Officials of the Chennai North GST and Central Excise Commissionerate, Chennai, busted a racket of fraudulent companies engaged in raising fake tax invoices worth ₹352 crore for availing input tax credit by dealers of various commodities in the country.
According to a release, based on specific intelligence information and through data-based analysis, an officer — under the supervision of M. Sreedhar Reddy, Principal Commissioner of GST and Central Excise, Chennai North — raided multiple locations on November 15.
The teams found incriminating documents and electronic evidence pertaining to fake companies at nine locations that were searched.
The investigation found that the fake companies registered with the Department issued invoices without actually trading to various other companies. The bills were issued for commodities like gold jewellery, steel, plastics, fabric and timber.
A person named Danaram — the mastermind behind the scam — was arrested under the provisions of GST Law. Danaram had obtained 37 GST registrations and Kailash 13 registrations and floated 50 fake companies.
Modus operandi
Their modus operandi was to create fake companies, issue fake GST invoices and generate e-way bills with fake/wrong vehicle registration details, without supplying goods.
It came to light that they had issued tax invoices for a turnover of about ₹352 crore with a GST liability of nearly ₹61 crore, the statement said.
The individuals admitted that the firms do not exist. Further investigation is in progress, the statement said.
