CCS books Ex-CS Somesh Kumar, four others in Rs. 1400 crore GST evasion

HYDERABAD: Ravi Kanuri, Joint Commissioner (CT) of the Central Computer Wing, Hyderabad, lodged a complaint against former chief secretary Somesh Kumar and two senior officers for alleged GST violations on Friday. The allegations stem from unauthorized data transfers and substantial tax evasion amounting to over Rs 1,400 crore.
The complaint implicates IIT Hyderabad, Plianto Technologies Private Limited, and assistant professor Sobhan Kumar in a sophisticated scheme. Preliminary verifications of 11 masked cases by IIT Hyderabad revealed tax evasion of over Rs 400 crore. Additional fraudulent cases in the state led to over Rs 1,000 crore in losses. These findings pointed to a criminal conspiracy involving data masking, unauthorized jurisdiction changes, and improper handling of taxpayer information.
IIT Hyderabad and Big Leap Technologies face scrutiny
The investigation identified a significant fraud involving Big Leap Technologies, which provided manpower supplies. The company allegedly passed on input tax credit worth Rs 25.5 crore without paying taxes. This action caused substantial losses to the state exchequer.
IIT Hyderabad was engaged by the Commercial Taxes Department to develop software and perform data analytics. However, basic discrepancies, such as those found in Big Leap Technologies’ audit, did not appear in IIT Hyderabad’s reports. An officer visited IIT Hyderabad on December 26, 2023, and identified several issues. These included undocumented software changes and oral instructions from Somesh Kumar.
Further inquiries revealed that proprietary data from the Commercial Taxes Department was accessible to a third party. Unauthorized changes in taxpayer jurisdiction also occurred. These changes often favored taxpayers with favorable advance rulings.
Authorities sought explanations from S.V. Kasi Visweswara Rao, Siva Rama Prasad, and Plianto Technologies Private Limited. These individuals cited instructions from Somesh Kumar as their authority. They provided formats to IIT Hyderabad for capturing discrepancies but were unsure why IGST and Cess notices were not generated.
A forensic audit by CDAC revealed significant deficiencies. Hardcoded taxpayer IDs and employee IDs were found in the system, along with data connections to a third party. Additionally, evidence showed reports generated from IIT Hyderabad’s server were shared in a “Special Initiatives” WhatsApp group, linking the group to the fraudulent activities.
High Court dismisses writ petitions in GST fraud case
The WhatsApp chat history revealed discussions about not canceling fraudulent registrations and estimating IGST losses. Based on these findings, authorities seized mobile phones from key individuals. The High Court dismissed their petitions against these seizures, directing authorities to follow due process under the TGST Act, 2017.
IIT Hyderabad responded to the audit findings, stating that all developments followed departmental guidelines. However, discrepancies in the software and unauthorized modifications persisted. A comprehensive forensic report from CDAC confirmed these issues, identifying systematic exclusions of certain cases and unauthorized third-party data access.
Further investigations revealed that employees working on these projects were on the rolls of Plianto Technologies, not IIT Hyderabad. This contradicted previous statements from Plianto Technologies. Moreover, a forensic report indicated the unauthorized transfer of proprietary data to a third party.
The investigation continues as authorities probe the full extent of the fraud. They aim to hold accountable those involved, including Somesh Kumar and other key figures in the WhatsApp group. The case highlights significant lapses in the system and calls for stringent measures to prevent future occurrences.