Probe reveals non-existent firm, accounts and addresses
The Delhi government’s Trade and Taxes Department has detected a fraud of ₹50 crore by a businessman who allegedly used forged documents, incorrectly claimed input tax credit (ITC) under the Goods and Services Tax (GST) regime and passed some of it along to other businesses.
The Department’s Commissioner, H. Rajesh Prasad, said on Wednesday that the department had filed a complaint with the Economic Offences Wing of the Delhi police in connection with the fraud.
A complaint dated October 12 stated that the accused, Pankaj Chawla, proprietor of Kavita Industries, allegedly defrauded the government by using fake documents, falsely claiming ITC without being eligible and transferring ₹15 crore in ITC to other traders. The remaining credit of ₹35 crore had been suspended by the department when it learned of the fraud, the commissioner said.
ITC of ₹47.46 crore
The complaint noted that after the GST replaced the earlier Value Added Tax (VAT) regime from July 1, 2017, the accused claimed a total ITC of ₹47.46 crore, a large figure that had to be verified by an inspector.
On June 22, when the inspector visited the Wazirpur address given by the accused for signing up for the GST portal, it was found that no such company existed there.
The inspector then visited two residential addresses associated with the company and found that both were non-existent.
The department then sent a request to Karnataka Bank, in which the accused had declared an account, to verify the details, but was informed that no such account existed.
The department also contacted the Income Tax Department to verify the details of the PAN card given by the accused.
When the inspector visited the address linked to the PAN card given, it was found that no one by the name of the accused lived or worked there.
The department further found that the accused’s company had used the ITC to set off its output tax liability of ₹15.8 crore.