GST investigation arm unearths Rs 40 cr tax evasion by pan masala/gutkha mfg unit

The GST investigation arm DGGI unearthed Rs 40 crore tax evasion by an unregistered pan masala/gutkha manufacturing unit in the national capital. Even as manufacturing, storing, sale and distribution of gutkha is banned by the Delhi government, data from seized documents revealed that the unregistered factory was carrying out operation even during the lockdown period.

Based on specific intelligence input, the Directorate General of Goods and Service Tax Intelligence (DGGI) carried out searches in the company's manufacturing unit, an official statement said. "Searches were conducted at various places on June 25, 2020, including the unregistered factory, godowns and residence of main beneficiary.

"During the search, incriminating documents and electronic devices pertaining to the supply of pan masala/gutkha without payment of taxes and duties were recovered. Preliminary investigation in the case has revealed the evasion of more than Rs 40 crore till now," the statement said.


The main beneficiary of the unregistered pan masala/gutkha factory was arrested on June 27, 2020 under the provisions of CGST Act, 2017, and placed under judicial custody of 14 days. Further investigation in the case is still under process, the statement added.