After Maharashtras Commercial Taxes Department, Karnataka CT sleuths raided ceramic units in Morbi on Thursday in connection with a C Form scam to evade Value Added Tax (VAT), said Customs and Excise Department officials.

The first such raid was conducted by the Gujarat Commercial Taxes Department in September, which led to revelation of VAT evasion to the tune of Rs 7 crore by six units. The raid was conducted following information that C Form, which shows VAT was paid, had been forged. The department had sent teams to check documents of the units for at least last three years.

Officials from Maharashtra and Karnataka are investigating into deals related to their states, officials said. While details of the two latest raids are not available yet, sources say the figure may shoot up considerably as over 300 ceramic units operate from Morbi and Than, located on the border of Rajkot and Surendranagar districts.

The annual turnover of these units is estimated to be Rs 8,000 crore.