DGGI Gurugram arrests man for defrauding exchequer

3/1/2021

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The Gurugram Zonal Unit of Directorate General of GST Intelligence has arrested a man for defrauding exchequer in excess of Rs 13.76 crore.

The arrested Pradeep Jain is the Director of M/s PSR Metals Pvt Ltd that has been found to be involved in tax fraud.

The investigation on the company found that Jain claimed to procure both old and non-guarantee batteries from various registered and unregistered dealers and also claimed to manufacture lead from old batteries and doing trading of new batteries (termed non-guarantee batteries).

In the GST regime, old/scrap batteries are taxed at 18 per cent and new/fresh batteries are taxed at 28 per cent. However, verification with their suppliers revealed that they had sold only fresh batteries to M/s PSR Metals Pvt Ltd.

Confronted with these facts, DGGI said, Jain claimed that they were also manufacturing lead from these new batteries, whereas earlier he claimed only trading of the same.

Investigation showed that it was not economically viable to manufacture lead from destroying and breaking down fresh batteries to pick miniscule lead therein.

It appeared that they were actually using bazaar scrap to manufacture such lead and was using the ITC of fresh batteries while clearing these new batteries without issuance of invoices, the DGGI investigation showed.

Jain, was thus found to have defrauded the exchequer in excess of Rs 13.76 crore by clearance of goods without issue of invoices.

He was therefore arrested on February 2 under the section 69 of the CGST Act, 2017. The Magistrate has sent him to Tihar jail for 10 days' judicial custody.

Further investigation in the matter is under progress.

Source: IANS

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