BENGALURU: In a major crackdown on tax evasion, the Directorate General of GST Intelligence (DGGI) Belagavi Zonal Unit has unearthed a massive scam involving fake Input Tax Credit (ITC) claims worth nearly 593 crore rupees. The alleged mastermind, a registered GST practitioner, was arrested from Bengaluru, marking a significant victory for tax enforcement agencies.
Investigations revealed that Mohammad Saifullah, the key accused, was operating multiple fictitious and shell GSTINs. He generated bogus invoices and e-way bills without any actual supply of goods or services, earning commissions based on the invoice values. This elaborate racket allowed beneficiaries to wrongly claim ITC, siphoning off public revenue.
The probe began with scrutiny of a suspicious GST registration, leading to raids on premises linked to ‘Star Tax Consultant’ in Bengaluru. These operations exposed an organized network churning out fake documents. Preliminary findings show around 235 crore rupees in wrongful ITC was availed and passed on through these sham transactions.
Confronted with irrefutable evidence, Saifullah confessed to his role. He was apprehended on February 24 under Section 69 of the CGST Act, 2017. Produced before a special economic offenses court in Bengaluru, he was granted transit remand to Belagavi, where he was remanded to judicial custody.
Authorities uncovered that Saifullah used online accounting software to maintain records of transactions through shell companies, none of which had real business operations. This digital facade made the fraud appear legitimate on paper.
The DGGI emphasized that the investigation is ongoing, with efforts focused on identifying other beneficiaries and unraveling the full extent of the network. This bust highlights the growing sophistication of GST frauds and the vigilance of enforcement wings in protecting the exchequer.
Tax experts note that such scams erode trust in the GST system, introduced to streamline indirect taxation. With digital trails now aiding probes, perpetrators face higher risks. The case underscores the need for stricter oversight on GST practitioners, who play a pivotal role in compliance.
As the nation pushes for a transparent economy, actions like these reinforce accountability. Further revelations are expected as the investigation deepens, potentially leading to more arrests.