Some exporters involved in trade with Bhutan have come under the radar of the Central Goods and Service wing that functions under the Union finance ministry, following the arrest of an exporter from Jaigaon in Alipurduar district along the India-Bhutan border.

Sources said an inquiry was initiated against M/s Kavya Enterprises and M/s SK Enterprises by the Siliguri Commissionerate of CGST and Commercial Tax.

Trader-exporter Ranjit Prasad was taken into custody by tax officials on Thursday.

Officials claimed Prasad showed the export of cigarettes, pan masala and other products to Bhutan, but only on paper to avail tax benefits.

Produced in the additional chief judicial magistrate's court in Siliguri, Prasad was sent in judicial custody for five days.

More traders are under the scanner, a source said.

"Some traders in this region are engaged in showing the export of products to Bhutan without physically exporting the items to claim tax benefits from the government. They are adopting fraudulent practices which we believe runs into crores over a period of time," the source added.