New Delhi, Nov The Directorate General of GST Intelligence (DGGI) has uncovered a massive case of fraudulently availing Input Tax Credit (ITC) to the tune of RS 645 crore through a web of 229 dummy GST-registered firms, controlled and operated by a Delhi-based syndicate.
The kingpin of the racket has been arrested, according to an official statement issued on Thursday.
Acting on credible intelligence, DGGI officers of the Delhi Zone conducted a coordinated search operations at multiple premises across the national capital, unearthing a huge cache of incriminating documents, digital devices, and ledgers that established the operation of non-existent firms engaged in issuing invoices without actual supply of goods or services.
"The seizures included 162 mobile phones, probably used to get OTPs for GST/banking purposes, 44 digital signatures and more than 200 cheque books of various firms. The preliminary findings indicate that these bogus entities were engaged in issuance of invoices without any actual supply of goods or services, resulting in the fraudulent passing of ineligible ITC amounting to around Rs 645 crore, causing substantial loss to the exchequer," the statement said.
Investigations have revealed that Mukesh Sharma, a key conspirator, orchestrated the operations of this network of fake entities.
Evidence points to his active role in managing GST registrations and returns and records of dummy firms, managing banking transactions, and facilitating the circulation of illicit funds through multiple layers.
As the offences of Mukesh Sharma are cognisable and non-bailable, he was arrested on Tuesday under Sections 132(1)(b) and 132(1)(c) of the CGST Act, 2017 and has been sent to judicial custody, the statement added.
The investigation has also brought to light a possible money-laundering component, wherein proceeds of the fraud were allegedly rotated through an NGO and a political outfit.
Further investigation is underway in the case to unravel the wider network involved in the racket, the statement added.
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