Introduction
In a major crackdown on high-value customs evasion, a Hyderabad-based luxury car dealer, Basharat Khan, has been arrested for allegedly evading nearly Rs 100 crore in customs duties. The scam involved illegally importing high-end vehicles from the United States and Japan using fake documentation and undervalued invoices. The arrest was made by the Directorate of Revenue Intelligence (DRI).
How the Rs 100 Crore Luxury Car Scam Worked
According to DRI officials, Khan imported luxury cars through a complex international smuggling route. The cars, originally left-hand drive models from the US and Japan, were rerouted via Dubai or Sri Lanka. In these countries, the vehicles were converted to right-hand drive to comply with Indian road standards.
Using fake invoices and undervaluing the vehicle costs—sometimes by as much as 50%—Khan allegedly avoided massive import taxes. The scam also included forged documents, and the vehicles were brought into India under false identities to bypass customs scrutiny.
High-End Cars Involved
So far, officials have uncovered at least 30 illegally imported cars. These include:
- Rolls-Royce Phantom
- Cadillac Escalade
- Hummer EV
- Lexus LX 570
- Toyota Land Cruiser
- Lincoln Navigator
These vehicles were reportedly stored in various cities, with several kept at the farmhouse of Khan’s business partner, Dr Ahmed.
Political Links and Tax Evasion
The investigation also revealed that Khan had developed strong political connections, which allegedly helped him expand his business. Many buyers, including influential individuals, purchased cars in cash to avoid Goods and Services Tax (GST). The DRI is investigating these transactions for possible tax fraud.
‘Car Lounge’ Showroom and Modification Unit
Basharat Khan operated the ‘Car Lounge’ showroom in Hyderabad for over 10 years. The facility included a luxury car workshop where imported vehicles were modified and enhanced for local buyers. Extensive alterations often masked the origin of these vehicles, complicating DRI tracking.
National Smuggling Network
The car smuggling ring spans major Indian cities including Hyderabad, Mumbai, Pune, Ahmedabad, Bengaluru, and Delhi. Officials believe more arrests could follow as they trace vehicles and financial transactions across these locations.
Current Status and Ongoing Probe
Basharat Khan has been remanded to judicial custody, and the DRI is continuing its investigation. Authorities are working to identify more vehicles imported using fraudulent documentation and estimate the full scale of the financial damage to the government.
Conclusion
This case underscores the need for stronger enforcement mechanisms to prevent large-scale customs duty evasion in India’s automobile sector. As luxury car imports grow, so do the risks of financial fraud and illegal activity. Authorities have called for inter-agency cooperation and stricter port inspections going forward.
