CGST Mumbai detects GST Evasion of Rs 40.5 Cr on commission of Wazir X Crypto Currency; recovered Rs 49.2 Cr
The Taxpayer was pursued to pay GST on commission collected in WRX coin transactions and asked to submit details of such commission collected from their customers.
New Delhi: Officers of Central Goods and Services Tax (CGST) Mumbai East committee detected Goods and Service Tax (GST) Evasion of Rs 40.5 Cr. on commission of Wazir X Crypto Currency and have recovered Rs 49.2 Cr in cash as GST, interest & Penalty on Thursday (December 30) from Zanmai Labs Pvt. Ltd.
Currently, Zanmai Labs Pvt. Ltd are managing WazirX cryptocurrency exchange application in India.
WRX platform and WazirX coins are owned by M/s Binance Investment Co. Ltd, Seychelles.
Officers of CGST Mumbai East comm’te have detected GST Evasion of Rs 40.5 Cr. on commission of Wazir X Crypto Currency & recovered Rs 49.2 Cr. in cash as GST, interest & Penalty today on 30.12.2021 from Zanmai Labs Pvt. Ltd. @nsitharamanoffc @mppchaudhary @cbic_india @PIBMumbai
— CGST Mumbai Zone (@cgstmumbaizone) December 30, 2021
WRX platform and WazirX-Trading of cryptocurrency is done in two ways:
(a) Trading in cryptocurrency by using INR and
(b) Trading in cryptocurrency by using WRX coins.
The WRX coins are required to be purchased from WazirX platform by the trader in INR. The Taxpayer is charging commission on each transaction in cryptocurrency from buyer and seller both.
The platform provides option to the trader to transact in INR or WRX coins. In cases, when the trader opts for transaction in INR, the commission charged is @0.2% of trading volume. The Taxpayer is paying GST on such commission received. However, in cases where the trader opts for transaction in WRX coins, the commission charged is @0.1% of trading volume and they were not paying GST on such commission.
The Taxpayer was pursued to pay GST on commission collected in WRX coin transactions and asked to submit details of such commission collected from their customers.
Subsequently, the Taxpayer vide their letters dated 29.12.2021 and 30.12.2021 intimated that in response to the ongoing enquiry by Mumbai East, they have discharged the GST liability on transaction fees collected on WRX transactions and paid GST amounting to Rs. 40,51,03,412/- as GST, Rs 2,59,34,207 interest and Rs 6,07,65,512 as penalty covering period from March, 2020 to Nov, 2021.
Further investigation is under process.