CUTTACK: In a major breakthrough, the Odisha State Commercial Tax & Goods and Services Tax Commissionerate on Monday busted a whopping Rs 712 crore fake invoice racket, arresting a businessman who indulged in large-scale GST fraud by floating ghost firms, carrying out fake transactions and even duping gullible people. Kashmira Kumar Agrawal, Director of M/s. Madhumita Steels Industries Private Limited, who is charged with passing bogus input tax credit (ITC) of Rs 129 crore over multiple transactions routed through different chains, was arrested from Sambalpur by the Enforcement Wing of Commissionerate.
According to Commissioner CT & GST SK Lohani, Agrawal had hired middlemen who collected documents such as PAN card, Aadhaar Card, photographs from people seeking gainful employment such as housewives, drivers, plumbers from Sundargarh and Sambalpur districts in exchange of money. He, however, misused the documents for his vested interest and defrauded the Government. Agrawal had transferred huge amount of money to different firms without having any business transactions with them. In the case of one firm, he had shown to have purchased goods worth Rs 13 crore but had transferred Rs 38 crore through its bank accounts.
This has raised suspicion of his involvement in money laundering, the CT and GST Department said. In many cases, documents showed that Agrawal’s firm despatched tonnes of goods such as steel and iron items through scooters, motor cycles, tractors and cars which is not possible. During investigation, the mastermind was found to have fraudulently availed bogus ITC of Rs 113.81 crore and passed on tax credit worth Rs 129.09 crore in the name of the 14 fake firms created and operated by him using the fake invoices.
GST fraud worth Rs 712 cr busted
Proprietors of the ghost firms admitted during investigation that they were neither in any business nor effected any purchases/sales in the name of their firms, and the transactions in their returns were only limited to paper work without any actual receipt and supply of goods. Steps are being taken to recover the bogus ITC availed by recipients of Odisha with interest and penalty. In respect of recipients of bogus ITC of other states, respective Commissioners shall be moved to take steps to recover the said amount with interest and penalty along with other statutory actions prescribed under GST Act, Lohani said.
Agarwal is also accused of creating fake bank accounts which he used to transfer huge amount of money. At least Rs 2 crore was seized by the Enforcement wing from some accounts. Agarwal, who was under the scanner for long, used to change his address to Rourkela, Haryana, Tata as well as Sambalpur. Some of the accused involved in the racket were arrested earlier, informed Lohani.