Continuing its hot pursuit against those not filing their Goods and Service Tax (GST) returns, the anti-evasion wing of the Hyderabad GST Commissionerate has served notices on as many as 30,000 defaulters which include top infrastructure companies, hotels, film production houses, jewellers and management of at least three leading educational institutions.
After painstaking efforts by special teams constituted to examine the available data on GST network, the officers managed to identify 33,000 non-filers of GST returns in respect of each range and accordingly issued notices to 30,000.
Sources in the Commissionerate revealed how big players in areas like infrastructure, jewellery, film industry and educational institutions, which have the dubious reputation of tax evasion, tried to evade paying tax.
A leading multi-crore jewellery group, which started its operations in the City recently and has good presence in the southern states, is under the close watch of the anti-evasion wing, officials said.
Undervaluation
The jewellery group declared ₹100 crore transaction every month and paid ₹3 crore as GST.
The group reported transactions to the tune of ₹700 crore in the last seven months and remitted ₹21 crore as GST.
“However, the said group has made most of the payments by way of selling off input tax credit than cash payment as it has procured large quantity of yellow metal which has been converted into jewellery elsewhere and paid IGST on interstate transactions,” a senior official in the Commissionerate told The Hindu on Sunday.
“Whenever the input tax credit ratio is higher than the cash payments, taxmen will have a closer look at the taxable value. The owner is certainly under our scanner,” the officer said adding they were surprised at the special offers that group was making to attract the customers.
Officials suspect that the jewellery group could be undervaluing the gold that is imported.
Coaching institutes
This apart, three leading educational institution chains with branches in the two Telugu speaking States were found to be camouflaging coaching for entrance examination such as Eamcet, NEET and IIT as part of regular curriculum of Intermediate courses and thereby evading payment of Service Tax to the tune of ₹200 crore.
“These institutions insisted on cash payments from parents and undervalued taxable value even on the compressed portion of the coaching which they pay as service tax,” the official said.
“Cases have been booked and adjudication orders have been issued confirming to the said demand,” the official explained.
On account of special drive for recovery of due service tax, the pre-GST regime in general and three months before introduction of GST in particular in this financial year, service tax of ₹53.53 crore has been realised from infra, educational institutions, hotels/restaurants, film industry and jewellers alone.
Officials said the total number of tax payers in the commissionerate limits, both State and Central, were 3,20,974 of which State government registered payers were 2,10,524 and those remitting to Central government are 1,10,450.
High profile cases in GST evasion
The Anti-Evasion wing of Hyderabad GST Commissionerate has booked three high profile cases in the last few months, including one against leading Telugu film production unit Sri Venkateswara Creations, for GST evasion. It is one of the big cases booked for GST evasion, after the introduction of GST regime, worth ₹8 crore. In this case, the film producer collected dues from the clients, but did not remit the same to the government.
After booking the case, the tax payee shelled out ₹6.80 crore so far. Subsequently, many tax payees of the film industry, who were quietly evading tax, filed their returns and an amount of ₹40 lakh were realised so far.
Another big catch was a case against Premier People Logistics Solutions Private Limited for evading ₹1.60 crore GST on employee transport service being provided to IT companies. On filing of the case, the assessee admitted the offence and paid the entire amount and further verification is in progress.
Tejaswi Jewellers Private Limited, a franchisee of Tanishq Jewellers landed in trouble for evading GST of more than ₹ 1.10 crore. The assessee has sought time till March 25 failing which penal provisions of the law would be enforced.
