GST Evasion: Two more arrested in Hyderabad

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Two more persons have been arrested in Hyderabad in connection with the Rs 8.23 crore GST input tax credit fraud on Friday. The fraud, involving a network of unknown assailants who were floating multiple dummy firms using which fraudulent input tax credit was availed and utilized, was unearthed recently.

The two persons, Rajesh Dhoot and Mukesh Dhoot, running Likasan Traders and Om Dhanalaxmi Traders from Katedan Industrial Estate were identified as beneficiaries of GST Fraud after the search proceedings conducted in their official premises of two separate firms registered with GSTN.

Both were produced before the Judge for Economic Offences which also handles all cases booked under the newly rolled out GST tax schedules and remanded to judicial custody.

“They are the beneficiaries of the fraud. A number of their suspicious transactions are being verified. We suspect many more persons are involved,” said an official. In a separate incident from November 1, two persons —Majjiga Narasimha Raju and Shaik Shaker—were arrested after they were found to have issued invoices worth `25 lakh and `9 lakh respectively to dummy firms. This was done to avail the required input tax credit and make uncalled for benefits.

As many as 20 firms were initially identified to be involved in the high-technology fraud. While most of them were found to be fictitious in spite of being registered with the GSTN, officials have found some of them to be physically operational on the ground. The challenge before the officials of GST Commissionerate is now to identify those with a legible fraud and devise methods to do so.

Last week, the GST department, Hyderabad detected an evasion of rupees 8.23 crore by multiple dummy firms, which are used for availing and utilizing fraudulent input tax credit.

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