DGGI initiates search operations on manufacturers supplying goods without paying tax in Kanpur

Ahmedabad (Gujarat) [India], December 24 : After receiving information about manufacturers supplying goods without payment of applicable tax, Ahmedabad's Directorate General of GST Intelligence (DGGI) with the support of officers of local Central GST initiated search operations in Uttar Pradesh's Kanpur on Wednesday and seized Rs 1.01 crores.
According to an official statement issued by DGGI, the search operations covered the factories which manufacture pan masala and tobacco products as they were involved in such transportation of goods.
"The transporter reportedly used to generate multiple invoices in the name of non-existent firms, all below Rs 50,000 for one full truckload, to avoid the generation of E-way Bills while moving the goods. The transporter was also collecting the sale proceeds of such clandestine supply in cash and handing it over to the manufacturer, after deducting his commission," the statement said.
Initially, the officers were able to successfully intercept and seize four such trucks outside the factory premises, cleared from the factory without invoices and E-way Bills, which confirmed the contents of intelligence.
In the factory premises, during physical stock-taking, a shortage of raw materials and finished products were noticed as the finished products had been cleared clandestinely. The authorised signatory of the company has admitted to having cleared the goods without GST.
In the premises of the transporter, more than 200 fake invoices used in the past for transportation of goods without payment of GST have been recovered and he has also admitted that goods were being transported without e-way bills under the cover of fake invoices and also the sale proceeds were being collected in cash, to be handed over to the manufacturer.
An amount of Rs 1.01 crores in cash has been seized from the possession of the transporter.
Based on the intelligence inputs, the residential premises of its partners supplying perfumery compound in Kanpur, mostly in cash, to the said company was also searched. It was suspected that the sale proceeds in cash were secreted in the premises.
During the search proceedings at the residential premises, a huge amount of cash, wrapped in paper, has been found. The process of counting cash has been initiated with the help of officials of the State Bank of India, Kanpur, which may continue till December 24, evening.
The total amount of cash is expected to be in excess of Rs 150 crores.
The agency proposes to seize the cash under the provisions of section 67 of the CGST Act, pending further investigations.
An amount of Rs 3.09 crores has been recovered so far towards tax dues, the statement added.