The Lieutenant Governor of Delhi, V K Saxena, penned a letter to Chief Minister Arvind Kejriwal, recommending that he instruct the finance minister to initiate a comprehensive investigation into the purported Goods and Services Tax (GST) evasion within the city.
In a statement, the Delhi government denounced cases of tax evasion, highlighting its commitment to tackling the issue. Despite endeavors to develop software aimed at addressing such concerns, a proposal in this regard has remained stagnant within bureaucratic channels for nearly a year. Saxena, in his letter to Kejriwal, underscored that Delhi has unfortunately attained the dubious distinction of registering the highest instances of tax evasion nationwide.
In all, 483 bogus firms were detected which evaded Rs 3,028 crore of tax, he said. It is indeed dubious that the capital of the country tops the list of tax evasion amongst all states and union territories, with the one on the second place behind Delhi by as much as Rs 827 crore. This is a serious matter in which the possibility of collusion of officials in the GST department cannot be ruled out, the LG said.
Saxena recommended that the chief minister instruct the finance minister to conduct a thorough investigation into the issue and identify the underlying reasons for the tax evasion. He emphasized that such evasion not only reflects negatively on the state of tax administration in the national capital but also leads to significant losses for the public treasury. These resources could have been utilized for beneficial investments in the public interest, the LG added.
A Central Board of Indirect Taxes and Customs report released in January highlighted the issue of “bogus registrations and fake invoices” in the country, he said. The report for the third quarter brings out “shocking” facts about the extent of tax evasion prevailing in Delhi, he said, referring to the alleged GST evasion.
I trust that you will personally take interest in the matter and apprise me of the efforts being made to tighten the tax administration in the city, Saxena said in his letter to Kejriwal.