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ITC fraud: CGST Delhi East busts syndicate of 48 fake firms

By TIOL News Service

NEW DELHI, NOV 22, 2023: THE Central Goods and Services Tax (CGST) Delhi East Commissionerate has busted a syndicate of 48 interconnected fake firms availing fraudulent ITC of over Rs.199 crores in "Operation Clean Sweep". The CGST Delhi East commenced coordinated "Operation Clean Sweep" against fake billers, based on gathered human intelligence which was further developed through data mining and data analysis aided by on ground intelligence.

In the first wave of the operation, a total of 48 fake/bogus firms – either non-existent or paper firms – have been identified that were dealing in bogus invoices. Such invoices were made without the actual supply of goods or services, which is an offence under GST Law. Three persons were apprehended and arrested and subsequently sent to judicial custody remand for two weeks by the Chief Metropolitan Magistrate Court, Patiala House. Other members of the syndicate and the ring leaders have been identified and further investigation is being carried out.

One of the apprehended person who happened to be proprietor of M/s M.K. Traders was found to have availed fraudulent ITC of more than Rs.5 Crores of which major portion had been passed on to other connected links. The other two apprehended persons were aiding and abetting the syndicate and instrumental in functioning of the syndicate. Incriminating material, including stamps belonging to 55 different firms, several SIM cards and documents like AADHAR cards, and electricity bills belonging to 3rd party were recovered during the operation.

The entire operation was conducted in difficult terrain, involving narrow by lanes and sensitive areas of Delhi – which was only possible due to amicable cooperation of Delhi Police which deployed adequate police personnel to assist the GST officers.



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