DDGI unearths GST racket of crores; mastermind held

STAFF REPORTER

GUWAHATI: The Guwahati Zonal Unit of Directorate General of GST Intelligence (DGGI) has unearthed a fake-invoicing racket allegedly involved in the issuance of fake GST invoices showing sale of TMT bars and cement worth approximately Rs 20.62 crore involving GST amounting to Rs 4.91 crore and also availed and utilized GST Input Tax Credit (ITC) worth Rs 4.438 crore.

According to the Additional Director of DGGI, Guwahati, L.S. Gangte, the official gathered information about the racket after weeks of rigorous surveillance; and initiated this investigation by way of inspection at the premises of a business outlet located in Guwahati and followed it up with subsequent searches at many official and residential premises. During the investigation, the DGGI officials traced the mastermind of this racket, who is a young entrepreneur in Guwahati. The DGGI officers also collected corroborative evidences against the entrepreneur by way of recording statements from his various suppliers and buyers which led to a statement of confession from the mastermind.

The mastermind received fraudulent GST ITC into his proprietorship from M/S Shanti Enterprise and his Hindu Undivided Family (HUF) firm from three other firms, of which he acted as a GST consultant and passed on fraudulent ITCs to 22 firms based in various parts of the North East without supply of goods and services. The DGGI has already started investigation against all these 22 firms.

The mastermind of this racket in his statement of confession accepted his quantum of evasion to be around Rs 4.91 crore, which is an offence inviting imprisonment up to three years under Section 132 (1) (ii) of the CGST Act, 2017 making him liable to be arrested under Section 69(1) of the Act.

Accordingly, the mastermind was arrested on Thursday (February 11, 2021). This is the first instance of an arrest made under the CGST Act, 2017 in the entire North East.

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