Mumbai, 27 July 2022
Officers of CGST Bhiwandi Commissionerate have busted a fake GST invoice racket, which was used to pass on fake GST Input Tax Credit (ITC) of around Rs. 14.4 crore on bogus invoices of Rs 74 Crore. The proprietor of Bswar Industries, who is said to have established this firm was arrested on 24.05.2022. The second person was arrested on 26.07.2022 who was involved in fraudulently opening a current bank account in the name of M/s Bswar Industries pretending to be the proprietor and received the proceeds of fake transactions amounting to Rs.18 crore.
Acting on a specific input, the anti-evasion wing of CGST Bhiwandi Commissionerate initiated an investigation against the firm. During investigation the declared business address was found to non-existent with no trace of any business activity. Investigation also revealed that this firm had fraudulently claimed input tax credit of Rs. 7.20 Crore and passed on input tax credit of Rs. 7.20 Crore.
Bogus invoices of around Rs. 74 Crore were issued for availing and passing on of this tax credit, without any supply or receipt of goods, in gross violation of provisions of the CGST Act, 2017. A network of more than 126 business entities, which are spread across different states and cities including Delhi, Ahmedabad, Rajkot, Mumbai, Thane and Navi Mumbai, is involved in this tax fraud.
Based on material evidence gathered during the investigation and admission of his role in this tax fraud, the accused person was arrested on 26.07.2022 under Section 69 of CGST Act, 2017 for contravention of Section 132 of the CGST Act, 2017. He was produced before the Hon’ble Additional Chief Metropolitan Magistrate, Esplanade. The Magistrate has remanded him to judicial custody. Further investigation and tax recovery action is under progress.
This case is a part of the special drive launched by the CGST Mumbai Zone against the tax fraudsters and fake ITC networks. This is the 9th arrest by CGST Bhiwandi Commissionerate in last one year.
CGST officers are using data analysis and network analysis tools to identify and trace the potential fraudsters. The CGST officers will intensify this drive against the tax evaders in the coming days.
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(Source: CGST Bhiwandi Commissionerate)
PIB Mumbai | CP/DR