GST scam: Odisha villagers allege lax enforcement, apathy

JAGATSINGHPUR: Lack of coordination between police and Goods and Services Tax (GST) as well as from loopholes in the system have allowed scamsters to go scot-free even after stealing identity of innocent villagers to register fake firms. Between April and December, the State exchequer is believed to have lost Rs 13 crore as the fraudsters get a free pass with no case registered against them.

While four such cases have been detected within two to three months, not a single case has been registered against the suspects. The GST enforcement team had raided the house of Bijay Nayak of Birabarapatana and Rinubala Sahoo of Tihudi, on November 2 and 13 respectively. The team found that a fake firm in the name of Nayak  - a contract worker in SVM college - was showing a turnover of Rs 8 crore to claim input tax credit of Rs 96 lakh. Nayak had no inkling of the goings-on.

Sahoo, a housewife, too was unaware of the fake company running under her name. So was Pratap Patra, a petty trader of Kendal village whose house was raided in September and Chakardhar Swain, a farmer of Patenigaon village whose house was searched last week. Many such cases have been reported from across the district. On Sunday, Nayak and Patra lodged FIR with Jagatsinghpur police and alleged that gullible people are being unduly penalised by GST officials.

Sources said fraudsters have been active in the district since last two to three years and pulling off one scam after another through identity theft of gullible villagers and registration of bogus companies in their names. After GST officials made raided houses of local farmers, contract workers, petty traders, housewives and daily labourers with fake firms registered under their names, the explosive bungling came to fore. These firms, whose address and contact details were found incorrect, reportedly issued fake invoices, e-way bills and even claimed input tax credit, bleeding the exchequer of over Rs 13 crores. Apparently, these villagers had shared documents like Aadhar and PAN card, electricity bills, passport photos and contact numbers with unknown people which fuelled identity theft for the scam.

Jagatsinghpur IIC Rajani Kant Mishra said police complaints have been received but no cases registered yet because GST officials have not yet communicated about the fraud. “Case should be registered under the enforcement unit of GST or Economic Offences Wing to unearth the fraud,” he added. On the other hand, a lawyer informed that not only police but GST officials have been empowered under Section 69 of the CGST Act to arrest accused persons in case of fraud, yet no action has been taken. 

A senior officer, central GST, Customs & Excise, Jagatsinghpur range said, “We cannot direct police to register cases in such fraud cases even if complainants have lodged FIRs. Instead of police, we are giving a detailed report to the division office, CGST (intelligence) and racket will be unearthed very soon.”

Alarming trend  

• Four such cases have been detected within two to three months

• Not a single case has been registered against the suspects

• GST fraudsters have been active in the district since the last two to three years

• Between April and December, the State exchequer is believed to have lost Rs 13 crore