The anti-evasion wing of CGST arrested two persons on Wednesday in connection with a fraudulent claim of input tax credit (ITC). The companies were engaged in paper trading to cheat the department by claiming fraudulent ITC.
“The two accused created and operated a chain of firms registered with different proprietors and directors. These firms issued goods-less invoices of taxable value Rs 20.3 crore involving ITC of Rs 7.1 crore,” said a CGST official.
A tax credit fraud of Rs 66.6 crore, exposed on Feb 20, led the CGST commissionerate of Gurgaon to the accused. The accused, in their statement, admitted their role and were arrested under section 69(1) of the CGST Act, 2017. They were sent to judicial custody for 14 days.
“These accused are also involved in circular trading and fraudulent claims of refund in some other firms. Further investigation is ongoing,” said the official.
On Feb 20, tax sleuths uncovered a massive GST scam operating from an inconspicuous 10x10sqft shop in the narrow lanes of Khandsa village merely 12km from the city centre. The operation generated fake invoices worth Rs 97 crore for tobacco products and soft drinks and fraudulently claimed input tax credits of Rs 66.6 crore.
Cigarettes, which attract a staggering 108% tax, including central GST and cess, and soft drinks with their 40% tax burden, were the primary focus of this fraudulent operation.
Source #TOI
