Six companies in Mumbai has been found to conduct unauthorized activities, which has caused loss of revenue of around ₹110 crores to the Central Goods and Services Tax (CGST). The six accused companies had been issuing bogus invoices of purchase and sale to each other, without actually supplying the goods.
Further investigation revealed that all 6 entities has been claimed ITC worth ₹110 crores. GST officials has already initiated inquiries against these private firms. GST officials visited these companies and discovered that most of their registered premises were residential or did not exist at the addresses mentioned in their registrations as ‘Place of Business’ (POB).
After visiting iron and steel trading firm known as Omkar Enterprises, managed by Mr. Ram at Girgaum, GST officials found that the accused was operating from his residential premises. Ram too admitted that his firm did not have a godown. He also accepted that his firm had not purchased or supplied goods and all the transactions of purchase and sale exist only on paper.
Mr.Ram failed to provide any GST-compliant document and told the officials that all his work pertaining to GST was being done by a broker named Kamlesh Bishnoi and all the sale invoices were also raised by him.
GST officials said that Ram could not give a satisfactory explanation on claiming ITC worth ₹12.10 crores. The accused also could not explain how the supplies were made to some firms : Shubham Steelage, Pioneer Overseas, Tirupati Ispat Industries Private Limited, Skyorient Ferromet Private Limited and Paramount Metal Corporation. All of these
All of these does not exist in real. GST officials believe that these companies are dummy entities created to carry out paper transactions without the actual movement of goods.
The auhorities revealed that Ram played an important role in the racket to pass the ITC rebate to the other firms in a fraudulent manner by issuing bogus invoices without the actual supply of any good and also by availing ₹12 crores for his own firm.
Ram has been charged under the relevant sections of Central Goods and Services Act, 2017. GST officials are investigating further and are searching for others accused.