DGGI busts input tax credit frauds worth Rs 2,350 crore, three arrested

Continuing with its crackdown on availment of fictitious input tax credit, the Directorate General of GST Intelligence (DGGI) on Wednesday busted three more cases cumulatively amounting to frauds worth over Rs 2,350 crore.

Three people were arrested in connection with what was termed as "massive frauds" involving the availment and utilisation, as well as passing on of ineligible input tax credit (ITC) on the strength of bogus invoices, an official statement said.

In the first instance, one Sachin Bhoruka, a director or partner in various firms including Erman Metals, Pioneer Trading Co and Marshal Multiventures, was arrested for allegedly availing and utilising fictitious ITC amounting to Rs 485.64 crore.

He also passed on fictitious ITC amounting to Rs 485.55 crore, it said, pegging the total value of the fraud at Rs 971.19 crore.

In a parallel investigation, Mahesh Kinger, an authorised signatory for Blue Sea Commodities which now operates as Curzen Infraprojects, Blue Sea Commodities and director of Theme Lights, was arrested after being found to have allegedly availed ineligible ITC amounting to Rs 580.23 crore and passed on ineligible ITC worth Rs 579.76 crore, making it a Rs 1,159.99 crore fraud.

In a separate case, the authority arrested Deepak Kumar Prajapati, a director in Udyog Kiran, who was found to have created a complex web of over 22 firms that indulged in circular trading for the purpose of artificially inflating their turnover so as to avail higher bank loans and credit facilities and also indulging in ITC-related fraud, the statement said.

It has been noticed that Prajapati allegedly passed on bogus ITC amounting to approximately Rs 126 crore and availed ITC amounting to Rs 94 crore, it said, adding that the total fraud involves GST amounting to Rs 220 crore.

All the three have been booked under the relevant sections of the GST Act and produced before a local court, which has remanded to judicial custody.

DGGI has been busting fake ITC rackets through the month. PTI AA ABM ABM