GST Intelligence Busts Rs 102 Crore Fake Billing Racket in Rajkot, Two Arrested
The Directorate General of GST Intelligence (DGGI), Ahmedabad zonal unit, has made a significant breakthrough by arresting two individuals from Rajkot for allegedly orchestrating a sophisticated fake billing racket. The accused, identified as Vaibhav Boricha and Jatin Sakariya, are charged with fraudulently availing and passing on input tax credit (ITC) worth a staggering Rs 102.25 crore. This arrest marks a major crackdown on tax evasion activities in the region, highlighting the vigilance of GST authorities in combating financial crimes.
Coordinated Searches and Legal Action
The arrests were executed under Section 69 of the CGST Act, 2017, following meticulously coordinated searches at multiple premises linked to the accused and their associates. During these operations, officials seized a trove of incriminating evidence, including documents, mobile phones, and electronic devices. These items are currently under thorough examination to unravel the full extent of the fraudulent scheme and identify any additional accomplices involved in the racket.
Uncovering the Fake Billing Network
According to DGGI investigations, Boricha and Sakariya allegedly controlled a network of 23 dummy firms, with 14 of these firms actively used to issue bogus tax invoices. The probe has so far unearthed invoices worth approximately Rs 545 crore that were generated without any actual movement of goods, indicating a purely paper-based fraud designed to manipulate the GST system. Sakariya played a pivotal role in this operation by managing GST registrations, filing returns, and liaising with beneficiary firms to facilitate the issuance of fake invoices, thereby enabling wrongful ITC claims.
Use of Angadia Firms as Conduits
In a further twist, investigators discovered that the accused utilized angadia firms as conduits to transfer and circulate cash, adding a layer of complexity to their illicit activities. This method allowed them to obscure the trail of funds and evade detection, showcasing the elaborate nature of the racket. The involvement of such traditional cash-carrying services underscores the challenges faced by authorities in tracking and preventing financial fraud in the digital age.
Implications and Ongoing Efforts
This case underscores the persistent efforts of the DGGI to clamp down on GST fraud and protect the integrity of India's tax system. The arrest of Boricha and Sakariya serves as a stern warning to those engaged in similar fraudulent practices, emphasizing that stringent legal actions will be taken against offenders. Authorities continue to analyze the seized evidence to ensure all aspects of the racket are fully exposed, potentially leading to more arrests and recovery of evaded taxes. The crackdown is expected to bolster compliance and deter future attempts at tax evasion in the business community.
