ANI quoted official sources as saying that the offices of several major crypto currency service providers have been raided by the officers of the Director General of GST Intelligence at various places across the country. In which a large amount of tax evasion has been detected. Earlier on Friday, GST Mumbai East Commissionerate of Mumbai zone raided the office of cryptocurrency exchange WazirX which revealed GST evasion of Rs 40.5 crore. In this raid, Rs 49.20 crore related to GST evasion was seized.
The theft came to light when the trading activities of the exchange were being probed. Which is operated by Zanmai Labs Pvt. Ltd and cryptocurrency WRX. Which is owned by Binance Investment Co. Ltd is near Seychelles.
According to the press release issued on this issue, the exchange allows traders to trade in Rupee or WRX. The trader has to buy WRX from the platform of WazirX. For this, WazirX charges commission from both buyer and seller on every transaction on cryptocurrency.
However, the commission rate is different in both these transactions. A commission of 0.2 per cent is charged on transactions in rupees. At the same time, 0.1 percent commission is charged on the transactions done in WRX. During investigation, it was found that the taxpayer (WazirX) used to earn commission from traders in the name of trading fee, deposit fee and withdrawal fee. The taxpayer paid GST only on the commission received in Rupees whereas no GST was paid on the commission received on WRX.
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Let us inform that both these types of transactions attract GST at the rate of 18 per cent. In this way, the taxpayer had evaded GST of Rs 40.5 crore. Recovered from WazirX (taxpayer) along with interest and penalty on 30th December. On-the-spot recovery of Rs 49.2 crore has been made from WazirX.
According to a press release issued by the GST Commissionerate, the officials of CGST Mumbai Zone are probing the business transactions of emerging economic sectors like e-commerce, online gaming, non-fungible tokens to detect possible tax evasion. This press release also states that the CGST department will investigate all the upcoming cryptocurrency exchanges in Mumbai zone and intensify its operation in the coming days.
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