NAGPUR: As Goods and Services Tax (GST) regime completes two years on July 1, the Directorate of GST Intelligence (DGGSTI) — the investigation arm — has notched up 50 raids in Nagpur zone over the six months of its operations. These actions relate to tax evasion to the tune of Rs300 crore, of which Rs250 crore has been recovered so far, said sources.
DGGSTI became operational in December last year, and raids were conducted till May end. The Nagpur zone covers Vidarbha, Marathwada and Nashik regions of the state. There was focus on real estate and food industry apart from other sectors, said sources.
With other agencies also sharing data with the directorate, nine cases have been referred by the income tax department apart from one by the enforcement directorate (ED). The ED had referred a money laundering case it was investigating, where DGGSTI also found a case of GST evasion.
The DGGSTI has found that a number of builders have not been paying GST even if the units constructed by them were not an occupancy certificate. The 5% GST on real estate units is not applicable on ready to possess building units. For this an occupancy certificate has to be obtained from the concerned authority.
Houses attract GST if an under construction property is sold. It has been learnt that a number of builders were not paying tax on the sale of under-construction properties. They had filed applications to get an occupancy certificate, but the tax was not paid even if the certificates were not granted, said a source.
In another case, DGGSTI team found that a food manufacturing unit in the city was not only evading GST on most sales but was also involved in selling expired packets by putting a fresh label. The expired material was returned from dealers, on which the unit also claimed input tax credit, but sold it again by putting fresh tags. Apart from charging tax on the repeat sales of the expired items, the DGGSTI plans to refer the case to Food and Drug Administration (FDA) also.
During a raid at a jeweller’s premises, it was seen that the firm was running a parallel unit and no tax was paid in the transactions undertaken there. The sleuths have also come across four cases of firms engaged in providing fake invoices. This helped other businesses fudge purchases on the basis of which input tax credit was availed. These firms were engaged in providing invoices with no real supply of goods or services taking place at the other end.
In the cases where income tax department has shared details, the DGGSTI has sent letters to the concerned assessees seeking their response. A mismatch was seen in the details furnished by these assessees to the income tax and GST authorities.
Source : https://timesofindia.indiatimes.com/city/nagpur/gst-intelligence-arm-unearthed-rs-300-cr-evasion-in-6-mths/articleshow/69980849.cms