Mumbai: CGST officials bust fake Input Tax Credit racket of Rs 10.26 crores; arrest proprietor of trading firm

CGST officials have busted a fake Input Tax Credit (ITC) racket of Rs 10.26 crores and arrested the proprietor of a trading firm on Tuesday. The firm was allegedly engaged in availing, utilizing and passing on a fraudulent ITC on the strength of bogus invoices of more than Rs 60 crores thereby defrauding the government exchequer.

According to the CGST officials, a team of officers of Anti-Evasion, CGST, Navi Mumbai conducted enquiry against the firm M/s. Al-Marwah Traders. As per the statement of the proprietor, the said firm is involved in trade of scrap of ferrous, aluminium, copper and other metals. However, the investigation revealed that the taxpayer has availed and passed on fake ITC from various non-existing/bogus firms. The accused has been arrested under relevant section of the Central Goods and Services Act and was produced before the court at Belapur on Wednesday and has been sent on judicial custody for 14 days stated Commissioner of CGST and Central Excise, Navi Mumbai Shri Prabhat Kumar.

"This case is a part of Anti-Evasion drive launched by CGST, Mumbai Zone against the fraudsters and tax evaders who are creating unhealthy competition for compliant taxpayers and defrauding the Government exchequer. As a part of this drive, Navi Mumbai Commissionerate has detected tax evasion of more than Rs 450 Crore, recovered Rs. 20 crores and arrested 12 persons recently," the agency claimed in a statement.

"The CGST Mumbai Zone is using data analytics tools to identify tax evaders. By using data analysis and network analysis, the officers of CGST Mumbai zone have booked more than 625 tax evasion cases, detected tax evasion of Rs. 5500 Crore, recovered Rs. 630 Crores and arrested about 50 persons, in the last five months. The CGST department is going to intensify its drive against the fraudsters and tax evaders which are causing unfair competition with honest taxpayers and defrauding the government exchequer of its rightful revenue in the coming days and months," the statement added.