The Directorate General of Goods and Services Tax Intelligence (DGGI), Meerut Zonal Unit, has uncovered a massive network engaged in fraudulent invoicing. This network was responsible for generating invoices with a taxable turnover amounting to a staggering Rs. 1,481 crore, allowing for the illicit passage of Input Tax Credit worth Rs. 275 crore. This fraudulent activity was conducted through the use of 102 fictitious companies, benefiting over 1,000 recipient companies.
This remarkable accomplishment by the DGGI Meerut Zonal Unit was made possible through a meticulous process of data analysis and critical thinking, leading to the dismantling of a significant syndicate operated by four key masterminds. One of these individuals, working within a placement consultancy firm, played a pivotal role in obtaining essential documentation for GST registration, including PAN cards, Aadhaar cards, electricity bills, and address proofs.
To achieve this, this mastermind enticed individuals with financial incentives in exchange for their KYC (Know Your Customer) documents, which were then passed on to the other two masterminds. These two individuals were responsible for creating fictitious companies, managing bank accounts, overseeing financial transactions, and controlling the cash flow for these fraudulent entities.
Meanwhile, the fourth mastermind operated a covert office where crucial activities, such as generating invoices, creating e-way bills, filing GST returns, and maintaining sales and purchase records for the fraudulent firms, were carried out.
The syndicate also enlisted the help of several assistants and maintained connections with various middlemen who provided critical information for generating counterfeit invoices to benefit the ultimate beneficiaries. Furthermore, the investigation has revealed the complicity of bank officials in establishing bank accounts under the names of these fictitious firms.
In the course of their operation, officers from the DGGI conducted synchronized raids at multiple locations, leading to the seizure of a substantial cache of incriminating evidence. This evidence included laptops, desktop computers, electronic storage devices, PAN cards, Aadhaar cards, checkbooks, over 25 mobile phones, SIM cards used for receiving OTPs (One Time Passwords), and rubber stamps used by these sham entities.
All four accused masterminds were presented before the Economic Offence Court in Meerut on November 4, 2023, and they were remanded in judicial custody until November 17, 2023. This successful crackdown represents a significant achievement in the ongoing efforts to combat fraudulent invoicing and financial malpractice.
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