LUDHIANA: The past week in Ludhiana has turned out to be perfect Diwali week for both central GST (CGST) commissionerate, and state GST (SGST) department here as in just a span of three days both departments managed to unearth bogus billing totalling over a whopping Rs 760 crore involving forged input tax credit (ITC) claims of Rs 74 crore.
These three cases by far are among the biggest ones busted in Ludhiana this year and interestingly, there are several firsts in these operations in which five accused were arrested. The major one being that these were the first arrests under the GST Act in Ludhiana, which has made both CGST and SGST empowered more than before.
Secondly, this was the first action by the newly formed special investigation team (SIT) of the SGST, which has been entrusted with the task of detecting the tax frauds and tax evasion and reports directly to the deputy excise and taxation commissioner (DETC)-level official. As far as the cases busted by the CGST include, these were the first ones done with the help of the newly developed fraud detection tool by the GST Network (GSTN) called Business Intelligence and Fraud Analytics (BIFA).
Speaking to TOI on the condition of anonymity, a senior official of the CGST department said, “This tool does in-depth data analysis of a firm, giving graphic details of the company’s entire business transactions and even genuineness of the purchases and sales among several other details. This way, it is helping the investigating officers to reach the conclusion about whether or not the firm has been involved in any wrongdoings and using this we can process information in a few hours for which earlier it used to take several days and even months.”
Meanwhile, in a shocking revelation in the case busted by the SGST department in which bogus billing to the tune of Rs 350 crore was done by three accused, a network of bogus firms was created in the name of unsuspecting and poor people like daily wagers, auto rickshaw drivers, etc. to avail ITC of Rs 30 crore. The web of companies to do circular trading was created across five states in order to pass on the fraudulent ITC to the accused. According to sources, in one of the cases busted by the CGST a similar pattern of availing ITC had been followed, as owner of one of the firms shown in the registration, which had claimed forged ITC, had turned out to be a daily wager.
Box – Recent arrests in bogus billing cases
The cumulative total of bogus billing unearthed in three different cases busted by the SGST and CGST, Ludhiana, is about Rs 760 crore and the total ITC claimed by the accused in all cases combined amounts to Rs 74 crores roughly.
Nov 12 - CGST commissionerate, Ludhiana, busts a network of companies which committed bogus billing of more than Rs 158 crore and availed forged ITC of Rs 26 crore. One person was arrested in the case
Nov 11- CGST commissionerate, Ludhiana, busts a case involving bogus billing to the tune of Rs 252 crore, involving forged ITC of Rs 17.65 crore done by creating 14 firms. One person arrested in the case
Nov 10 - SGST department, Ludhiana, busted a bogus billing network created by three persons who did bogus billing of about Rs 350 crore and availed ITC of more than Rs 30 crore. Three persons were arrested in the case