Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
Popular Search: articles on VAT and GST in India :: cpt :: ARTICLES ON INPUT TAX CREDIT IN VAT :: VAT Audit :: TAX RATES - GOODS TAXABLE @ 4% :: empanelment :: list of goods taxed at 4% :: ACCOUNTING STANDARDS :: Central Excise rule to resale the machines to a new company :: form 3cd :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ACCOUNTING STANDARD :: due date for vat payment :: VAT RATES
 
 
News Headlines »
  Institute of Cost Accountants of India land deals under lens
 Arun Jaitley asks Income Tax Department to unearth black money at home too
 File tax returns on time
 International mutual funds may be a good bet despite new tax norms
 Instructions for filing wealth tax returns
 FM Arun Jaitley's new income tax rule has the potential to kill black money market
 Manner of distribution of common input service credit under rule 7(d) of the Cenvat Credit Rules, 2004
 CPT 2014 results declared by ICAI
 Four Websites For Hassle-Free Filing of Income Tax Returns in India
 Filing of DPT4: It has been decided to grant extension of time for the period of 2 months i.e. up to 31-08-2014 without any additional fee in terms of section 403 of the Act to enable the companies for filing of statement under Form DPT4 with the Registrar. LTR
 ITR filing: CBDT launches new tax calculator for taxpayers

Hawala trade turnover in diamond market
May, 21st 2007

Rs 5,000 crore, hawala trade turnover in diamond marketThe hawala (transfer of unaccounted money through illegal channel) trade, unearthed by the income tax (I-T) authorities during two-day raid on three `diamond traders' in Pancharatna building, is overall worth a whopping Rs 5,000 crore per annum.

Those in the market said that there are about 100 people who are operating close to 1,000 companies that imports and exports diamonds for other traders, who don't want to get into paper work.

This is known as "accommodation entry" in the trade. These companies also provide fake bills for cutting and polishing of diamonds to some traders that helps the latter in showing inflated expenditure which is then used to reduce profit and in turn tax liability. All this is done at a premium of one to two per cent that gets these people an earning of about Rs 75 crore per annum (total for all 100 people) in total cash.

Those in the market said that a large number of such companies are situated in Pancharatna, the diamond hub in Opera House. Many other companies are also functional at places surrounding the diamond market in Opera House.

Moreover, many of these 100 people, run 10 to 20 companies each. "They get economically backward people from their villages and float companies on their names," the trader said. The `traders' also make these people sign cheques in advance to avoid problems in the future.

Explaining the modus operandi, a trader from Opera House said that there are many in the business who are not interested in doing paper work for import and export of diamonds, for obvious reasons of tax evasion. "Some traders go to Antwerp and place orders for import of rough diamonds. But as they don't want to get into paper work, the diamonds are imported on the name of some of these 1,000 companies," the trader said.

He added that the original importer then collects the delivery of rough diamonds here and sell it in the local market, as he is not interested in polishing and exporting the same. "The same `company' then utilizes this import, shown in its accounts book, to export polished diamonds for some other trader who also doesn't want to get into paper work," the trader said.

Those in the market said that these people do the import and export on the name of more than one company so that the profit gets divided.

"With this they show minimal profit in the lowest slab that doesn't attract tax or escape by paying minimum tax," the trader said. He added that these people run a company for one to two years and then shuts down the same to avoid attraction of tax authorities.

The companies are then opened on different names using different people from villages. Those in the market said that many of these 100 `traders' had come to Mumbai in poor conditions some years back, and stayed alongwith other people in one-room flats in far off suburbs. "But today they play in crores," said another trader.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2014 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Integrated Software Solutions Integrated Software Development Integrated Software Services Integrated Software Solutions India Integrated Softw

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions