The Thane Central Board Of Indirect Taxes & Customs and Central Excise Commissionerate has dismantled a fraudulent Input Tax Credit operation involving 19 fake entities and the illegal passing of Rs 34.74 crore, news agency ANI reported on Saturday. The mastermind of the fraud and his two accomplices have been arrested in this case
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The Thane Central Board of Indirect Taxes and Customs (CGST) and Central Excise Commissionerate, which are a part of the Mumbai CGST and CX Zone, dismantled a fraudulent Input Tax Credit (ITC) scheme involving 19 fake entities, leading to the illegal passing of Rs 34.74 crore in fraudulent ITC and the arrest of the mastermind and his two accomplices.
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During a series of follow-up searches, the authorities uncovered incriminating evidence, including fake invoices, chequebooks, laptops, and pen drives containing details of the bogus firms.
The investigation revealed that the alleged mastermind of the fraud, Bhavesh Kachiyapatel, along with his accomplices Dilip Bhatt and Hardik Shah, orchestrated the crime by recruiting individuals through monetary inducements.
These individuals were allegedly enticed into providing their identification documents, such as AADHAR cards, PAN cards, and other KYC documents.
These documents were then misused to register GST accounts in the names of these individuals, falsely designating them as proprietors or directors of the fake firms.
Bank accounts were also opened in the names of these fictitious companies to facilitate the fraudulent activities.
19 fake firms created by accused
The accused trio created 19 fake firms, enabling them to fraudulently avail ITC worth approximately Rs 40.66 crore. Of this, Rs 34.74 crore was illegally passed on to other entities, causing significant revenue loss to the exchequer, news agency ANI reported.
Following their arrest, the three accused were produced before the Chief Judicial Magistrate in Thane. The magistrate remanded them in judicial custody for 14 days, until 13th September.
Authorities said that further investigations are ongoing, with additional revelations expected as the case unfolds.
In March, the Anti-Corruption Bureau (ACB) filed a first information report (FIR) against a state GST inspector and 16 traders for allegedly committing a fraud of more than Rs 175 crore. The ACB acted upon mid-day's reports in September and October 2023. Following a vigilance probe by the state GST department, an FIR was registered against the 44-year-old inspector and 16 traders who were suspected of colluding with him.
In its statement, ACB announced that the FIR was filed against the inspector and the traders under various sections of the Indian Penal Code, including criminal conspiracy, criminal breach of trust, cheating, and the relevant sections of the Prevention of Corruption Act.
(With ANI inputs)
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