Crackdown on defaulters unveils over Rs 2,600 cr tax evasion

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Financial intelligence agencies have detected tax and duty evasion of over Rs 2,600 crore in the last quarter.  (Reuters) Financial intelligence agencies have detected tax and duty evasion of over Rs 2,600 crore in the last quarter. (Reuters)
SummaryIn addition to crackdown on tax evaders, the DRI has seized contraband worth Rs 504.39 crore.

Coming down heavily on tax defaulters, financial intelligence agencies have detected tax and duty evasion of over Rs 2,600 crore in the last quarter ended December.

The Directorate General of Central Excise Intelligence (DGCEI) and Directorate General of Revenue Intelligence (DRI) – two lead financial intelligence agencies under the Revenue department – have detected service tax and central excise and customs duties evasion of Rs 2,670.51 crore and recovered over Rs 880 crore from various defaulters during the period.

In addition to crackdown on tax evaders, the DRI has seized contraband worth Rs 504.39 crore which was attempted to be smuggled into or out of the country.

The agency detected 143 cases of customs duty evasion to the tune of Rs 701.17 crore during Oct-Dec 2012, Director General of DRI, Najib Shah said.

As many as 62 persons were arrested under the Customs Act, 1962 by DRI alone in this quarter on charges of evasion of customs duties, he said.

"Customs duties to the tune of Rs 369.34 crore were recovered by the DRI in the third quarter of the current financial year which is more than the total recoveries of Rs 362.04 crore made in the last financial year," Shah said in a press release giving details of DRI's performance.

Investigations are also underway in cases of misuse of exemption notifications and undervaluation of imports involving evasion of customs duty of more than Rs 1,000 crore by the DRI, he said.

Another stringent action taken was preventive detention of 13 persons under the COFEPOSA (the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act) ,1974 in FY 2012-13 (up to December 2012).

A person can be detained for a year with a view to, inter-alia, prevent him from smuggling goods or abetting in smuggling of goods under COFEPOSA.

The trends of smuggling indicate gold smuggling not only by way of outright smuggling but also through commercial manipulations including misuse of Free Trade Agreement with Thailand, the official said.

Other trends in outright smuggling include smuggling of Fake Indian Currency Notes (FICN) from Bangladesh, Heroin from Pakistan across the Indo-Pak Border, hashish from Nepal, miscellaneous contraband like cigarettes, scotch whiskey, branded shoes, Ozone depleting refrigerant gases, branded shoes etc from China, smuggling of high end watches from Europe etc, he said.

Red Sanders, an endangered species of sandalwood much in demand in China and Japan, continues to

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