across multiple locations, including business premises, warehouses, offices of freight forwarders, customs brokers, and associated entities. The investigation has exposed a complex, intertwined network used for massive undervaluation and misdeclaration of branded luxury furniture operating across multiple jurisdictions, involving the use of dummy importers (IEC holders), local intermediaries, overseas shell entities, and fabricated invoices.

The investigation conducted thus far revealed that branded luxury furniture was being directly sourced by a beneficial importer from reputed Italian and other European suppliers, and invoicing was being done in the names of shell companies based in jurisdictions such as Dubai.

In parallel, fabricated invoices were obtained through a Singapore-based intermediary in the names of dummy importers falsely declaring the goods as unbranded furniture at significantly undervalued rates to customs. Once cleared through Customs, the goods were transferred on paper to the intended beneficial owner via a local intermediary created for this purpose, while the goods were directly sent to the customer on the instructions of the beneficial owner.

Preliminary findings indicate a gross undervaluation of 70 per cent to 90 per cent of the actual transaction value, resulting in estimated customs duty evasion of approximately Rs 30 crore. The beneficial owner, the dummy importer, and the intermediary have been found in complicity and close conspiracy for executing the whole modus operandi. On 21 and 22 July 2025, all three individuals were arrested by DRI under provisions of the Customs Act, 1962.

Earlier in May 2025, another such case was unearthed by DRI, exposing a similar modus operandi involving the undervaluation of luxury furniture imports using a front company, which was controlled and managed by another entity for evading customs duties. This case also involved duty evasion exceeding Rs 20 crore, resulting in the arrest of three individuals involved.

DRI continues to probe deeper into the wider network of shell companies, dummy IECs, masterminds and beneficial owners, and financial flows involved in these operations.

The DRI has stepped up its efforts in exposing such commercial frauds, which not only result in significant losses to government revenue but also create market distortions and an uneven playing field for compliant importers and domestic manufacturers. (ANI)