The GST officials have detected a case of raising fake invoices without actual supply of goods and claiming GST refund for the same. The officials have taken action against two persons in this regard.
Mohammed Sahil from Coimbatore and Kandaswami from Tiruppur, were involved in issuing invoices without actual supply of goods and availing of input tax credit based on the fake invoices. This has been prima facie established based on the documents seized from their premises and also from their statements wherein they have admitted to the same. They had done so with an intention to claim refund fraudulently and also pass on credit to other fake companies. They had registered five fake companies, four in Tiruppur jurisdiction and one in Mumbai.
Both were arrested under Section 69 of the CGST Act, 2017 for contravention of Section 132(1)(b), 132(1)(c) of CGST Act, 2017 and have been remanded to police custody on August 13.
According to an official press release, based on intelligence and data analytics that fake invoices are being issued without actual supply of goods, the residence of the Mohammed Sahil, alias Sathya, was searched and various incriminating documents were seized. It was found that invoices were issued for around ₹ 50 crore within a month involving a GST amount of ₹ 10 crore (approximately) without actual supply of goods through various fake units floated by the accused.
On further investigation of Mohammed Sahil, it was found that the assessee due to business loss had asked for help from a GST consultant Kandaswami. He had, in turn, suggested the idea of floating fake companies for availing of fake credit and taking refund fraudulently from the Government under the GST Act. Both have floated the fake companies under random names and different addresses by providing false credentials and forging documents after which they have raised invoices without actual supply of goods. They had availed of input tax credit with the motive of filing refund and monetising the same. The official and residential premise of the consultant was also searched and similar incriminating documents viz, fake invoices, letterheads, mobile sim cards of numbers used to take registration of the fake units were found and seized. They had also claimed refund of ₹2.5 crore, which was not given.
The two had taken the help of Saravanan, a Chartered Accountant for filing refund with the GST office which was rejected. Investigations are on in the case.
