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ACB Arrests Mastermind and Sales Tax Officer in Rs 175 Crore GST Refund Scam

Last updated: 08 July 2024

The Anti-Corruption Bureau (ACB) has arrested three individuals in connection with a ₹175 crore Goods and Services Tax (GST) refund scam. The arrested include Farooq Shaikh, Farooq Contractor, and state sales tax officer Amit Lalge. They are accused of submitting fraudulent export documents for 16 companies to claim GST refunds totaling ₹175 crore.

ACB Arrests Mastermind and Sales Tax Officer in Rs 175 Crore GST Refund Scam

Key Details

  • Arrests Made: The ACB presented the accused before a special ACB court, where they were remanded to police custody. The investigation is ongoing, with more arrests expected.

  • Fraudulent Activities: The accused allegedly conspired to obtain Aadhaar and PAN details of unemployed individuals under the pretext of offering them jobs and money. They secured affidavits and created 16 fictitious companies in these individuals' names, submitting 39 tax refund applications with false shipping bills and export documents.

  • Official Misconduct: Sales tax officer Amit Lalge is accused of abusing his official position by approving tax return files exceeding ₹5 lakh, despite lacking the authorization to do so. Lalge's actions facilitated the fraudulent refunds.

  • Mastermind's Role: Farooq Shaikh, a notorious fraudster previously detained by the CBI in a ₹2,200 crore fraud case, is alleged to have orchestrated the scam. Shaikh was taken into custody from Arthur Road jail, where he was already imprisoned.

  • ACB Investigation: The scam was uncovered after a sales tax department audit revealed that 16 companies had submitted tax refund applications without paying any tax. The ACB charged Lalge and 16 unknown traders with causing a wrongful loss of ₹175 crore to the government. The internal audit indicated collusion between Lalge and unknown individuals.

  • Further Legal Action: The ACB has charged the accused under various sections of the Prevention of Corruption Act and the Indian Penal Code related to cheating, forgery, and criminal breach of trust. The Enforcement Directorate (ED) and the Central Bureau of Investigation (CBI) have also charged Shaikh in other cheating and conspiracy cases.

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