New Delhi: The Central Goods and Services Tax (CGST) Commissionerate – Faridabad of Panchkula CGST Zone, arrested two persons for running a fake billing racket, involving five dummy firms, dealing in trading of iron scrap, registered in Faridabad, Haryana, for the issuance of fake invoices of over Rs 200 crore without actual supply of goods and availing and passing fraudulent Input Tax Credit (ITC) amounting to Rs 31.85 crore.

A team of officers of Anti-Evasion, CGST Commissionerate, Faridabad, conducted simultaneous searches at five places in Faridabad on February 22, 2022. During the investigation, it was found that the said firms have been availing and passing on fraudulent ITC based on bogus/fake invoices without actual supply of goods, said the Ministry of Finance on Thursday.  

As per Section 132 of CGST Act 2017, the issuance of an invoice or bill without supply of goods or services and wrongful availment or utilization of ITC is a cognizable and non-bailable offence if the amount is over Rs 5 crore, said the Ministry. The arrest was made on February 23.

Both the proprietors of the said firms have accepted that they have availed and passed on fraudulent ITC of Rs 31.85 crore, without actual supply of goods to inter-state recipients and have accepted the total GST liability of Rs 31.85 crore during initial investigation. The quantum may increase in the future, said the Ministry.

Both the accused have been arrested under Section 69 of Central Goods and Services Tax Act, 2017 for committal of offences under Section 132(1)(b), 132(1) (c) and 132 (5) of the CGST Act, 2017. They were produced before the CJM Court, Faridabad on February 23 and were remanded to 14 days judicial custody. Further investigation in the case is underway. /BI/