Tax evasion by Mumbai-based gold businessmen

Berhampur: Tax evasion in gold ornaments trading by Mumbai-based businessmen has come to light in this south city with the commercial tax wing of the vigilance collecting around Rs 62 lakh as fine from a trader.

"The vigilance department collected Rs 61,75,295 towards one per cent Value Added Tax (VAT), one per cent Entry Tax and 30 per cent fine for tax evasion from one Rajendra Kantilal Jain recently," SP (Vigilance) Berhampur J N Hansdah said.

Vigilance sleuths had seized about 10 kg gold ornaments, worth about Rs 2.68 crore from him at Bada Bazar area here early this month as the Mumbai trader failed to show any receipt on payment of entry tax and VAT, he said.

Since he could not show any tax receipts, he had to pay the fine to release the gold ornaments, said a vigilance officer. After payment of the amount of the taxes and the fine, the seized ornaments were handed over to him, he said.

Berhampur is one of the centres of gold business in the state. Gold traders from Bullion Market in Mumbai and several other places came to here to supply the local traders without paying the relative taxes towards their commodities.

Over 100 jewellery shops are in the town presently. Berhampur Jewellers Association (BJA), however, denied the allegation of the Mumbai based traders supplied the gold ornaments to them in cheaper rate without taxes. "We received the products from them with all taxes paid," president of BJA P Satyanarayan Senapati said.