Over 100 trucks of cancer-causing areca nuts likely reached Delhi: GST Officials - India Today

The Central Goods and Services Tax (CGST) Department in Maharashtra, which recently busted a major smuggling racket of substandard areca nuts from Indonesia, has flagged concerns that over 100 trucks carrying more than 2,500 tonnes of the illicit consignment could have already reached a distributor in Delhi.

According to officials, the contraband -- identified as substandard and unfit for consumption due to cancer-causing elements -- may have subsequently entered the supply chain of pan masala manufacturers.

Investigators suspect that after arriving in Delhi, the distributor could have supplied the areca nuts to multiple pan masala companies, raising alarms over potential health risks and regulatory violations.

The CGST Department has intensified efforts to trace the movement of the trucks and identify the manufacturers who may have procured the smuggled stock. Further details on the supply trail and possible enforcement action are awaited.

The officials' statement came in the wake of a recent seizure of 11 trucks in Maharashtra’s Raigad district. Sources said the intercepted consignment may be just “the tip of the iceberg”, signalling that the smuggling network could be far larger than initially detected.

According to sources, GST registrations used for the alleged supply chain belonged to two Karnataka-based firms -- NN Traders and SRS Traders. The proprietors of both firms are suspected to be from below-poverty-line backgrounds, possibly acting as dummy operators, sources said.

Investigators have identified two suspects believed to be the masterminds, one Kader Khan from Kasargod in Kerala and Sameer Khan from Mangaluru in Karnataka.

Substandard Indonesian areca nuts are prohibited for sale, distribution, and use in products such as pan masala and gutkha, due to proven cancer risks. Multiple agencies, including Customs, the Directorate of Revenue Intelligence (DRI), and the Food Safety and Standards Authority of India (FSSAI), monitor and block the contraband supply chain.

Sources further claimed that smuggled consignments were routed through southern states, brought to Mangaluru for chemical polishing, and then moved via rail to Raigad before being ferried by road to Nagpur and onward to Delhi, National Capital Region (NCR), as well as Uttar Pradesh-based distribution channels.

THE SEIZURE

On November 26, the officials intercepted and seized around 111 trucks that had arrived at Raigad rail corridor from Mangaluru. The trucks carried consignments weighing approximately 2,500 tonnes, worth around Rs 25 crores.

The current duty structure on areca nuts classified under the standard tariff code of Indonesia is 100 per cent customs duty plus 5 per cent Integrated GST, totalling 105 per cent duty.

The Food and Drug Administration (FDA) reiterated that the substandard areca nuts must not enter the open market under any circumstances, citing grave public health concerns.

The preventive arm of the Directorate of Revenue Intelligence is also expected to open an investigation, as the seized stock is suspected to be of foreign origin. Officials said that forged documents and multiple GST registrations may have been used to generate fake purchase and sale invoices to facilitate tax evasion.

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