GST back-end system helps unearth tax evasion in Mumbai
Shruti Srivastava : New Delhi, Sat Oct 05 2013, 05:10 hrs
The Mumbai income tax department is investigating a staggering Rs
30,725 crore of potential income tax evasion facilitated by a group of
city-based agents supplying fake bills to traders and small
manufacturers.
The tip-off came from the sales tax department of the state government
which came across over 2,000 such agents who supply these bills
operating from Girgaum and Kalbadevi areas of Mumbai.
Based on the information, the income tax department is planning the
largest ever sweep of traders and small-time manufacturers for tax
evasion in India's richest revenue jurisdiction.
The department has landed on this treasure trove through the back-end
IT platform created for Goods and Services Tax (GST), which has begun
matching sales with income tax returns.
The agents provide false invoices for the traders and manufacturers to
mask their profit from their sales.
An official told The Indian Express that the frauds came into light
when assesses uploaded their audited accounts along with annexures of
purchase and sales on the sales tax department website.
When the department turned over the data to the income tax department
as envisaged under the proposed Goods and Services Tax regime the
discrepancies between the sales and purchases started to roll out.
As of now, the two departments have found 42,315 such records which
have been put under the scanner.
The papers have been used by the traders and manufacturers even for
procuring loans from banks. Sectors including iron and steel, paper
and chemicals are most susceptible to the fraud, the official added.
Of these, nearly 10,000 cases have been sent to the various
intelligence departments in the revenue machinery for investigation.
Stunned by the scale of evasion which has brought both the direct and
indirect tax departments in into play, the Central Economic
Intelligence Bureau has written to the chief secretaries of all states
to detect similar frauds.
--
CS A Rengarajan
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