Realty firm MD arrested for Rs 6 crore service tax evasion

The managing director of a Gurgaon -based real estate firm has been arrested after his company allegedly evaded service tax to the tune of over Rs 6 crore.
The firm -- Vigneshwara Developers Pvt Ltd -- had applied under the Voluntary Compliance Encouragement Scheme (VCES) amnesty scheme for service tax defaulters and declared tax liabilities of over Rs 6 crore, official sources said.
However, it failed to pay the mandatory 50 per cent of the tax dues before December 31, 2013. That became the grounds for the firm's Managing Director Sunil Kumar Dahiya to be arrested, the sources added.
Dahiya was arrested on Friday by the Delhi Service Tax Commissionerate and has been sent to 14 days' judicial custody, they said.

The investigation found that the firm had not paid service tax since 2010. The total service tax liability on the company was over Rs 7 crore, the sources said.
Service tax officials are also investigating the other companies run by the realty firm's promoters for alleged service tax liabilities, they said.

Repeated calls and SMSs to the company and one of its officials seeking their comments failed to yield any results.
VCES, which ended on December 31, was introduced by Finance Minister P Chidambaram for service tax defaulters to pay dues without any penalty or late payment charges.
Defaulters were given a chance to declare tax liabilities, including cess charges, for the period October 1, 2007, to December 31, 2012, and clear the same.

The declarants were mandated to pay not less than 50 per cent of their tax dues on or before December 31, 2013, and the rest of the liability by June 30 of this year.
The first-of-its-kind scheme was introduced by the Finance Minister during the 2013-14 Budget.
Evasion of service tax of Rs 50 lakh and above has now been made a cognisable offence following the passage of the 2013-14 Finance Bill on May 10 last year.
Earlier, officials did not have any powers to arrest offenders for service tax evasion.