GST Officers Bust Syndicate Involved In Fraudulent ITC Claims

GST officers have busted a syndicate involved in fraudulently passing on input tax credit (ITC) of Rs 275 crore through 102 fake firms.

In a statement the finance ministry said through meticulous data mining and application of mind, the officers of the Directorate General of Goods and Services Tax Intelligence (DGGI) Meerut Zonal Unit has successfully dismantled a major syndicate operated by four masterminds.

The ministry said that the fake invoicing syndicate that issued invoices with a taxable turnover of Rs 1,481 crore, resulting in passing on of fraudulent Input Tax Credit of Rs 275 crore through 102 fake firms to over 1,000 beneficiary companies.

One of the masterminds, working in a placement consultancy firm, was responsible for arranging PAN, Aadhaar, electricity bill, address proof, and other documents required for GST registration. To achieve this, the mastermind enticed candidates with modest financial perks in exchange for surrendering their KYC documents. These KYC documents were then passed on to the other two masterminds, who used them to create fictitious companies.

During the operation, DGGI officers conducted coordinated raids at multiple locations and seized a vast cache of incriminating evidence, including laptops, desktops, electronic storage devices, PAN card, aadhar card, cheque books, more than 25 mobiles, SIM cards used for receiving OTPs, and rubber stamps of shell entities.

All four accused individuals were presented before the Economic Offence Court in Meerut on November 4 and have been remanded in judicial custody until November 17, 2023.