Chennai: The officers of the Directorate General of GST Intelligence, Zonal Unit, Coimbatore conducted simultaneous search operations at the residence and business premises of the ‘key person’ of a fake bill trading racket, who had set up multiple fictitious registrations in Salem, Karur, Coimbatore and Pollachi, to generate and pass on fraudulent input tax credit.
According to an official release, all these firms were shown as engaging in different businesses such as plywood business, ceramic products, etc. in Tamilnadu.
“All in all, these firms have passed on Input Tax Credit without supply of goods with a taxable value of approximately Rs 318 crore, thereby availing and passing on fraudulent ITC of around Rs 40 crore to various entities.”
The release said further: “This key person, in connivance with another key person and mastermind, had set up and controlled various GST registrations, one of which was created under his own PAN, while other companies were registered in the name of his relatives and friends in order to avail and pass on ineligible Input Tax Credit without supply of goods, thereby resulting in massive loss of revenue to the government.”
During the search operation, incriminating documents like cheque books and passbooks of the bank accounts set up in the name of these fake firms were recovered from his residential premises.
The offender admitted having aided in issuing fake bill through multiple fictitious registrations by misusing the facility extended by government under GST regime for ease of doing business. The proxy firms floated by him have availed or passed on input tax credit without actual supply or receipt of goods.
The key person has been placed under arrest and produced for judicial custody as the investigation is in crucial stage.