The Commercial Taxes Department of Karnataka arrested a key mastermind of a multi-state multi-crore GST fraud in a two-day operation. The issue was on fake invoices totalling ₹1008 crore which led to the illegal availing of Input Tax Credit of ₹180 crore.
The operation spanning over two days was conducted in collaboration with Kerala State GST authorities and revealed significant fraudulent activities. The accused was caught in Mysuru.
The accused used to acquire dummy GST registrations using forged documents, facilitating scrap businesses in Kerala, Tamil Nadu, and Karnataka. He further issued fake tax invoices, misappropriating Input Tax Credits without remitting the taxes to the governments in the initial transaction. The fraudulent network extended its operations to Kerala and Tamil Nadu, obtaining fake GST registrations to unlawfully transfer bogus Input Tax Credits to fake taxpayers registered in Karnataka.
The investigation exposed the complicity of certain auditors and GST practitioners in these fraudulent activities. The department claimed that they successfully dismantled a GST fraud racket involving approximately 100 bogus registrations across Karnataka, Kerala, and Tamil Nadu.
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