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Illegal coal suppliers syndicate operating through bogus firm busted in Bihar
The syndicate operated through a bogus firm based in Madhubani supplying coal mined illegally to firms both in Bihar and Jharkhand.
PATNA: The commercial taxes department has busted a syndicate supplying coal mined illegally to firms both in Bihar and Jharkhand, officials said.
The syndicate operated through a bogus firm based in Madhubani making a transaction of ₹73 crore causing tax losses worth ₹25 crore, they said.
The Madhubani-based fake firm was acting as the main conduit in the syndicate of illegal coal supply to states like Jharkhand, Bihar and other states by creating a fake paper trail to dupe authorities in evading taxes, said people aware of the matter.
Investigations have revealed that the bogus firm was owned by one rural woman, who had no knowledge of the activities of the firm.
“During investigations, the woman was traced residing in a village in Madhubani and she claimed to have no knowledge of the firm she was named as a proprietor. The woman disclosed she had put a signature on some papers by a firm on the promise of getting loans. Further investigations are going on,” said a senior officer, who was part of the investigations.
Officials said investigations revealed that the syndicate was working like a well-oiled supply chain to send coal consignments from Jharkhand apparently mined illegally from coal mines in Jharkhand by generating e-way bills and fake invoices through the bogus firm in Madhubani in a bid to dupe authorities and make a fake paper trail.
“On paper, the Madhubani firm had sold coal worth ₹73 crore without any purchase showing the supply chain. These illegal coal stocks were being systematically supplied to 14 firms in Jharkhand, 2 in Bihar and one each in Uttar Pradesh, Maharashtra and West Bengal,” said another official of the department.
He said coal attracts 11.6% GST, a reason why illegal coal suppliers adopt such clandestine methods to ship coal consignments from one state to another through bogus firms to generate e-way bills (the documents necessary to ferry consignments through transporters) and fake invoicing.
Tax officials said investigations, which was being carried for the last many months, have revealed that 1,075 firms in Bihar and 1,031 firms outside Bihar have been found to have got illegal supplies of coal while a Raxaul-based firm has been identified, which is exporting goods. “ The bogus firm in Madhubani engaged in re-routing illegal coal stocks from Jharkhand to various states including Bihar was operational since November last year. This is a case of circular bill trading,” said another officer.
Commissioner cum secretary, commercial taxes department, Dr Pratima said stringent action will be taken against the firms involved in the syndicate and investigations are going on to trace the actual kingpin of the syndicate. “ We are also investigating other trails and traders showing exports to prevent fraud and tax evasion,” she said. The commissioner said the recovery of tax and other punitive action will be taken against the firms involved in the clandestine trade.
