Hyderabad GST wing finds Rs 6,500 crore fraud in Goa, Sikkim casinos

HYDERABAD: In a covert operation launched by the director general of GST Intelligence (DGGI), sleuths from the city unearthed Rs 6,500 crore tax evasion by casinos in Goa and Sikkim .

Camping in Goa for weeks, the DGGI sleuths, who have jurisdiction to conduct raids all over the country, inspected five top casinos in Goa and one in Sikkim, and found how they undervalued Rs 6,500 crore worth transactions by splitting services.

“The casino inspection was carried out by the Hyderabad unit and was very successful,” DGGI Hyderabad zone chief Balaji Mazumdar told TOI. The tip-off came in March, Mazumdar said.

The operation that started in May continued further and it has now emerged as one of the biggest tax evasion cases, said DGGI, which also served show-cause notices to the companies which are running the casinos.

“Investigations showed that apart from splitting the betting services to ensure lower GST tariff, the casinos also paid GST on net revenue though they were supposed to pay on each transaction of a bet,” said one of the top officials who worked undercover and visited the casinos.

While in Hyderabad, the DGGI found that hotels and restaurants in the city were resorting to large-scale irregularities to evade tax, including formatting the computer hard disks every day to avoid detection.

‘They enter the dummy database for billing and at the end of each day before updating they delete several transactions and format the hard disk. Officially they show only fewer transactions so that they end up paying less GST. They have been collecting from customers, but not paying to the department,” an official added.