The Commercial Taxes Department (South Zone), Bengaluru, detected GST evasion by a lead ingot manufacturer and arrested its director.
The accused entity, in collusion with fraudulent suppliers, utilised fake invoices to illegally avail Input Tax Credit (ITC), violating the provisions of the GST Act, 2017.
Investigations indicated that the manufacturer fraudulently availed ITC amounting to Rs 44.83 Crores, with a turnover impact of Rs 250 crore.
“The entity systematically orchestrated financial transactions, transferring payments to shell bank accounts under the guise of legitimate suppliers. However, the actual suppliers never received these payments, confirming that no real supply of goods had occurred. It is being ascertained that the funds were funnelled through multiple hawala accounts, eventually routing back to the accused entity. Further investigation is expected to reveal details regarding other players in this fraudulent supply chain,” a press release said.
Mukund Agarwal, director of M/s Lawraga Metals Private Limited, was arrested and presented before the Special Court for Economic Offences, which remanded him to judicial custody until April 9, 2025.
“The uncovering of such modus operandi is first of its kind in the state and the Department is also investigating other people involved in such orchestrated tax frauds,” the release added.
The operation was carried out under the direction of Vipul Bansal, Commissioner of Commercial Taxes, and was supervised by Chandrashekara Nayak L, Additional Commissioner.
The team led by Krishna Kumar, Joint Commissioner, and Bharatesh Kumar S M, Deputy Commissioner (Enforcement), South Zone, Bangalore executed the arrest operation
