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Rs 35 Cr Racket of Fake Input Tax Credit Busted In Mumbai

CGST Mumbai Central Commissionerate has busted a racket of fake Input Tax Credit (ITC) generators, who had been passing fake ITC to the tune of Rs 35 crores to various entities, a press release by PIB Mumbai stated.

The officers have arrested the kingpin for generating and passing on the fake credit to over 15 entities in and around Mumbai.

“The arrested person was receiving the fake ITC and passing it in the downward supply chain without actual receipt or supply of goods. He was arrested under section 69 of the CGST Act and produced before the Chief Judicial Magistrate on Tuesday (December 7, 2021). He has been remanded to judicial custody for 14 days,” the release said.

This case is one amongst a series of cases detected by the CGST Mumbai zone in the last three months, by launching a special campaign against those who are generating fictitious entities for availing and passing on fake ITC.

The officers from the Mumbai zone have unearthed more than 50 networks of tax evaders, detected tax evasion amounting to Rs 3000 crores, recovered tax of Rs. 400 crores and arrested 24 persons in the last three months.

“To support the honest taxpayers, it has been an endeavour of the CGST department to cleanse out the fake entities and tax evaders who are generating and utilizing the fake ITC without actual receipt or supply of goods,” the release stated.

“In order to increase the revenue mop-up, CGST department shall carry on this special drive by doing intensive data mining and data analytics along with the collection of specific intelligence from different sources,” the release said.

Earlier on Friday, Thane Central Central Goods and Services Tax (CGST) Commissionerate busted a fake GST Input Tax Credit racket worth Rs 12 crores and arrested one person.

The arrested accused allegedly indulged in fraudulent availed and utilised Input Tax Credit without receiving goods or services in violation of provisions of CGST Act 2017.


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