GST Fraud: Officers unearth fake invoicing racket involving Rs 38.5 crore tax evasion

 







GST officers have unearthed a racket of 54 bogus firms involved in fake invoicing of Rs 611 crore involving tax evasion of Rs 38.5 crore, the finance ministry said on Thursday.

Officers of Delhi South CGST Commissionerate conducted searches and inspections spread across Delhi, unearthing a cartel running 54 bogus firms registered in Delhi-NCR region that were engaged in fake invoicing and circular trading.


Incriminating documents such as rubber stamps and letter heads of various firms, mobile phones, laptops etc have been seized from the search premises.

"Preliminary enquiry conducted so far into these transactions has revealed fake invoicing of around Rs. 611 crores and tax evasion of over Rs. 38.5 crores. The members of cartel in their confessional statements have accepted their roles in managing these bogus firms," the ministry said in a statement.


Three key persons of the cartel, namely Ankit Gupta, the mastermind managing these bogus firms and two of his accomplices Rabiendra Singh and Rajendra Singh, were arrested on February 23 and remanded to 14 days' judicial custody.

In a separate statement, the ministry said the Central Goods and Services Tax (CGST) Commissionerate, Faridabad, of Panchkula CGST Zone, on February 23 arrested two persons for running a fake billing racket, involving five dummy firms, for issuance of fake invoices of over Rs 200 crore without actual supply of goods and availing and passing fraudulent Input Tax Credit (ITC) amounting to Rs 31.85 crore.

As per GST law, issuance of an invoice or bill without supply of goods or services and wrongful availment or utilisation of Input Tax Credit is a cognizable and non-bailable offence if the amount is over Rs 5 crore

Both the proprietors of the said firms have accepted that they have availed and passed on fraudulent ITC of Rs. 31.85 crore, without actual supply of goods to inter-state recipients and have accepted the total GST liability of Rs. 31.85 crore during initial investigation. The quantum may increase in future," the statement added



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