GST: 5 arrested for operating bogus billing network

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Chandigarh, Mar 13 (PTI) Five people were arrested on Saturday for allegedly operating a GST bogus billing network in Punjab and other states, an official statement said here.

The statement said the scam could be around Rs 700 crore.

Officials of the investigation wing of the Punjab State GST Department arrested five persons for creating and operating a bogus billing network across various states, including Punjab, Delhi and Haryana, it said.

Giving details of the modus operandi, the statement said the accused used to pass on bogus input tax credit to various firms without due payment of tax to the government.

Search and seizure operations were conducted at multiple locations in Khanna of Punjab by teams of the department to gather evidence for establishing the modus operandi that also involved creating firms dealing in copper scrap and hosiery items.

The input tax credit created through bogus firms was used to support the local movement of goods of various traders.

The department got alert about the network after a vehicle carrying copper scrap was detained by its officials in Jalandhar last year and investigation had revealed that the goods had been procured locally while e-way and invoice were generated from some other firm.

“Detailed investigation revealed a network of 44 firms spread across states that was being used to create the bogus ITC for setting off the tax liability arising out of purchases made from local unregistered dealers. On being confronted with the evidence, the main kingpin accepted that he was operating the network with the help of some other accomplices some of whom have also been arrested.

During search operations incriminating documents related to various firms and mobile phones used for sharing fake invoices and e-way bills generated were seized. The total bogus billing by the network is likely to be more than Rs 700 crore while ITC created/availed and tax evaded is more than Rs 122 crore. Evidence was also gathered about various beneficiaries of the bogus network and other accomplices involved,” as per the statement.

The accused were produced before the duty magistrate and were sent to judicial custody for 14 days. The persons arrested were identified as Vinod kumar, Maninder Sharma, Sandeep Singh, Amarinder Singh and Sunny Mehta, the statement said.

All the accused belong to Khanna town of Ludhiana district. A hunt is on to nab other accused, it said.

Action against various beneficiaries and other accomplices is also being initiated. Details of the firms registered in the names of the accused and other persons outside Punjab is being compiled and will be shared with other states for necessary action. Further investigation is going on, it said. PTI SUN VSD RDK RDK