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GST Fraud: GST officials have once again exposed the fraud. During the raids conducted in Delhi-NCR, it was revealed that Rs 645 crore was recovered through fake input tax credit through 229 fake companies.
New Delhi. The government has tried to provide convenience and easy process to crores of businessmen of the country by making rules like GST, but some people take wrong advantage of it. A gang of such people was recently busted, where Rs 645 crore was recovered from the government in the name of refund without any supply of goods or from the company itself. For this, 229 fake companies were created and input tax credit was collected in the name of these companies.
The Finance Ministry said that the Directorate General of GST Intelligence (DGGI) conducted raids at many places in Delhi-NCR. In this, GST officials busted a gang that allegedly committed ITC (input tax credit) fraud of Rs 645 crore through 229 fake GST registered firms. The Directorate General of GST Intelligence (DGGI), Delhi Regional Unit, conducted search operations at several premises in the national capital. During this, a large quantity of objectionable documents, digital devices and ledgers were recovered. These revealed that these fake companies were issuing invoices without actual supply of any goods or services.
What was recovered in the search
Items recovered during the search operation included 162 mobile phones, which were possibly used to obtain OTPs for GST and banking purposes. Apart from this, 44 digital signatures and more than 200 check books of various firms were also recovered. It was through these companies and checkbooks that the fraudsters used to show their business and collect ITC by making fake bills in the name of these companies.
How did the game of fraud work?
The whole game of fraud was about collecting ITC. ITC i.e. Input Tax Credit is available when the GST rate applicable on the company’s raw materials is lower than its finished product. In such a situation, companies claim the difference between the GST on these raw materials and the GST on the finished product in the form of GST return. The fraudsters also showed the supply of raw materials through a firm on which higher GST was charged. Fake supply of finished products through another company of his own was also seen. After this, the return was filed to recover the difference in GST between the two products as input tax credit. In this way, Rs 645 crore was recovered from the government without supplying any raw material or product.
Fraud worth Rs 2 lakh crore last year
The game of making a dent in GST through ITC has been going on since the implementation of this new law. If we look at the figures of the last financial year, in 2024-25, more than 25 thousand cases of fake ITC claims were reported across the country and a fraud of Rs 1.95 lakh crore was done. Ever since the GST law came into force, more than Rs 5 lakh crore has gone into fake ITC claims. Recovery was also done from this, but its quantity is very less in the total amount.
