Karnataka: Tax department busts fake GST scam, 30 fake companies defraud govt of Rs 90 crore
By Vinaykumar Patil | First Published Aug 31, 2023, 4:32 PM ISTThe Karnataka Commercial Tax Department uncovers a fake GST scam involving over 30 fictitious companies, defrauding the government of Rs 90 crores. Two arrests made, marking the first case of prosecution in this sector. Forgery and tax evasion under GST law carry severe penalties.
The Karnataka Commercial Tax Department has nabbed criminals involved in fake GST scams, and it has been discovered that they have created more than 30 fake companies and defrauded the government of more than 90 crores of tax.
Enforcement officials of the Commercial Tax Department arrested two people on Wednesday for making fraudulent bills. This is the first time such a case has been prosecuted, as stated by the department.
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According to Commissioner C Shikha of the Commercial Tax Department, fake bills were made for more than 30 made-up companies, amounting to Rs 525 crore. This trick resulted in an embezzlement of Rs 90 crore from the government, causing significant tax losses for the state government.
These criminals generated fake tax deposits and transfer bills, which were given to service sector companies dealing with tasks like human resources and labour supply. This is the first time such a fake bill network has been exposed in this sector.
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Using the identities of family, friends, and others, this network created over 30 fake companies. This information was discovered during an investigation. Two enforcement department officers, H.M. Guruprakash and H.M. Manjunathaiah, were arrested on Wednesday, and the investigation is ongoing with the suspicion of more people being involved.
Forgery and evading taxes are serious crimes under GST law. The law allows strict actions like arrests, fines, taking away property, and freezing bank accounts. Therefore, the officials have warned everyone not to break the GST law.
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