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Delhi South CGST unearths fake invoicing racket involving tax evasion of Rs 17 crore, arrests two persons

New Delhi: The Central Goods and Service Tax (CGST) Delhi South Commissionerate has busted a racket of firms fraudulently claiming Input Tax Credit (ITC) of Rs 17 crore and arrested two people in connection with the matter.
Upon specific inputs, the officers of CGST Delhi South Commissionerate found certain bogus firms that were created solely for the purpose of generating goods less invoices and passing on of ineligible input tax credit along the chain. According to an official statement, inspections were conducted at the registered premises of three bogus firms/companies registered in the jurisdiction of CGST Delhi South Commissionerate that were allegedly engaged in fake invoicing and circular trading. Incriminating documents were resumed from the premises of the taxpayers.
"A preliminary enquiry conducted so far into the transactions of these firms has revealed tax evasion of Rs 17 crore approx. The Proprietor/Director in his confessional statements has admitted his role in passing and availing fraudulent ITC without any underlying supply of goods," the statement said.
"The persons behind the bogus firms have defrauded the government exchequer and committed offences specified under section 132(1)(b) and 132(1)(c) of the CGST Act 2017 which are cognizable and non-bailable. Two persons namely Sanjay Kumar Srivastava and Sunil Gulati have been arrested on March 17, 2023," it added.
The accused were produced before the Duty Metropolitan Magistrate following which they have been remanded to judicial custody for 14 days.
Further investigation into the matter is in progress. (ANI)

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