Fronting: The Office of the Attorney General (OAG) yesterday submitted the four remaining cases related to fronting to Phuentsholing’s dungkhag court.
Unlike the 23 cases OAG submitted to the court as “civil restitution” in March this year, the current cases fall under criminal cases.
The preliminary hearing for the 23 cases started on April 28. About six people were summoned for the hearing. OAG has submitted that the defendants must restitute the amount of commission the Bhutanese counterparts received by lending their licences to non-nationals.
OAG submitted that the defendants should also restitute the Indian Rupee (INR) that was remitted across the border. According to sources, Bhutanese licence holders opened current deposit accounts in banks and signed blank cheques for their non-national counterparts to remit INR for imports from India and US dollars (USD) for third country imports.
Records maintained by the customs office at Phuentsholing and transactions made from these accounts revealed huge imports and transactions between 2012 and 2015. In the name of M/s Rabten Pharmaceuticals and Medical Supplier, a non-national imported goods worth Nu 71.5 million.
OAG said that huge imports coincided with shortage of INR in the country. Further, OAG said that the particular non-national defendant abused the economic activities created for legitimate Bhutanese business operators.
Non-nationals who had leased the licences from the Bhutanese licence holders have been asked to pay a 9.75 interest on the imported value.
About Nu 211 million is expected to be restituted to the state from these 23 cases.
Facing INR shortage in 2011, the government had to resort to selling USD 200 million in December of the same year. Government also borrowed INR 10 billion in March 2012 and two billion more in May of the same year. A month later in June, the government had to borrow three billion more.
OAG also has submitted to the court to revoke the trade licences. Leasing of the trade licences to another party is prohibited under rule 3 of the Rules and Regulations for Establishment and Operation of Industrial and Commercial Ventures in Bhutan 1995 and rule 6 of the General Guidelines for Industrial and Commercial Ventures in Bhutan, 1997.
Rajesh Rai, Phuentsholing