CGST Commissionerate Busts Rs.142 crore Fake GST Invoice Racket; One person arrested

The Officers of CGST Mumbai South Commissionerate have busted a fake GST invoice racket, which was used to pass on fake GST Input Tax Credit (ITC) of Rs. 27.80 crore on invoices of Rs 142 Crore, and have arrested the Director of M/s Techno Satcomm India Pvt. Ltd. for issuing GST invoices without actual supply of goods.

The anti-evasion division of the CGST Mumbai South Commissionerate opened an investigation into this company in response to a specific tip from the Central Intelligence Unit of the CGST Mumbai Zone. The company was discovered to not exist at the stated business address during an investigation. On September 5, 2012, the company’s director made a statement that was later recorded in which he acknowledged his involvement in the creation of bogus ITC and its transmission down the supply chain.

Investigation disclosed that this company had fraudulently claimed input tax credit of Rs. 27.80 Crore in its GST returns and passed on this ITC to its various recipients. Bogus invoices of around Rs. 142 Crore were issued for passing on this tax credit, without any supply of goods, in gross violation of provisions of the CGST Act, 2017.

The Director of the Company was detained on September 6, 2022, and brought before the Hon’ble Additional Chief Metropolitan Magistrate, Esplanade, who remanded him to judicial imprisonment for 14 days based on material evidence acquired throughout the inquiry. Further research is now being conducted.

In the current financial year, the officials of the CGST Mumbai South Commissionerate have made seven arrests. The CGST Mumbai South Commissionerate discovered GST evasion of Rs. 949 crore during the financial year 2021–2022, recovered Rs. 18 crore, and detained 9 tax evaders.

Data analysis and network analysis tools are being used by CGST officials to locate and track suspected fraudsters. This case is a component of the CGST Mumbai Zone’s special campaign against tax evaders and bogus ITC networks. In the upcoming days, the CGST officers will step up their campaign against tax dodgers.