DG GST Arrests Two Companies’ MDs For Evading Tax
Congress Balkonda in-charge Sunil Reddy says GST default case under review
Hyderabad/ Nizamabad: The Director-General of GST Intelligence (DGGI), Hyderabad unit, has stepped up its crackdown on organised tax evasion, arresting the managing directors of two private firms in connection with GST frauds cumulatively exceeding `50 crore.
DGGI officials on Tuesday arrested Sunil Kumar, managing director of Orange Passenger Transport Pvt Ltd. Investigations revealed that Kumar had allegedly collected GST amounting to `28.24 crore from customers but failed to remit the tax to the government even after the lapse of the stipulated three-month period.
The agency also arrested Chethan N., managing director of Trillion Lead Factory Pvt Ltd, who is accused of masterminding a fake Input Tax Credit (ITC) racket involving `22 crore.
In a press release issued on Wednesday, the DGGI said both arrests were made under the provisions of the CGST Act, 2017. The agency stated that the cases were detected based on specific intelligence developed through advanced data analytics and inter-agency coordination.
Both the accused have been remanded to judicial custody, while investigations are continuing to trace further links in the organised tax fraud network, officials said.
The arrest of Sunil Kumar, also known as Muthyala Sunil Reddy, has triggered political discussion, as he is currently serving as the Congress constituency in-charge of the Balkonda Assembly segment. Officials said Sunil Reddy, in his capacity as managing director of Orange Passenger Transport, had collected GST from customers but failed to deposit the amount with the exchequer.
DGGI officials said inspections conducted across the state in recent weeks had led to the detection of the alleged evasion. As the GST dues remained unpaid even after the statutory deadline, the arrest was effected under the GST Act.
Chethan N., the second accused, allegedly generated fake ITC to the tune of `22 crore and passed it on fraudulently, causing significant revenue loss, officials added.
Responding to the arrest, Sunil Reddy issued a statement stating that he felt compelled to clarify the matter as a person in public life. He claimed that Orange Travels had been paying GST at the rate of five per cent on its operational buses as per prevailing norms, but alleged that GST authorities had subsequently raised the rate to 12 per cent and were demanding an additional `24 crore.
He said the issue was under investigation and expressed confidence that the matter would be resolved within the next two to three days, adding that he would continue his public service despite the controversy.