P K Abdul Raheem, proprietor of Thouheed Scrap Dealer, and Abdul Khader Kuloor Chayebba, proprietor of M K Traders, were arrested by officers of the Anti-evasion Wing of Mangalore Central GST Commissionerate on charges of raising fake invoices and evasion of GST.
Commissioner of Central GST Dharm Singh, in a press release, stated that the firms had taken fraudulent input tax credit (ITC) based on ‘fake invoices’ received from different firms or entities, without actual receipt of the goods. The amount involved is estimated at over Rs 83 crore.
The fraudulent ITC was utilised for evasion of GST payable on supplies of metal scrap, procured from local unregistered dealers to the manufacturers of aluminium, MS, copper rods, ingots and castings. The commissioner said that they were also involved in raising fake invoices to transfer the fake ITC credit further in the invoice chain.
The offence involved falls under the cognisable and non-bailable offence as per provisions of Section 132 of the CGST Act, attracting inter alia, the provisions for arrest under Section 69 of CGST Act. Singh said that the investigation is in progress to identify other firms involved in the racket.
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