CGST Delhi West Commissionerate busts nexus of more than 30 fake firms and arrests a person in special drive against fake registrations

In a critical crackdown on financial malpractices, the CGST Delhi West Commissionerate has successfully busted a network of more than 30 fake firms. The apprehension of a key individual in the process provides a glimpse into the depths of GST fraud in the region.

Special Drive Against Fraudulent Registrations

In the face of increasing fraudulent practices, a special drive against counterfeit registrations was launched by the CGST Delhi West Commissionerate. During an investigation into a suspicious entity, the Commissionerate discovered numerous entities registered under the same address. The existence of the address was confirmed, however, the property owner denied having any knowledge about these registered firms. Further investigation revealed a complete lack of goods movement from the said location, hinting at potential fraudulent activity.

Data Analytics in Action: Unearthing the Fraud

Utilizing data analytics, searches were conducted at multiple locations across Delhi. The investigation led to an individual named Shiva, who had been using deceitful means to gather KYC credentials from unsuspecting individuals. He promised them assistance with loan sanctions, only to use their information for illegitimate purposes. Shiva was found to have established over 30 fake firms using the obtained credentials and sold them for cash premiums. To dodge physical verification processes, he manipulated AADHAR authentication to secure these fraudulent GST registrations.

The Fall of the Fraudulent Network

The illicit operations of these fraudulent firms had resulted in the availing and passing on of ineligible Input Tax Credit (ITC) amounting to more than 50 crore. This clear violation of Section 132 of the CGST Act, 2017, led to the arrest of Shiva. He has since been remanded to judicial custody, and further investigation is ongoing.

Conclusion

This case showcases the extent of fraudulent practices within the financial sector and highlights the crucial role of investigative bodies like the CGST Delhi West Commissionerate. The effective use of data analytics to unearth such fraudulent operations indicates a progressive approach towards maintaining financial integrity. As the investigation progresses, it remains crucial to continue such efforts to uphold transparency and accountability within the financial ecosystem.