Rourkela: A largescale tax evasion racket in the construction of carriages of heavy cargo vehicles has come to light in and around Rourkela, sources said Friday. Though the vehicles are purchased and modified in Odisha, the Goods and Services Tax (GST) filings are being done in neighbouring Jharkhand, thereby resulting in significant revenue losses for the Odisha government.
According to sources, agencies building carriages for heavy vehicles like trailers, tankers, trucks, tippers, and tractors are required to obtain trade licenses. Additionally, certifications from the Automotive Research Association of India (ARAI) in Pune are mandatory for ensuring structural safety and compliance.
However, in Rourkela and nearby areas, very few agencies are officially registered. More than 100 garages operate in localities such as Vedvyas, Kalunga, Kuanrmunda, Rajgangpur and along the main road, offering heavy vehicle carriage-building and body modification services. While the work demands skilled technicians, necessary infrastructure and compliance with safety norms such as the use of specified-grade iron and adherence to weight limits, many unlicensed garages with untrained workers are carrying out the work flouting regulations in place.
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Notably, GST is applicable on the fabrication of heavy vehicle carriages and bodies. Ideally, the state government should receive this tax. But in practice, GST registrations for these operations are being carried out in Jharkhand.
Despite the labour and raw materials being sourced from Odisha, the 28 per cent GST levied per vehicle body is benefiting neighbouring Jharkhand instead. Owing to this ongoing cross-border GST fi ling loophole, Odisha is losing out on crores of rupees in tax revenue annually. Despite being aware of the matter, the state Transport department has allegedly remained silent, according to sources. A truck buyer, speaking on condition of anonymity, claimed that a racket is operating across Odisha and Jharkhand, involving fraudulent individuals who are fabricating truck bodies and evading GST.
As per the allegation, truck bodies or carriages are manufactured in Rourkela and then sent to Jharkhand at lower prices. GST fi lings are then carried out in that state, using the prepared documents to register the heavy vehicles. These documents are later submitted at the Rourkela Regional Transport Office (RTO) to obtain fitness certificates for the vehicles, the buyer said. When contacted, Rourkela Regional Transport Officer Bibhav Bhanjan Samantsinghar stated that only four to five garages in the city are authorised to manufacture truck carriages and bodies.
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Additionally, a separate license has been granted to the private garages in Vedvyas. The Motor Vehicles Inspector (MVI) team issues fitness certificates only after proper inspections, he added. Samantsinghar also noted that vehicle registration in other states leads to revenue loss for Odisha, but no formal complaint regarding such a racket has reached the department so far. “If any such complaint is received, appropriate action will be taken,” he said. Rourkela GST Enforcement department’s Deputy Commissioner Jagdish Sa, when asked about the matter, said no such complaint has come to their notice. “If such tax fraud is occurring, it would be subject to investigation,” he added.
