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Haryana police busts fake GST invoices racket, arrests 89

The Haryana police has busted four gangs running a racket of issuing fraudulent GST invoices to numerous firms leading to an estimated loss of nearly ₹465 crore to the public exchequer.

The busting of the racket has led to arrest of 89 people after the registration of 72 cases between July and October last year, Haryana Director General of Police Manoj Yadava said on Sunday.

“The Haryana police has busted four major gangs related to bogus firms involved in GST fake invoice bills scam which defrauded the government exchequer to the tune of over ₹464.12 crore through fraudulent means across the state,” he said.

A State police spokesperson added that the racket of causing loss to the exchequer through the issuance of forged GST invoices to firms with fake Goods and Services Tax Identification Numbers (GSTIN) was unearthed by police during a two-year-long investigation by it.

“Among the total cases, 40 have been lodged against key accused gang members Govind Sharma, Gaurav, Anupam Singla and Rakesh Arora, who have been arrested,” the DGP said in an official statement.

The arrested mastermind of the racket, Anupam Singla, was also active in other states including Rajasthan, Gujarat, Punjab and Delhi.

Earlier also, he was booked by Director General GST Intelligence, Delhi in a GST scam, the DGP said, adding he had also indulged in VAT frauds earlier before the rollout of GST tax system in the country.

Mr. Yadava said the arrested accused persons used to issue fraudulent invoices to numerous firms and companies without actual supply of goods through fraudulent E-way bills (GST-related challans for transporting consignments) and facilitated fake Input Tax Credit (ITC) entitlement on GST portal.

It also transpired during the investigation that fraudulent ITC entitlement receipts worth crores of rupees were generated by these gangs using fake GST invoices and e-way bills through forged bank transactions, he said.

The State police has also blocked inadmissible ITC worth of ₹97.22 crore in Excise and Taxation Department, he said.

The DGP informed that the major goods involved in these GST invoice scams were scrap, iron and steel articles, cotton-yarn and paper.

The probe is on in these cases to identify other beneficiaries to recover the tax liability from them, he added.

Giving details of their modus operandi, the DGP said the accused first used to register fake firms on GST portal in the name of gullible people and then generate fake invoices, bills of these firms by using various software apps and later uploaded these bills to generate e-way bills on GST portal.

These bills which were generated by these fraudsters were found to be fake on verification by the Crime Branch of Haryana Police.

These e-way bills mentioned registration numbers of ambulances, government vehicles, motorcycles, private vehicles which cannot be used for commercial purposes, he said in the statement.

On further inquiry, the bank account numbers which were shown in the GST registration forms of bogus firms were also found dubious and the fraudsters used another bank account gateway to deceive authorities, he said.

The probe also revealed that the accused established these non-existent firms on the basis of forged documents like rent agreements, electricity bills, PAN cards etc, the DGP said.

These fake firms had no business premises, no stock registers or purchase registers and often operate out of a small room with no infrastructure, he added.

As part of their modus operandi, they also regularly changed directors/proprietors of these fake firms along with their addresses, mobile numbers, PAN cards and email addresses every financial year to trick authorities into believing that they were genuine firms.

The Hisar Crime unit charged Anupam Singla, a resident of Sirsa, and some of his accused associates for allegedly evading GST amounting to ₹157.39 crore without actual supply of cotton yarn material.

He used to generate fraudulent ITC receipts for some well- established traders and cotton yarn spinners to help them discharge their GST liability and defraud the state government exchequer, the DGP said.

These fake firms were created to act as a link in the chain of many fraud firms and their ultimate aim was to transfer this ITC through a chain of many other bogus firms before being utilized by the original beneficiary so that it would be difficult for the government authorities to verify the genuineness of the bogus transactions which were merely on paper, he said.

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Printable version | Feb 28, 2021 4:22:03 AM | https://www.thehindu.com/news/national/other-states/haryana-police-busts-fake-gst-invoices-racket-arrests-89/article33594274.ece

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