Officers of the investigation wing of Punjab state GST on Saturday arrested five persons for creating and operating a bogus billing network across various states, including Punjab, Delhi and Haryana, according to a release.
An authorisation for the arrest of seven persons was issued by commissioner state Tax Nilkanth S Avhad, under Section 69 of the GST Act for violation of Section 132 (1)(a),(b) &(c). Search and seizure operations were conducted at multiple locations in Khanna, including residences of the accused, to gather evidence for establishing the modus operandi that involved creating firms in states outside and within Punjab dealing in copper scrap and hosiery items and thereafter passing the same to various beneficiary firms in Punjab, the release said.
The income tax certificate (ITC) created through bogus firms was used to support the local movement of goods of various traders, said the release, adding the department got alerted about the network after a vehicle carrying copper scrap was detained by the mobile wing in Jalandhar last year and investigation revealed that the goods had been procured locally while the e-way and invoice were generated from some other firm.
Detailed investigation revealed a network of 44 firms spread across states that was being used to create the bogus ITC for setting off the tax liability arising out of purchases made from local unregistered dealers. On being confronted with the evidence, the kingpin confessed that he was operating the network with the help of some other accomplices some of whom have also been arrested, the release said.
During search operations, incriminating documents related to various firms and mobile phones used for sharing fake invoices and e-way bills generated were seized. The total bogus billing by the network is likely to be more than ₹700 crore while ITC created/availed and tax evaded is more than ₹122 crore, the release said. Evidence was also gathered about various beneficiaries of the bogus network and other accomplices involved.
The arrested have been identified as Vinod Kumar, Maninder Sharma, Sandeep Singh, Amarinder Singh and Sunny Mehta, all residents of Khanna. They were produced before the duty magistrate and were remanded in judicial custody for 14 days.