CGST Navi Mumbai busts fake GST Input Tax Credit racket

New Delhi : On 17th November 2022, a key person responsible for handling the business activities of M/s Storage Miles (GSTIN: 27BCQPG7380A1ZJ) and M/s Catbus (GSTIN: 27AZIPP2044A1ZP) has been arrested by CGST, Navi Mumbai on the charges of availing/ utilizing/passing on fake Input Tax Credit (ITC) which was received from bogus/fake entities amounting to Rs 20.96 Crores (Availed Rs 10.48 crores and passed on Rs. 10.48 crores). Proprietor/operator who was accomplice to the aforesaid person was already arrested on 16th November, 2022.

After arrest of the proprietor/operator of above said firms, the team of officers of Anti-Evasion, CGST & C.Ex. Navi Mumbai gathered necessary information about the second accused and arrested him after tracking him down using proper surveillance. As mentioned earlier, the said firms have availed and utilized ITC of Rs. 10.48 crores which has been received from bogus/fake entities on the strength of bogus invoices received and passed on the same. The total amount of bogus invoices involved is to the tune of Rs.117 crores, without actual supply of goods or services.

As per the provisions of Section 132(1) (b) & (c) read with Section 132(1) (l) of the CGST Act, 2017, if taxpayer issues invoices and/or bills without supply of goods or services or both leading to wrongful availment or utilization of input tax credit, or avails input tax credit using such invoice or bill as well as attempts to commit or abet the commission of any offence stated above, the Section 132(1)(i) renders the taxpayer punishable with imprisonment for a term which may extend to five years and with fine. Further, as per Section 132(5) offences specified supra are cognizable and non-bailable.

The second accused has been arrested under Section 69 (1) of the Central Goods and Services Act, 2017 for committal of offences under Section 132 (1)(b) & (c) of the said Act and was produced before the Judicial Magistrate First class, Vashi at Belapur on 17.11.2022 and has been sent on judicial custody for 14 days.

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