In a significant breakthrough, the Investigation Wing of the Central Goods and Services Tax (CGST) has successfully dismantled a massive fake Goods and Services Tax (GST) invoice racket in Mumbai. The racket, designed to fraudulently claim a GST input tax credit (ITC) amounting to Rs 25.73 crore, has raised concerns about the prevalence of such deceptive practices.
The key player in this illicit operation, Kiran Kantharia, has been apprehended by the CGST officials following a thorough investigation. The scheme came to light after intelligence inputs prompted a probe into a seemingly non-existent private company, Hacnup Trading (OPC) Private Limited. Further scrutiny revealed that the director of the fictitious company, Nilesh B Shah, confessed to his involvement in the creation of multiple fake firms engaged in input tax credit frauds.
According to officials, Kiran Kantharia and another individual, Manish Shah, instructed Shah to orchestrate the fraudulent activities through these fabricated entities. During interrogation, Kantharia admitted to his role in orchestrating the fraudulent tax credits through these sham companies, further implicating Manish Shah.
The investigation uncovered that these bogus companies facilitated the passing on of ineligible input tax credit amounting to Rs 11.02 crore while availing input tax credit of Rs 14.70 crore using fake invoices without any actual supply of goods or services.
Kantharia has been arrested under the relevant provisions of the CGST Act, marking a significant milestone in dismantling this elaborate web of fraudulent activities.
