GST Evasion: Businessman gets bogus ITC worth Rs.15 crore

A businessman was detained by the Central Goods and Services Tax and Central Excise for perpetrating a widespread GST Evasion by creating fraudulent invoices and remitting fake Input Tax Credits (ITC) without providing any products or services in Chhattisgarh.

The investigation found that businessman Saurabh Agrawal was responsible for setting up and running a fictitious company and had obtained fake ITCs worth Rs. 15.32 crores from several companies with locations in Odisha and Chhattisgarh.

An official statement said that he distributed Rs.16.94 crores to a number of other businesses without providing any underlying goods or services.

Agrawal was taken into custody by the Central GST Commissionerate team on February 21, 2023 in accordance with the requirements of section 69(1) of the CGST Act 2017, and he has since been brought before the court. The accused is being held in detention for 14 days, according to the Chief Judicial Megisterate (CJM) court.

In Chhattisgarh, a significant effort was made to verify the legitimacy of 147 suspect taxpayers. The Raipur CGST Commissionerate physically verified every one of these taxpayers in a single day, identifying 73 bogus parties in the process.

Preliminary examination reveals that these taxpayers have transferred bogus input tax credits totaling about Rs. 118 crores. All other jurisdictional agencies outside of Chhattisgarh have also been made aware of the need to reclaim ITC that was accessed within the state, and effective actions to do so have already been taken.