GST officers expose syndicate involved in fraudulent ITC claims

GST officers have unveiled a major syndicate engaged in fraudulent input tax credit (ITC) claims amounting to Rs 275 crore, using 102 fictitious firms.

In a statement, the Ministry of Finance disclosed that, through meticulous data analysis and critical thinking, the officers from the Directorate General of Goods and Services Tax Intelligence (DGGI) Meerut Zonal Unit have successfully dismantled the operations of this syndicate, orchestrated by four masterminds.

The Ministry revealed that this counterfeit invoicing syndicate generated invoices with a taxable turnover of Rs 1,481 crore, resulting in the fraudulent passing of Input Tax Credit amounting to Rs 275 crore through 102 counterfeit firms to more than 1,000 beneficiary companies.

Created fictitious identities

One of the masterminds, associated with a placement consultancy firm, played a crucial role in procuring PAN cards, Aadhaar cards, electricity bills, address proofs, and other necessary documents for GST registration. To achieve this, the mastermind lured individuals with financial incentives to provide their KYC documents. Subsequently, these KYC documents were handed over to the other two masterminds, who used them to create fictitious entities.

During the operation, DGGI officers conducted synchronized raids at various locations, seizing a substantial volume of incriminating evidence. This included laptops, desktops, electronic storage devices, PAN cards, Aadhaar cards, chequebooks, over 25 mobile phones, SIM cards employed for receiving OTPs, and rubber stamps of these shell entities.

All four accused individuals were brought before the Economic Offense Court in Meerut on November 4 and have been remanded in judicial custody until November 17, 2023.

(With PTI inputs)