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Fake GST invoices: DGCI launches nationwide drive; arrests 25 persons

Fake GST invoices: DGCI launches nationwide drive; arrests 25 persons

DGGI will continue to raid entities involved in the fake invoices rackets; govt is planning to use AI and Aadhaar registration to prepare a list of dubious entities to check GST evasion

The Director-General of GST Intelligence (DGGI) has arrested 25 persons in just four days during its drive against those involved in issuing fake GST invoices. Under the drive, a total of 350 cases have been registered against 1,180 entities. Prominent among those who arrested are the son of an MLA and two charted accountants. The total amount involving fake invoices is yet to be ascertained, CNBC TV18 reported citing sources.

The department will continue to raids entities involved in the fake invoices rackets. The arrests have been made as part of the government's drive against those using fake invoices to evade GST, income tax and those involved in money laundering. The action was taken after a high-level meeting between the Department of Revenue officials earlier this month.

Also read: How a CA aspirant pulled off Rs 50 crore GST input tax credit fraud

The arrested persons were dealing in goods such as MS/SS scrap, articles of iron & steel, copper road/wire, waste & scrap of non-ferrous metals, plastic granules, PVC resin, milk products, mobile, ad and animation services. The DGCI could further intensify the drive against GST evaders and fraudsters in the coming days. The raids were conducted in Delhi, Bengaluru, Surat, Vadodara, Bhilai, Jodhpur, Hyderabad, Mumbai, Ludhiana, Chennai, Nagpur, Kolkata, Gurugram and Ahmedabad.

In October too, the Directorate General of GST Intelligence (DGGI) detected around 115 fake firms spread over nine GST Commissionerates illegally claiming input tax credit to the tune of Rs 50.24 crore. The kingpin of this racket was Prince Manish Kumar Khatri, a third-year student and a partner in a Chartered Accountancy firm.

Similarly, GST officers also busted a racket, which generated fake bills worth about Rs 1,278 crore for fraudulently claiming ITC, and arrested one person last month. The syndicate was being operated by floating seven different fake firms with the intent of passing of inadmissible credit to the tune of Rs 137 crore.

Meanwhile, the government is planning to use artificial intelligence (AI) and Aadhaar registration to prepare a list of dubious entities to check Goods and Services Tax (GST) evasion. Such firms will be categorised as "risky" to keep a tab on their activities.

Also read: GST evasion: Govt to create database of 'risky' companies

Also read: GST officers bust fake billing racket, arrest 1 person