Fake GST Bill: 1.63 lakh GST numbers cancelled in 2 months

A source in the department of revenue has confirmed that the tax authorities have booked 1,430 cases against 4,586 bogus firms having GST registration in the ongoing nationwide drive that started on November 9.

New Delhi:In one of the biggest nationwide drive against the use of fake GST bills, tax authorities have cancelled the GST registration of more than 1.63 lakh entities in October and November for not filing GST returns on time and also arrested 132 persons in the last one month, including four chartered accountants, ETV Bharat has learnt.

“Central GST officials and officers of the Directorate General of GST Intelligence (DGGI) have booked 1,430 cases against 4,586 bogus firms having GST registration in the ongoing nationwide drive that started on November 9,” said a source in the department of revenue.

“Akshay Jain, a chartered accountant, has been arrested from Visakhapatnam for issuing fake GST invoices to the tune of Rs 21 crore for supply of cements by creating 14 bogus firms,” the source told ETV Bharat.

Akshay Jain is the fourth chartered accountant to be arrested in this nationwide crackdown against the use of fake GST bills for fraudulently claiming the Input Tax Credit under the GST system.

Tax authorities have so far arrested several masterminds, including a lady mastermind Sagila M from Chennai who created several bogus firms on the name of her relatives and family members to commit GST fraud.

These offenders also include Sunil Gutte, son of influential Maharashtra MLA Ratnakar Gutte, who was arrested by the Mumbai zone and another mastermind Mitesh M Shah who was arrested by Ahmedabad zone for creating more than 100 bogus firms for committing GST fake bil fraud.

Cancellation of GST registration

Officials in the department of revenue said these 1.63 lakh GST registrations have been cancelled as they had not filed their GSTR-3B returns for more than six months.

Under the GST law, it is compulsory for entities having GST registration to file GSTR-3B returns every month for outward supplies.

“Before cancellation, notices were issued to these entities and then registrations were cancelled as per the standard procedure,” said an official.

Tax officials have also initiated action against 55 of over 700 firms that did not use Aadhaar for GST registration as discrepancies were detected in their functioning after grant of deemed GST registration to them between August and November.

Source said in addition to 1.63 lakh entities whose GST registrations have been cancelled, authorities have also identified over 28,000 taxpayers who have not filed GSTR-3B returns in the last six months and suo-moto action has been initiated against them.

Over 11,000 GST registrations have been cancelled in Ahmedabad zone while over 19,500 GST numbers have been cancelled in Chennai GST and Central Excise Zone.

Crackdown in Delhi-NCR

In Delhi zone, GST officials Thursday arrested Avijeet Saluja, who has been accused of creating five bogus firms for fraudulently claiming the input tax credit (ITC) to the tune of Rs 45 crore.

Officials said Avijeet Saluja, along with another director Lupita Saluja, created five private limited companies to commit GST fraud by using fake GST invoices by providing wrong information on e-way bill portal.

“During the course of investigation, it was found that most of the suppliers of these 5 companies were either found non-existent at the place of business or the address given in the GST registration was fabricated or non-existing,” officials in the finance ministry said.

On Friday, Avijeet Saluja was sent for 14 days judicial custody by a Delhi court.

Officials said GST Delhi zone has so far arrested 14 offenders and detected GST frauds worth over Rs 3,542 crore in the current financial year.

(Article by Krishnanand Tripathi)