GST Fraud Racket Busted In Arunachal Pradesh

(MENAFN- IANS) Itanagar, Feb 4 (IANS) The Central GST Commissionerate, Itanagar, has unearthed a racket involving the issuance of fake invoices valued at Rs 658.55 Crores without any supply of goods, officials said here on Tuesday.

An official said that to curb fraud in Goods and Service Tax (GST) and increase compliance, the GST formations, under the Central Board of Indirect Tax and customs (CBIC) under the Union Ministry of Finance, are carrying out a focussed drive across the country on the issue of non-existent/ bogus registration and issuance of fake invoices without any underlying supply of goods and service.

As part of the nationwide drive, the Central GST Commissionerate in Itanagar has unearthed the racket involving the issuance of fake invoices valued at Rs 658.55 Crores without any supply of goods, the official said.

The investigation revealed that M/s Siddhi Vinayak Trade Merchants, a firm registered in Arunachal Pradesh, had engaged in the fraudulent passage of Input Tax Credit (ITC) of Rs 99.30 crores to fifty-eight firms across the country.

The fraudulent activities included the creation of a firm using forged documents to create a fake firm, the generation of invoices without supply of goods, the manipulation of GST returns to avail Input Tax Credit fraudulently resulting in a loss of nearly about 100 crores to the government exchequer, the official said.

The GST officials said that as a part of the investigation, a search operation was conducted recently in Kolkata and during the search, significant evidence was seized, including electronic devices (seven mobile phones and one iPad) which have been sent for forensic analysis, and other miscellaneous documents like 53 PAN and Aadhar Cards of different individuals, 17 rent agreements etc connected with the fraud.

During the search, it was also discovered that multiple KYC (Know Your Customer) documents of fictitious individuals were in the possession of the accused, further indicating the scale of the fraudulent activities.

The search also revealed that the accused were actively managing and filing fraudulent GST returns from this location. The accused were found to have orchestrated a complex network of fraudulent transactions across the country, utilising forged documents and fake identities, to facilitate the passage of Input Tax Credit. Considering the forgery of KYC documents to create the firm, an FIR was lodged by the Central GST department with Itanagar Police (Arunachal Pradesh).

Based on the FIR of Central GST, two masterminds in this fake racket -- Ashutosh Kumar Jha and Bipin Kumar Jha -- were apprehended by Itanagar Police from Darbhanga, Bihar.

On Monday, the offenders were arrested by Central GST, Itanagar under Section 69 of the CGST Act, 2017.

Further investigations are ongoing, and the department would continue to take stringent action against those involved in such illegal activities, the official said.

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