CENTRAL Goods and Service Tax (CGST) Department cracked a whip against a construction firm that had handled a major contract of Nagpur Metro for alleged evasion of duty of Rs nine crore. The Navi Mumbai Commissionerate of Mumbai Zone arrested a businessman who was co-venturer of M/s Pratibha CSL Sudhir Construction on grounds of non-deposit of CGST of Rs 8.5 crore. Further illegality that came to fore was that the JV firm had also claimed input tax credit of Rs 95 lakh.

The action was taken by Navi Mumbai Commissionerate, Mumbai Zone, of CGST in evasion of duty, said a release issued by Press Information Bureau (PIB). It may be mentioned that Sudhir Construction is a leading construction firm of Nagpur.

As per CGST, the JV firm had bagged a contract from Maharashtra Metro Rail Corporation Limited (MMRCL) in year 2016 for construction of Metro Maintenance Depot, on Orange Line, at Khapri. They had collected GST of Rs 8.05 crore but same was not deposited with the authorities. During the investigation it was learnt that GST was collected in the year 2018.

Apart from evading the CGST duty, the firm had also availed ineligible Input Tax Credit (ITC) of Rs 95 lakh.

As per the norms, GST collected by a tax payer has to be deposited with the exchequer within three months of collection, otherwise it is an offence under Section 132 of the CGST Act. After painstaking investigation, CGST officials arrested one of firm partners (the name was withheld by authorities) on January 27, 2022, under Section 69 of the CGST Act. He was produced before the Judicial Magistrate, Vashi, on Friday which sent the accused for 14 days judicial custody. Aside from payment of tax, interest and penalty, this offence attracts prison term up to five years.

This case is a part of anti-evasion drive launched by CGST, Mumbai Zone, against fraudsters and tax evaders who are creating unhealthy competition for compliant taxpayers and defrauding the Government exchequer. As a part of this drive, Navi Mumbai Commissionerate has so far detected tax evasion of Rs 415 crore, successfully recovered Rs. 18.63 crore and arrested 10 persons.

CGST Department is leveraging the advancement in technology to the hilt and in evasion case they are using data analysis tools to identify tax evaders.

By using data analysis and network analysis, the officers of CGST Mumbai zone have booked more than 625 tax evasion cases, detected tax evasion of Rs. 5500 crore, recovered Rs. 630 crore and arrested 47 persons, in the last five months.

A meeting was also held between senior officials of CGST Mumbai zone and Maharashtra State GST Authorities wherein both sides agreed to initiate a co-ordinated anti-tax evasion action plan against the tax evaders. A road map was also laid for identification of fraudsters and to bring them to book. Both authorities also decided to intensify their anti-tax evasion efforts in the coming days.