The Directorate General of GST Intelligence busted a fraudulent input tax credit racket worth Rs816 crore. The racket was being executed through 130 shell companies. The search operation led to the recovery and seizure of as many as 28 cheque books in the name of various people and about 16 debit cards.
A search was carried out at the residential premises of Zahirabbas Mazharbhai Vakaliya in Prahladnagar in Ahmedabad. The search led to the recovery of huge incriminating documents revealing details of GST registration for non-existent and non-operative firms. The documents also pointed to fake invoices which helped them claim fraudulent Input Tax Credit (ITC). The ITC was claimed for goods that were never supplied or received. Sources said the racket caused the exchequer a loss of Rs139.44 crore.
Lookout for 3rd person Digital data recovery revealed details of the 130 non-existent GST entities (shell companies) as well as several fake firm handlers. The details were in an encrypted format on the laptop of Sojebabbas Mohsinali Bhimani, who works as an accountant for Vakaliya. The two men were later arrested and will be presented in court on July 22. A third suspect is likely to be booked in the same case and arrested on Saturday.
After uncovering at least 28 different bank accounts, DGGI officials are now attempting to uncover the identities of more ‘fake owners’ of these shell companies. The fake owners are spread across several cities of Rajasthan, Madhya Pradesh, and Chhattisgarh apart from Gujarat.
The accused offered fake jobs to unemployed men and took their signatures on documents needed for the incorporation of shell companies, GST numbers and bank accounts. This helped them create fake invoices and avail of the ITC.