GST authorities detect 960 crore of tax evasion by tobacco and pan masala makers

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NEW DELHI: The General Directorate of GST Intelligence (DGGI) has unearthed a tax fraud that is worth ??960 crore in two cases involving an underground supply of tobacco products and pan masala, according to an official update.

In one of the cases, DGGI officials in Jaipur detected ??870 crore of escape through the clandestine manufacture and supply of tobacco products.

The case involved issuing GST invoices to non-existent companies and one person has so far been arrested, the Central Council for Indirect Taxes and Customs (CBIC) said in an update on its website. In that case, ??10 crore was recovered by the authorities.

In another case, DGGI officials in Ahmedabad detected a case of clandestine production and supply of pan masala and scented tobacco products. This case concerns an alleged tax evasion of approximately ??90 crore, depending on the update. In that case ??25 crore was recovered, the CBIC said.

Tobacco products placed in the 28% GST bracket also attract a tax, making it an item of interest to tax evaders. Analysis and sharing of data between various regulatory bodies helps authorities detect cases of tax evasion.

Since the GST is a tech-heavy tax system, it is difficult for offending companies to keep all of their transactions out of the sight of tax authorities because part of the supply chain will be in the spotlight. .

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