GST Fraud: 6 CAs, 3 CEOs, 36 MDs, Directors arrested in countrywide crackdown

GST intelligence authorities have arrested 215 people, booked over 2200 cases and recovered Rs 700 crore from the fraudsters in the last two months in a countrywide crackdown on GST fraud, writes Krishnanand Tripathi, Deputy News Editor, ETV Bharat.

New Delhi:In the ongoing nationwide crackdown against the use of fake GST invoices, the GST intelligence authorities have so far arrested 215 people, booked over 2200 cases and recovered Rs 700 crore from the fraudsters in the last two months, ETV Bharat has learnt.

Out of total 215 persons arrested so far, 17 people have been arrested in the last two days.

According to the sources in the department of revenue, there are six chartered accountants, 3 CEOs, 36 managing directors and directors, 15 partners and 81 proprietors among others who have been arrested for using fake GST bills to fraudulently claim the input tax credit without actual supply of goods and services.

GST authorities have cancelled more than 6,600 GST numbers so far.

Officials said that those arrested include not only the bogus GST dealers but also include the end beneficiaries who connive with these fake GST dealers to avail input tax credit on a commission basis.

In addition to six chartered accountants, there is one company secretary, one broker and one GST practitioner among the offenders who have been arrested in the drive which started in the second week of November last year.

“Use of data analytics, data-sharing and AI along with the BAFTA tool has enabled the GST ecosystem and intelligence authorities to identify layer-by-layer activities of these fake entities and pinpoint the fraudsters with precise input,” a source told ETV Bharat.

GST intelligence officials have also arrested over 70 masterminds, including a lady mastermind from Chennai who floated multiple firms in the name of family members and relatives to commit fraud under the GST, and several other influential people including a son of a powerful Maharashtra legislator.

“Those arrested include managing directors, directors, proprietors and partners of various business and trade entities who are either involved in availing or utilizing the ineligible ITC fraudulently,” said an official.

Mumbai tops the list of arrested offenders

According to officials, the use of fake GST bills has been widespread in several parts of the country but maximum arrests have been made from Mumbai Zone which accounts for 23 arrests so far.

Ahmedabad zone has booked 14 cases against in the last two days, and according to officials, eight non-existent entities were used in fraudulent claims of input tax credit of more than Rs 113 crores by using fake invoices.

These bogus entities were engaged in the trade of garments, copper waste scrap, medicines, ferrous waste and scrap, cement and coal, among other things.