Three top executives of Vadodara-based Manpasand Beverages were arrested by the Goods and Services Tax (GST) department for creating fake company units and committing tax invasion.

Manpasand Beverages' managing director, Abhishek Singh, his brother Harshvardhan Singh and chief financial officer Paresh Thakkar were arrested by the Central GST (CGST) and Customs, Vadodara-II, according to a press release by the CGST.

The statement said that the authority carried out multi-locational searches on various premises of Manpasand Beverages on May 23.

“The searches unearthed a huge racket of creating fake/dummy units for availing fraudulent credit and committing tax evasion of Rs 40 crores and involving turnover of Rs 300 crore,” the release said.

"The continuing investigation has unearthed a network of more than 30 fake units located in various parts of the country which were used for committing fraud by availing illegal credit. The investigation regarding ultimate beneficiary of the fraud and web of shell companies is under progress,” as per the statement.

In May last year, the company announced the sudden resignation of Deloitte Haskins & Sells, the statutory auditors of the company after it failed to provide them with "significant information" on the financial results for the year ended March 31, 2018.

In a letter addressed to company's board, Manpasand Beverages Managing Director Dhirendra Singh, Deloitte Haskins & Sells said that significant information"requested by us from the company at various points of time for the purposes of audit of the financial results have not yet been provided to us".

First Published:May 25, 2019 11:18 AM IST