The Enforcement Wing, south zone Bengaluru of Commercial Taxes Department, Government of Karnataka busted a fake GST bill operators’ racket under which a syndicate was run to help companies in the service sector of manpower and labour supplies to avail fake Input Tax Credit (ITC) and inflate the turnover artificially.
According to an official release, this is the first of its kind of operation where fake invoice racket in the service sector has been busted.
The Enforcement Wing’s probe revealed that around 30 fake entities were floated using the credentials of family members, relatives, friends and other persons. While the transaction under the scanner involves a total turnover of ₹525 crore, the enforcement wing suspects a revenue loss of approximately ₹90 crore to the government, a release said.
The enforcement officers arrested two alleged masterminds - Guru Prakash H.M., and Manjunathiah H.M. on Wednesday. More arrests are likely to follow in this case, the official release stated .
The Department of Commercial Taxes of Karnataka is rigorously contemplating strong action against fake invoicing and tax evaders. Fake invoicing and tax evasion in GST can result in the arrest, prosecution, and imprisonment of those involved, along with other such measures as fines, penalties, confiscation of goods and provisional attachment of properties and bank accounts, added the release.
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