Shops that refused to pay advance tax raided
They should remit 150% of what they had paid last year
April deadline was extended twice in May and June
Kozhikode: Officials of the Department of Commercial Taxes here carried out raids on jewellery and home appliances showrooms in north Kerala on Tuesday as part of a State-wide check at shops that refused to pay advance tax under the compounding system of the Value Added Tax (VAT) regime.
Documents and central processing units (CPU) of computers in many showrooms were seized during the raids. The shops that were raided were Alappat Fashion Jewellery at Mofussil Bus Station Junction; Kannankandy Sales Corporation on Mavoor Road and Devices Distribution on Jail Road in the city and Vadakkara Retna Mahal in the district. The other shops were Alukka Gold Souk and Cullayil Traders at Edappal; Kannankandy Fridge Centre at Tirur and its branches at Kottakkal and Kondotty and Chinnan Sons Jewellery at Perinthalmanna in Malappuram district.
Deputy Commissioner C. Lalappan and Assistant Commissioner K.P. Sajeveen monitored the raids in north Kerala.
Documents including stock registers, sale bills, statements, and vouchers were also seized.
CPUs were seized from Alukka Gold Souk and Chinnan Sons Jewellery on the suspicion that these gold showrooms had manipulated the stock registers, officials said.
Mr. Sajeevan said that the documents would be checked to see if these business establishments had violated any provision of the sales tax Act. Raids had been carried out only in big showrooms that had refused to comply with the rules issued by the State government.
Merchants had to remit an advance tax of 150 per cent of what they had paid the previous year as per the compounding system. The order was issued as per Section 8 of the VAT rules. The original deadline was in April. It was extended twice in May and June, he said.
Senior officials said that the government had adopted the compounding system to assess VAT for the retail sale of gold since retail business of gold in the State usually took place without bills. The compounding system was found to be effective in tacking the tax evaders.
The government expected the sale of gold to touch Rs.15,000 crore this fiscal and VAT to be Rs.150 crore, they added.
Mr. Sajeevan said that 95 per cent of the showrooms had paid advance tax. However, the small players had been exempted from the raids. Hundreds of gold showrooms carrying out retail business thrive in Kozhikode and neighbouring districts.
Meanwhile, the Calicut Bullion Dealers’ Association has called for a strike on Wednesday in protest against the raids. Shops dealing in gold and silver would down their shutters against the “arbitrary and illegal action,” association secretary M. Ram Mohan Kammath said.