GST authorities bust network of firms dealing in fake invoice

Goods and Services Tax (GST) authorities have bust two networks of firms indulging in tax frauds using fake invoices, leading to the arrest of one person, Central Board of Indirect Taxes and Customs (CBIC) said in a communication to officials on Monday.

The Directorate General of GST Intelligence (DGGI) bust a network of 16 firms after conducting searches at multiple premises in Punjab, Himachal Pradesh and Haryana, leading to detection of bogus invoices meant to pass on tax credits worth more than 115 crores.

In a separate operation, central GST officers in Gujarat discovered a web of 19 firms allegedly involved in export and claiming tax refunds on the basis of fraudulent invoices showing tax credits. The total tax credits involved in this case is about 52 crores. One person is arrested and further probe is on, CBIC said. Mint has seen a copy of the communication.

GST authorities have in recent past tightened the enforcement of tax compliance based on extensive use data analytics and sourcing of intelligence from various other regulatory agencies including customs department and the income tax department.

The compliance enforcement drive had to some extent helped step up GST receipts in recent months. GST collections of central and state governments have been staying above 1 trillion mark since last October. The government also tightened rules of tax credit as well as reporting requirements in recent months with the intention of improving tax compliance. Many small businesses are now seeking a relaxation on compliance given the reduced availability of manpower during the second wave of the pandemic.


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