Mohali: 2 excise officers, steel industrialist awarded three-yr RI for tax fraud

A local court has awarded three-year rigorous imprisonment (RI) to two excise and taxation officers (ETOs) for misusing their position to help the owner of M/S Gupta Iron and Steel Industry Mandi Gobindgarh, in fraudulently procuring a Sales Tax Number and Taxpayer Identification Number (TIN) for his firm in 2005.

The special vigilance court of Manjot Kaur also awarded three-year-RI to Vikas Mittal, the owner of the firm, for committing forgery.

While the court held Mittal guilty under Sections 465, 468, 471 and 120-B of the Indian Penal Code (IPC), the court convicted excise and taxation officers SK Aggarwal and Manjit Singh guilty under Section 13 (2) of the Prevention of Corruption Act. The accused were booked by Punjab Vigilance Bureau under Sections 409, 420, 467, 468, 471, 120-B, and 201 of the IPC and Section 13(i)(d) read with Section 13(2) 88 of the Prevention of Corruption Act on July 5, 2006.

As per the Vigilance Bureau’s report, Vikas Mittal of Bishan Nagar, Patiala, by forging and fabricating documents, had moved an application at the office of the excise and taxation department, Mandi Gobindgarh, for the registration and issuance of Sales Tax Number and TIN for the said form.

Manjit Singh, ETO, had recommended the case, on the basis whereof a Sales Tax Number was allotted to the said firm. He had recommended the case even when Mittal had provided wrong information to the department in his application. The house number provided by him as his residential address was found not to exist.

After suspecting major tax evasion and suspicious operations of the firm, the excise and taxation department directed excise and taxation officer SK Aggarwal to take action and submit a report regarding the large-scale tax evasion committed by the firm during the year 2005-06 in sale and purchase of goods outside the state.

However, Aggarwal did not take any action, and on the contrary, upon an application moved by the firm for the cancellation of its registration, on February 7, 2006,accepted the application upon a verification conducted by Paramjit Kaur, inspector excise and taxation, by way of his orders, according to which, “May cancel the RC under both the acts and framed up to date assessment”.

Aggarwal cancelled the registration of the firm without making any assessment regarding the tax to be paid by it and also did not make any efforts to recover tax from the said firm to the tune of ₹53.45 lakh, which was due to be paid to the department.

Mittal, according to the Vigilance Bureau, on the basis of the Sales Tax Number and TIN allotted to him by the excise and taxation department, furnished returns using false documents by showing his business transactions with firms situated outside and within the state, including the ones which either did not exist or with the ones he had no business transaction records with, including M/S Swastica Enterprises New Delhi, M/S Tanshika Sales Corporation, M/S Forgo Foundry and Engineering Meerut.

Pronouncing the sentence, the court observed, “There is ample evidence in this case to show that accused Manjit Singh did abuse his position as a public servant and as a corollary to which it would follow that such a position was abused by him for some illegal gratification from accused Vikas Mittal. On the other hand, even when the higher authorities had directed accused SK Aggarwal to recover the tax due from the said firm, he neither gave any reply to the department nor took any action.”