Scrap dealer, two others arrested in Rs 58-crore GST fraud

The case against the accused is that they secured GST registrations by misusing KYC documents of other people, said a press note from B Jayabalasundari, additional commissioner, GST and Central Excise. The mastermind of this fraud had floated 44 fictitious companies using KYC documents like copies of PAN, Aadhar and photographs of several people for monetary benefits, the release said. Of the 44 fictitious accounts, he was operating 24 firms on his own to issue fake invoices to other companies. thereby passing on fraudulent input tax credit. The remaining 20 fictitious companies had been ‘sold’ to others who were also engaged in the same modus operandi. Besides these, 56 fictitious companies have been created and operated by others for which he had acted as a commission agent.

The second person arrested is a scrap dealer from Vellore who availed of fraudulent input tax credit based on fake invoices and used the same for his firm’s GST payments. Further, he is also an accomplice in circulating fake invoices to other known companies and shared commission on these transactions along with the mastermind of the group. The third person knowingly provided his KYC documents to the mastermind for monetary gains, the press release said.