DGGI Officials bust network involving fake invoices worth more than Rs.4,500 crore; Mastermind Arrested

The DGGI has filed a complaint against some fictitious businesses that were discovered to be non-existent at their primary location. The physical address from which GST returns were really submitted was determined in order to track down the real people behind these bogus companies. Then, on January 6, 2022, a search was undertaken at that location in Delhi. During the search, it was discovered that the proprietor is engaged in offering ‘Cloud Storage’ services on his servers to various customers for the purpose of keeping track of their financial affairs.

Details of some organisations were discovered in tally data on one of the suspicious servers. The proprietor informed us that this tally data is being managed by a Kolkata-based syndicate. On 10.01.2022, the Proprietor provided the addresses of these individuals, and searches were performed at several locations in Kolkata.

During the search, a large number of incriminating documents were discovered, including mobile phones, numerous check books, stamps from various firms, and SIM cards. These individuals are remotely maintaining data on a server located at the premises in Delhi, according to a study of their electronic devices, documents, mobile phones, and e-mail.

According to Tally data, this syndicate operates 636 businesses. The syndicate’s mastermind has admitted that they have just issued invoices at these firms and have not supplied any items against them. They have issued bills with a taxable value of approximately Rs.4,521 crore and an ITC of approximately Rs.741 crore.

During the investigation, GST in the amount of Rs.4.52 crore was deposited through the reversal of ITC available in these organisations’ ITC ledger. Furthermore, around Rs.7 crore has been frozen in various bank accounts of these companies. On January 13, 2022, the mastermind behind the entire scheme was apprehended. The case is currently being investigated further.