UP’s biggest GST Evasion caught with the help of AI, Fraud of Rs 19.66 crore caught

The state’s largest ever GST evasion was found in Ghaziabad using Artificial Intelligence (AI). GST evasion is being detected by state tax department authorities.

The department’s Artificial Intelligence (AI) is also assisting them with this project. A company falsely claimed Rs 19 crore 66 lakh in input tax credit from the government in one financial year.

After this, when the firm started filing its returns, the AI ​​installed in the system analyzed it. In which it was revealed that whatever ITC claim has been made by the firm is completely fake. Then when the department officials cracked down on the owner of the firm, he deposited Rs.19 crore 66 lakh in the department.

In this case, Rs.1 crore was taken in cash, while the remainder was deducted from his bank account. Every month, the state tax department examines the e-way bill issued for the returns filed by traders and corporations using an AI-enabled system.

In the same order, on the instructions of Diparatan Singh, Joint Commissioner of Corporate Circle, a probe into paint selling enterprises in the Indirapuram region began. An investigation revealed that a firm claimed an excess ITC of about Rs.20 crore on account of IGST in its monthly return GSTR-3B compared to the ITC availed on purchases made in the current financial year.

It was caught with the help of artificial intelligence. Following this, departmental officers conducted their own investigation. When inconsistencies were discovered, a notice was sent to the concerned firm, and additional ITC was collected.

This is how the System Works

Officials said that the AI ​​installed in the system keeps an eye on every activity of the traders and the firm.

This involves monitoring tax compliance, identifying non-filers, detecting potential tax evasion activities by taxpayers to avoid paying taxes, identifying ineligible Input Tax Credit (ITC) claims, and profiling taxpayers. Obtaining comprehensive information about taxpayers through Dealer 360, conducting risk-based analysis of taxpayers, and exhibiting the discrepancy between declared turnover and e-way bills issued.

Red flag in these cases

Officials believe that new traders may have downloaded more e-way invoices, had errors in their filings, are not depositing tax, or are receiving undue benefits from ITC. AI begins displaying red flags to such dealers on the site.

Then the department officials start investigating such traders. After investigation, the process of tax recovery is started by giving notice.