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Gujarat: SGST officials raid 282 locations, bust Rs 6,030 crore billing racket

Authorities of State Goods and Service Tax (SGST) in Gujarat has busted a bogus billing racket worth Rs 6,030 crore in the state on Saturday by conducting simultaneous raids at 282 locations. This could be the largest single day operation in terms of extent of fake billing and tax evasion. Authorities has further suspected tax evasion of Rs 910 crore and the number is likely to go up.

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Gujarat: SGST officials raid 282 locations, bust Rs 6,030 crore billing racket
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Authorities of State Goods and Service Tax (SGST) in Gujarat has busted a bogus billing racket worth Rs 6,030 crore in the state on Saturday by conducting simultaneous raids at 282 locations. This could be the largest single day operation in terms of extent of fake billing and tax evasion. Authorities has further suspected tax evasion of Rs 910 crore and the number is likely to go up.

The companies and the locations were identified on the basis of mismatch in return for sales, purchases and the e-Way bills filed by the companies. The contradiction in returns filed by these 282 companies raised suspicion over tax evasion. The e-Way bills generated showed that goods were transported butit did not reflect on the returns displaying sales of these company.

Based on this data intelligence, 282 teams were formed which conducted parallel raids at as many locations. A workforce of close to 750 participated in the unprecedented operation and seized the details of transactions made by these companies.

Companies created fake bills of transactions and claimed Input Tax Credit (ITC) in an illegal manner. "Fake transactions are to the tune of Rs 6,030 crore, involving an estimated tax evasion of Rs 910 crore," said P D Vaghela, commissioner of SGST in Gujarat.

Talking to media persons in the city, he said that the trend of creating fake bills has risen off late. "While earlier, it was about 5-10% claim of ITC refund, it has now grown in proportions," added Vaghela.

Another official while speaking to DNA said that this is the largest operation carried out in Gujarat after the roll out of GST. Even in previous indirect tax regimes, such a widespread operation is unheard of. The official is unsure whether this the largest operation in the country after the roll out GST.

Tax advocate Axat Vyas welcomed the action by the tax authorities but also questioned on why such a huge racket did not come to light when it was in the making and it was only after it snowballed into giant proportions that authorities got to know of it.

Case File

Companies and locations were identified on the basis of mismatch in return for sales, purchases and the e-Way bills filed by the companies. The contradiction in returns filed by 282 companies raised suspicion over tax evasion.

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