The Pune zonal unit of the Directorate-General of GST Intelligence (DGGI) has unearthed trading of fake invoices and arrested one person in this connection. It is estimated that over Rs 50 crore of Input Tax Credit (ITC) was availed of illegally.
Sources in the Finance Ministry said on Sunday that a person named Tusshar Ashok Munoat has been arrested for alleged involvement in generating fake invoices on commission basis for ineligible ITC availment, and for passing them on to others fraudulently.
According to sources, he reportedly admitted to using fake invoices and owns a few firms including Rutu Enterprise, Reise Enterprises, Namo Enterprises and Patil Contractor. So far, he has issued bogus/ fake invoices for ITC availment worth Rs 32.56 lakh and passed on fake invoices for ITC worth Rs 19.63 lakh. The total ITC involved is approximately Rs 52.19 crore. Further investigations are in progress.
Sources said, during investigations against Finnova Infotech and Softtech Ltd on availment of ineligible ITC through fake invoices, it was noticed in a data analytics exercise in November last year that Rutu Enterprise and other companies including Reise Enterprises, Namo Enterprises and Patil Contractor, had issued fake invoices without supply of goods/ services. Accordingly, investigations against these firms were initiated last November and their registered premises were searched. It was found that none of these firms operated from their registered premises and were all controlled by Munoat. The details of ITC involved in the transactions pertained to the supply of construction service and works contract service, among others.
Munoat was arrested on October 21 from a remote village in Osmanabad district of Maharashtra. He was produced before the Magistrate, who rejected his bail application and remanded him to judicial custody till November 2.
In order to curb the menace of the fraudulent availment and passing of ITC through fake invoices, the government has started the use of Aadhaar in GST registration. The Revenue Department is in deliberations to put such dubious firms in the risk category and to block their refunds, besides other appropriate legal actions, as necessary.