The Gujarat State Tax department has detected a GST scam of Rs. 478 crore in connection with which three persons have been arrested.

Reportedly, the accused created fake companies and bills were issued in their name, over which the accused had claimed Input Tax Credit (ITC), causing losses to the state exchequer. Authorities suspect more people to be involved in tax evasion and in a hunt for them.

SGST authorities have been examining GST Returns and e-way bills as well as conducting inquiries where transactions appear suspicious, said a statement from SGST Department. They have conducted inquiries in Gandhidham, Surat, and Rajkot. However, they did not find companies in whose names, the bills were issued. On checking the bank accounts, they found out that no transactions were recorded in three companies, registered by one Shaikh Munaf Abdul Rashid alias Munna Papan, from Bhavnagar district.

“He had taken Aadhaar Card, PAN Card and other identity proofs from laborers in nearby areas and registered companies in their name. These include NB Enterprise in Gandhidham, Anmol Sales Corporation in Surat and J M Impex in Rajkot,” said a statement from SGST Commissionerate. Bills worth Rs 101 crore, Rs 166crore, and Rs 132 crore were issued in these companies respectively. ITC worth Rs 60 crore was credited on the basis of these bills. SGST authorities arrested Shaikh Munaf Rashid.

Source:http://www.taxscan.in/gst-evasion-three-arrested/33484/