AHMEDABAD: With rising number of fake billing scams and those involving illicit claiming of input tax credit (ITC), Gujarat reported fourth highest number of Goods and Services Tax-related frauds. According to data tabled in the Parliament by the Union ministry of finance, the state reported 2,848 cases of GST-related frauds from 2017-18 to 2020-21 (till January 2021) of a total of 27,000 cases reported across the country. Gujarat is behind Delhi (3,295), Tamil Nadu (3,220) and Maharashtra (3,195) in terms of the number of GST frauds reported.
“GST evasion is a countrywide phenomenon. When the new tax regime was rolled out, no physical verification was required for obtaining GST registration. As a result, many obtained fake GST registrations,” said J P Gupta, state commercial tax commissioner.
“Furthermore, many have illicitly claimed ITC using their GST registrations. The clause allowing a buyer to claim ITC only if the supplier has paid taxes was introduced only last year. Due to several such procedural reasons, tax evasion was rampant since the rollout of the new tax regime,” added Gupta.
At least 50 arrests have been made by the state GST department alone in fake billing fraud cases since the rollout of the new tax regime.
A nationwide special drive against unscrupulous entities for availing and passing on ITC fraudulently because of fake/bogus invoices is being carried out. From November 9, 2020 to January 31, 2021, GST fraud worth Rs 20,124 crore was detected across the country, of which, Rs 857.75 crore was recovered with 282 persons arrested from across India. Specific information pertaining to Gujarat is not available with either state GST department or DGGI about this drive.
In Gujarat, the SGST department has unearthed fake billing scams worth Rs 18,000 crore involving a tax evasion of close to Rs 2,500 crore