DGGI detects Rs 4 Cr GST evasion by govt contractors

KT NEWS SERVICE. Dated: 3/3/2021 10:37:18 AM

JAMMU, Mar 02: Jammu unit of Directorate General of GST Intelligence (DGGI), the intelligence arm of Central Board of Indirect Taxes & Customs, Ministry of Finance has reportedly detected more than Rs 4 crore GST evasions by government contractors in J&K UT.
The office of Jammu Regional Unit of DGGI headed by Dr Iftikhar Ahmed Chowdhary (IRS) Deputy Director, by using data analysis tools has scrutinised GST returns filing history of about 250 contractors, who have received payments against completion of works allotted to them by two government department offices in J&K only.
During the scrutiny of data, more than 100 contractors were found violating laws and rules in respect of GST Act and have evaded more than Rs 4 crore GST.
It is pertinent to mention here that work contractors are covered under category service providers in GST Act and the payments released against completion of work contracts like roads, bridges etc. includes GST applicable on the service provided (allocated works completed and payments released from Govt.) by them.
The DGGI found that many of these contractors after receipt of payments from Government are either not depositing remaining tax (from October 2018, 2% of GST mandatorily being deducted by Department) at all or paying less tax than their actual liability.
As the Government spends a major chunk of its development funds on infrastructure projects and up to 12% of this expenditure is actually the indirect tax (GST) which is expected to be deposited by service providers (work contractors) to Central and State Governments. It is expected that some of these contractors by evading their tax liability are causing huge amount of revenue loss to both Central and State Governments.
DGGI has booked many of the contractors found violating the GST Act and had started investigations against them. The remaining violators are expected to be covered subsequently.
It is pertinent to mention that officers of Jammu Regional Unit (JRU) and Chandigarh Zonal Unit (CdZU) of Directorate General of GST Intelligence (DGGI) searched multiple business premises belonging to cement manufacturer, hotel, coaching institutes and others in Srinagar from February 18-20.
On 18th February, simultaneous searches were conducted by DGGI teams at the corporate office of a Cement manufacturer in Srinagar and its manufacturing plant located at Khrew, Pulwama”.
During these search operations, many incrementing documents and electronic evidence were found by DGGI officers. The initial estimates showed large scale tax evasion by the taxpayer.
It may be recalled that on 19th February, the DGGI teams searched premises belonging to the hotel and coaching institute. During these searches many discrepancies were detected. The electronic and documentary proofs showed tax evasion by taxpayers.
On 20th February, the DGGI officers searched the office travel service provider located at the Srinagar International Airport. Many records were resumed for further investigations.
The DGGI teams were led by Deputy Director of Jammu Regional Unit and Deputy Director from Chandigarh Zonal Unit of DGGI.
Directorate General of GST Intelligence (DGGI) is intelligence wing of Central Board of Indirect Taxes & Customs (CBIC), Ministry of Finance, Govt. of India. Its main obligation is to develop intelligence regarding GST evasion across India.
The bitter fact is that post abrogation of article 370 valley witnessed rampant raids by NIA, Enforcement Directorate and other law implementing agencies.



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