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31-year-old Arrested for GST Fraud of Rs 33 Crore, 2 Accomplices Still at Large

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North Chennai Central Goods and Services Tax (GST) Commissionerate on Friday arrested a 31-year-old for committing a Rs 33 crore tax fraud by issuing fake tax invoices to avail GST credit.

“The arrest was carried out after a detailed investigation and searches to gather evidence. The person arrested was produced before Additional Chief Metropolitan Magistrate, who remanded him to judicial custody till December 18,” GST Principal Commissioner Ravindranath said.

The modus operandi of the three persons is to open not less than 100 business centres and get GST registration with identity documents of other individuals. “The purpose of floating such fictitious companies was to commit GST credit frauds. These companies issued tax invoices to various business entities, without transacting any business or supplying any goods or services for a commission to facilitate availment of GST credit,” added Ravidranath.

GST on such bogus invoices was also paid using input tax credit, based on fraudulent tax invoices received from other fictitious companies. “In the process, GST credit fraud of Rs 33 crore on the invoice value of Rs 350 crore was committed by the arrested person, along with his accomplices,” said the principal commissioner.

However, the department is on the lookout for his two accomplices and has also identified all others either involved in or benefitted from the fraud. The investigation is also focused on tax practitioners for their role in helping these fraudsters commit the fraud, the commissioner added.