CGST Bhiwandi Busted a Fake ITC Network of Rs 11.4 Crores; One Businessman Arrested

CGST Bhiwandi Busted a Fake ITC Network of Rs 11.4 Crores; One Businessman Arrested

Reetu | Jan 24, 2022 |

CGST Bhiwandi Busted a Fake ITC Network of Rs 11.4 Crores; One Businessman Arrested

CGST Bhiwandi Busted a Fake ITC Network of Rs 11.4 Crores; One Businessman Arrested

Officers from the CGST Mumbai Zone’s Bhiwandi Commissionerate have apprehended a businessman who was engaged in a fraudulent GST Input Tax Credit scheme. Based on information from the Mumbai CGST Zone’s Central Intelligence Unit, the officers launched a coordinated operation in Thane, Bhiwandi, Raigad, and Mumbai, detecting GST evasion of Rs.11.4 crores through the generation and passing of fake ITC through an intricate web of bogus billing totaling more than 63 crores.

The search was conducted at M/s. Adarsh Scrap Traders’ Bhiwandi-based business premises, which was engaged in bogus invoicing, availment, and passing on of phoney ITC, thereby robbing the government exchequer of its due GST money. The initial inquiry indicated that the company had falsely claimed and passed on Rs.11.4 crores in Input Tax Credit (ITC) without actually supplying or receiving products. The firm’s owner admitted to falsifying invoices and running a Fake ITC racket. He was detained on the 21st of January 2022 under Section 69 of the CGST Act, 2017 and appeared before the Hon’ble Additional Chief Metropolitan Magistrate, Fort, Mumbai, on the 22nd of January 2022. The accused has been remanded in judicial custody for 14 days, until February 4, 2022, by the Hon’ble CMM.

Once the entire network is scrutinised, the amount of false ITC involved is likely to increase during the continuing inquiry. Apart from Mumbai and Thane, the roots of this network can be found in Nagpur, Pune, Delhi, and Nasik. At this time, it appears that roughly 25 entities are connected to this network. Jurisdictional Commissionerates have been notified that legal action against the firms that fall within their jurisdiction will be taken.

This operation is part of the CGST Mumbai Zone’s efforts to eliminate phoney ITC networks that have been destroying the country’s healthy economic ecosystem and cheating the government. This is Bhiwandi Commissionerate’s sixth arrest in the last six months. In the coming months, the department would step up its crackdown on bogus ITC networks and other GST evaders.

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