The Goods and Services Tax (GST) department has recorded its first arrest on ground of availing ineligible credit. Two Mumbai based directors, Sanjiv Pravin Mehta, director of Shah Brothers Ispat Pvt Ltd, and Vinaykumar D Arya, Director of VN industries, Darukhana, Mumbai are arrested for availing ineligible credit of Rs 5.20 crore and Rs 2.03 crore, respectively.
According to sources, the two firms allegedly indulged in only paper/invoice movement and no actual goods changed hands, tax officials said.
Sources said that prima facie, there is a malafide intention to defraud exchequer and banks by opening LCs (letters of credit) on fake purchase transactions
The arrest has been approved by Commissioner, Mumbai Central, K N Raghavan and executed by Additional Commissioner Manpreet Arora, Assistant Commissioner Anand Gokhle and Superintendent Parecha.
