CGST Delhi Busts Rs. 6.53 Crore Fake ITC Scam; Director Arrested Over Bogus Rs. 36.28 Crore Invoices

The Anti-Evasion Branch of the Central Goods and Services Tax (CGST), Delhi South Commissionerate, has uncovered a massive tax evasion case involving the availment of bogus Input Tax Credit (ITC) amounting to Rs. 6.53 Crore using fake invoices of Rs. 36.28 crore. In connection with the same, a director of the private limited company has been arrested. As per the sources, he orchestrated the fraud by trading electronic goods to claim inadmissible ITC.

This huge amount of fraudulent ITC was claimed using invoices issued by several different firms; many do not even exist, and many are non-functional or have been suspended/had their GST number cancelled.

In order to confirm that some of the suppliers were bogus entities with no genuine business activity at the disclosed place of business, the jurisdictional authorities conducted a field verification.

Further investigation revealed that the ITC was claimed without actual movement or receipt of goods in violation of the provisions of the Central Goods and Services Tax Act, 2017. In conclusion to the probe, the concerned authority held the director of the disputed company under Section 69 of the CGST Act, 2017, and produced him before the Duty Magistrate. The accused has been sent back to judicial custody for 14 days.

Further investigation in regard to the case is ongoing.