The Central Goods & Services Tax (CGST) officials on Sunday arrested two persons running a steel business for allegedly committing input tax credit fraud of Rs 6.23 crore.
The officers of CGST Mumbai zone have unearthed more than 50 networks of alleged tax evaders, detected tax evasion amounting to Rs 3,000 crores, recovered tax of Rs 400 crores and have arrested 24 persons in the last three months, the agency had claimed in a statement.
The persons identified as Adarsh Mittal and his father Jaiprakash Mittal have been arrested and charged as per the provisions of the CGST Act.
According to the CGST officials, acting based on information, an investigation was initiated against a firm engaged in the steel business for availing of fake/ineligible input tax credit (ITC) from fake/non-existent firms.
"Summons were issued to the said company after which statements of Adarsh and Jaiprakash Mittal were recorded. The probe revealed that at least 14 suppliers of the accused person's company were found non-existent or addresses were non-traceable," said a GST official.
He added, "Our probe has revealed that the accused persons are involved in availing and passing of ineligible/ fake ITC from non-existent firms without movement of any goods to the tune of Rs 6.23 crore. The quantum is likely to increase in future."
"Jaiprakash in his statement has stated that he looks after activities of the firm and that they have received the goods. They place their order through brokers. However, he is not divulging the details of the brokers in the transactions and is non-cooperating in the investigation. Further, the accused have not reversed any fake ITC availed till date," said the official.
The CGST officials have also seized documents, laptops and personal mobile phones of the accused persons under panchnama on Saturday. They were produced before the court on Sunday which granted them judicial custody.
"The allegations that suppliers are not genuine are false. My client has purchased the goods and paid the GST amount as per the law. They cannot be blamed for other people's wrongdoings," said Ravi Hirani, defence advocate of arrested persons.
