Excise and taxation department of Ludhiana seems to be not taking the issue of multi-crore fraud seriously in which nearly 100 cycle companies sold their goods in Uttar Pradesh and Bihar and allegedly forged the documents to show that the goods were exported to Nepal to get more refunds.
After the wrongdoing was detected on June 20, the department deputed an assistant excise and taxation commissioner (AETC) to look into the matter and so far, only one cycle company, SK Bikes, has returned the extra refunds claimed by it.
The companies had claimed a refund of 6% tax (4% VAT and 2% central sales tax (CST)). The entire 6% is refundable only in case the goods are exported to Nepal and 4% in case they are sold in other states within the country. The companies forged documents to show most of their goods being exported to Nepal.
Darbara Singh, who is the AETC, Ludhiana 1, and the inquiry officer into the case, said, “A sum of Rs 2.5 lakh had been returned by SK Bikes,” said Singh.
Interestingly, while the excise commissioner based in Patiala, Anurag Verma, says that the inquiry was underway to identify all the erring companies, the local officials were reluctant to call it a fraud. Darbara Singh said that it was an ongoing process and no inquiry was going on in the case.
On the other hand, some industrialists have demanded that a full-fledged inquiry committee, including industrialists, should be formed to look into the case. “The state government should form a inquiry committee to look into the issue,” said Badish Jindal, national president of Federation of Associations of Small Industries of India (FASII).
There are around 150 cycle and cycle parts exporters in Ludhiana, which export worth Rs 850 crore annually. Of the 100odd firms that indulged in the wrongdoing, around 75 had never done any international export earlier, source said.