Exporter arrested for GST fraud

The officers of Anti Evasion wing of Thane CGST Commissionerate of Mumbai zone have arrested an exporter who is Director of a Private Limited Company, for fraudulently claiming GST Input Tax Credit (ITC) of Rs. 15.26 Crore. This ITC was claimed on the basis of bogus invoices of  Rs. 85 Crore issued by the fake entities.

Based on inputs received from Delhi Customs and further developed by Officers of Thane Commissionerate, an investigation was initiated against M/s. Corvette Tradelink Pvt. Ltd, Borivali. Investigation revealed that this firm was engaged in export of footwear and had availed GST Input Tax Credit fraudulently on the basis of bogus invoices issued by non-existent fake entities from  Delhi The Company had used this fake ITC for payment of IGST for exports through ICD Tughlakabad, Delhi and had subsequently claimed IGST refund from Indian Customs on the fake ITC so used.

One Director of the said Private Limited Company  was arrested on 03.03.2022, under Section 69 of CGST Act 2017 for contravention of Section 132(b) and 132(c) of CGST Act 2017 and produced before Chief Metropolitan Magistrate, Mumbai. The accused  was sent to judicial custody for 14 days by the magistrate.  If proved guilty, he shall face imprisonment up to 5 years and fine.

This case is a part of Anti-Evasion drive launched by CGST, Mumbai Zone against the tax evaders and fraudsters. CGST Thane Commissionerate has detected tax evasion of Rs. 1238 Crore, recovered  Rs. 20 crore and arrested 7 persons during last six months.

The CGST department is using data-mining, data analysis and network analysis tools to identify potential tax evaders and fraudsters. The department is focusing on all sectors of economy including service sector, exports, imports and digital economy to identify tax evaders who has been causing unfair competition for honest and compliant tax payers. The department is going to intensify this anti-evasion drive in the coming days and months.