Fake Billing Scam: Trader arrested for fraudulently availing ITC of Rs.11.7 crore via fake bill worth Rs.65 crore

The Anti-evasion unit of the Central Goods and Services Tax (CGST) commissionerate unearthed another evasion network in the nearby Jalna district, this time involving the issuance of fake bills worth Rs. 65 crore.

During the investigation, the team discovered that the accused, Swapnil Agrawal, the suspected mastermind of the racket, not only received fraudulent input tax credit (ITC) but also partially passed them on to other beneficiaries, bringing the total amount of fraud to Rs 11.75 crore.

Shaikh Jafar, the proprietor of M/s Myco Enterprises in Jalna, was detained a week earlier on suspicion of fraudulently obtaining an input tax credit (ITC) worth Rs 9.19 crore using a similar method.

The investigation into the new case has also shown that the accused trader received ITC benefits totalling roughly Rs 5 crore and passed on the remaining amount to contractors with whom he had been doing business for some time.

“While screening the filings by different traders, some suspicious invoices caught our notice. We carried out a thorough probe and found that fake bills running into crores were issued by two firms associated with Agrawal,” a spokesperson for the CGST said.

“On Tuesday, our team busted a Rs.11.5 crore fake ITC racket and captured the founder of M/s Bharija Traders. He is also the mastermind behind M/s Siddhivinayak Trading Co., for which he is the authorised signatory,” the official stated.

Both businesses were registered under GST to trade a variety of items, including cement, metal bars and rods, ferrous trash, scrap, and so on.

“The firms received and issued bogus GST bills totalling Rs 65 crore, with an ITC of Rs 11.75 crore. The accused admitted that M/s Bharija Traders and M/s Siddhivinayak Trading Co. were involved in the use and distribution of fake GST billing without actual receipt or supply of goods. The culprit was then arrested under Section 69(1) of the CGST Act of 2017, according to a press release issued by the CGST.

The investigation discovered that the firms were registered in 2017, but the issuance of bogus bills and receipts occurred in the second half of 2023.