Rajasthan govt unearths entry tax fraud by sugar traders

JAIPUR: Anti-tax evasion agencies in the state unearthed a major avoidance of

entry tax

by sugar dealers in

Jaipur and Alwar district

. Investigations are now expected to spread across state as agencies expect similar leakages in other districts.

Officials said there is an entry tax of 0.25% on sugar that comes from the states like UP, Maharashtra,

Gujarat and MP

. However, in the investigation, it was observed that some of the dealers did not register while some others, though registered, were not paying tax.

Sugar being an essential commodity is exempted from VAT. However, traders dealing in this commodity are required to pay 0.25% of entry tax when purchased from outside Rajasthan.

Sources claim that sugar of about Rs 1,263 crore was purchased by the dealers in Surajpole Mandi at Jaipur over the period of five years. However, nearly 150 dealers were found to be evading entry tax which is estimated to be Rs 4-5 crore. Added with penalty and interest, the realization is expected to be around Rs 9-10 crore.

Similarly, in Alwar district, one the major market of sugar in the state, 13 such dealers were found to be evading the entry tax. As per records, in past three years, sugar of Rs 90.74 crore was purchased by the dealers.

Commercial taxes department (CTD) will now assess tax penalty and interest and will soon send notices to evaders. "Dealers will get the opportunity to present their stand and if they failed to put any rational reasons, they will be asked to pay penalties," said an official of CTD

Agencies meanwhile have broadened their scope of investigation and are at present carrying it out in Ajmer and Bharatpur. It is likely that similar exercise will be carried out in almost all the districts of the state.