[GTO]

Can one blame the government for getting stricter & stricter? We have seen big industrialists default on TDS payments. We have seen airline CEOs throw lavish parties on yachts, while their air hostesses & aircraft engineers didn't receive salaries for months. India is home to thousands of GST scams.

Before blaming the government, we should take a long hard look at ourselves too.

Someone dropped in this email offering a "Paid BH Registration" service to BHPians. I am going to blank the details out, but just showing the kind of scams happening in India. Hopefully, such a thread helps the government nab such scamsters.


Source

Dear Team-BHP, I am XXX XXX, living in XXX, Gujarat. I have been in the IT industry for the last XX years, working for MNCs like Microsoft.

I'm now running my own software company. I’ve been following Team-BHP since the early 2000s, and all my car purchases so far have been based on the reviews and forum discussions on Team-BHP. So, thank you, Team-BHP!

I'm writing to offer a paid service for BH-series registration for Team-BHP members and their friends / families. My company employees are eligible for BH-series because our company is registered in 4 states with separate GSTs. I did that because I wanted a BH-series number for our recent XXXXXXXX (note from GTO = It's a luxury car costing 90-lakhs OTR). Unfortunately, the company's directors (I am) cannot avail of this facility. It is open only to the employees of the company. I offer this facility to Team-BHP members and their friends and families - to get BH-series RC using my company on a payment basis. The one-time fee we will charge for one registration is INR 50,000 or 3% of the car's ex-showroom price - whichever is higher.

Following are the steps to get BH-series via our company:

1. The interested person enrols in our online software training course by paying 99k (fully refunded) our BH-series fee.

2. We hire the person after completion of the course as an expert consultant, drawing a salary of 33k per month. The person continues the current job as well (note from GTO = their company further gets a tax benefit on this salary paid, making their actual fee higher than the 50k stated earlier).

3. As our company employee, the person buys the vehicle and applies for BH-series from Gujarat (we recommend Gujarat, as it is easy to get BH-series here). Our company provides all requisite documents.

4. The person gets the 99k paid back in three months as a monthly salary of 33k. If the BH-series number is successfully obtained, the person can optionally exit the company. Otherwise, the person can pay 99k for another course and remain on the payroll by getting 33k for another three months (note from GTO = more benefits for their company).

5. If the BH-series request is rejected, the company refunds the course fee (99k) BH-series fee, deducting only 5000 as incidence expenses.

Please let Team-BHPians contact me at XXX@XXXXXX.com or WhatsApp/call me at XXXXXXXXXX for further details.

Thanks,
XXXXXXXXXX
Director, XXXX
Regd. Offices in 4 Cities

[ssateesh]

This is unbelievable !! It doesn't look a scam though if the person is who he says he is. But maybe illegal for anyone to take-up this offer as it amounts to tax evasion

[Axe77]

This is so disappointing. Not surprising though. But disappointing nevertheless, like many other things.

In order to protect against the most egregious mischief makers, rules unfortunately wrap around the genuine cases also into a plethora of impossible paperwork.

Some of the conditions that I see in the new MH circular are clearly protecting against some of these aspects - like financial ability to buy a vehicle for instance so the reverse structuring is not done - i.e. an eligible BH employee buys a benami car for someone else. But some of the other conditions are still plain overreach and seem to be from the basic objective of preventing the loss of upfront registration revenue.

The next step might even be scamsters making this promise and relieving other aspiring scamsters of their money by asking for some payment upfront. The cycle will be properly complete then.

[gnome]

Registering in PY is a prevalent technique that's been going on for decades. This BH reg "scam" is more elaborate - unlikely to get prevalent.
Solution here is for govt to simplify the process and make it more uniform. The entire "BH" process reeks of good-old babudom.

[saket77]

This BH series registration mechanism is anyway not fair in my opinion. The Govt. cannot discriminate people based on their employment. I simply cannot get my head around this fact that a system like this exists. We need a simpler mechanism in place which gives hardly any benefit to the car owners to register their cars out of state.

I would NOT say that all states should charge the same road tax because states like KA, MH etc offer lots of good employment opportunities to people and states should have an incentive for that compared to places like BR, JH, WB etc. But it is upto the Govt to find a better way out than giving preferential treatment to some people only because either they are Central Govt employees or their employer has multi-location offices.

[JithinR]

To be honest, this reads like a "Scam scam" rather than a BH registration series related scam. I mean it would be extremely stupid of someone who has managed to climb the ranks to be a director in a company to actually send out an email to a well known automotive forum (whose members would know this is illegal..not like say a forum for plumbers) with details of a scheme to defraud various state and central government through tax evasion.

I guess they were hoping that some members would fall for it and they would make some easy money.

[anjan_c2007]

Fishy and quite a fly by night operator here who represents XXXXXXXXXX as Director, XXXX with allegedly Regd. Offices in 4 Cities.

-Now with a salary of 33K a month (will be fired after 3 months) if someone buys even a Creta, would the Income Tax deptt not pounce upon him?

- This Director overtly appears "selfless" doing good and only good for others by offering them BH registrations though he is himself not eligible.

- To me, even if we bhpians dismiss the offer as a potential scam and trap to avoid landing in trouble, there are hundreds who could make a beeline for the "modest" offer by this Director.

- I can surely foresee that this Director who has four offices in India, would generate much, much more turnover and profits through this fraudulent BH business than whatever his core business domains are.

