Gujarat GST Department Uncovers ₹3.53 Crore Tax Evasion by B2C Entities after Raids
Gujarat GST Department exposed Rs. 3.53 crore tax evasion by seven B2C entities through raids, uncovering concealed sales, fake invoices, and unaccounted stock
The Gujarat State Goods and Services Tax ( GST ) Department uncovered tax evasion worth Rs. 3.53 crore after conducting raids on November 16, 2024. The raids targeted seven businesses selling directly to customers ( B2C ) and found they were hiding income, underreporting taxes, and issuing fake invoices. According to The Week, the searches occurred in Ahmedabad, Waghai in Dang district,...
The Gujarat State Goods and Services Tax ( GST ) Department uncovered tax evasion worth Rs. 3.53 crore after conducting raids on November 16, 2024. The raids targeted seven businesses selling directly to customers ( B2C ) and found they were hiding income, underreporting taxes, and issuing fake invoices.
According to The Week, the searches occurred in Ahmedabad, Waghai in Dang district, and Nadiad in Kheda district. The department found multiple cases of malpractice during these inspections.
The salon in Nadiad was caught hiding sales and not paying the correct amount of tax. Despite being on a simple tax plan (composition scheme), it illegally collected extra customer taxes. The total tax evasion was over Rs. 53 lakh.
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Two battery dealers in Ahmedabad were selling imported batteries without issuing invoices. Large amounts of unaccounted stock and sales were discovered leading to a tax evasion of more than Rs. 92 lakh.
Four tobacco dealers in Waghai were found to have unreported stock and sales. The total tax evasion by these dealers was Rs. 2.08 crore.
How the Fraud Happened? Businesses issued fake or no invoices to hide their sales. Many goods and sales were not recorded in their official accounts. The Nadiad salon collected extra tax despite being on a simplified GST plan.
The GST Department has started legal proceedings to recover the unpaid taxes. Officials are also increasing checks on other businesses in the B2C sector which is likely to cause such fraud.
Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here
This discovery is part of Gujarat’s broader efforts to fight tax fraud. In another recent case, GST authorities found tax evasion worth Rs. 19.5 crore in the copper trading industry. Fourteen businesses in cities like Surat, Rajkot, Bharuch, and Vapi were raided after receiving intelligence reports.
Authorities arrested Sandeep Anwar Virani, a partner at Fortune Copper Industries in Surat, for his role in the scam. Investigators found fake transactions and uncovered total tax evasion of Rs. 48 crore across these firms, with four companies identified as completely bogus. To prevent further losses, the GST Department blocked Rs. 1.90 crore in tax credits and attached assets worth Rs. 22.98 crore.
This raid is part of a national effort to stop fake GST claims. Over 73,000 companies were investigated across India for using fraudulent transactions to misuse GST credits. In October 2024, the GST department discovered a network of over 220 fake companies involved in fraudulent GST claims causing huge losses to the government.
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