Bengaluru Tax Officials arrest a Director for GST Evasion of Rs.44.8 Crore

The Commercial Taxes Department, Bengaluru, has detected a case of GST evasion involving a Lead Ingots manufacturer. The accused entity, with the help of fake suppliers, used false invoices to wrongly claim ITC, which is against the GST rules.

The arrest was carried out by Krishna Kumar (JCCT) and Bharatesh Kumar S M (DCCT, Enforcement), South Zone, Bangalore.

Officials discovered that the company illegally claimed ITC amounting to Rs.44.83 crore, affecting a turnover value of Rs.250 crore. The company was involved in making payments to fake bank accounts that appeared to belong to legitimate suppliers.

However, the actual suppliers never received any money, proving that no real goods were ever supplied. Authorities have confirmed that the funds were moved through multiple illegal accounts and eventually returned to the accused company.

Currently, one of the accused has been arrested; he is identified as Mukund Agarwal, Director of M/s Lawraga Metals Private Limited. He was presented before the Special Court for Economic Offences, which has acknowledged the case and ordered that he remain in judicial custody until April 9, 2025. Further investigations are likely to uncover more information about other individuals involved in this fraudulent supply chain.

This is the first time such a tax fraud method has been found in the state. The tax department is now looking into other people who might be involved in similar planned scams. It uses analytical tools to identify and prevent such frauds.

The department has advised all stakeholders to examine their financial transactions, stick to fair business practices and pay their taxes on time.