UP Trader Booked for ₹7 Crores GST Fraud; Fake Sales Worth ₹55 Crore Unearthed
UP trader booked for ₹7-crore GST fraud after officials uncover fake sales worth ₹55 crore in Bhadohi.
GST - Fraud - Taxscan.
GST - Fraud - Taxscan.
Authorities in Bhadohi district have uncovered a large Goods and Services Tax (GST) fraud that caused a loss of around Rs. 7 crore to the government. Officials said that a local businessman created fake sales records worth more than Rs. 55 crore without actually supplying any goods.
According to officials, the accused, Pawan Kumar Mishra, is the owner of Pawan Traders, a firm registered in Katra Bazaar under the Koirauna police station area. Mishra had obtained GST registration for his business on December 22, 2019.
During an investigation, it was found that between June and August 2020, his firm declared sales amounting to Rs. 55.49 crore to traders based in Bihar and Punjab. However, there was no evidence of any goods being transported or delivered.
Officials from the State Tax Department said that the firm passed on Input Tax Credit (ITC) worth Rs. 7.29 crore to other traders. ITC is a tax benefit that businesses can claim for the tax already paid on purchases. By creating fake sales, the firm helped other entities wrongfully claim these credits, causing losses to the government.
Deputy Commissioner (State Tax) Manoj Agrawal said that the probe revealed that the traders in Bihar and Punjab were also not genuine. They had obtained their GST registrations using false information. The transactions existed only on paper, and there were no real invoices, transport documents, or goods to support the sales. Agrawal described the case as part of an “organized tax evasion and criminal conspiracy.”
Based on a complaint from the State Tax Department, the Koirauna police registered a case against Mishra on October 10. He has been booked under Sections 419, 420, 467, 468, and 471 of the Indian Penal Code which deal with cheating, forgery, and using fake documents.
The GST registration of Pawan Traders has been cancelled, and further investigation into the scam is underway.
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