Service tax authorities conducted searches at five city caterers on Friday, as part of their ongoing drive against errant contractors who tried to evade tax by not disclosing their actual earnings.
The authorities found that the caterers had evaded tax worth Rs. 3 crore, out of which they immediately deposited Rs. 2 crore with the department.
Service tax officials said that searches were conducted at Lakhani Caterer, Trupti Caterer, Amrut Caterer, Jyoti Caterer and Chetak Caterer across the city. “We conducted searches at the offices and residential premises of the owners in Wadala, Dadar, Byculla and Vile Parle,” said a service tax official.
Officials said these caterers had served food at lavish weddings and other important events in the city.
“During investigation, it was found that most of these caterers had carried out their transactions in cash, which they did not record in their statutory books of accounts, in order to evade tax,” the official said. He added that several documents and records of such transactions have also been recovered from these premises.
Apart from this, in the past month, the department had searched the premises of some prominent decorators who also admitted that they had evaded service tax. They paid more than Rs. 2 crore to the department. “Some of the other marriage-related service providers, including wedding planners and those who provided marriage grounds and banquet halls on rent have been surveyed for service tax compliance,” the official said.
The department initiated the drive against contractors in November 2012. Officials said that as part of the strategy, the department first identified the major venues where such lavish events were held and then obtained crucial data of their services. Investigations were then launched to unearth the tax evasion by visiting the business establishments of these contractors.
The service tax department and the Directorate General of Central Excise Intelligence (DGCEI), on February 20, had conducted searches on the decorator and caterer who had been given the contract for the weddings of NCP minister Bhaskar Jadhav’s son and daughter. Shah Construction, which funded the weddings, was also searched.