BHOPAL: The promoters of city-based liquor company SOM Distilleries and Breweries Limited were arrested on Thursday for alleged tax evasion of nearly Rs eight crore in the supply and sale of alcohol-based hand sanitiser. GST intelligence officers arrested company CMD Jagdish Arora, his brother Ajay Arora ( also promoter of the firm) and Binay Kumar who was working as a director. All the accused were produced before a court and then sent to judicial custody till July 24. Sanitizer production attracts 18 per cent GST, however, defaulting on tax payment, the company sold 14 lakh litres of alcohol-based hand sanitizers during Covid-19 lockdown period. They have been booked under sections 157, 158, 190 of IPC and 132 of 69 GST.
The Arora brothers were interrogated for over 28 hours before their arrest. Soon after their arrest, they complained of health issues and were admitted to ICU at JP hospital. They were taken to court after doctors declared that their health was fine.
The investigations till now have revealed that the total retail price value of clandestine removal of hand sanitizers in bottles of various sizes without payment of GST is about Rs 20 crore. In terms of volume, about 14 lakh litres of hand sanitizers appears to have been supplied to various cities in India during the lockdown period without payment of taxes.
"The total GST evasion detected till now is about Rs 7.97 crore," a statement issued on Thursday by the Directorate General of Goods and Services Tax Intelligence (DGGI) here said. This evasion quantum is expected to increase considering that a large quantity of hand sanitizers is suspected to have been supplied in drums and tankers for which investigation is under progress, it said.
A search was conducted by the DGGI officers of Bhopal zonal unit at the factory and office of SOM Distilleries Private Limited (SDPL) at Raisen Road area on June 26, the statement said. "During the search operation, it was gathered that during the COVID-induced lockdown SDPL had also manufactured alcohol-based hand sanitizers which may have been removed clandestinely without payment of Goods and Service Tax (GST) at the rate of 18 per cent," it said
Advocate Ajay Gupta, who appeared for Aroras said, “Following the outbreak of Covid-19 in the end of March, SOM Distilleries & Breweries Limited was given permission to produce sanitizers and Jagdish Arora was producing alcohol sanitizer for the last two months. The amount of tax evasion Rs 8 crore which GST intelligence is pointing out, is just peanuts in comparison to the annual turnover of the company which prepares breweries. In such a case, the general agency asks to deposit the amount and later on it will be settled.”
