The Directorate General of GST Intelligence's (DGGI's) Pune zonal unit
has unearthed a Rs 80 crore "fraud" which is suspected to have been
perpetuated through procurement of "bogus invoices" from markets and
arrested one person from Mumbai.
Modsingh Padamsingh Sodha was arrested on Friday and found to be
operating over 10 dummy companies that had issued fraudulent invoices
worth Rs 415 crores, the DGGI Pune zonal unit said in
a release here
Sunday.
The officials suspect that the bogus invoices might have been utilised
to get enhanced credit limits from banks, "thereby laying foundation of a
future banking fraud".
"No goods were supplied and all transactions were on paper. GST fraud
of around Rs 80 crore has been detected in this case, which was paid
through set-off of fraudulently availed Input Tax Credit on the basis of
invoices procured through market without receipt of goods," it stated.
It said GST of Rs 2.18 crore was recovered from these dummy companies in the first round of searches.
"Investigation is going on and it has been found that this is just a tip of the iceberg," it claimed.
The accused was produced before a court in Pune which remanded him in judicial custody of 14 days.
The investigation was carried out by the Pune Zone DGGI officers based
on the specific information that certain persons had taken GST
registration and were issuing bogus invoices for passing fraudulent
Input Tax Credit (ITC).
"After analysing a large amount of data, some key players of this racket
were identified and simultaneous raids were conducted in Mumbai and
Pune by the officers," stated the release.
A large number of similar entities involved in this fraud have been
identified which indicate that it is a much bigger racket and its
threads are spread all over India, it said.
The amount of fraudulent ITC detected in this case has reached the
figure of over Rs 220 crores and is likely to further go up, it said.
"The value of supplies as per the bogus invoices detected till date is
around Rs 900 crore, which indicates the extent of bogus transactions,
which appear to have been also done for inflating turnover of
companies/firms which may have been utilised to get enhanced credit
limits from banks, thereby laying foundation of a future banking fraud,"
the office said in its note.