Big fraud detected | GST authorities captured fake international ITC billing worth Rs 88 crore through iron and steelmakers; 2 held

The Goods and Services Tax (GST) authorities uncovered connections to steel and steel traders associated with counterfeit tax credits, with bills related to illegal sales, worth Rs 8.79 crore, resulting in tax evasion rates of Rs 1.34 crore.

Three steel and steel merchants from Mandi Gobindgarh, Punjab, were illegally sold for Rs 879 crore, which allowed GST to escape Rs 134 crore, an investigation by GST Intelligence (DGGI) Ludhiana General Administration. The three business entities are: Aar Dee Enterprises, Aashi Steel Industries and Abhi Alloys.

The forged discoveries highlight potential revenue losses from central and state authorities, which in turn affects funds for public welfare, infrastructure and social development, and causes damage to the entire economy and domestic market. This loss of income fundamentally hinders fair market competition and may even lead to inflationary pressures.

Key to understanding about fraudulent billing detected by the GST authorities:

How are fake bills detected? Inter-organizational and inter-regional cooperation and synergy between Ludhiana, Punjab and DGGI offices in Lucknow, Uttar Pradesh, led to the emergence of fraud.

How does wrongdoing work? Two men of Mandi Gobindgarh of Punjab and Devinder Singh of Khanna once deceptively sourced iron and steel articles through fake bills by deepanshu srivastava and his accomplice Mohit Kumar. The Lucknow-based Duty Tax Credit (ITC) passed the Mandy Gobingar entity to the Mandy Gobingar entity through 37 fraudulent business entities.

Further investigations show that entities in Punjab adopted fraudulent ITCs through fake bills from 78 commercial entities.

Dggi Ludhiana discovered and seized some evidence of charges against wrongdoing, which was confirmed in his voluntary statement.

GST Fraud | 2 Related to Fake ITC Billing

On May 15, Dggi Ludhiana arrested Chaurasia and Singh for his actions, causing GST to evade Rs 1.34 crore. The two were sent to judicial custody.

Dggi Ludhiana continues to fight GST fraud

The statement said the Ludhiana Authority has made great progress to eliminate the threat of fake bills and fraudulent exploitation, exploitation and passage of fake ITC.

Fake bills and fraudulent ITC claim that under the indirect tax system, the integrity of the indirect tax system poses a serious threat.

DGGI Ludhiana added: “This behavior erodes the public's trust in the tax system by establishing an uneven playing field, whereas the taxpayers bear the burden while the fraudsters benefit adversely. This undermines voluntary tax compliance, which is the cornerstone of any effective tax system.”

DGGI, led by the Ministry of Finance, is the country's top agency to investigate tax evasion related to GST. It uses a range of data analytics and intelligence networks to detect and prevent tax evasion.

What is an input tax credit, and what does a fake ITC bill mean?

Input tax refers to the supply of goods or services collected by the Central Goods and Services Tax (CGST), State GST (SGST), Comprehensive Goods and Services Tax (IGST) or Trade Union Territory GST (UTGST) to the registrant. It also includes taxes paid at the opposite expense and a comprehensive tax on imports of goods, excluding taxes paid under the constituent tax.

Entering a tax credit refers to the credit for supply taxes for goods and/or services received by a person.