Sirsa Trader held for GST Fraud; Fraudulent Availment of GST Refund using Shell Companies

The State Vigilance Bureau was detained Amit Bansal, a trader from Sirsa town in connection with an alleged scheme to illegally obtain tax refunds totaling roughly Rs.54 crore by setting up shell companies.

On the basis of a complaint submitted by DSP Gaurav Sharma on June 29 under several sections of the IPC and the Prevention of Corruption Act, the Vigilance filed a case against Padam Bansal, his son Amit Bansal, and a few other individuals. The investigation revealed that Padam Bansal, Amit, and their associates formed a number of shell companies between 2010 and 2015.

According to reports, the Government is considering decriminalising some offences under the goods and services tax (GST) by raising the threshold limit for tax evasion cases from Rs.2 crore to Rs.5 crore in order to encourage ease of doing business. However, frequent arrests are being reported in the midst of these reports.

“A suggestion to increase the starting point for criminal prosecution to Rs.5 crore is being considered. Soon, the issue would be brought before the GST Council,” a senior official stated.

Currently, tax evasion of up to Rs 2 crore is punishable by a one-year jail sentence, while tax evasion over Rs.2-5 crore is punishable by a three-year prison term.