The Central GST (CGST) and Central Excise authorities in Agra recently uncovered a massive GST fraud amounting to a staggering Rs 134 crore. The investigation revealed a network of fake companies operating in a sophisticated manner to exploit the Goods and Services Tax system.
The fraudsters employed a well-thought-out plan to orchestrate the scam. They set up fake companies using the PAN and Aadhaar numbers of family members, friends, and employees. Through these fictitious firms, they conducted fraudulent transactions and issued invoices for non-existent goods. The money obtained from these illegal operations was then transferred using other people’s names through personal current bank accounts.
During the investigation, the authorities seized several objectionable items that served as evidence of the fraud. These items included counterfeit invoices printed on the letterheads of multiple firms, chequebooks, bank passbooks, rubber stamps, and mobile phones. This substantial evidence helped the investigators gain insights into the elaborate network of deceit.
A crucial breakthrough in the case came when the mastermind behind the fraud, Akshay Goyal, was apprehended. Goyal, who resides in Kamla Nagar and hails from Bhairon Bazar near Belanganj Tikonia, admitted to his involvement in the elaborate scheme.
The modus operandi employed by the fraudsters revolved around circular trading, a method that involved passing on Input Tax Credit (ITC) to different customers without any actual movement or supply of goods. Through this technique, the criminals wrongfully claimed and utilized ITC without any legitimate transactions or payments.
The fake transactions conducted by the fraudsters involved a wide range of items, including iron scrap, cement, tiles, and marbles, with a total value exceeding Rs 755 crores. Their illegal activities allowed them to claim ineligible ITC amounting to approximately Rs 134 crore, causing significant losses to the government exchequer.
In a related incident, the Gurugram Zonal Unit of the Directorate General of GST Intelligence also conducted a search operation that uncovered another significant fraud involving 461 shell and fake entities. These entities were found to be involved in passing on fraudulent Input Tax Credit (ITC) worth Rs 863 crore. This second discovery further highlighted the rampant misuse of the GST system by dishonest individuals seeking to wrongfully claim tax benefits.
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