GST authorities in Delhi have uncovered input tax credit fraud worth 34 crore, with seven firms involved in the crime, Finance Ministry said in a statement on Sunday. These firms used to avail and pass on inadmissible input tax credit (ITC) through bogus Goods and Services Tax (GST) invoices without actual movement of goods, the ministry added.

“The seven firms were created in order to generate bogus GST invoices with an intent to pass on fraudulent ITC without actual movement of goods and without paying actual GST to the Government. These entities have generated goods less GST invoices of value 220 crore and passed inadmissible ITC amounting to 34 crore,” it further said.

The firms involved in this network are M/s Blue Ocean, M/s Highjack Marketing, M/s Kannha Enterprises, M/s S S Traders, M/s Evernest Enterprises, M/s Gyan Overseas and M/s Viharsh Exporters.

The mastermind behind the ITC fraud was one Rishabh Jain who created bogus firms, and generated and sold bogus GST invoices. The modus operandi involved creating multiple firms with the intent to avail or utilize and pass on inadmissible credit. 

“Rishabh Jain has knowingly committed offences under Section 132(1)(b) of the CGST Act, 2017 which is cognizable and non-bailable offences as per the provisions of Section 132(5) and are punishable under clause (i) of the sub section (1) of Section 132 of the Act,” the ministry stated.

Jain was arrested on November 13 and has been remanded to judicial custody till by the duty Metropolitan Magistrate till 26.11.2021, it further said.

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