In a significant crackdown on GST fraud, the Central GST Itanagar Commissionerate has exposed a massive fake invoice racket involving Rs 658.55 crore in fraudulent transactions without any actual supply of goods. The investigation has revealed the misuse of the Input Tax Credit (ITC) mechanism, causing a loss of nearly Rs 99.30 crore to the government exchequer.
Bogus Firm and Fraudulent ITC Claims
The key player in the racket was identified as M/s Siddhi Vinayak Trade Merchants, a firm registered in Arunachal Pradesh, which facilitated ITC fraud by issuing fake invoices to 58 firms across India. The fraud involved:
- Creation of a fake firm using forged documents
- Issuance of invoices without actual goods supply
- Manipulation of GST returns to wrongfully claim ITC
Search Operation Uncovers Crucial Evidence
Acting on intelligence inputs, GST officials conducted a search operation in Kolkata, where they seized critical evidence, including:
- Seven mobile phones & one iPad (sent for forensic analysis)
- 53 PAN/Aadhaar cards of different individuals
- 17 rent agreements linked to the fraud
- Multiple forged KYC documents used for fake GST registrations
Investigators also found that the accused were filing fraudulent GST returns from the Kolkata location, further exposing a nationwide network of bogus transactions.
Masterminds Arrested in Bihar
Following the investigation, an FIR was lodged by the Central GST Department with Itanagar Police. The police, in coordination with GST officials, apprehended the masterminds Ashutosh Kumar Jha and Bipin Kumar Jha from Darbhanga, Bihar. On February 3, 2025, both accused were arrested under Section 69 of the CGST Act, 2017.
Nationwide Crackdown on Fake GST Registrations
This operation is part of a nationwide drive by the Central Board of Indirect Taxes and Customs (CBIC) to curb fake GST registrations and bogus invoice issuance. The authorities are stepping up enforcement actions to ensure tax compliance and prevent fraudulent ITC claims.
Strict Action to Continue Against GST Frauds
With investigations still ongoing, authorities have assured that stringent action will be taken against all individuals and entities involved. This case highlights the government's zero-tolerance policy toward tax fraud, ensuring that wrongdoers face legal consequences.
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