Major Action by State GST Against Tax-Evading Businessmen

Raipur, 2 June 2025: On 31 May, the State GST Department, Jagdalpur, conducted an inspection at the business premises of M/s Arihant Steel located in Narayanpur district. Upon reaching the location, the inspection team found that no accounting records or software, such as Tally, were being maintained at the business site—despite GST regulations mandating that all such records be kept at the premises.

The businessman informed that all invoices were issued by his tax consultant, which further raised the suspicion of potential tax evasion.

The investigation revealed that from the financial year 2021–22 to 2024–25, the company had a total turnover of over ₹16 crore, but only ₹43,000 had been paid in tax in cash during this entire period.

Furthermore, during scrutiny of e-way bills, it was found that purchases worth ₹8.21 crore had been made during the same period, but no e-way bills were generated for the supply of goods. This indicates that the goods were sold directly to end consumers, but fake invoices were issued in the name of other businesses to fraudulently claim input tax credit. As a result, both the central and state governments suffered significant tax revenue losses.

During the investigation, the businessman admitted his mistakes and expressed willingness to voluntarily pay ₹10 lakh in taxes. However, GST officials demanded accounting records and other documents to support the stock found at the premises, estimated to be worth around ₹90 lakh. The businessman failed to provide any such information or documents.

In an attempt to pressure the investigation team, the businessman called in some familiar media personnel and fellow businessmen. Due to his non-cooperative behavior and the need for a detailed investigation into the tax evasion, the business premises have been sealed in the presence of local police until further proceedings.