Hyderabad: Car Lounge, a well-known luxury car dealership operating from Hyderabad, has landed in controversy after its owner Basharath Khan was arrested in Gujarat in connection with a ₹100 crore customs tax evasion case. The arrest was made by the Directorate of Revenue Intelligence (DRI), which has been investigating the illegal import of luxury vehicles into India.
Officials revealed that Khan was at the centre of a tax evasion racket involving high-end cars imported from the US and Japan. Instead of bringing them directly to India, he routed them through Dubai and Sri Lanka, where the vehicles were converted from left-hand drive to right-hand drive to suit Indian regulations. Using forged documents and fake invoices, the modified vehicles were then imported into the country at undervalued rates.
Investigators estimate that Khan managed to avoid up to 50% of the applicable customs duties through this route. Around 30 luxury cars were brought into India using this method and sold through his dealership.
Among the premium models identified in the operation were the Hummer EV, Cadillac Escalade, Rolls-Royce, Lexus, Toyota Land Cruiser, and Lincoln Navigator. The firm, which has operated from Hyderabad for nearly a decade, reportedly evaded ₹7 crore in customs duty on just eight vehicles.
Further inquiries revealed that Dr. Ahmad, a business partner, helped Khan store several of these vehicles at a farmhouse. Officials also found evidence that Khan used political connections to shield his operations and primarily accepted cash payments to avoid detection by tax authorities.
The business extended beyond Hyderabad, with presence in Mumbai, Pune, Ahmedabad, Bengaluru, and Delhi. DRI sources indicated that the probe is ongoing and more arrests are likely.