Tamil Nadu: ED Urges GST And Income Tax Authorities To Take Action On Large Scale Tax Evasion Done Through Illegal Sand Mining

The Enforcement Directorate (ED), which has been investigating illegal river sand mining in Tamil Nadu since last year, has now written to the income tax and goods and services tax (GST) authorities, urging them to take note of the large scale tax evasion and act against those involved, as per a report by The Hindu.

The letter, according to the report, stated that the ED had questioned M/s Kobelco Construction Equipment India (P) Ltd and M/s JCB India Limited, which are some of the well known manufacturers of excavators — the machines used in sand mining and found that they had provided 273 such machines to 16 customers in the state. 

Further, these companies were able to provide the data related to how many hours these machines were used and an estimate of how much sand was mined.

Earlier, in February 2024, The Hindu reported citing ED sources, that the agency had attached over 200 Kobelco excavators and frozen the accounts of contractors involved in the illegal mining operations.

After the statewide raids conducted in September 2023, which unearthed a large number of fake bills, QR codes and incriminating documents, the ED had roped in the services of IIT Kanpur and Indian Space Research Organisation (ISRO) to estimate the area and depth of illegal sand mining.

In an affidavit submitted to the court, the ED had mentioned that while total sale value of the sand that was mined illegally was Rs 4,730 crore, the revenue recorded was a paltry Rs 36.45 crore.

Regarding the volume and area mined, the affidavit stated that 24 lakh units were extracted illegally and instead of the permitted 195.37 hectares, 987.01 hectares were mined.

The letter to the income tax and GST authorities is a significant development as the investigation seemed to have taken a back seat after the arrest of an ED officer, Ankit Tiwari by the state’s Directorate of Vigilance and Anti-Corruption for allegedly taking a bribe of Rs 20 lakh from a government doctor.