The Central Excise, Customs and Service Tax Department on Tuesday arrested the director of an engineering firm on charges of evasion of service tax. The arrested person has been identified as Salim Sheikh alias Abdul Rauf, director of Kalsskone Engineering Private Ltd, located on Doiraiswamy Iyer Road here.
This is the first arrest in a service tax evasion case in the state. “Preliminary investigation revealed that Klasskone Engineering, which provides finishing services to buildings (interior and exterior) collected service tax of around `1 crore but had not remitted the same to the Exchequer,” Customs Commissioner K N Raghavan said in a press release.
The commissioner said that Voluntary Compliance Encouragement Scheme (VCES) for service tax was operational till December 31, 2013. “Service providers who have evaded payment of service tax can avail the liberal benefits offered under the scheme, provided they make an honest declaration before December 31. The department has gathered credible intelligence regarding tax evasion by various service providers. Defaulters will have to face stringent action,” Raghavan said.
The arrested person was produced before the Chief Judicial Magistrate (Economic Offences) and was remanded in custody for 14 days.
A team of officers including Additional Commissioner K C Johny, Assistant Commissioner (Preventive) V Pazhaniyandi, Superintendents Joffe Jose, Thara Divakar, Raghukumar and Padmarajan Nambiar and Inspectors Vivek V, Albert George, Jayan K G, Sreejith and Sandeep Unnikrishnan, carried out the arrest.