On Friday, July 14, the Goods and Services Tax (GST) Department conducted raids at around 20 shops at SM Street, Jaffer Khan Colony and Thiruvannur in the Kozhikode city of Kerala over alleged tax evasion. The raids came after the GST department officials noticed irregularities involving around Rs 27 crore in the said 20 shops.
All twenty shops are owned by three Kozhikode residents: KS Ashraf Ali, his wife Noor Jahan, and Shebir. They had been running the stores in collaboration with others. A raid was also carried out at the home of K Abbas, one of the partners, in Manjeri.
The raids on shop owners’ houses occurred at about 8.30 AM on Friday. Four residences in Kozhikode and one in Malappuram were raided. The raids on the shops began around 10 AM.
TA Ashokan, Joint Commissioner of GST Intelligence, Kerala North Zone, and Shijoy James, intelligence officer, Kozhikode unit, led the raid. The team included officials from the districts of Ernakulam, Palakkad, Kozhikode, Malappuram, Wayanad, Kannur, and Kasaragod.
Reportedly, some local shop owners locked some of the officials inside a shop on SM Street on Friday during the raid. A Manorama report said that six officials were locked inside the shop. Eventually, the police intervened and then the vendors ensured cooperation.
Meanwhile, Mathrubhumi reported citing an official that they were locked inside the shop for 30 minutes and the shutters of the shop were opened only after the local police intervened.
“They pulled down the shutters, locking us inside within 30 minutes of the raid. Following this, the Town Police arrived at the spot and with their timely intervention, the traders opened the shutters,” the official said.
“At SM Street, there were some arguments between traders and GST officials. However, the issue was resolved after we showed the evidence we had gathered over the last two months,” T A Ashokan explained.
Meanwhile, the representatives of the Kerala Vyapari Vyavasayi Ekopana Samiti (KVVES) dismissed the reports about locals locking up GST officials.
“As it was Friday, we had to go to the mosque. So we downed the shutter and informed the officials that we would cooperate with the raid after returning from the mosque”, a KVVES member said.
The operation of the establishments was brought to the attention of State GST officials when it was revealed that the state tax was not paid despite the establishments having a turnover of several crores. The shopkeepers claimed to have purchased products from Gujarat and Rajasthan. They also stated that the GST was paid in the states where the products were bought.
Their owners kept a list of what they sold to each other and showed it to the officials to divert their attention. Nobody had to pay the taxes in the end.
Fourteen teams were deployed for the raids in Kozhikode. Each team consisted of at least five officials of the state GST department. The officials gathered information pertaining to the financial transactions and sales from the establishments in question and their proprietors.