NEW DELHI: Tax officials in New Delhi have busted a racket of fake invoicing worth Rs 7,896 crore using a network of 23 shell companies.
"The officers of anti evasion wing of Central Tax, Delhi West Commissionerate have busted a major racket of fake invoicing of Rs 7,896 crore involving fraudulent Input Tax Credit (ITC) of Rs 1,709 crore, using a network of 23 shell companies," the finance ministry said in a release.
This comes a day after officers of the Central Goods and Services Tax (GST) Delhi East Commissionerate have arrested three people involved in floating 17 fake firms and wrongfully availing credit on taxes paid on input worth Rs 436 crore by issuing fake invoices.
According to sources, these companies procured and generated invoices without the actual supply of goods and availed as well as passed on input tax credit. The officials have also arrested two people on February 29 in this regard and there were remanded to 14 days judicial custody, the ministry said.
According to the officials, the accused were evading tax by creating several dummy companies for the purpose of passing on input tax credit by generating fake invoices.
"They also used banking transactions to make input tax credit appear genuine. These firms issued the fake invoices to buyers, who availed fraudulent input tax credit without actually receiving any goods and defrauded the exchequer by way of availing ineligible input tax credit towards GST liability," the statement further said.
Meanwhile, an anti-evasion wing of Central-GST has detected a fraud of more than Rs 214 crore last month through fake invoices in New Delhi, according to an official release.