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August 28, 2019
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GST Fraud of INR 24.55 Crore in Maharashtra

GST Fraud

Goods and Services Tax (GST) officials arrested a businessman in Maharashtra for allegedly evading taxes of worth ₹ 24.55 Crore by issuing fake invoices without actual supply of goods. A spokesperson of the Central GST and Excise department said that after getting specific inputs, searches were conducted at three firms of the businessman Bhavin Bharat Shah during which incriminating documents and sale/purchase invoices were found.

Shah floated three firms named M/s C B Shah and Co, M/s Maanya Impex, and M/s Padmavati Enterprise, which were allegedly involved in the receipt of fake bills/invoices and issuance of invoices without the supply of goods. The official added that the perpetrator also allegedly claimed Input Tax Credit (ITC) of ₹ 24.55 Crore on the basis of bogus invoices for ₹ 136.38 Crore without the actual supply of goods.

The spokesperson said, “The payment for the said invoices was made through RTGS and the cash was received after deduction of the commission of 50 percent of the GST involved.” The official added, “Shah also admitted that he had issued invoices to various companies without the supply of goods or services on a commission basis of two percent and three percent of the value of goods.”

Businessman Arrested for GST Fraud

Following the searches, Mr. Shah was arrested and booked under relevant sections on Tuesday. The official said that he was subsequently produced before a magisterial court which remanded him to judicial custody till September 9.

To prevent any kind of tax evasion and corruption, GST has introduced strict provisions for offenders regarding penalties, prosecution, and even arrest. The submission of false information while registering under GST or supply of any goods/services without any invoice or issuing a false invoice is considered a major offense.

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