DGGI Meerut Zonal Unit found entity engaged in supply of Laminates to many non-existent/dummy firms having taxable value of more than Rs. 5000 crores [ITC of Rs.900 crores (approx.)]

Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes & Customs
North Block, New Delhi-110001
Tel. No. +91-11-23092849, Fax : +91-11-23092890
E-mail : ajit.m@gov.in

D.O.No.98/CH(IC)/2020

Date: 23rd November 2021

Hon’ble Union Union Finance Minister Smt. Nirmala Sitharaman visited Jammu & Kashmir on 22nd – 23rd November, 2021. Among her various programmes, she had interacted with tax administrators both of the Centre and the State. She urged the officers of both the Central Revenue Boards to work together and to be the “agents of change”. The Hon’ble Finance Minister has laid out the contours of a citizen contact program at the district level in the UT of Jammu & Kashmir. This reach out to the industry, taxpayers, citizens and especially the youth would apart from explaining the tax laws and procedures, would also be an occasion to ascertain from them their expectations from the government along with a general awareness discussion. In her words, “Service to taxpayer, service to people”. It is this that I would lay more importance on because that’s what is going to bring the people’s contact. She has desired that the outcome of this mass contact program be completed and suggestions received be submitted through the Zonal CCs to her by both the Boards, on or before December 15^th, 2021. This would help give the suggestions due consideration during the budget deliberations. The message to us is very clear and we must be pro-active in our approach to resolve citizen grievances on tax matters, if any, educate and provide requisite facilitation to them at their door steps and be a bridge to carry their suggestions onto the high table of policy deliberations. I on behalf of CBIC have assured the Hon’ble Finance Minister that we would diligently comply by her instructions.

Last week, I had the opportunity to inaugurate the CBIC’s Customs & GST Pavilion on 15^th November, 2021 at the on-going 40^th edition ‘of India International Trade Fair, 2021 (IITF, 2021). The department’s pavilion is based on the theme “Make in India” and is aligned to the IITF, 2021’s theme of `Atmanirbhar Bharat’. Many activities are being organized every day to educate the visiting members of the trade and public about various aspects of Customs and GST such as talk cum live event on Manufacture-In-Bond, which is CBIC’s flagship program for `Atmanirbhar Bharat’, Import of Goods at Concessional Rate of Duty Rules (IGCR) 2017, Production Linked Incentive (PLI) Scheme, Cross Border E-Commerce through Foreign Post Office & International Courier Terminals, etc. My best wishes to the DGTS team for putting forth a wonderful pavilion and well thought out initiatives to reach out to taxpayers and public at large.

On 15^th-16^th November, 2021, I had visited Mumbai to interact with officers & staff and review functioning of Customs operations at Nhava Sheva. It was satisfying to see the efforts put in by officers in keeping up the trade flows seamlessly in spite of the pandemic. Previously, in my letter dated 8^th November, 2021, I had mentioned about the progress made on project at the Customs Enclave at Wadala. I am happy to share that on 16^th November, 2021, Bhoomi-Poojan of an office-cum-residential complex under Phase-I was organized due to the efforts of officers of the Mumbai Customs Zone-1 under the leadership of Pr. Chief Commissioner, Shri Pramod Kumar Agrawal. I am hopeful that the project would get completed in time by 2024.

On the anti-evasion front, Raigad CGST Commissionerate had reported detection of GST evasion, based on data analytics, by wrong availment of ITC to the tune of Rs.100.75 crores in respect of Cess under the GST (Compensation to States) Act, 2017 in contravention of Section 17 (2) of the CGST Act, 2017. The formation has been able to recover Rs.100 crores as well. In another case, DGGI Pune Zonal unit reported GST evasion where the assessee was engaged in providing taxable as well as exempt supply without reversing the proportionate ITC on the exempt supplies. The entire evaded GST amount of Rs.68.67 crores was recovered.

In a big case, DGGI Meerut Zonal Unit has reported that entities were found engaged in supply of Laminates to many non-existent/dummy firms having taxable value of more than Rs. 5000 crores involving ITC of Rs.900 crores (approx.). However, the Laminates mentioned in these invoices were diverted to various pan-masala/tobacco manufacturers which resulted in clandestine purchase of laminates and clandestine production and supply of Pan Masala and Tobacco. I am told that the unit had effected recovery of Rs. 50 crores in cash along with arrest of 5 persons in total in this case. It is noteworthy that DGGI Meerut Zonal Unit has been consistently doing well in unearthing tax evaders. I am informed that during the current Financial Year 2021-22, the DGGI, Meerut Zonal Unit has booked a total of 117 Cases (GST —111 cases, ST — 6 cases) ‘involving total detection of Rs.4254.41 crores with total recovery of Rs.711.33 crores and arrests of 30 persons. My congratulations to the officers of DGGI Meerut Zonal Unit led by Shri Pradyumn Kumar Tripathi, ADG, for their efforts.

On the Anti-Smuggling front, the officers of DRI made an excellent seizure of about 85.5 Kgs of Gold at the Air Cargo Complex, IGI Airport, New Delhi, in an operation code named ‘Molten Metal’. Several Indian and foreign nationals suspected to be indulging in smuggling Gold, in the form of machinery parts, into India from Hong Kong using the Air Cargo route, have been apprehended. The recovered Gold is valued at approximately Rs.42 crores. Further investigation is under progress. The DRI Jaipur Zonal Unit detected a case where the party was unduly availing the benefits of notifications No. 57/2017-Cus and 25/2005-Cus on import of Power Adapter of Cellular Mobile Phones thereby evading payment of appropriate Customs Duty amounting to Rs.37.62 crores approximately. The assessee, so far, has deposited Rs.35 crores.

On the Administration and HR front, I am happy to share that Office Order No. 134/2021 dated 22^nd November, 2021, has been issued relating to grant of Non-Functional Selection Grade to the officers in the Junior Administrative Grade in CBIC on regular basis. The order benefits 647 officers.

The Governing Body had approved financial assistance of Rs.14.65 lakhs and Rs.20.90 lakhs from the Customs and Central Excise Welfare Fund for setting up of Guest Houses in the newly constructed building of Daman Commissionerate situated at RCP Compound, Vapi and also at Surat Commissionerate respectively.

The Hyderabad Zone has come up with its first book in a series of books intended to be released by the Hyderabad Zone on different concepts of GST for the benefit of trade. The first booklet is ‘Registrations in GST’. The PDF book is made available in the Zonal Website in vernacular and English language for ease of reference for taxpayers.

Moving on to the third quarter of the financial year, the revenue realized so far is very encouraging. With a little extra effort, we can hopefully cross the revenue realised in the previous month even though the previous month had the advantage of quarterly filers also filing their returns. The Zonal Chiefs must lead and guide the officers to gently remind all taxpayers to file their returns and deposit the due tax amount in the next few days. We had done it earlier and I am sure we can do it this month too.

Yours sincerely

(M. Ajit Kumar)

To
All Officers and Staff of Central Board of Indirect Taxes and Customs