The Directorate of Revenue Intelligence (DRI) has recently cracked down on a sophisticated customs fraud involving the import of luxury furniture, revealing an elaborate scheme designed to evade customs duties. This operation spanned multiple jurisdictions, utilizing dummy importers, local middlemen, shell entities overseas, and falsified invoices to significantly undervalue premium furniture imports. The estimated customs duty evasion amounts to approximately Rs 30 crore.

Acting on specific intelligence, DRI officials conducted searches across multiple locations, including business premises, warehouses, freight forwarders' offices, customs brokers, and associated entities. The investigation uncovered a complex network orchestrated for the undervaluation and false declaration of branded luxury furniture.

The modus operandi involved several key steps:

• Sourcing from Reputable Suppliers: The actual beneficiaries directly sourced branded luxury furniture from well-known suppliers in Italy and other European countries.
• Routing Through Shell Companies: Invoices were issued in the names of shell companies based in jurisdictions like Dubai, concealing the original transaction details from Indian Customs.
• False Invoicing: A Singapore-based intermediary generated undervalued and falsified invoices in the names of dummy Indian importers. These invoices falsely declared the goods as unbranded and significantly cheaper items.
• Direct Delivery to Customers: Despite the documentation suggesting otherwise, the furniture was directly delivered to end customers as per the instructions of the beneficial owner.
• Creation of Fictitious Supply Chain: Some firms existed only on paper and were used to create a fictitious supply chain, masking the direct link between the importer and the actual beneficiary.

Preliminary findings indicate severe undervaluation, with actual transaction values being understated by as much as 70% to 90%. This fraudulent operation has led to the evasion of around Rs 30 crore in customs duty. On July 21 and 22, 2025, the DRI apprehended three key individuals involved in this conspiracy under the Customs Act, 1962. Those arrested were identified as Falgun Yogendra Shroff, owner of Di Lusso Furniture LLP, Sambhaji Bhosale, proprietor of Sam Furniture & Electronics, and Manoj Rai, proprietor of Divine Enterprises.

The investigation revealed that Bhosale used his Import Export Code (IEC) to bring in branded furniture under the guise of unbranded or low-value items. The goods were then transported directly to Di Lusso's warehouse, bypassing the supposed intermediary, Divine Enterprises. Rai's firm existed only on paper and was used to create a fictitious supply chain, masking the direct link between the importer and the actual beneficiary.

Earlier in May 2025, the DRI had exposed a similar modus operandi involving the undervaluation of luxury furniture imports, resulting in the arrest of three individuals and duty evasion exceeding Rs 20 crore. In that case, the DRI arrested Rizwan Iqbal Chunawala, the proprietor of Design Decode, and Sajid Hanif Jada, the ICE holder of Design Decode, under the Customs Act. Chunawala confessed that Design Decode was merely a front set up to import goods on behalf of another entity and admitted to full knowledge of the scheme.

The 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.