Chinese national among 3 held for tax evasion and hawala scam

Police claimed the scam was exposed after irregularities were found in the workings of Shuangma Machinery India Private Ltd, a plastic injection molding company based in Ahmedabad,  listed as a subsidiary of a foreign company, with the Registrar of Companies (ROC).

“The ROC submitted several complaints at Naranpura police station regarding certain Chartered Accountants floating Chinese shell companies by keeping Indian nationals as dummy directors to get them incorporated and later removing them from the posts to keep only Chinese nationals as directors,” said a senior police official at Ahmedabad DCB. “Then to evade tax, the companies used to show fake bill receipts and get money through the hawala system. After the complaint was lodged, an investigation was started by the DCB,” he added.

According to police, the company Shuangma Machinery manufactured machines used for molding plastic injections for which over 70% of the raw material was exported from China and export costs shown in the receipts were higher than the actual cost.

Later, the price of the machines  were intentionally shown as very low to evade GST and other taxes and Chinese directors were paid through Hawala medium.

“We found out in a probe that the accused Ping Huan was initially the general manager of Shuangma company and later was appointed as director,” said the senior official.

All accused have been booked under IPC sections 420 for fraud, 406 for criminal breach of trust,  IPC sections of forgery and IT Act.