[GTX+]

"I'm now running my own software company. I’ve been following Team-BHP since the early 2000s, and all my car purchases so far have been based on the reviews and forum discussions on Team-BHP. So, thank you, Team-BHP!"

Since this person claims to follow Team BHP since 2000, hopefully he reads this, as well other messages in this thread.

This person should be ashamed of himself and I really hope better sense prevails and he puts a full stop to his swindling ways. Though there is really no hope from such people.

While he may be able to fool few people and make some money, eventually he is gonna get caught.

[ssateesh]

@GTO : The title is a click-bait though. The process described is an elaborate technical workaround and nothing illegal as well. Its a scam if somebody availed this service and got cheated off their money

[PPS]

Have seen an Aston Martin Vantage, Lamborghini Urus & Range Rover Vogue running in Mumbai with BH plates! So not surprised by this scam. More than a decade back most imports & fancy cars in Mumbai had JH or PY plates, that has stopped now.

[Axe77]

Originally Posted by ssateesh

@GTO : The title is a click-bait though. The process described is an elaborate technical workaround and nothing illegal as well. Its a scam if somebody availed this service and got cheated off their money

We’re getting into semantics. If not a scam then a sham perhaps! Basically it’s illegit because it’s creating a sham employment merely to qualify for a particular registration scheme. It’s no different from a sham lease in a different state only to register a vehicle in that state.

A person who has nothing to do with a company is being shown as an employee only so he can benefit from registering his car with a BH plate. It’s a sham employment per se. People could start companies / partnerships with 4 GST registrations and 4 offices only to provide such services to individuals, defeating the very purpose of the regulation.

Originally Posted by PPS

Have seen an Aston Martin Vantage, Lamborghini Urus & Range Rover Vogue running in Mumbai with BH plates!

Why is that a scam. If one is a high ranking private employee (and please do remember even a director can be an employee), working in a company with presence in 4 states (with 4 GST numbers), capable of being moved from one state to another state, then the provision entitles that person to register his vehicle as BH.

More often than not, what happens is that such vehicles get registered in company name when its a proprietor / significant shareholder of a large company so that it can benefit from depreciation, expense out interest cost etc. Which is also possibly why BH as a scheme is only available to individual employees and not cars registered in company name.

If a high ranking / well paid employee has chosen to buy a car in his individual name under BH and not in company name, then he should get the benefit if the company meets the 4 states / 4 GST criteria.

[riteshritesh]

I too am of the opinion that if the scheme works, it is more of a work-around than a scam.
No one is evading any tax. Road tax is being paid, albeit in instalments as per BH guidelines.

[jaysheth]

Originally Posted by ssateesh

@GTO : The title is a click-bait though. The process described is an elaborate technical workaround and nothing illegal as well. Its a scam if somebody availed this service and got cheated off their money

Technical workaround?? It is a scam. The person offering this is not even shameful - is shameless!!

What was the intent behind BH series?: I am an employee, my office (employer) has presence in multiple states. I therefore require a BH series vehicle to travel/relocate without additional overhead/worry.

And this shameless fellow says: You want a BH series. Therefore be my employee on paper. Yet pay me for my services(!).

And you are calling this a technical workaround?

Sad.

[ssateesh]

Originally Posted by saket77

This BH series registration mechanism is anyway not fair in my opinion. The Govt. cannot discriminate people based on their employment. I simply cannot get my head around this fact that a system like this exists. We need a simpler mechanism in place which gives hardly any benefit to the car owners to register their cars out of state.

I would NOT say that all states should charge the same road tax because states like KA, MH etc offer lots of good employment opportunities to people and states should have an incentive for that compared to places like BR, JH, WB etc. But it is upto the Govt to find a better way out than giving preferential treatment to some people only because either they are Central Govt employees or their employer has multi-location offices.

Good differentiating thought. One nation one tax may be the answer

Originally Posted by jaysheth

'Technical workaround'?? It is a scam. The person offering this is not even shameful - is shameless!!

What was the intent behind BH series?: I am an employee, my office (employer) has presence in multiple states. I therefore require a BH series vehicle to travel/relocate without additional overhead/worry.

And this shameless fellow says: You want a BH series. Therefore be my employee on paper. Yet pay me for my services(!).

And you are calling this a technical workaround?

Sad.

I don't support this proposal one bit. But leaving aside emotions is there anything illegal you can find in his proposal? My point was putting it as scam is a click-bait in the title when no scam happened.

[jaysheth]

Originally Posted by ssateesh

I don't support this proposal one bit. But leaving aside emotions is there anything illegal you can find in his proposal? My point was putting it as scam is a click-bait in the title when no scam happened.

Alright, emotions aside Few common sense questions:

Which employer employs employees only so that they get a BH series registration, and fires them after 3 months?

Which employee pays 3-month-advance salary to their employer, so that the employer can pay it back? What is this nature of payment of employee to employer? Legal or illegal?

What about employer obligations towards the employees and vice-versa? Legal or illegal?

Can the 'beneficiaries' be employees of 2 different companies at the same time? Is that legal?

What about EPF contribution etc.? Is bypassing these legal? Please read about labour laws.

Open 4 offices in 4 states on paper. Start making 50K per BH-series registration through a 'business model' that has nothing to do with 'any actual business'. Is that legal?

Is there anything legal that you can find in this proposal?

If it is not a scam, what else is it?

Our mods are prudent enough, and do not need 'click-baits' to make us read their posts. Repeatedly calling this out as a click-bait is severe disrespect in itself.