After the trade data highlighted a glaring difference of around $12 billion in the data sourced from China and India, Tax authorities in India are investigating under-invoicing of goods imported from China
On comparison, the trade data from the two countries show invoiced imports into the country are far less than exports from China to India.
Taking cognizance of the same, the customs authorities have issued tax-evasion notices to 32 importers since September.
Tax authorities suspect a tax evasion of more than Rs 16,000 crore through under-invoicing by businesses from April 2019 to December 2020.
And more such notices are likely to be issued by the tax authorities in the coming days, according to officials sources
In a 2019 report, a US-based think tank Global Financial Integrity said that India lost a staggering $13 billion, over Rs 90,000 crore, to trade mis-invoicing and it said most of it relate to imports from China.
According to a senior government official these imports largely involve electronics goods, gadgets, and metals.
The reason attributed of under invoicing for electronic goods, gadgets, and metals is due to fact in order to encourage domestic production, the government of India has levied import duties on electronic goods and mobile phones and this increased duty has resulted in increased cases of “under-invoicing” and tax evasion from businesses to dodge customs duties.
According to the official trade data, India imported goods worth $79.16 billion from January to September 2022.
While customs data from China showed that country’s exports to India stood at $89.99 billion in the same period.
This gap has only increased over the years that is in 2019, this gap stood at $6 billion as India’s imports from China stood at $68.35 billion, while China’s data showed exports at $74.92 billion.
And again In 2020, gap increased to $8 billion in 2020 and $10 billion in 2021.
Officials however tight lipped about portwise breakup data for 30Bus$ ( equivalent to 246000 Crores Indian rupees ) gap mismatch over three years .