Commercial Tax Department unearthed GST fraud of Rs 315 crore

The Commercial Tax Department has unearthed GST fraud of Rs 315 crore by unearthing crores of tax evasion by bogus traders, non-existent firms.

The Commercial Tax Department is running a campaign against bogus businessmen who pass on ITC to other firms by issuing fake bills. In this context, data analysis by the officials of State GST Anti-Evasion Bureau Indore-A exposed the supply chain of bogus firms which were doing bogus turnover of crores of rupees.

During data analysis, it was found that some firms were making huge turnover in a short span of time after taking new registrations. During the preliminary examination of artificial intelligence geo-tagging and business sites, it was revealed that no business activities were found to be conducted at the business sites and the benefit of ITC was given to other businessmen on the basis of bogus bills without actually supplying the goods. Apart from this, discrepancies were also found in the documents shown in their registration. After analyzing their suspicious supply chain and knowing the solid basis, the Commercial Tax Department took action against the non-existent firms.

The bogus turnover of about Rs 315 crore was exposed in the raid proceedings. Action was taken on the bases of many firms simultaneously in Neemuch besides Indore. During the raid, many firms were found bogus, which were operating only on paper. By showing the supply of 315 crores of DOC in the return, the benefit of bogus ITC of about Rs 15 crores was passed on to other firms.

The bogus firms are mainly Shrinath Soya Exim Corporate, Shri Vaibhav Laxmi Industries, Agarwal Organic – Agarwal Overseas, JS Bhatia Enterprises etc. In the action taken on these firms, no business activities of any kind were found to be conducted at the places of business. Of these, M/s Srinath Soya Exim Corporate Firm was operating in the name of an auto driver Sachin Pateria, whose forged rental agreement was attached with the application at the time of registration. Its landlord had died many years ago, while the rent agreement had forged signatures of the deceased. Similarly Ajay Parmar, the proprietor of M/s Shri Vaibhav Laxmi Industries, was not found at the place of business. The rent agreement submitted at the time of registration application of the firm was found to be fake. At the time of checking, the owner of the business place recorded in the rent agreement gave a statement saying that the rental agreement was forged and that the business place was not given on rent by him to any firm. Similarly, Agarwal Organic and Agarwal Overseas were found to be non-existent. The process of ITC reversal is in progress by the department after taking action against these bogus firms who have given the benefit of ITC to firms from Madhya Pradesh and outside Madhya Pradesh.

Shri Manoj Choubey, Joint Commissioner, Anti-Evasion Bureau Indore-A, said that on the one hand bogus turnover of crores of rupees has been detected by this action of the department, while on the other hand, tax evasion by these bogus firms by issuing fake bills will be checked in future. Assistant Commissioner Shri Harish Jain informed that on the basis of data analysis and human intelligence, the department is preparing to take action against other firms which are doing such fraudulent transactions.