Navi Mumbai CGST Commissionerate busts Input Tax Credit racket of more than Rs. 10 Crores – Arrests one businessman

Acting on the intelligence about the operation of a fake ITC racket , the Officers of Navi Mumbai CGST Commissionerate of Mumbai Zone  have arrested a businessman who is the proprietor of M/s Maharashtra Enterprises .

The Central CGST department has busted yet another fake Input Tax Credit racket of 15 fake entities who had generated the fake ITC fraudulently to the tune of Rs 10.28 Crores. The fraudsters had generated the fake ITC by issuing bogus invoices of metal scarp without any receipt or supply of goods of more than Rs 57 Crores. The network is spread in the cities of  Mumbai, Aurangabad and Nasik The firms is registered with GST for trading Ferrous Waste and Scrap; Remelting Scrap Ingots of Iron or Steel – Waste and Scrap of Cast Iron and was indulging  in fraudulent availment and passing of Input Tax Credit (ITC) of Rs 5.17 Crores  & Rs 5.11 Crores respectively without receiving the goods or services, in violation of the provisions of the CGST Act,2017.

The firm was availing fake ITC from the non-existing entities and passing on the same to other entities of this vicious network by defrauding the Exchequer of its rightful GST revenue and causing unhealthy competition with honest Taxpayers. The accused was arrested today 13.01.2022 under Section 69 of CGST Act 2017 for contravention of Section 132 ibid and produced before the Hon’ble Judicial Magistrate First class, Vashi, who has remanded accused to 14 days judicial custody till 27.01.2022 This operation had been a part of large-scale operations launched by the CGST Mumbai Zone to stamp out the fake ITC networks which had been causing undue hardship to the honest taxpayers and defrauding the Government exchequer of its rightful taxes.

Navi Mumbai Commissionerate had arrested two businessmen on 08.01.2022 of a Public Listed Company M/s Omnipotent Industries Limited which had been availing and passing on the Fake ITC generated by the fake entities to the tune of more than Rs 70 Crores by issuing bogus invoices of Rs 385 Crores.

The department is going to intensify the drive against the fraudsters and tax evaders in the days to come.