Mumbai: Three businessmen in Rs 100 crore tax con arrested

MUMBAI: The Central Goods and Service Tax (CGST) department has busted a GST racket where a gang of businessmen duped the government by showing fictitious firms and made fake sales and purchase invoices to claim input tax credit (ITC) of Rs 100 crore. Three businessmen have been arrested.

ITC is paid on purchase and can be used to reduce tax liability when a sale is made.

The arrested are director of Aura Spinwell Rakeshkumar Jain, proprietor of Aarudhi Impex Vipu Jain and proprietor of ASL Industries Manoj Sharma. Their aides are absconding.

On April 8, officials searched Spinwell and found sales and purchase invoices pertaining to Everflow Petrofils and the above companies. Rakeshkumar admitted that the companies are jointly operated by him and his brother Pinkesh and all transactions showing purchase and sale were merely on paper without actual supply of goods. He said that Everflow Petrofils supplied yarn to Aarudhi Impex which in turn supplied it to Auro Spinwell which supplied it to ASL and ASL which supplied it to Everflow.