4th Arrest case of Service Tax in the Country

         

As per Section 89 of the Finance Act, 1994, if a Service provider collects Rs 50 lakhs or more and keeps in his own pocket without depositing with Central Govt for more than six months, such act is illegal and is punishable. The person can be convicted & imprisoned from 6 months to 1 year depending upon the gravity of the offence. The defaulter can be arrested under Section 90 & 91 of the Finance Act, 1994. This new provision of arrest has been introduced w.e.f dtd 10.5.2013.

The first arrest in Kolkata involved an amount of Rs 79 lakh, His name is Sri Sudip Das, Managing Director of a Courier Comapnay. The second one in Mumbai involved Rs 1.96 crore. The Delhi case is much bigger. This is the third case in the country on the charge of service tax collected but not deposited with the Government It was Rs 6 crore. Service Tax was collected by the company from its clients as service tax to be paid to the exchequer, but was not deposited. The Department asked  Jasjit Singh Sawhney, Managing Director of IT Firm to deposit the amount. Sawhney gave an undertaking, but failed to comply and was arrested.

Now, the 4^th case of the Country is in Chhattisgarh. The evader is M/s Vasva Engineering Construction, Bhilai, Chhattisgarh. The owner of the concern, Shri Sandeep Nair who had collected Rs 2.17 Crore from his clients but had not deposited the same with the Govt Exchequer in spite repeated persuasion from the Departmental officer of Central Excise & Service Tax Commissionerate, Raipur Chhattisgarh. Shri Nair failed to deposit the amount as assured by him and ultimately arrested on 15^th Oct, 2013. The outcome of the case & arrest is awaited.