4 Arrested In Rs 60 Crore GST Fraud Case In Noida

With the arrest of four men and unearthing of six fake firms, the Special Task Force of the Uttar Pradesh Police Friday claimed to have busted a GST evasion racket of nearly Rs 60 crore.

Using the fake companies, the accused had generated e-way bills (GST related challans for transporting consignments) of over Rs 615 crore and caused loss to the public exchequer, STF officials said.

The six companies were registered at Greater Noida addresses but did not exist in real, the officials said, adding the four accused who were running a well-organised racket were arrested on Thursday evening near the GST office in Surajpur by the Noida unit of the STF.

The accused have been identified as Rajiv Kumar (35) the kingpin of the gang, Vipin Singh (28), Satendra Kumar (33) and Nitin Bansal (31), Deputy Superintendent of Police, STF, Raj Kumar Mishra said.

"Two of the accused have worked in the district GST office at date operator level. There they learnt the procedures of how to generate the e-way bills and started creating fake companies. They have established these non-existent firms on forged documents like rent agreements, electricity bill, PAN cards," Mr Mishra told PTI.

"Six of these fake firms were used to generate outward e-way bills of Rs 615 crore. They would then sell them to other businessmen, helping them evade tax or balance their account books for tax benefits by showing business which actually didn''t take place. So far a tax evasion of Rs 55 crore to Rs 60 crore has come to light in this case," he said.

The officer said around 20 such fake firms have been identified, six of them were at Greater Noida addresses, while the remaining having Delhi addresses.

Searches are underway and further probe is on to track down the entire ring, he said, adding the amount of tax evasion could go up.

The gang also charged a commission for each e-way bill that were used for evading tax.

"If a product fell under 5 per cent GST slab rate, they would take a commission of 0.30 per cent, if 12 per cent GST then 0.60 per cent commission and on 18 per cent GST a commission of 1 per cent," the STF said.

The GST department had in 2018 identified the six fake firms in Greater Noida of suspicious business, after which a case was registered at the Bisrakh Police Station in Gautam Buddh Nagar and later the matter was handed over to the UP STF, officials said.

A Toyota Fortuner car was impounded during the arrest of the gang on Thursday, while a laptop, eight mobile phones with sim cards bought via forgery, several fake documents like PAN cards, rent agreements and Rs 1.20 lakh in cash were seized from them, the officials said.

An FIR has been registered against them at Surajpur Police Station under Indian Penal Code sections 420 (fraud), 467, 468, 471 (all related to forgery), and 120B (being party to a criminal conspiracy), the STF said.