Lieutenant governor VK Saxena has asked Delhi govt to hold a detailed inquiry into goods and service tax (GST) evasions and tighten tax administration in the capital.
Referring to a TOI report published on Feb 9 that Delhi recorded an estimated GST evasion of nearly Rs 3,028 crore in third quarter of the current fiscal, highest in the country and detected 483 “bogus” firms, the LG wrote to chief minister Arvind Kejriwal advising him to direct the finance minister to assess its root cause.
“It is indeed dubious that the capital of the country tops the list of tax evasion among all states and Union territories, with the one in second place behind Delhi, by as much as Rs. 827 crore. This is a serious matter in which the possibility of collusion of officials in the GST department cannot be ruled out,” Saxena said in his letter to the CM.
Delhi govt, meanwhile, said it condemns any instances of tax evasion and is unwaveringly committed to enforcing strict compliance with tax laws, Strictest possible action will be initiated against the violators at once, it said.
“Despite our efforts, in collaboration with IIT-Hyderabad, to develop a software targeting tax evasion and improving revenue collection, we are dismayed by the fact that the proposal has been languishing among bureaucratic offices for almost a year,” a govt statement said.
“A full year has passed since the initiation of the proposal in Feb, yet it is only now that it is slated to be presented before the cabinet. This delay has only happened because of the GNCTD Amendment Act, It is imperative that we collectively prioritize upholding the integrity of the tax system and safeguard the interests of the citizens of Delhi,” It added.
Central Board of Indirect Taxes and Customs, in a report released a few weeks ago, highlighted that in the quarter ending Dec 2023, a total of 4153 bogus firms involved in suspected input tax credit evasion of around Rs. 12,036 crore were detected across the country.
As per the report, 483 bogus forms were busted in the city during the period, which were suspected to be involved in GST evasion of Rs. 3,028 crore. Delhi was third only to Maharashtra (926) and Rajasthan (507) in the number of bogus GST firms that were detected by the authorities in third quarter of FY24.
“This not only reflects poorly on the state of tax governance in the national capital, but also results in a huge loss to the public exchequer. This resource could have been meaningfully utilized for investments in public interest,” the LG said in his note.
“I trust that you will personally take interest in the matter and apprise me of the efforts being made to tighten the tax administration in the city,” he added.
Source: The Times of India
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