Agra, Uttar Pradesh: The Special Investigation Branch (SIB) of the State Tax Department has uncovered alleged tax irregularities at a shoe factory in Shahganj, Agra, including purchases worth ₹46.96 lakh shown from allegedly bogus firms and an input tax credit (ITC) claim of around ₹8.45 lakh.
A physical verification of the factory’s stock also reportedly found a discrepancy of nearly ₹90 lakh between the inventory recorded in the books and the goods available at the premises. Following the departmental action, the trader deposited ₹6 lakh in tax, while further statutory proceedings are underway.
SIB Flags Irregularities At Shahganj Shoe Factory
The investigation was initiated against M/s Holy Max Shoe Factory, located at Prakash Nagar on Bhogipura Road in Shahganj. The firm is involved in the manufacturing and sale of footwear.
According to the State Tax Department’s findings, the firm was identified for investigation through data analysis. Officials detected unusual patterns in its purchase, sales and tax-payment records, prompting a detailed examination of its transactions.
The department found that the firm’s turnover had been increasing continuously, but its cash tax payments did not appear proportionate to its reported sales and value addition.
ITC Claim Linked To Alleged Bogus Firms
The investigation reportedly found inward supplies worth ₹46.96 lakh shown from firms that the department identified as non-existent or bogus.
Based on these purchases, the firm allegedly claimed around ₹8.45 lakh in ITC.
Officials also examined compliance with the one-per-cent cash payment requirement associated with Rule 86(B) and reportedly found irregularities.
The department further found that e-way bills corresponding to certain inward supplies exceeding ₹50,000 were not available in the records.
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GSTR-3B And E-Way Bill Records Show Differences
Investigators also detected discrepancies between outward supplies declared in the firm’s GSTR-3B returns and supplies reflected through e-way bill records.
These differences, along with the suspected bogus purchases and ITC claims, prompted the SIB to conduct an on-site inspection.
The team inspected the factory on September 2 and physically verified the stock available at the premises.
₹90 Lakh Stock Discrepancy Found
The physical verification reportedly revealed a difference of around ₹90 lakh between the stock recorded in the firm’s books and the stock actually found at the factory.
The State Tax Department is examining the reasons for the discrepancy and whether it is connected to the other irregularities identified during the investigation.
Purchase and sales records, ITC claims, e-way bills, tax returns and physical inventory are being examined to determine the firm’s actual tax liability.
Trader Deposits ₹6 Lakh In Tax
Following the departmental action, the trader deposited ₹6 lakh in tax.
However, the payment does not conclude the proceedings. After completing its examination and determining the actual liability, the department may initiate further proceedings involving tax, interest and applicable penalties under the law.
Questions Over Other Goods In 225-Kg Silver Seizure
Separately, another State Tax Department action in Agra has raised questions over the examination of other commercial goods found in a passenger bus carrying a large quantity of silver.
On September 3, a Radhika Travels bus was intercepted at Sainya toll plaza, where officials reportedly found around 225 kg of silver, along with hardware, medicines, auto parts and clothing.
While the silver became the primary focus of the seizure, questions have emerged over whether the other commercial goods were also examined for invoices, e-way bills and other prescribed documentation.
Tax Documents For Commercial Goods Under Scrutiny
Commercial goods transported under applicable tax rules are required to be supported by prescribed documentation. Where goods are found without valid documents or with discrepancies, tax and penalties can be determined according to the applicable provisions.
The presence of substantial quantities of hardware and auto parts therefore makes verification of their source, invoices and tax records relevant to the broader enforcement action.
The extent of document verification and whether any discrepancies were detected in these goods remains a matter of scrutiny.
Two Agra Cases Highlight Different Tax Enforcement Issues
The two cases involve different enforcement concerns.
The Holy Max Shoe Factory investigation began with data analysis that reportedly identified suspected bogus-firm purchases, an ITC claim and discrepancies in stock and tax records. The silver seizure, meanwhile, has raised questions over the examination of other taxable goods being transported in the same vehicle.
Further investigation and statutory proceedings will determine the final tax liabilities and whether additional violations or individuals emerge.
What This Means For You: The case shows why businesses need to maintain accurate purchase, sales, stock and e-way bill records. Discrepancies between tax returns, transaction records and physical inventory can trigger detailed departmental scrutiny and potentially lead to additional tax, interest and penalties.
The420 Insight: The shoe factory case stands out because several warning signals reportedly appeared together suspected bogus purchases, ITC claims, e-way bill gaps and a major stock discrepancy. For tax authorities, combining data analysis with physical verification can help uncover irregularities that may not be visible from returns alone.
About the author — Ananya Aradhya writes on cybercrime, fraud, scams, cybersecurity, digital safety, and emerging threats. Her work also covers major criminal cases, financial frauds, consumer scams, and stories that highlight risks affecting people in the real and digital world.
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