The Directorate General of GST Intelligence (DGGI) has busted a racket of fake GST bill operators, who used to run a syndicate to help companies, especially in the metal and scrap industry, to avail of input tax credit (ITC), according to The Economic Times report.
The DGGI’s probe revealed that around 160 companies were involved in using documents that were fraudulently procured from people by promising to help them get government's Covid relief or employment.
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As per the report, after procuring documents, fictitious companies, bank accounts and invoices were created to help the companies avail of the tax credit. The transactions under the scanner amounted Rs 1,000 crore, the DGGI is suspecting a net loss of around Rs 206 crore to the government.
"During the course of investigation so far, it was revealed that these firms are involved in a large-scale nexus of bogus billing/fake invoicing wherein only invoices have been issued and no actual supply of goods has taken place," an official was quoted as saying by ET.
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DGGI unit in Mumbai has arrested the mastermind behind this and are likely to make more arrests in the case, sources were further revealed.
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"While the probe is from FY2018, the investigation has revealed that the gang managed to lure more people to share their KYCs during Covid by promising them jobs or government schemes," the official said.
It further added, “ Many of the GSTINs have already been cancelled by concerned jurisdictional authorities, however, proprietors and directors mentioned against these firms in the GST portal have not been traced till date, as all the firms are being managed, handled and operated by a few individuals.