SGST finds large scale service tax evasion during raids on coaching classes

Gandhinagar: The State Goods and Service Tax Department (SGST) has found unaccounted transactions to the tune of Rs 42 crore and tax evasion of Rs 6 crore during raids it conducted on coaching classes being run in different cities such as Ahmedabad, Gandhinagar, Surat, Rajkot, Mehsana, Jamnagar and Junagadh.

The department has also recovered Rs 1.85 crore from the owners of these coaching institutes and also initiated the process to recover the remaining amount.

Officials have also confiscated objectionable books of accounts and documents during their raids on the coaching classes, which on investigation will likely reveal evasion of service tax on a massive scale.

The coaching class owners were able to evade the service tax net by documenting a lower amount as fee paid by the student and by not issuing any receipt against the payment. Even if they issued receipts, it was for a much lesser amount compared to the amount that was actually received as the fee from students.

The owners of coaching classes could also soon find themselves in the crosshairs of the Income Tax Department next. DeshGujarat